Key Takeaways
- The cross-strait military standoff has entered its fourth phase—a "renewed cold war"—following China's military drills in 2022, signaling heightened risks for armed confrontation.
- Military exercises, force deployments, and arms buildup among China, Taiwan, and the U.S. are intensifying, creating a vicious cycle of escalating tensions.
- China's gray-zone tactics against Taiwan—including military exercises, patrols, coast guard surveillance and intrusions, and cyber operations—have become routine occurrences.
- Economic interdependence, which once served as a crucial buffer against conflicts, is becoming less effective in this role.
- The prospect of a war at a definite point in the near future remains not high, as the escalating tensions suggest China’s strategy of maximizing pressure on Taiwan to force negotiations rather than following a set timeline of military operations.
- To address the rising but not imminent risks, the EU should develop a coordinated strategy for a Taiwan contingency, focusing on leveraging its unique position to mediate peace between the rival parties.
Introduction
The military standoff across the Taiwan Strait is a defining characteristic of China-Taiwan[1] relations—commonly known as cross-strait relations. It emerged from the end of the Chinese Civil War in 1949—when the People's Republic of China (PRC) was established on the Chinese Mainland and the Republic of China (ROC) government relocated to Taiwan—and persists to this day. Although no major military conflicts have occurred between the two sides since then, crises across the Taiwan Strait have taken place several times, and the risk of war has never completely disappeared. In recent years, the Taiwan Strait has once again become an international flashpoint, which The Economist described in 2021 as "the most dangerous place on earth."[2] Several of Europe's core interests are closely tied to this region, despite the geographic distance and Europe's far more limited influence compared to that of the U.S. From an economic perspective alone, China ranks among the largest trading partners for many European countries, while Taiwan serves as a vital supplier of high-tech products, particularly advanced semiconductors. Should a war break out—especially with U.S. intervention—it would undoubtedly trigger severe economic repercussions throughout Europe.[3]
In this paper, we analyze the features of the current stage of the military standoff through longitudinal comparison and examine the prospect of war at a specific point in the near future—particularly 2027, a timeframe that has attracted significant media attention. With the latest developments of the situation in mind, we aim to provide European readers with a concise yet incisive analysis that will hopefully stimulate policy discussions.
Military standoff has entered a new phase
Based on the intensity of military rivalry,[4] we divide the cross-strait standoff into four phases.
The first phase spans from 1950 when the ROC lost control of the entire Mainland to 1958 when the PRC failed to capture the islands of Kinmen and Matsu.[5] During this period, the military standoff and mutual isolation across the strait took shape, though sporadic fighting still erupted in coastal areas. The second phase of “Cold War” from 1958 to 1979 saw a reduction in direct military conflicts, yet both sides actively prepared to use force against each other. Military relations thus remained tense with occasional armed skirmishes, while economic and societal exchanges were completely severed. The standoff entered a third phase of “Cold Peace” after Beijing announced a major policy shift to "peaceful reunification" in 1979. Except for the 1995–96 missile crisis, overall tensions decreased significantly, and military frictions largely subsided. The accompanying resumption of civilian contacts spurred enormous economic and societal interactions, leading to increasing integration across the Strait.
However, without a formal armistice or other peace-building arrangements, the armed forces on both sides continued to build up their military capabilities against each other. Over the past two decades, particularly since President Xi Jinping took power in 2012, Beijing has significantly reformed the military institutions and strengthened thearmed forces (the People’s Liberation Army, PLA), leading to a growing advantage over Taipei.[6] Cross-Strait relations took a nosedive in2022, when Beijing launched large-scale military exercises in response to U.S. House Speaker Nancy Pelosi's Taiwan visit, effectively threatening to encircle and blockade the entire island of Taiwan. For the first time, the People's Liberation Army (PLA) conducted live-fire exercises in six designated zones surrounding Taiwan and launched 11 ballistic missiles into waters around the island. In an equally unprecedented move, PLA aircraft also entered Taiwan's air defense identification zone (ADIZ), with several crossing the median line of the Strait—an unofficial boundary that both sides had previously respected to prevent escalation.[7] Unlike the 1995–96 crisis which quickly subsided, tensions in the Taiwan Strait have continued to rise since then.
We therefore argue that the cross-strait military standoff has entered a fourth phase of “renewed Cold War”, in which the shadow of armed confrontation looms large.
