A Chinese invasion of Taiwan could cost the global economy US$10 trillion, equivalent to 10% of global GDP, with potential scenarios including a regional war drawing in the U.S. and a blockade severing Taiwan's trade with the world. The impact would lead to significant GDP declines for Taiwan, China, the U.S., and the world, surpassing losses from past crises such as the COVID-19 pandemic and the global financial crisis. If Taiwan were to face a blockade, the resulting global GDP losses would fall between the levels observed during the global financial crisis and the Gulf War.
Military experts can predict a Chinese invasion of Taiwan by analyzing subtle and not-so-subtle market moves. France's recent change of heart regarding NATO and the European Union will have significant implications for European security. Additionally, scrapyards are transforming into efficient and profitable disassembly lines.
Taiwan is conducting defense drills simulating a Chinese air attack and live-fire exercises to test combat readiness in response to a potential Chinese invasion. The drills aim to reduce casualties and prepare civilians for an attack. China has been increasingly aggressive towards Taiwan, with a record number of warships deployed near its waters. Taiwan is preparing for a sudden, swift attack from China, focusing on resilience and readiness. The exercises also send a message to China that invading Taiwan would be costly. Taiwan is seeking advanced missile systems from the US and emphasizes the need for intelligence-sharing and long-range weapons. The US has expressed support for Taiwan's defense. Japan's role in defending Taiwan remains uncertain. Effective communication and coordination between Japan, Taiwan, and the US are crucial. While some of China's recent moves may be for domestic messaging, Taiwan cannot ignore the risk of a potential Chinese attack and must strengthen its national defense and alliances.
