TAIPEI (Taiwan News) — The Center for Strategic and International Studies said in a new report Wednesday that Chinese military action against Taiwan could severely damage Beijing’s economy by disrupting key maritime trade routes.
CSIS noted that, in 2024, the Taiwan Strait and the Strait of Malacca each handled more than US$2.4 trillion (NT$76.9 trillion) in cargo flows and accounted for about 21% of global maritime trade, per Liberty Times. It said China faces a greater “Taiwan Strait dilemma” than its long-discussed “Malacca dilemma.”
CSIS said about 33% of China’s total imports and 58% of its seaborne imports pass through the Taiwan Strait, along with roughly 16% of its exports. It said China’s reliance on the route reached nearly NT$41.65 trillion in 2024, exceeding flows through the Strait of Malacca by about 33%.
The report said the Taiwan Strait is a key route for energy and industrial materials, including oil, coal, natural gas, and ores. It said the corridor also links manufacturing hubs such as Shenzhen and Guangzhou with northern ports, including Shanghai, Ningbo, and Tianjin.
CSIS said a war or blockade launched by China would likely push the country to shift maritime freight to rail and road networks, sharply increasing logistics costs, according to Liberty Times. It said overland transport from Guangzhou to Tianjin can cost about three times more than sea shipping, creating bottlenecks in China’s inland transport system.
The report said alternative shipping routes through the Miyako Strait would also carry interdiction risks, longer transit times, and higher insurance and fuel costs. It added that rerouting would add weeks to shipping times and impose billions of dollars in additional costs on global trade flows.
CSIS said regional economies would also be affected, noting that Japan, South Korea and the Philippines had a combined NT$24.19 trillion in goods passing through the Taiwan Strait in 2024, according to Liberty Times. It said the strait accounts for 28% of Japan’s total trade and is critical for semiconductor imports, while also handling 22% of South Korea’s trade and 64% of its energy imports.