Feature 1: Combat readiness is accelerating
A defining characteristic of this new phase is the intensifying tempo of military exercises, force deployments, and arms buildup among the three key players—China, Taiwan, and the U.S., driving the tensions into a vicious cycle of escalation.
Among others, Beijing’s military operations are the main cause of heightened tensions. Its perception of deepening "seccessionist activities in Taiwan and external intervention" have pushed the PLA from a deterrence posture to combat-ready preparation. The Eastern Theater Command, which is primarily responsible for Taiwan operations, is swiftly accelerating equipment deployment across key cross-strait domains, including missile systems, naval and amphibious equipment, fighter jets, and unmanned aerial vehicles.[8]According to a recent remark by a senior Taiwanese military official, “the PLA's air force and missile units have improved to the point where they could switch from peacetime to war operations any time”.[9]
Since the 2022 drills, Beijing has established a periodic and multi-tiered exercise program around Taiwan, with an estimated 7% of its annual defense budget—around USD 15 billion—spent on Western Pacific exercises in 2023 alone.[10]The PLA has conducted at least one major, named, multi-day exercise each year, with additional drills responding to Taiwan-related political events or perceived provocations.[11] Notable operations include the Joint Sword series (2023–2024) and the Strait Thunder in 2025. These drills have grown increasingly sophisticated, featuring integrated operations across military branches such as the carrier battle group and missile brigades. Regular PLA aircraft patrols crossing the Strait’s median line have also become almost a daily routine, reflecting Beijing’s enhanced control over the Strait’s airspace. A total of 3,070 sorties were recorded in 2024,[12] with formations ranging from single aircraft to sophisticated reconnaissance-strike systems that integrate fighters, anti-submarine aircraft, and drones.[13]
In response to Beijing's mounting pressure, Taipei has significantly increased its defense spending with President Lai indicating further increases from the current 2.45% to 3% of GDP, focusing primarily on developing asymmetric combat capabilities across all military branches.[14] Arms procurement from the U.S. has reached record highs in both amount and sophistication, including missile systems, advanced fighter jets, and drones.[15] Military exercises are also expanding in scale and transformed in nature, with growing emphasis on battlefield reality. The Han Kuang exercises—Taiwan's biggest annual drills—has reached unprecedented levels in scale and intensity, evolving into a platform for testing joint operations under simulated wartime conditions. The 2024 iteration marked the first "unscripted and realistic" drill, making it the most combat-like exercise in years.[16] To counter PLA exercises, the Taiwanese military has announced that starting in 2025, it will conduct "immediate combat readiness drills" to strengthen deployment capabilities and implement "unplanned readiness exercises" based on threat levels.[17]
The U.S., as a decisive player, also has increasingly redirected its global military focus toward the Taiwan Strait. President Joe Biden repeatedly stated that U.S. forces would come to Taiwan’s defense in the event of a conflict, effectively undercutting the long-standing policy of strategic ambiguity. Washington continues to facilitate arms sales to Taiwan, with the 2022 Taiwan Policy Act authorizing USD 6.5 billion to accelerate the island’s military modernization.[18]However, there have been significant delays and persistent backlogs of U.S. arms deliveries to Taiwan, partly due to the war in Ukraine and chronic shortfalls in American defense production capacity.[19]It has also intensified military posture in the region by deploying additional troops and missile systems to Japan and the Philippines—two longstanding allies located near Taiwan. In parallel, it actively conducts joint military exercises with these and other regional partners, strengthening combined operational capabilities and reinforcing deterrence against China.[20]
Feature 2: Gray-zone conflicts become routine
Alongside tensions in traditional security domains, gray-zone conflicts—activities that exist between clear-cut war and peace—have become routine. Without sparking actual war, they are employed by states and non-state actors to probe rivals' resolve and capabilities. They are deliberately ambiguous and provocative, open to different interpretations based on perspective.[21] As these cross-strait conflicts continue, they not only heighten mutual hostility but also increase the likelihood of accidental or unintentional military clashes.
