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We are witnessing the fourth Cross-Strait Crises. Chinese and American armed forces are undertaking dangerous, spectacular and threatening show of military might. 

What makes the present crisis different from the previous ones is the fact that it happened during and after the mutual cold-war declaration by Washington and Beijing in Anchorage, Alaska on March 18-19, 2021

The world is wondering how far this military show will go. Many are afraid of a shooting war involving China, Taiwan and the U.S.

 Indeed, many are even afraid of the possibility of the third world war which will kill us all.

However, I do not share such pessimistic views. My view is that the inter-China cold war is likely to remain cold, not hot, because none of the three actors involved in the conflict – two Chinas and the U.S.- will gain from the shooting war.

The Sino-American shooting war – if there will be one – will be ignited somewhere else.

My argument may be summarized as follows.

First, the U.S. does not want the inter-China hot war, because through its ambiguous Taiwan policy, it can continue to sell weapons to Taiwan and, at the same time, keep Taiwan as the primary outpost of its China containment policy.

Second, China is not eager to declare a hot war with Taiwan, because Taiwan has not provided the reasons for China’s Taiwan invasion.

There are five reasons for China’s Taiwan invasion including the declaration of Taiwan independence, internal turmoil, military alliance with another country, acquisition of weapons of mass destruction (WMD) and negotiations under the violation of the 1992 Consensus for “one-China”. None of these conditions are present. Therefore, China has no reason to invade Taiwan.

Third, Taiwan does not want the hot war with China for the reason that it will be most likely defeated and the cost of such defeat will be too high in terms of economic development and the loss of its identity. In fact, if and when China wins, it is likely that the two Chinas will be united under the banner of PRC.

The U.S. does not want inter-China hot War

To understand Washington’s role in the inter-China conflict, it is important to understand its Taiwan policy.

Washington’s Taiwan policy is based on the three joint communiqués, the Taiwan Relations Act of 1979 (TRA) and the Six Assurances imposed by Ronald Reagan in 1982. The followings are the contents of the three Communiqués, TRA and the Six Assurances.

The First China-U.S. Communiqué (28 February 1972)

• The U.S. Government acknowledges (not accept or recognize) that all Chinese in either side of the Taiwan Strait maintain there is but One China
• Taiwan is a part of China
• The U.S. Government does not challenge this position
• . It reaffirms its interest in peaceful settlement of the Taiwan question by Chinese themselves
• With this prospect in mind, it affirms its ultimate objective of the withdrawal of all the U.S. forces and military installations from Taiwan. 

The Second China-U.S. Communiqué (January 1, 1979)

• Neither should seek hegemony in the Asia-Pacific region or any other region of the world.
• Each is opposed to efforts by any other country or group of countries to establish such hegemony
• The government of the USA acknowledges the Chinese position that there is but one China and that Taiwan is part of China
• PRC is the sole legal government of China

Third China-U.S. Communiqué (August 17, 1982)

• The U.S. Government attaches great importance to its relation with China.
• It has no intention of infringing on Chinese sovereignty and territorial integrity or interfering in China’s internal affairs or pursuing a policy of ‘two Chinas’ or ‘one China, one Taiwan.’
• The U.S. Government states that it does not seek to carry out a long-term policy of arms sales to Taiwan
• Its arms sale to Taiwan will not exceed, either in qualitative or in quantitative terms the level of those supplied in recent years
• It intends to reduce gradually its sales of arms to Taiwan, leading over a period of time to a final solution.
• The U.S. Taiwan policy cannot be changed by the president and requires the consent of the Congress.

The Taiwan Relations Act (enacted by the U.S. Congress on April 10, 1979)

The principal contents of the Act is in Section 2 of the Act

• Taiwan is treated as a country, a nation or a state as sub sovereign nation
• Informal diplomatic relations are carried out by the American Institute in Taiwan (AIT)
• The U.S. Government normalizes its diplomatic relations with PRC (Beijing) under the condition that the future of Taiwan will be determined by peaceful means.
• Any efforts to determine the future of Taiwan by other than peaceful means including by boycotts, or embargoes, a threat to the peace and security of the Western Pacific are grave concern to the U.S.
• The Sino (Taiwan)-U.S. Mutual Defence Treaty is terminated.
• The U.S. Government does not intervene in case of invasion by People’s Republic of China (PRC)
• The U.S. Government provides arms of defensive character and maintains the capacity to resist any resort to force or other forms of coercion that would jeopardize the security, or the social or economic system, of the people on Taiwan
• The decision related to the quantity and the quality of defence articles and services is determined by the Congress and the president.

