I don't know if you followed what happened yesterday: what if I told you that the third world war could break out any minute? In a nutshell: the US Navy has deployed four warships east of Taiwan, while the speaker of the US House of Representatives Nancy Pelosi visits the country. According to Reuters, China had previously warned that its military would not “stand by” if Pelosi visited Taiwan. Luckily (for now) they have limited themselves to starting exercises around the island.
Pelosi spent the night in Taiwan's capital, Taipei. Who knows what will happen when American politics heads home. Authorities who claim sovereignty over the self-governing island now warn: there will be countermeasures.
What would happen in the event of an invasion of Taiwan?
Don't get me wrong: certainly the loss of life would be the worst consequence in the event of a conflict. However, I cannot help but point out that these new tensions (another chapter of the new cold war between the USA and China) also highlight the world's incredible dependence on Taiwan for semiconductors. It is an issue particularly resonant with Ukraine, given the expected global impact of the gas crisis in Europe, following the “boomerang sanctions” approved against Russia. And Europe, at this point.
It could be even worse, with Taiwan. Already last year, an initial semiconductor shortage had huge knock-on effects for the automotive industry, for example, forcing many large companies to halt production.
Taiwan Semiconductor Manufacturing Co. (TSMC) it is the world's largest chip producer: among others it makes those of Apple, but alone it has 50% of all market shares in the world. You can imagine why today Europe and the USA are talking about becoming autonomous in the construction of chips. Just recently, for example, the US Congress approved a financing bill of 52 billion dollars, which will help Intel Corporation (and also TSMC) to strengthen its "domestic" manufacturing presence, directly on American soil.
Everything okay then? Not at all
War would be a defeat for everyone
This is not rhetoric, I repeat: the horror of a war between China and Taiwan would far outweigh the problems associated with chip shortages. Just the president of TSMC, Dr Mark liu, underlined that “war can create problems for all parties involved. We must prepare for the worst, but we must hope for the best."
Taiwan's chip industry, all things considered, offers crucial economic leverage in the midst of this now heated rivalry between the United States and China. Some experts have stated that this situation is ultimately positive, because it will prevent China from further worsening the scenario.
What do you think about it? After what happened with Russia, I would not take it with all this optimism. The next few weeks will be revealing.
