Trump’s March Could Aggravate Tension Between China and the United States

I was recently reading an article by the Scottish historian Nial Ferguson entitled “A crisis in Taiwan can end the American empire” And leaving aside the greater or lesser predictive success, of which I have my doubts, this very interesting article seems to me a must-read to better understand the current crisis in Taiwan.

This Harvard professor is the author of one of the best books to understand the British Empire: “Empire”, which was a must-read for those of us who were doing the master’s degree in international relations Birkbeck-University of London.

My reflection on current events clearly highlighted in the last Alaska summit between the USA and China, with Taiwan at the center of the problem, is that the arrival of Biden does not diminish the fundamental confrontation between the two superpowers, an idea already argued by me in previous writings.

When US National Security Advisor to the President Henry Kissinger made his secret visit to China in 1971 to negotiate aid from the People’s Republic of China in Vietnam, and Nixon’s subsequent historic visit to Chinese President Mao Zedong, to the government Chinese at the time was only concerned with a single issue: the withdrawal of American economic and military support to what they considered the Chinese “province” of Taiwan. What strikes me is that half a century later China continues with exactly the same claim, but the fundamental difference is that today China is no longer an impoverished country as in the 70s, but the economic power that already openly challenges the United States.

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The Taiwan issue is not a minor problem and for those who still doubt it, let’s see a single data: the trade tensions Between the two superpowers they have contributed to the current insufficient supply of chips because it has caused companies around the world to double the orders of chips to ensure their stock, and the undisputed world leader in the production of advanced semiconductors is in Taiwan, is the TSMC (Taiwan Semiconductor Manufacturing Co) and depend heavily on their chips, from the Chinese Xiaomi to the American Apple, to give just two examples. And the risk is that the current Cold War II, to use Ferguson’s terminology, could even get worse without Trump in the White House, strange as that sounds. Why? For three very obvious reasons.

The first is that commercial rates imposed by Trump will not be repealed by Biden. The second is that Trump’s manifest disinterest in human rights violations of Xi Jinping in Hong Kong or with Uighur Muslims were a blessing, albeit debatable, in reducing this sticking point. The ideological position of the Democrats denouncing these Chinese violations will surely exacerbate this friction. And finally, also unilateralism Trump safeguarded other countries from globalizing the new Cold War, but Biden is multilateral and it is clearly seen in his leadership of the group called Quad (United States, Japan, India and Australia) that seeks to counter Chinese power in the region.

The reality is that at the time of writing this article (30.3.21), Taiwan’s 10-year bond has fallen in price, doubling its profitability in recent months. (from 0.225% to 0.45%), that the main Chinese stock index (CSI 300) has fallen almost 15% from highs, than its Hong Kong counterpart (Hang Seng) it has done so by more than 8% and that the US government bond yields, Treasuries, they have been expanding so far this year from 0.86% to 1.68%. Coincidence or consequence in part of what was explained? Time will give us the answer.

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