In mid-October, China conducted yet another round of large-scale military drills in the Taiwan Strait, including practicing a blockade of Taiwanese ports. This time, the trigger was a series of unremarkable comments by Taiwanese President Lai Ching-te on the occasion of Taiwan’s National Day a few days prior. Beijing “has no right to represent Taiwan,” Lai had asserted, describing Taiwan as a place where “democracy and freedom are growing and thriving.” Although Lai gave no indication that he would pursue independence or seek to change Taiwan’s international status, Beijing used his remarks as a new pretext to ramp up the pressure.
Over the past two years, major Chinese military exercises around Taiwan have gone from comparatively rare to almost routine. Beijing launched major drills after former U.S. Speaker of the House Nancy Pelosi visited the island in August 2022; when Lai’s predecessor, Tsai Ing-wen, briefly stopped in the United States in April 2023; and again after Lai’s inauguration in May 2024. But rather than isolated actions responding to specific events, these high-profile military drills should be viewed as a core component of China’s larger campaign of “gray-zone” operations against Taiwan—coercive activities that fall below the threshold of armed force. As part of these tactics, China has levied tariffs and embargoes on Taiwanese exports, sought to increase Taiwan’s international isolation, and employed disinformation campaigns and cyberattacks meant to destabilize its people and government.
The ultimate goal is forcing Taiwan to acquiesce to unification. In China’s ideal scenario, the Taiwanese people would find the accumulating pressures of these gray-zone activities unbearable and ultimately capitulate, allowing Beijing to win control of Taiwan without having to fire a shot. Short of these maximalist aims, the Chinese leadership hopes to erode trust in Lai’s ruling Democratic Progressive Party (DPP) and sow division in Taiwanese society, including by raising questions about whether the United States would come to Taiwan’s defense in the event of a Chinese blockade or invasion.
But it is already clear that China’s gray-zone operations are backfiring. The threat against which China justifies its campaign—a Taiwanese push for independence—does not really exist: the Taiwanese people support the status quo and understand that pursuing independence would alienate the island’s international partners and likely invite a Chinese attack. Instead, China’s actions have hardened Taiwan’s resolve to resist unification, making it only more likely that Beijing will have to resort to force to achieve this aim. Taiwan and the United States should therefore remain focused on deterring—and, if necessary, defeating—a Chinese blockade or invasion. And they should respond to aggressive gray-zone behavior by imposing costs on China that might change its calculus for an invasion or blockade. To prevent a hot conflict, they need to win the cold one. Put simply, Washington and Taipei need to exploit the gray zone themselves.
HONEY INTO VINEGAR
China’s strategy for unifying with Taiwan has always rested on a combination of inducements and threats—a marriage proposal at gunpoint. Beijing has attempted to demonstrate to the Taiwanese people the benefits of a closer political and economic relationship and the costs of further estrangement. China’s overtures were sweetest from 2008 to 2016, during the administration of Taiwanese President Ma Ying-jeou, whose party, the Kuomintang, emphatically rejected Taiwanese independence and favored a relatively conciliatory approach to Beijing, based on the so-called 1992 Consensus—a vague framework in which both sides agree there is “one China” but disagree on how to define it. During that period, Beijing and Taipei inked more than two dozen agreements on everything from trade to people-to-people exchanges. In 2016, however, Ma was succeeded by Tsai, of the DPP, which views Taiwan as an already independent and sovereign nation, formally called the Republic of China. Although Tsai, in her inaugural address, offered a formulation for cross-strait relations that satisfied the idea of “one China,” she declined to explicitly endorse the 1992 Consensus. Since then, China’s approach has grown more antagonistic, especially in the past few years.
