Brace Yourself for More Supply Chain Crisis Amid China’s War Ambitions

  • By: Ahmed Khan
  • Date: August 11, 2022
  • Time to read: 3 min.

China’s increasing military engagement around Taiwan is intensifying the hurdles for global trade that has the potential to disrupt consumer markets across the globe.

Strategic experts suggest that China is aiming for long-lasting military activities in the Taiwan strait, which will become a “new normal” in the Western-Pacific region.

The Strait of Taiwan, which is only 130 km wide at its narrowest point, is the primary trade route between China, Japan and Europe. Similarly, it also provides a pathway to the technological products of South Korea that regularly go into the European markets. So, the persistent disruption in the waters surrounding Taiwan will trigger the supply chain crisis that can kick off a new wave of inflation across the world.

Although most of the ships have already resumed their journeys after the latest military exercises of China, however, the uncertainty of the Chinese military and their ambitions to create more naval blockades is creating tensions within the markets.

If manufacturers and suppliers decide to adopt an alternative trade route, it will come at the expense of higher shipping costs, the burden of which will be shifted to the consumers.

Peter Sands, a chief analyst at one of the largest shipping intelligence companies, Xeneta, stated that exporters would be bound to change their traditional routes, which will increase not only the shipping time but also the freight rates. “Freight rates will be most affected in the short term, before a ‘new normal’ for trade lanes in the region is established,” Sands added.

This trade crisis is coming at a time when the global markets are already grappling with unprecedented food shortages that are pushing the poor nations to the brink of seizure.

A Major Military Conflict on Its Way?

While other countries may be able to receive their shipments in one way or another, Taiwan is most prone to damage due to these military exercises of China. As China blocks all the waters surrounding Taiwan, it becomes impossible for any ship to reach the country amid the raining bombs by the Chinese military.

So American stakeholders are urging the Biden administration to challenge the Chinese authoritativeness in the region, which aims to disturb the status quo.

Elbridge Colby, a defense official of the Trump administration, is urging the US to work with Asian and other “link-minded countries” to ensure the constant supply of goods in Taiwan, even if it means challenging the Chinese blockade in the waters.

Chinese President Xi Jinping has long vowed for the “peaceful reunification” of Taiwan and asked the United States “not to play with fire” by intervening in China-Taiwan relations. Now Beijing has released another white paper that emphasizes Taiwan’s “reunification” and warned the “Taiwanese independence forces” not to push for the independence of the controversial island. 

China is exercising its military might after Nancy Pelosi’s controversial visit to Taiwan, which brought new tensions to Sino-US relations. Reportedly, China has already canceled all of its bilateral negotiations with the United States on the issues of climate change, drug smuggling, and military exercises.

Ahmed Khan

Author - Ahmed Khan

Political Reporter - View All Articles
Ahmed is a freelance journalist covering the main political news from around the world. Muhammad joined InterSpaceReporter as a freelance journalist on Monday 8th August 2022.

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