Beijing action against Taiwan would spur a ‘crisis much larger’ than the war in Iran, Ambassador Yui said.
In Taiwan, a sense of threat is part of daily life, shaped by persistent and growing military pressure from across the Taiwan Strait.
The Chinese Communist Party (CCP), which sees democratically governed Taiwan as a Chinese province, has been rapidly modernizing its armed forces and expanding capabilities that could be used in a conflict over the island nation.
Should Taiwan come under CCP control, the consequences would extend far beyond the region, according to Alexander Yui, Taiwan’s top representative to the United States.
A conflict involving Taiwan would cause a “crisis much larger” than the war in Iran and the situation in the Strait of Hormuz, Yui told EpochTV’s “American Thought Leaders” on May 3.
Such a conflict would affect not only China and Taiwan, but also Japan, South Korea, Europe, and the United States, Yui said, and the ripple effects would be “almost unimaginable.”
There have been many studies estimating the economic costs of a Chinese attack on Taiwan. The Center for Strategic and International Studies projected that the economic cost would reach $10 trillion, and the burden would fall heavily on the developing world, which would “suffer disproportionately” from an economic downturn, according to a January report.
Two U.S. allies—Japan and South Korea—would be among the countries most affected by disruptions in the Taiwan Strait, because both are dependent on the waterway for energy imports, according to a 2024 Center for Strategic and International Studies report.
A 2025 review by the Federal Reserve Bank of St. Louis said a conflict in the strait would have more severe economic consequences for the global economy than any conflict in which the United States has been involved in recent decades, including the war in Ukraine.
The importance of Taiwan’s geolocation extends far beyond the narrow confines of the strait. The island sits at the center of the so-called First Island Chain, a concept in maritime strategy involving a strategic arc stretching from Japan through the Philippines to Indonesia. The chain acts as a barrier constraining the Chinese regime’s ability to project its naval and air power into the wider Pacific.
Taiwan is “holding the line” within the strategic arc, Yui said, extending the U.S. defensive perimeter into the Western Pacific, a role analogous to NATO’s security posture in Europe.
Yui serves as Taiwan’s de facto ambassador to the United States, representing Taipei through the Taipei Economic and Cultural Representative Office because of the absence of formal diplomatic relations between the two governments.
Despite the lack of formal ties, Taipei and Washington have maintained a robust relationship under the Taiwan Relations Act, a law authorizing the United States to provide the island with military equipment for self-defense.
Coercion
Refusing to recognize Taiwan as a country, Beijing has sought to isolate the self-ruled democracy on the international stage. That includes blocking Taipei’s participation in global organizations, poaching Taiwan’s allies, and pressuring foreign governments and officials to not engage with the island nation.
The latest example of this approach came when Taiwanese President Lai Ching-te’s scheduled trip to Eswatini in April was abruptly canceled. Taiwan authorities said China had exerted “intense pressure” on Seychelles, Mauritius, and Madagascar, all of which revoked overflight permissions for his presidential aircraft without prior notice.
According to Taiwan’s semi-official Central News Agency, a national security official said Beijing had threatened to revoke substantial debt relief granted to the three African nations, halt further financing, and impose economic sanctions to pressure them into the decision.
or doing business” with Beijing.
The CCP “will weaponize things according to their interests,” he said.
The setback was short-lived. On board a plane provided by the government of Eswatini, Lai arrived in the southern African country on May 2 for a state visit.
There are similar events across the Western Hemisphere. For example, after Panama’s top court ruled in January that a contract allowing a Hong Kong corporation to operate ports on the Panama Canal was unconstitutional, Beijing warned that the Central American country would pay “heavy prices” for complying with the decision.
In March, the U.S. Federal Maritime Commission raised concerns about a surge of detentions and inspections of Panama-flagged ships by Beijing “under the guise of port state control,” a trend it said was tied to Panama’s takeover of port contracts.
The United States and its allies have denounced the regime’s maritime actions as “a blatant attempt to politicize maritime trade” and an infringement on Panama’s sovereignty, according to an April 28 statement.
In light of the danger of doing business with China, Yui said, Taiwan has reduced its economic exposure there.
In 2010, more than 80 percent of Taiwan’s outbound investment went to China, but that share was less than 4 percent last year, according to Taiwanese government data.
“China is an unreliable partner,” Yui said. “That’s not a healthy environment to do business.”