Since late 2020, People’s Liberation Army aircraft have flown through Taiwan’s air defense identification zone—a buffer area outside its territorial airspace—on a near-daily basis. In 2022, Chinese aircraft began routinely flying over the median line in the Taiwan Strait, a demarcation that both sides had previously respected for over half a century. China has progressively increased the sophistication of these sorties as well as their proximity to Taiwanese territory. Before, the People’s Liberation Army Navy only occasionally operated in the waters near Taiwan; today, it stations warships around the island almost continuously. As a result, according to Taiwan’s naval chief, Chinese forces “are ready to blockade Taiwan at any time they want.”
China is also targeting Taiwan economically, attempting to drive divisions within its society by penalizing industries typically located in municipalities that favor the DPP. In May, it announced it would reinstate tariffs on 134 imports from Taiwan and in September added another 34 products to that list. Beijing has also threatened and fined China-based subsidiaries of Taiwanese companies that it believes support the DPP and pressured Taiwanese companies with operations in China to publish pro-China public statements.
China’s gray-zone campaign, intended to help achieve unification, is instead pushing Taiwan further away.
Politically, China continues to attempt to isolate Taiwan. It has succeeded in barring Taiwan from various world bodies, including the World Health Organization, Interpol, and the International Civil Aviation Organization. More recently, it has embarked on a sustained effort to persuade countries and global organizations to declare that Taiwan is a part of China’s territory and to support its efforts to achieve unification. In one notable example, which occurred after Lai’s inauguration, Nauru, a tiny island nation in Micronesia, severed diplomatic ties with Taiwan. This was not the first time a country had “flipped” to Beijing by cutting ties with Taipei, but it was the first time such a country explicitly recognized that “the Government of the [People’s Republic of China] is the sole legal Government representing the whole of China, and Taiwan is an inalienable part of China’s territory.” In this narrative battle, China is attempting to establish that disagreements between Beijing and Taipei constitute an internal matter. If this perspective were to become broadly accepted around the world, Beijing could argue that any use of force would not be in violation of international law, making it more difficult for the United States to lead a response.
In June, China unveiled new legal guidelines meant to target Taiwan independence activists; these crimes, some punishable by death, include promoting Taiwan’s inclusion in international organizations for which statehood is a requirement. A few months later, a Chinese court convicted a Taiwanese political activist who had moved to China and had previously advocated for Taiwan’s inclusion in the UN, sentencing him to nine years in prison. (The Republic of China was a founding member of the UN, representing “China” even after its government fled to Taiwan. In 1971, however, the UN voted to move representation to the People’s Republic of China; Taiwan has not had a presence in the body since.) China also continues to sanction Taiwanese officials—including its current vice president and national security adviser—and nationals it considers to be pro-independence.
Taiwan is now the target of more external disinformation attacks than any other democracy, with China producing the lion’s share of large-scale operations against it. And Beijing’s campaigns are growing increasingly sophisticated: in the run-up to Taiwan’s most recent presidential election, actors linked to the Chinese government used generative artificial intelligence to create audio and video deepfakes of Taiwanese political leaders. In recent years, China has attempted to sow skepticism of the United States among the Taiwanese population, as well. Consequently, a new perspective has taken hold: a September 2023 poll by Taiwan’s top research institution found that only 34 percent of Taiwanese people consider the United States to be a trustworthy partner, which represents a decline of 11 percentage points since 2021. Although this is a worrying trend, growing Taiwanese skepticism of the United States has not translated into a greater desire to unify with Beijing.
HARDENED STEEL
China’s gray-zone campaign, intended to help achieve unification, is instead pushing Taiwan further away. It is fueling a growing conviction among Taiwanese that China is hostile and raising an awareness among the population that conflict is a real possibility. Taiwanese people also see Beijing’s crackdown on democracy in Hong Kong as a harbinger of their likely fate following unification, and they are determined to prevent that from happening. Now, according to a long-running poll from National Chengchi University, in Taipei, less than seven percent of Taiwanese people desire unification with China at any point. That number was more than twice as high just six years ago.
