Chinese President Xi Jinping (習近平) has prioritized modernizing the Chinese People’s Liberation Army (PLA) to rival the US military, with many experts believing he would not act on Taiwan until the PLA is fully prepared to confront US forces.
At the Chinese Communist Party’s 20th Party Congress in 2022, Xi emphasized accelerating this modernization, setting 2027 — the PLA’s centennial — as the new target, replacing the previous 2035 goal. US intelligence agencies said that Xi has directed the PLA to be ready for a potential invasion of Taiwan by 2027, although no decision on launching an attack had been made.
Whether or not the PLA achieves its modernization goals on schedule, a significant logistical hurdle remains that could make waging war impossible: the “Malacca dilemma.” China is strategically vulnerable due to its heavy reliance on the Strait of Malacca, a narrow, but crucial maritime passage connecting the Indian Ocean to the South China Sea.
China relies on the waterway for 90 percent of its trade and 80 percent of its oil imports, and its dependence on foreign liquefied natural gas is expected to reach 62 percent in the coming years. According to the China Aerospace Studies Institute, China’s primary maritime transportation route passes through the South China Sea, Indian Ocean and the Red Sea via the Strait of Malacca. In the event of war, a US-led blockade of the strait could cut off fuel supplies, cripple China’s economy and severely affect its civilian population.
Beijing has explored several alternatives to reduce its reliance on the vulnerable Strait of Malacca, but each faces significant challenges. In its 2025 climate goals, China initially ramped up efforts to reduce domestic energy consumption, but has since abandoned the plan, recognizing the need for energy to fuel its economy. That has slowed the transition to renewable energy, leaving China reliant on imports.
Expanding its naval presence in the South China Sea is another way Beijing aims to secure key shipping lanes, but the dominance of the US Navy makes uncontested control unlikely. Efforts to build partnerships with regional players such as Indonesia and Malaysia, along with establishing military bases in Cambodia and Djibouti, are complicated by regional geopolitics and a potential backlash from rival powers. The Belt and Road Initiative, initially intended to address China’s resource needs, faces resistance from financially strained partner countries wary of debt distress.
China is exploring arctic shipping routes as climate change makes them more accessible, but several factors limit their viability. Harsh weather conditions make the routes usable for only a few months each year, and the region’s underdeveloped infrastructure requires significant investment. Additionally, Russia’s dominance in the region presents a geopolitical obstacle that could delay or obstruct China’s use of the routes. Environmental concerns also add to the controversy surrounding that option, making it a long-term prospect rather than an immediate solution.
China is working to develop three primary overland routes to enhance its energy security: the China-Pakistan Economic Corridor (CPEC), the China-Myanmar Economic Corridor and the proposed Power of Siberia 2 pipeline that would connect China to Russia via Mongolia. However, each of these projects faces significant challenges and is expected to encounter delays.
As part of the CPEC, launched in 2013 as the flagship project of the Belt and Road Initiative, Beijing promised US$62 billion in investments to improve Pakistan’s infrastructure, while providing China with direct access to the Indian Ocean via Gwadar Port. One of the CPEC’s key aims is to bypass the vulnerable Strait of Malacca by establishing an overland route for oil and gas imports from the Middle East.
However, after a decade, the initiative has stalled, marred by corruption, political instability, financial crises and frequent terrorist attacks. Delays have plagued major projects, including the Main Line 1 railway, and efforts to establish special economic zones are behind schedule. The future of CPEC remains uncertain, with frustrations growing on both sides. While the project is advancing slowly, full operational capacity is uncertain, and given the security concerns, it might never be a fully reliable alternative for China. Full completion and operational security might still be years away.
The China-Myanmar Economic Corridor aims to create a direct infrastructure and energy route from Kunming, China, to the deep-water port of Kyaukphyu, Myanmar, on the Bay of Bengal, offering a strategic alternative to the Strait of Malacca. Despite some initial progress, including the signing of 33 agreements in 2020, the project faces significant setbacks due to a military coup in Myanmar and the country’s escalating civil war.
