In Taiwan, the sense of threat has become a part of daily life, stemming from the continuous military pressure exerted by the other side of the strait and escalating tensions.
The Chinese regime views democratic Taiwan as a province of China and has been rapidly modernizing its military to enhance its capabilities in potential conflicts with Taiwan.
Representative Yu Dehan of Taiwan in the United States emphasized that the impact of Taiwan falling under the control of the Chinese regime would extend far beyond the region.
On May 3, Representative Yu Dehan stated in an interview with EpochTV’s American Thought Leaders that a conflict involving Taiwan would pose a “more significant crisis” than the wars in Iran and tensions in the Strait of Hormuz.
Such a conflict would not only affect China and Taiwan but also Japan, South Korea, Europe, and the United States, triggering an “almost unimaginable” chain reaction, according to Yu Dehan.
Various studies have estimated the economic losses that a Chinese invasion of Taiwan could bring. The Center for Strategic and International Studies (CSIS) in Washington, D.C. predicted economic losses of up to $100 trillion, with developing countries bearing a disproportionate burden and suffering from economic recession impacts, based on a report released in January by the center.
According to a report titled “Crossroads of Commerce: How the Taiwan Strait Propels the Global Economy” released by CSIS on October 10, 2024, U.S. allies Japan and South Korea would be among the countries most affected by the turbulent situation in the Taiwan Strait, as both countries rely on the waterway for energy imports.
In a 2025 assessment report, the Federal Reserve Bank of St. Louis in Missouri highlighted that a conflict in the Taiwan Strait could have more severe economic consequences for the global economy than any conflict the United States has engaged in over the past few decades, including the Ukraine war.
The strategic importance of Taiwan’s location extends beyond the narrow Taiwan Strait. Taiwan lies at the center of the “First Island Chain,” a strategic arc extending from Japan through the Philippines to Indonesia, acting as a barrier that limits the Chinese regime’s ability to project its maritime and air power into the broader Pacific region.
Yu Dehan stressed that Taiwan is “holding the line” within this strategic arc, expanding the U.S. defense perimeter into the Western Pacific, a similar role to that played by NATO in European security posture.
Despite the absence of formal diplomatic relations between Taiwan and the U.S. government, Yu Dehan serves as Taiwan’s representative in the U.S., representing Taipei through the Taipei Economic and Cultural Representative Office (TECRO) and effectively serving as Taiwan’s ambassador to the U.S.
Although there are no formal diplomatic relations, the Taiwan Relations Act authorizes the United States to provide Taiwan with military equipment for self-defense.
Beijing refuses to recognize Taiwan as a country and attempts to isolate the autonomous democratic entity on the international stage through various means, including blocking Taiwan’s participation in global organizations, luring Taiwan’s allies, and pressuring foreign governments and officials to refrain from engaging with Taiwan.
In the latest example of coercion, Taiwanese President Lai Ching-te’s planned visit to southern African country Swaziland in April was abruptly canceled. The Taiwanese authorities cited intense pressure from Beijing on African countries such as Seychelles, Mauritius, and Madagascar, leading to the three countries revoking landing permits for President Lai Ching-te’s special aircraft without prior notice.
According to Taiwan’s semi-official Central News Agency, a national security official stated that Beijing threatened to revoke significant debt relief granted to these three African countries, halt further funding, and impose economic sanctions to compel them to make decisions.
Yu Dehan emphasized that this incident serves as a warning that people need to be extremely cautious when cooperating, investing, or doing business with Beijing.
He noted that the Chinese regime “weaponizes things according to its own interests.”
The disruption of this trip is only temporary. On May 2, President Lai Ching-te arrived in Swaziland on a government-provided aircraft for an official visit to the southern African country.
Similar incidents have occurred in various regions worldwide. For instance, in January this year, Panama’s Supreme Court ruled that a Hong Kong company’s operation of a port in Panama, under contract, was unconstitutional, prompting Beijing to warn that Panama would face “heavy consequences” if it complied with the court’s decision.
In March, the U.S. Federal Maritime Commission expressed concerns about Beijing’s “port-state control” actions, detaining and inspecting a large number of vessels flying the Panamanian flag, following the port contract issue involving Panama.
In a statement dated April 28, the U.S. and its allies condemned the Chinese regime’s maritime actions as an “overt attempt to politicize maritime trade” and an infringement on Panama’s sovereignty.
