U.S. House Speaker Nancy Pelosi’s visit to Taiwan at the beginning of August included a meeting with Mark Liu, head of the Taiwan Manufacturing Semiconductor Corporation (TMSC), which is the world’s largest producer of computer microchips — and makes most of the world’s advanced ones.

Plans for Pelosi’s visit were first reported in Financial Times, after the trip was rescheduled due to COVID. China responded to the announcement with a global propaganda to present the visit as an act of defiance against the U.S. One China Policy. The U.S. One-China Policy recognizes the People’s Republic of China as the sole legal government of China but it does not necessarily agree with the PRC on Taiwan being a part of China.

Prior to her flight into Taipei, China also increased its military presence around Taiwan, including the conduct of live fire demonstrations and flying military aircraft close to the Taiwan Strait centerline.

The New York Times reports that Pelosi’s defiance of Beijing’s warnings was met with bipartisan support. She has historically taken a strong stance against the Chinese Communist Party (CCP), from demonstrating in Tiananmen Square in the early 1990s, to breaking from her own party to criticize policies that enable the CCP’s human rights abuses by economically supporting China. While her history of defiance and current prominence might, in part, underlie the CCP’s propaganda campaign against her visit, China has strong economic and political motivations for signaling its intentions of pursuing “reunification,” that is, taking over Taiwan.

It is not uncommon for U.S. lawmakers to visit Taiwan. As the Associated Press explainer notes, there have already been ten such visits this year. The U.S. and Taiwan are strategic trading partners under the Taiwan Relations Act (1979). In that context, the U.S. response to China’s threats was that it would not curtail U.S. representatives’ visits to Taiwan.

Many analysts are examining Beijing’s militaristic response. In the next few articles, we’ll take a closer look at the context in China, the U.S. and Taiwan — considering Taiwan’s prominence in the crucial semiconductor industry. For now, here are some things to consider:

A week after Pelosi’s trip to Taiwan, the U.S. passed the CHIPS+ Act, a bipartisan, billion-dollar initiative that, among other things, incentivizes bringing U.S. semiconductor manufacturing back to the U.S. One goal is to weaken the U.S.’s reliance on overseas manufacturing. Since Pelosi’s visit and the passage of the CHIPS Act, additional U.S. delegates have traveled to Taiwan.

Beijing also wants to weaken its reliance on foreign businesses to meet its technological needs. But additionally, the Chinese government wants to further a narrative that coincides with its political agenda as it approaches its 20^th Congress this Fall. Beijing has accused the U.S. of undermining the One China Policy and colluding with separatist groups.

China has existential political reasons for taking over Taiwan. Taiwan, a self-governed island off the coast of China, is governed democratically, with a capitalist economy. The residents enjoy freedoms not available to mainland China. As journalist Kia Strittmatter points out, Taiwan is a living rebuttal of the CCP’s claim that the Chinese aren’t cut out for democracy (We Have Been Harmonized, p. 247). Meanwhile, most Taiwanese people say they are used to living in the shadow of China.

Both China and the U.S. are heavily reliant on Taiwan to produce advanced microchips for commercial and military use. Taiwan sees its technological dominance as protection against sanctions or an impending military threat from China — its so-called “Silicon Shield Theory.”

Rather than serving as a deterrent, China’s response to Pelosi’s trip has served to galvanize the world’s democracies around Taiwan. Japan and Australia, both of which have a vested interest in Taiwan maintaining it autonomy, are sending diplomats to Taiwan and/or conducting military drills with each other and with the U.S. Further, according to China Digital Times, comments on Pelosi’s trip became so numerous on Weibo that the social media platform stalled out for a brief time and ended up censoring many of the posts.

In this series of articles, we will look further at Taiwan’s semiconductor industry and how it intersects with the political and economic interests of Taiwan, China, and the U.S.

You may also wish to read: On what terms is co-operation between the US and China possible? China analyst Miles Maochun Yu thinks that China’s new goal is to become the new global power first, then implement its ideology. The conflict between the U.S. vs. China seems to show that advanced technology can either liberate or enslave more profoundly than any lesser kind.