The Six Assurances 

The administration of Ronald Reagan unilaterally added in 1982 “Six Assurances” to the TRA and this has become the mains part of the U.S. Taiwan policy

• The U.S. Government has not agreed to set a date of the termination of its arms sale to Taiwan.
• The U.S. Government has not agreed to consult with PRC (China) or ROC (Taiwan) for arms sales to Taiwan.
• The U.S. Government does not perform the mediation role between ROC and PRC
• The U.S. Government has not agreed to revise the TRA
• The U.S. Government has not revised its position regarding the sovereignty of Taiwan
• The U.S. Government will not exercise pressure on Taiwan to enter into negotiation with PRC.

The positive aspect of Washington’s Taiwan policy is the termination of the bloody civil war between ROC and PRC which caused the two cross-strait crises (1954 and 1958); the civil war lasted until 1979.

But, the end of the inter-China civil war was also desirable for Washington as well, because Washington badly needed China to counter the aggressive assertiveness of the Soviet Union in Asia.

So, Washington and Beijing were strange bed fellows with different dreams. Another possible reason for the U.S. initiative to end the inter-China civil war was the fear of Beijing’s victory over Taipei, which means the loss of a lucrative American arms market and reliable outpost of China containment strategy.

On the other hand, Washington’s Taiwan policy is characterized by the amazing ambiguity of Washington’s perception of the cross-strait problems and tactics which was most likely designed to maximize the American interests at the expense of China’s interests.

What comes out of the three communiqués, the TRA and the six assurances may be summarized in terms of the issue of regional hegemony, the legal status of Taiwan and the American arms sales.

Regional hegemony

In the second communiqué of 1979, there are items preventing China from becoming a hegemonic power in the region. Neither the U.S. nor China should seek for hegemonic power in Asia. But the U.S was already the hegemonic power there.

Legal Status of Taiwan 

The second feature of Washington’s Taiwan policy is its contradictory and ambiguous position regarding the legal status of Taiwan.

In the joint communiqués, the U.S. acknowledges that China is one and Taiwan is a part of China and that Beijing is the sole legal government of China. But this should mean that since Taiwan is a part of China, Beijing should also govern Taiwan.

But, in the Taiwan Relations Act, Taiwan is given the status of a de facto sovereign country.

China can argue that Washington did no respect the contents of the joint communiqués. But Washington can say this: “We have never accepted one-China regime, we said we acknowledged the regime”. Here, we see the strategic political ambiguity of Washington.

In fact, in the TRA, it says that Taiwan is treated as a nation of sub sovereignty. The U.S. has established de facto diplomatic relations with Taiwan conducted through the American Institute in Taiwan (AIT).

Here, Washington’s position regarding the sovereignty of Taiwan is not clear. The hidden purpose of the U.S. could be to make the sovereignty issue ambiguous so that it can change its position in function of needs.

Washington’s Arms Sales to Taiwan 

Now, as for the issues of arms sales to Taiwan, the U. S. is even more ambiguous.

In the third communiqué, the U.S. says that it has no long-run plan of arms sales to Taiwan. But in the same communiqué, the U.S. says that it will reduce arms sales, which contradicts each other.

In the TRA, the Sino (ROC)-U.S. defence Treaty is terminated. Therefore, Washington should not intervene militarily if and when Taiwan is in armed conflict with Beijing. But, already, in media, the US intervention in case of PRC’s Taiwan invasion is openly discussed. One wonders what the reliability of the joint communiqués, the TRA and the Six Assurances is.

Now, in the Six Assurances, it is written that the U.S. has no date for the ending of its arms sales to Taiwan. The U.S. is not obliged to consult PRC or ROC for its arms sales to Taiwan. So, Washington has absolute freehand in handling the arms sales to Taiwan.

In short, the U.S. Taiwan policy is so confusing and so ambiguous that it has useful flexibility for the sales of arms to Taiwan. The following table shows the pattern of American arms sales to Taiwan.

Table: Washington’s arms sales to Taiwan by U.S. Presidents

The table above allows these observations.

• Washington’s arms sales to Taiwan has increased over the years, which is contrary to what the U.S. Government had promised.
• The Trump administration spent as much as US$ 4.45 billion per year which represents as much as 30% of Taiwan’s annual defence budget of $15 billion
• By and large, the Republican Party sells more than the Democrats.
• Washington sells more when the anti-Beijing liberal party of Taiwan, the Democratic and Progressive Parry (DPP) is in power, that is, under the DPP government of Chen Shui-bian (2000-2008) and under the DPP government of Tsai Ying-wen (2016-2021)

This has an important meaning. Remember that the DPP is the party which seeks independence of Taiwan. Hence, the data can be interpreted as Washington’s strategy of encouraging the independence movement leading to ROC-PRC tension and more U.S. arms sales to Taiwan.

Now, coming back to the question of whether the U.S. wishes hot war over the Taiwan Strait, the answer is that it will not want the hot war, because, the hot war means the unification of China and Taiwan will no longer be able to play the role of Washington’s primary China-containment outpost and its function of being the lucrative market of American military equipments. 