Yu Dehan remarked that, given the risks associated with doing business with Beijing, Taiwan has reduced its economic ties with China.
According to Taiwanese government data, over 80% of Taiwan’s outbound investments went to mainland China in 2010; however, by last year, this proportion had dropped to less than 4%.
“China is an unreliable partner,” said Yu Dehan. “That is not a healthy business environment.”
As Taiwanese investors gradually withdraw from mainland China, many are redirecting their focus to markets that align with their values, particularly the United States.
According to data compiled by the U.S. Census Bureau in February, Taiwan ranked as the fourth-largest trading partner of the United States in the first two months of this year, following Canada, Mexico, and China.
The growth of U.S.-Taiwan trade is mainly driven by the strong demand for semiconductors and electronic products. Yu Dehan noted that Taiwan produces over 95% of the world’s advanced chips and over 90% of data servers and artificial intelligence servers, among others.
Driving this production boom is Taiwan Semiconductor Manufacturing Company (TSMC), the world’s largest chipmaker. In recent years, TSMC has increased its investment in the U.S., with expansion plans in Arizona including building six fabs, two advanced packaging plants, and a research center, among others.
To support Taiwanese tech companies’ investments in the U.S., Taiwan opened its second trade and investment service center in Phoenix, Arizona, on May 1.
In a January trade agreement between Taipei and Washington, Taiwan committed to investing at least $250 billion in the U.S. through Taiwanese tech and chip companies. Under the agreement, the Taiwanese government will also provide $25 billion in loan guarantees to companies seeking to expand production capacity in the U.S.
Yu Dehan stressed that Taiwan and the U.S. have established a strong and reliable partnership.
“The trade relationship between Taiwan and the U.S. has flourished and deepened, partly due to Taiwan’s disentanglement from China, but also because of our shared values in investment and joint action,” said Yu Dehan.
Data compiled by Bloomberg based in New York showed that Taiwan’s stock market surpassed Canada’s in late April, becoming the sixth-largest global stock market.
“So economically, Taiwan is essential to the world. But politically, internationally, we have always faced obstacles from the Chinese regime, preventing us from acting normally on the international stage,” Yu Dehan remarked.
“And this is what we have been calling to the world—Taiwan should have a place on the international stage.”
Chinese leader Xi Jinping and former U.S. President Donald Trump planned to hold a summit in Beijing. Weeks before the summit, China sent signals that the Taiwan issue might be included in the meeting agenda.
According to information released by China, Chinese Foreign Minister Wang Yi told U.S. Secretary of State Marco Rubio in a phone call on April 30 that Taiwan is the “biggest risk factor” in bilateral relations.
Yu Dehan refuted Wang Yi’s statement, asserting that the Chinese regime is the aggressor, “preparing for conflict.”
In recent years, the Chinese regime has frequently conducted large-scale military exercises in the Taiwan Strait, dispatching military aircraft and vessels near Taiwan almost daily.
On May 3, Taiwan’s Ministry of National Defense reported the presence of seven Chinese military vessels, three Chinese government vessels, and one Chinese military aircraft in the vicinity of Taiwan in the past 24 hours.
“They continue to harass our maritime and airspace, attempting to pressure Taiwan and instill fear and unrest in Taiwanese society,” stated Yu Dehan.
He added that the visible military harassment is just one of Beijing’s strategies. The Chinese regime also aims to undermine Taiwan’s stability from within by cutting Taiwan’s undersea communication cables, sowing discord among Taiwan’s political parties, spreading disinformation, launching cyber-attacks, and employing other tactics.
“This is just one example of what we are facing, but they are acting similarly with other countries, including the United States,” he said.
Yu Dehan reiterated that the Chinese regime is the “biggest risk factor affecting peace and stability in the Taiwan Strait and the Pacific region.”
“The Chinese regime has engaged in the largest military preparations in peacetime in human history. I think their statement is baseless because their borders are not under threat,” he said.
However, Yu Dehan pointed out that recent U.S. actions in other parts of the world, including the arrest of Venezuelan leader Nicolás Maduro and efforts against the Iranian regime, may influence Xi Jinping’s calculations regarding Taiwan’s sovereignty.
“The recent actions show that the U.S. is determined to use all necessary means to solve problems or achieve its goals. Obviously, this will have practical or reference significance for the Indo-Pacific region, especially the Taiwan Strait,” he stated.