Taiwan Strait conflict could eclipse World War Two economic impact: US

TAIPEI: Any conflict across the Taiwan Strait would have a bigger impact on the global economy than World War Two, and the upcoming U.S.-China summit is an opportunity to avoid miscalculations, the top U.S. diplomat in Taipei said on ‌Wednesday.

While the U.S., ⁠like ⁠most countries, has no formal diplomatic relations with Chinese-claimed Taiwan, it is the democratically governed island's most important international backer and arms supplier.

Speaking at ​a defence forum in Taipei, Raymond Greene, director of the American Institute in Taiwan, said there was no topic more ​timely or important than how to secure peace in the Taiwan Strait.


"Beyond the human toll, any conflict across the Taiwan Strait would have a bigger impact on the global economy than the Second World War," he ​said.

"The United States under the Trump administration has made preserving peace in ⁠the Indo-Pacific ‌one of its top priorities," Greene added.

That includes "vigorous" diplomacy, especially at the highest levels, he ​said.

"The upcoming U.S.-China ​summit is an opportunity to further advance a relationship of strategic stability, on ⁠the basis of fairness and reciprocity, that can avoid misunderstandings and miscalculations," Greene ​added.

Chinese President Xi Jinping is expected to travel to the United States later ​this month for a meeting with President Donald Trump.

Greene said that the U.S. was also reinforcing its presence and partnerships in the Indo-Pacific region to maintain a "favourable regional balance of power".

"Third, and especially relevant to today's discussion, we are supporting Taiwan's work to enhance its ability to defend itself."

Taiwan President Lai Ching-te's administration has made stepped-up defence spending and military modernisation priorities, given the threat level from China.

The government, which rejects Beijing's ‌sovereignty claims, has budgeted defence spending for next year to exceed T$1 trillion for the first time.

'PRESERVE PEACE, FREEDOM'

Speaking at the same event as Greene, Vice President Hsiao Bi-khim said ​Taiwan has a ​clear responsibility to strengthen its own ⁠defences and make its society better prepared to withstand a wide range of security challenges.

"Our purpose, of course, is to preserve peace and the freedom of Taiwan's people to determine their future. Better preparation gives us ​a basis for pursuing that purpose with steadiness and strength," she added.

China has never renounced the use of force to bring Taiwan under its control, though it says it would prefer a peaceful outcome under a "one country, two systems" model of autonomy no major Taiwanese political party supports.

"The reunification of the motherland is an unstoppable historical trend," Chen Binhua, a spokesperson for China's Taiwan Affairs Office, told a regular news briefing in Beijing on Wednesday.