Neither PRC (People’s Republic of China) nor ROC (Republic of China-Taiwan) wants the hot War.

When we discuss Taiwan and China, it is important to remember that they were enemies. The army of the ROC was defeated in 1949 and Chiang Kai-sek fled to Taiwan and continued the Republic of China which was created in 1912 by Sun Yat-sen. The civil war between ROC and PRC continued until 1979.

Even though the civil war was terminated, the ROC and PRC relations have not been smooth partly because of the past history and partly because of different political and economic regimes. In other words, there are always the possibilities of hostility in the cross-strait relations.

However, they have established viable relations which have been beneficial to both through political and economic cooperation.

Political Cooperation 

The evolution of the Taiwanese political orientation may be measured in terms of the way in which its presidents consider the legal status of Taiwan vis-à-vis PRC.

The evolution of Taiwanese political leaders’ perceptions of Taipei-Beijing political relations is shown below. By and large, such relations have evolved by the following periods.

• The civil war period (1949-1979)
• The period of good relations (1979-1998)
• The period of hostility (1998-2008)
• The resumption of high level dialogue period (2008-2016)
• The frozen relation period (2016-2021)

The period of civil war (1949-1979) was characterized by two cross-strait crises and never ending armed conflict between two Chinas.

During the friendly relation period (1979-1998), Deng Xiaoping met frequently the head of the Nationalist Party, Kuomintang (KMT) in order to develop cooperative relations.

President Chiang Ching-kuo (1980-1988) of KMT, son of Chiang Kai-shek, declared the three NOs:

• No declaration of independence,
• No unification of Chinas and
• No use of force between the two Chinas.

On July 9, 1999, President Lee Teng-hui (1988-2000) of KMT defined the ROC-PRC relation as “country to country relations.” So, there is no need for the independence declaration.

However, Lee’s visit to the Cornel University Alumni in 1995 alarmed Beijing and it led to the 1996 show of military might of People’s Liberation Army (PLA) of  PRC. This was, in fact, the third Taiwan Strait crisis.

During the period of hostility (1998-2008), President Chen Shui-bian (2000-2008) of the anti-PRC party, DPP, changed the name of “Chunghwa Post Co.” to “Taiwan Post Co.” He changed also the name of “China Petroleum Corporation” to “Taiwan Petroleum Corporation.”

But, under KMT president Ma Yong-Jeou (2008-2016), the old names came back. This episode shows how Taiwanese people are sensitive about the identity of Taiwan vis-à-vis China of main land.

In 2008, Ma Ying-Jeou of KMT (2008-2016) took over the power and the friendly relations across the Strait were resumed.

The year 2008 was marked by the efforts of PRCs president Hu Jintao to improve the bilateral relations across the Taiwan Strait. On March 26, 2008, he talked to President G.W. Bush, who endorsed the 1992 consensus on “One China”..

President Hu Jintao also met the Chairman of the KMT, Wu Po-hsing, who also accepted the 1992 Consensus.

As for President Ma, he defined the bilateral relations as “One Country on each side” or “two states in the same nation.”

In 2016, the power went back to DPP and Tsai Ying-wen became President. Tsai’s perception of Taiwan’s legal status was not more certain than those of other Taiwan presidents.

Her victory has put Beijing in even uncomfortable position. In 2016, Beijing cut all communications with ROC.

But, in the same year, some leaders in Taiwan being aware of the deteriorating cross-strait relations formed a Taiwanese delegation composed of eight magistrates and city mayors went to Beijing to improve the relations.

However, the cross-strait relations were not peaceful. In 2018, PLA conducted military exercises which surely alarmed Taiwan.

In 2019, Xi Jinping reaffirmed his position in favour of “one China, two systems.”

President Tsai Ying-wen refused Xi Jinping’s idea.

To the surprise of the world, in 2020 Tsai Ying-wen won the election again; the world was expecting that she would take more radical position regarding Taiwan’s independence.

True, her victory has encouraged the independence movement in Taiwan and pro-independence political parties and civic organizations asked for a referendum on independence.

However, Tsai maintained her position that since Taiwan is already independent country, there is no need for the declaration of independence.”

To sum up, none of the presidents of the major parties, the KMT and the DPP, opted for the declaration of Taiwan’s independence.

True, there are some pro-independence parties such as The Taiwan Independence Party, the Taiwan Solidarity and the Formosa Alliance, but they have no electoral support.

Thus, the danger of Taiwan’s declaration of independence seems nonexistent and therefore, Beijing has no reason to invade for now.

What has intrigued me is the Taiwanese people’s perceptions regarding Taiwan’s legal or political status. There are three public opinion polls which are meaningful.

In the poll of 2008 by the Mainland Affairs Council (MAC) no less than76% of the respondents rejected the idea of “one China, two systems.”

