Kuomintang does not sleep

The XX Congress of the Communist Party of China (CCP) continues to work in Beijing. General Secretary of the CPC Central Committee, Chinese President Xi Jinping in his report outlined the priorities of foreign and domestic policy. Content analysis experts noted that the word "development" is especially common, this priority remains unchanged for the country and its leadership.

But there's a problem - it's Taiwan. Relations between Beijing and Taipei can contribute to the implementation of development goals, but, most likely, they can overshadow their prospects, slow down the Chinese economy. The whole question is in what form relations between the "two shores" of the Taiwan Strait will continue.

Normalization of ties through the strait began in 1987, Taiwanese citizens were allowed to visit the PRC. In April 1988, Beijing proposed peaceful unification on the basis of the principle of "one country - two systems." In 1992, the parties agreed on the "one China" principle, reserving the right to interpret it ("Consensus 1992"). Relations began to improve slightly in 2008 after the KMT party led by Ma Yingju came to power. A number of economic agreements were signed in the field of tourism and business, according to The Moscow Post.

If something goes wrong...

Without naming either partners or opponents, Xi Jinping addressed the topic of "risks and challenges" in the report. "The PRC has achieved a comprehensive strengthening of state security, we are gradually making progress in the targeted fight against evil forces," the head of the PRC said.

It can be assumed that the United States belongs to a prominent place in the Chinese list of "evil forces." And relations in the Taiwan Strait area are becoming for Beijing a question of strategic importance and China's future place in the global economy. Washington is visibly present in this relationship, weaves intrigue, spares no money and even American business. It is possible that Taiwan for President Joe Biden and his team is next on the list after Ukraine.

Xi Jinping stressed that the "one country, two systems" formula has demonstrated its effectiveness on the example of Hong Kong and Macau. And the reform of the electoral system and the introduction of the principle of "Hong Kong is ruled by patriots" has led to the fact that the situation in this special administrative region of the PRC has become manageable. He stressed that the PRC authorities will "sincerely strive for peaceful reunification," but will not refuse to use force if something goes wrong.

"Something is wrong" is, firstly, the official declaration of independence by the island. The move would leave Beijing with no choice. Secondly, this is a direct intervention by Washington, which is already happening in a variety of forms. The US and allies of the island's independence do not recognize, but also do not refuse, the opportunity to influence Taipei's relations with Beijing.

Peaceful reunification is highly desirable, but not guaranteed. This is not really what the US or its allies want. The current administration of the island, headed by Tsai Ing-wen, also opposes. Her Democratic Progressive Party (DPP) opposes rapprochement with the PRC and is not averse to playing with the term "independence." In 2020, the DPP won 61 of 113 seats, retaining its majority in the legislature but losing 7 seats from the 2016 election. The opposition Kuomintang party won 38 seats - three more than in 2016.

Three days passed when Zhang Dunhan, a spokesman for the island's administration, noted that "one cannot make concessions on issues of sovereignty, democracy and freedom," which the inhabitants of the island consider the "one country, two systems" formula unacceptable. Commenting on the prospects for reunification, he said Taiwan is already a "sovereign and independent country."

Washington slept here too

US military-political support for Taiwan fuels pro-independence sentiment and leads to the accumulation of conflict potential, both in relations between Beijing and Taipei, and in the de facto confrontation between the PRC and the United States in the Taiwan Strait.

Relations between Washington and Taiwan, the level of which is rising, despite the protests of Beijing, have become the main "fuel" of the confrontation between the PRC and the United States. An example is a recent visit to Taipei by House Speaker of the Congress Nancy Pelosi. President Joe Biden has stated a couple of times that the United States will come to the aid of Taiwan in the event of an attack, arbitrarily moving away from the previously accepted "non-agreements."

The United States "is determined to fulfill its obligations to Taiwan under the [American] law on relations with Taiwan - in support of its ability to defend itself," said US Secretary of State Anthony Blinken once again recently, referring to indirect support for the island. At the same time, he assured that Washington is not going to abandon the "one China" policy, and also said that the approach to the Taiwan issue was replaced not by Washington, but by Beijing. In his opinion, "the status quo is no longer acceptable" for the PRC.

Officially, the US task is to support the island's ability to defend itself. So far, protection is not required, but the Americans are systematically working to fuel the conflict. This is part of US domestic policy, as well as Washington's strategy in Asia, especially in the Chinese direction.

The Joe Biden administration defiantly maintains ties with the island at a high political level, provides assistance with equipment and instructors. According to the Chinese Foreign Ministry, the amount of arms supply transactions exceeds $70 billion. Supplies are growing and a decrease in activity in this direction cannot be expected. For the United States, Taiwan's strategic importance increases as the PRC strengthens.

Taiwan independence is a threat to the PRC

The President of the PRC indicated that Beijing will promote the development of exchanges and cooperation with Taiwan, but strongly opposes attempts to external interference. "In response to separatist activities aimed at Taiwan's independence, serious provocations of external forces interfering in Taiwan's affairs, we resolutely fought a large-scale struggle against secession and interference," Xi Jinping said.

