TAIPEI (Taiwan News) — If China imposes a blockade on the Taiwan Strait, it would likely disrupt most of the world’s advanced semiconductor supply and trigger severe global economic damage, Bloomberg reported Thursday.

Bloomberg columnist Karishma Vaswani said the Taiwan Strait plays a critical role in the world’s trade and technology supply chains. Any disruption could impact key industries, including artificial intelligence, smartphones, automobiles, and defense systems.

Vaswani said a crisis in the Taiwan Strait could choke off about 90% of the world’s advanced semiconductors. Even limited disruption would quickly ripple through global manufacturing and financial markets.

China may be studying recent conflicts that rely more on economic pressure than direct military confrontation. A blockade, quarantine, or inspection regime around Taiwan is seen as more likely than a full-scale invasion, as it carries less of an immediate military risk, per CNA.

Even so, the economic consequences would be severe. Previous estimates suggest a blockade could result in losses exceeding (NT$63 trillion) US$2 trillion, even without factoring in international responses, per Liberty Times.

China would also face significant economic fallout. Taiwan is one of its major trading partners and a key supplier to its electronics and manufacturing sectors.

Beyond economic considerations, political tensions continue to shape the situation. Taiwan’s democratic system and economic success present an ongoing challenge to Beijing’s narrative.

Vaswani warned that disruption in the Taiwan Strait is no longer a distant scenario. Governments and businesses are increasingly being urged to prepare contingency plans, strengthen supply chain resilience, and safeguard the flow of critical goods in the event of a crisis.