If China were to impose a blockade of the Taiwan Strait, it would likely cut off most of the world's supply of advanced semiconductors and cause serious global economic damage, Bloomberg reported earlier this week.
Bloomberg columnist Karishma Vaswani said the Taiwan Strait plays a key role in global trade and technology supply chains. Any disruption would affect key industries, including artificial intelligence, smartphones, automotive and defense systems.
According to her, a crisis in the region could disrupt supplies of about 90% of the world's advanced semiconductors. Even a limited breach would quickly affect global production and financial markets.
China can analyze recent conflicts that have relied more on economic pressure than direct military confrontation. A blockade, quarantine regime or inspection system around Taiwan are seen as more likely scenarios than a full-scale invasion, as they carry a lower immediate military risk.
However, the economic consequences would be severe. Previous estimates suggest that a blockade could lead to losses of more than $2 trillion, even without taking into account international reactions, Liberty Times reported.
China would also suffer significant economic damage. Taiwan is one of its main trading partners and a key supplier to the electronics and manufacturing industries.
In addition to economic factors, political tensions continue to influence the situation. Taiwan's democratic system and economic success pose a challenge to Beijing's narrative.
Vaswani warns that a potential disruption across the Taiwan Strait is no longer a distant scenario. Governments and companies are increasingly being called upon to prepare crisis response plans, strengthen the resilience of supply chains, and ensure the uninterrupted flow of critical goods.