Rather than buckling to Chinese pressure, Taiwan is stiffening its resolve, inspired in part by Ukraine standing up to Russia. In the past three years, Taiwan has consistently increased its defense budget, lengthened mandatory military conscription from three months to a year while overhauling its training regimen, invested in domestic missile and drone production, and made important strides in civil defense. In 2016, more than 80 percent of Taiwanese people believed that resistance in a potential conflict with China would be futile; by 2022, the proportion of the population expressing this view had nearly halved to 43 percent.
On the economic side, Beijing’s pressure on Taipei has led to an erosion of its leverage over the island. Taiwanese firms, having witnessed the political risks of doing business on the mainland, are reducing their dependence on China. Investment in China made up 43 percent of Taiwanese outbound foreign direct investment in 2016, a number that dropped to just 11 percent last year. The island’s commerce with China continues to decline as a share of its overall trade, as well. Beijing, on the other hand, remains reliant on Taiwanese technology products for its manufacturing industry, meaning that China is now arguably more vulnerable to a disruption in cross-strait trade than Taiwan.
China is unlikely to find a path from gray-zone coercion to unification that does not involve the use of military force. It cannot return to the niceties of the Ma era, either: its gray-zone campaign has revealed its strategic aims to an extent that many Taiwanese people find irreconcilable with their own desires—an outcome no tactical adjustment can reverse.
A MOVING TARGET
Although China’s gray-zone tactics do not pose an existential threat, Taiwan cannot simply ignore them. Taipei should continue to diversify its economy away from China, build resilient communications networks, improve the cybersecurity of its key infrastructure and government ministries, stockpile critical supplies, and work with like-minded democracies on global challenges.
At the same time, there is a danger of Taiwan responding to Chinese pressure in such a way that eats up the finite resources the island needs to prepare for a blockade or invasion. Indeed, Taiwan’s decision to respond to incursions into its air defense identification zone by scrambling fighter jets and to trail Chinese navy ships on the seas has heavily taxed its defense platforms and risks exhausting the military, thereby compromising Taiwan’s readiness for direct conflict. Continuing on this path would weaken Taiwan’s ability to withstand a blockade or invasion just as China’s use of force becomes more likely.
It is important for Taiwan to prioritize preparing for the fight that it cannot lose. This means adapting its defense strategies to the reality of the power imbalance: because it cannot match China tank for tank, plane for plane, or ship for ship, Taiwan should divest from some of these legacy platforms in favor of uncrewed systems, mines, and missiles, which Taipei can produce itself—or procure from the United States—in far greater quantities. To be sure, Taiwan’s government cannot allow perceived gray-zone threats to go unanswered, and it must find some way of demonstrating to its citizens that it is protecting them. But with limited resources, preparing for genuine military escalation must remain the primary focus.
Meanwhile, the United States, which has a vital strategic interest in maintaining peace and stability in the Taiwan Strait, must raise the costs for China of pursuing these tactics. It should respond to gray-zone coercion by announcing additional military aid to Taiwan, deploying more of its high-end military capabilities to the region, and deepening its military engagement with Japan, particularly in that country’s southwestern islands, which stretch toward Taiwan. China’s military exercises in the Taiwan Strait are meant to signal to the United States that China’s capabilities are too advanced for Washington to be able to intervene on Taiwan’s behalf; likewise, the United States should respond with its own exercises that demonstrate that it can keep open critical sea-lanes near Taiwan and surge forces into the region as needed. Washington should also warn Beijing that its response to Chinese coercion against Taiwan would not be limited to the military domain—that further pressure on Taiwan will invite broader U.S. restrictions on high-tech exports to China.
This kind of coordination between Washington and Taipei would complicate Chinese plans for a blockade or invasion and may prompt Beijing to reexamine whether the costs of continuing on its current path outweigh the benefits. Even if China does not abandon its gray-zone playbook, such steps would, at the very least, better prepare Taiwan for a conflict that such coercion has made all the more likely.
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