Anti-China sentiment and instability in the country have led to damage to Chinese investments and raised security concerns along the route, particularly in conflict-prone regions such as Shan State. While the junta needs China’s support and would likely defend the project, it faces greater uncertainty and delays as Myanmar’s situation worsens.
Like the other land-based workarounds for the Malacca dilemma, the proposed Power of Siberia 2 is another critical project aimed at diversifying China’s energy imports. The gas pipeline would connect Russia’s Siberian gas fields to China through Mongolia. Initially, China was hesitant to proceed with the project, as existing contracts were sufficient to meet its gas needs until 2030, leading many to believe China was holding out for a better price for Russian gas.
However, if tensions with the US escalate, experts predict China might accelerate the project. At the same time, Mongolia’s exclusion of the Soyuz Vostok pipeline — an extension of the Power of Siberia 2 — from its 2024-2028 National Action Plan raises doubts about the project. Pricing, cost-sharing and control over the Mongolian section have delayed progress, complicating the likelihood of its completion.
Beijing does not appear to have a viable solution to the Malacca dilemma that could be completed by 2027. While it is possible that China could invade Taiwan without resolving the issue, perhaps hoping the US would stay out of the conflict or that its seaborne energy supplies could evade US forces, the unresolved dilemma adds another layer of uncertainty, which complicates Xi’s strategic calculus.
Antonio Graceffo, a China economic analyst who holds a China MBA from Shanghai Jiao Tong University, studies national defense at the American Military University in West Virginia.
A return to power for former US president Donald Trump would pose grave risks to Taiwan’s security, autonomy and the broader stability of the Indo-Pacific region. The stakes have never been higher as China aggressively escalates its pressure on Taiwan, deploying economic, military and psychological tactics aimed at subjugating the nation under Beijing’s control. The US has long acted as Taiwan’s foremost security partner, a bulwark against Chinese expansionism in the region. However, a second Trump presidency could upend decades of US commitments, introducing unpredictability that could embolden Beijing and severely compromise Taiwan’s position. While president, Trump’s foreign policy reflected a transactional
There appears to be a growing view among leaders and leading thinkers in Taiwan that their words and actions have no influence over how China approaches cross-Strait relations. According to this logic, China’s actions toward Taiwan are guided by China’s unwavering ambition to assert control over Taiwan. Many also believe Beijing’s approach is influenced by China’s domestic politics. As the thinking goes, former President Tsai Ing-wen (蔡英文) made a good faith effort to demonstrate her moderation on cross-Strait issues throughout her tenure. During her 2016 inaugural address, Tsai sent several constructive signals, including by acknowledging the historical fact of interactions and
HSBC Holdings successfully fought off a breakup campaign by disgruntled Asian investors in recent years. Now, it has announced a restructuring along almost the same east-west lines. The obvious question is why? It says it is designed to create a simpler, more efficient and dynamic company. However, it looks a lot like the bank is also facing up to the political reality of the growing schism between the US and China. A new structure would not dissolve HSBC’s geopolitical challenges, but it could give the bank better options to respond quickly if things worsen. HSBC spent 2022 battling to convince shareholders of
China’s “Joint Sword-2024B” military exercises around Taiwan last week have sparked concerns in Taipei and allied capitals that Beijing’s risk tolerance is increasing, and rather than prioritizing efforts toward “peaceful unification,” it is ramping up efforts to bring about unification by force, whether that be a military quarantine, blockade or full-scale invasion. Catherine Lila Chou (周怡齡) and Mark Harrison are right in their recent book Revolutionary Taiwan: Making Nationhood in a Changing World Order that the nature of Beijing’s one-party political system, in which the Chinese Communist Party (CCP) is always right, means Taiwanese identity is explained away as being the
RSS