In the 2017 poll by MAC, 85% of the respondents said that the future of Taiwan should be determined by the Taiwanese themselves.

In the 2019 poll by MAC, 75% of the respondents rejected the 1992 Consensus (There is only one China which should be governed by PRC).

In the 2020 poll by the Academia Sinica, one finds very interesting phenomena.

• 73% of the respondents identified themselves as Taiwanese.
• 27.5% of them identified themselves as Chinese-Taiwanese
• 2.4% of tem identified themselves as Chinese
• 52.3% of them would prefer the postponement of the question of Taiwan independence and keep the status quo
• 35.1% of them prefer immediate independence
• 5.5% of them would prefer immediate or eventual unification of China.

In the Poll of MAC, 90% of the respondents refused PLA’s military threats.

To sum up, the Taiwanese are eager to greater autonomy, even independence, but they seem to avoid military confrontation by postponing the solution of the independence issue. In short, Taiwan does not want a shooting war with China.

Economic Cooperation 

There is another reason why the ROC-PRC hot war will not take place. It is the cross-strait economic cooperation.

Taiwan has achieved a remarkable success in economic development. In the 19960s, the per capita GDP was as low as $60. Now, in 2020, its GDP (nominal) was $730 billion USD and the per capita GDP was $32,000. This is, in fact, the miraculous achievements of the Taiwanese people.

The information industries account for 35 % of the country’s industrial production. The semi-conductor producers such as Taiwan Manufacturing Co. (TSMC) and the United Microelectronic Corporation (UMC) are world leaders. Taiwan is the 13th largest producer of steel; its steel products are exported to 130 countries. The most spectacular entrepreneurial performance has been shown by the SMEs accounting for 85% of industrial outputs.

Such achievement has been possible because of the courage, the innovative entrepreneurial spirit, the productivity and, especially the hard work of the Taiwanese. However, Washington’s economic aid, its imports of Taiwanese products and technology transfer have all contributed. In addition, we should not forget the cooperation between Mainland China and Taiwan which were enemies.

Under President Chiang Ching-kuo (1978-1988), two important semi-official organizations were was established: the Strait Exchange Foundation (SEF) under ROC’s Mainland Affairs Council and the Association of Relations across the Taiwan Strait (ARATS) under PRCs Taiwanese Affairs Office.

These two organizations have been the center of bilateral political and economic cooperation. They have initiated the three links: postal services, transportation and trade.

The Taiwan’s Investment Guidelines and similar measures taken by ROC have led to mutual business investments. In fact, 40 % of Taiwan’s outbound FDI stock went to Mainland China. Chinese tourists contribute to more than 40% of ROCs tourist industry. The Economic Cooperation Framework Agreement of 2010 is another mechanism of the bilateral economic relations.

Above all, Taiwan depends heavily on China for trade. In 2020, the value of Taiwan’s total exports was $ 345 billion of which 29.7% went to China. In the same year, the value of Taiwan’s total imports was $ 286 billion of which 22% came from China.

It is true that the RCO-PRC relations are not peaceful. But these economic relations are beneficial enough to keep the status quo as long as possible.

The conclusion of my analysis is that none of the three actors involved in the cross-strait drama wants shooting war.

The U.S. does not want the hot war because it will mean the unification of China, the loss of Taiwan as the primary China-containment outpost and the loss of the lucrative arms market.

Taiwan does not want the shooting war, because it will mean the ruin of its economy, loss of its autonomy becoming one of the Chinese provinces.

China does not risk the hot war because Taiwan prefers the status quo; it has no intention of getting weapons of mass destruction; there is no internal turmoil; it does not seek military alliances.

However, even without the shooting war, as long as the Sino-U.S. cold war continues, the cross-strait tension will continue.

Washington will sell more military equipments and services and Taiwan will have to play the dangerous role of Washington’s the primary outpost of China containment strategy and that of main buyer of American military weapons.

I wish to add this. The bilateral conflict between two Chinas like all other major bilateral conflicts is an integral part of Washington’s strategy of global hegemony. One of the most productive components of the American global hegemony is the proxy war, that is, some member country of Washington’s alliances will fight for the U.S.

Japan might be asked to play this role, because Japan is the best qualified for such task; it is a world class military power and it has the ambition of dominating Asia again; to do so, Japan has to destroy China. I hope I am wrong in thinking such an awful thing.

Finally, I would like add this too. Taiwan is a country which has achieved an amazing economic miracle of which all Chinese should be proud. Taiwan has established viable democracy under very challenging conditions; this is a regime which will surely contribute to the further advancement of China’s socio-political system.

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Professor Joseph H. Chung is professor of economics and co-director of the East Asia Observatory (OAE)-the Study Center for Integration and Globalization (CEIM), Quebec University in Montreal (UQAM).

Professor Chung is a Research Associate of the Centre for Research on Globalization (CRG).