Western sanctions are intended to force Russia to rethink Ukraine. So far without success. But the economic penalties show that the West is standing together, and China is also aware of that. Can economic ties prevent Beijing from attacking Taiwan?
A year after the Russian attack, the EU states have now agreed on what is now the tenth package of sanctions. The West cuts further economic ties to weaken Russia and stop Putin’s invasion of Ukraine. The economy could also be used as a kind of weapon in the Taiwan crisis. However, here it serves to deter China – in the hope of preventing the escalation of this conflict from the outset.
Chinese leader Xi Jinping has viewed Taiwan as a breakaway province for years. He is pursuing a so-called “one China policy,” according to which there is only one big China, which also includes Hong Kong, Macau and, of course, Taiwan. The situation is tense. If war were to break out over the island nation, it would have massive economic repercussions worldwide. Because the country is an important semiconductor producer: Without microchips from Taiwan, import and export rates would fall in many countries.
The importance of high-tech chips for us in Germany was already demonstrated during the corona pandemic: supply chain problems slowed down production enormously in many areas, such as in car manufacturing. Since semiconductors from Taiwan are particularly small and powerful, this was not so easy to compensate.
Since the Russian war of aggression revealed our dependence on Russian gas, the focus has also increased on the close economic ties with China. Political scientist Daniela Schwarzer keeps a very close eye on German-Chinese trade relations. Putin’s attack on Ukraine has given this problem a whole new urgency, she explains in the podcast “Wirtschaft Welt
It hardly seems possible to become really independent: the Federal Statistical Office has just reported that China has been Germany’s most important trading partner for the seventh year in a row. The value of the traded goods was 297.9 billion euros. We import significantly more from China than we export there. Far too one-sided, experts warn.
Geopolitics expert Stefan Bayer, however, sees German-Chinese economic relations from a completely different perspective: For him, they are above all an important means of keeping peace. The Chinese, Bayer believes, would know very well that an attack on Taiwan would result in huge economic losses for their country. The head of research for geopolitics and strategies at the German Institute for Defense and Strategic Studies hopes for “the strength of economic exchange relationships and that they have a healing effect on potential for aggression”.
The economy would thus be a deterrent weapon in the Taiwan crisis – with the aim of keeping Chinese property claims in check. This is also badly needed for Bayer. He believes that a Chinese attack on Taiwan would cause significant upheaval, including on the global financial markets. “We have to do everything we can to avoid that,” he warned urgently. If the Taiwan crisis were to escalate, the consequences would be “much more serious than what we are currently seeing in Ukraine.”