Reuters estimated Xi uttered the words "safety" or "defense" 73 times - up from 55 in 2017. The head of the PRC warned that Beijing's steps, if something goes "wrong," will in no way be directed against most compatriots - the power option will be used against "the intervention of external forces and an extremely small number of separatists advocating for Taiwan's independence."

The People's Liberation Army (PLA) must "protect China's dignity and core interests," Xi stressed. "We will strengthen military training in close to combat conditions across the board to ensure the ability of our armed forces to fight effectively. We will introduce new military-strategic thinking and develop the strategy and tactics of the people's war, create a powerful system of strategic deterrence, increase the share of the armed forces in new military areas with new combat capabilities and strengthen the combat readiness of the troops. "

The leader of the PRC promised by 2027 to modernize the armed forces, which were once dominated by infantry. To achieve this goal, the PLA has undergone organizational changes and modernization. Ground forces were reduced, the Navy and Air Force sharply expanded, and missile forces acquired great importance. "We will modernize our military theory, personnel and weapons faster," Xi said. "We will strengthen our strategic potential."

China is developing hypersonic missiles, building aircraft carriers and surface ships, ready to fight back attempts by third countries to intervene in domestic relations.

Taiwan is closer to China than we think

Relations between the PRC and the island are quite saturated. According to the Main Customs Administration of the PRC, bilateral trade in 2021 increased to $328 billion. A third of Taiwan's exports are to mainland China. The parties signed more than 100 agreements on cooperation in various fields. Mainland Chinese companies are investing in Taiwan's infrastructure.

Xi Jinping in his report stressed that one of the priorities of the authorities is to turn China into a powerful technological and industrial power. According to him, China will provide energy as well as food security. He also pointed out that the country's authorities will pay special attention to ensuring stability, security and continuity of supply chains.

Some of these chains are closed to Taiwan. The basis of Taiwan's economy and its exports is the production of electronics and equipment. Taiwan is home to the world's largest chipmaker, TSMC. This company is the world leader in the contract services market for semiconductor companies, including Apple, AMD, Nvidia. Before the ban was introduced, Russian developers, including the ICST, Baikal Electronics, and Elvis, placed their orders at Taiwanese factories. TSMC owns half of the world's fleet of hard ultraviolet lithography lines.

Xi Jinping, speaking at the congress, expressed confidence in the irreversibility of the process of reunification of mainland China with Taiwan: "We will continue to strive for peaceful reunification with the greatest sincerity and maximum efforts, but we do not promise to abandon the use of force and reserve the opportunity to take all necessary measures."

Hit by barriers to technology

However, force is already being applied. The US continues to look for new leverage on China and the Chinese economy. In particular, Washington has included 31 Chinese companies, including memory chip maker YMTC, in a list of organizations that raise potential suspicions about the export of American sensitive technologies.

Exporters must carry out additional checks before sending goods to these companies. Chinese semiconductor companies lost $8.6 billion in market value amid the announcements.

Securities of Semiconductor Manufacturing International, the largest Chinese microchip company, sank 4%. Hua Hong Semiconductor depreciated 9.4%, and Shanghai Fudan Microelectronics lost 20.2%. Firms affected by the US decision also included Naura Technology, ACM Research Shanghai and Advanced Micro-Fabrication Equipment. Industry officials note that even unlisted companies are experiencing consequences from US actions.

Restrictive measures are aimed at preventing foreign companies from selling modern chips to the PRC and supplying Chinese firms with funds for the production of advanced chips produced using American technologies. It is also about controlling the production and trade of equipment to create the latest chips. Reuters reported that the US Department of Commerce will ban the sale of chip manufacturing equipment to Chinese semiconductor factories. Without a license, it is forbidden to supply chips used in the field of artificial intelligence.

The Wall Street Journal reported that the administration is trying to persuade key allies to join the sanctions. According to the newspaper, the introduction of joint export control by the United States, South Korea, Japan and European countries could significantly limit Chinese chip production.

US technological sanctions against China could have a negative impact on both Chinese and American companies engaged in the development of artificial intelligence and the creation of supercomputers. This was reported by the British Financial Times with reference to interviewed experts. The US ban on the export to China of a number of semiconductor technologies will not only adversely affect the state of microchip manufacturers in China, but will have global consequences.

"Now it seems that this fifth anniversary - from 2022 to 2027 - will be decisive not only in terms of the country's reunification, but also in terms of geopolitical, economic, technological and military-technical competition with the United States," suggested Andrei Kortunov, general director of the Russian Council on International Affairs.

Japan occupied Taiwan for about half a century and returned it to the Republic of China (proclaimed in 1912) only at the end of World War II. Having been defeated in the civil war in Taiwan in 1949, the remnants of the Kuomintang forces led by Chiang Kai-shek (1887-1975) fled.

Since then, this native Chinese island has been governed by its own administration, retains the flag and other attributes of the Republic of China. Until 1971, she represented China at the UN, including the Security Council, and acted as an "anti-China" and "showcase of capitalism." Taiwan takes part in a number of international organizations, in 1991 became a member of APEC as Chinese Taipei. Taiwan has not waived its rights to the mainland, either, although it has recently claimed them less frequently.