The PLA’s military exercises and patrols themselves belong to gray-zone tactics, as they deliberately avoid direct attacks on Taiwan’s military facilities or population centers. However, they carry clear intimidation intent, as Beijing stated that the PLA's activities aimed to deter and provide countermeasures against Taipei’s provocations and Washington’s interference.[22] At the same time, Beijing is steadily eroding the median line's effectiveness by repeatedly crossing it, thereby expanding its control over the Taiwan Strait while reducing Taipei's strategic depth. In fact, control over the Strait's airspace and waters has always been determined by military strength because no formal agreement has ever established the median line, making compliance entirely voluntary for each party. In this context, Beijing's actions increasingly test the limits of both Taipei and Washington, while providing valuable combat training for PLA frontline units. Moreover, frequent military operations compel Taiwan's forces to conduct constant monitoring and interception missions, which is draining their limited resources and personnel.
Another source of grey-zone conflicts comes from the clashes of maritime law enforcement. A 2024 incident near Taiwan's Kinmen islands prompted Beijing to reject Taipei's administrative authority over the islands' waters by deploying regular China Coast Guard (CCG) patrols in waters that Taipei had designated as prohibited and restricted zones. Since then, CCG vessels have routinely entered Kinmen's waters, creating frequent standoffs with their Taiwanese counterparts. Statistics indicate that CCG vessels conduct 2 to 4 monthly patrols, deliberately sailing along maritime boundaries—a strategy that avoids direct escalation while maintaining a distinctly provocative posture. These activities have grown more diverse, extensive and random, leaving Taiwanese Coast Guard disadvantaged in both equipment and personnel, struggling to maintain an effective response.[23] Beijing has steadily expanded its de facto administrative control through these actions, raising concerns about potential expansion of this pattern to other Taiwanese waters. More worrisome is the fact that the CCG has started synchronizing its operations with PLA exercises in the Taiwan Strait. This was starkly demonstrated during the "Joint Sword-2024B" exercises when CCG -2901, the world’s largest coast guard vessel, simultaneously appeared in Kinmen waters.[24]
Cyber operations represent the third major arena. According to an official report, Taiwan's government networks endured an average of 2.4 million daily cyberattacks in 2024—more than twice the number from the previous year—with most attacks originating from Beijing's cyber forces. Targets evolved from conventional government websites to critical infrastructure, specifically telecommunications operators, transportation systems, and defense supply chains.[25] In February 2025, Chinese vessels damaged two undersea cables linking Taiwan to its outer islands in quick succession. Given these cables' vital importance for communications, Taipei asserted that these incidents were deliberate and calculated actions by Beijing, likely a rehearsal for isolating Taiwan by cutting off its external communications.[26] Beijing utterly rejected these accusations, asserting that Taipei was deliberately spreading disinformation to heighten cross-strait tensions.[27] As a countermeasure, it issued two rounds of arrest warrants in 2025 targeting more than 20 members of Taiwanese army’s cyber warfare units, accusing them of conducting sustained attacks against network systems in mainland China and Hong Kong.[28]
Feature 3: Buffering role of economy is diminishing
Economic ties between Taiwan and China have grown exponentially since the 1980s as part of the global production chain, in which Taiwanese companies invested in China to produce goods primarily for the U.S. and European markets.[29] The resulting economic interdependence across the Strait served as a crucial buffer against potential conflicts during the third phase of the cross-strait standoff. This was primarily because China needed Taiwan's capital and technology for its development while seeking integration into the U.S.-led global economic system. This dynamic is effectively demonstrated by the 1995–96 Crisis. While Beijing's limited military capabilities helped prevent conflict, its unwillingness to risk damaging economic ties with Taipei and Washington proved equally decisive.[30] Another motive stemmed from Beijing's belief that growing economic integration between the two sides would ultimately lead to political unification.[31] Beijing was thus reluctant to use force that might disrupt economic ties, preferring instead to utilize economic means to advance its Taiwan agenda.
However, this economic buffer is now losing its effectiveness. Beijing has become more willing to demonstrate military strength with less concern for its impact on cross-strait trade. Within China, skepticism toward the long-standing strategy of using economic integration to promote unification is growing, as are voices calling for its abandonment.[32] Two structural changes underpin this shift. China's industrial upgrading has transformed the once complementary economic relationship with Taiwan into an increasingly competitive one. Amid U.S.-China decoupling, Taiwanese firms are aligning with U.S. sanctions, while the Taiwanese government is actively promoting the diversification of supply chains away from China.[33] As a result, although overall trade volume remains high, Taiwanese investment in the mainland has declined sharply, and its exports continue to fall.[34] The weakening of interdependence may not be beneficial for peace. If China ceases to depend on or loses access to Taiwanese chips, for instance, the strategic leverage that Taiwan's semiconductor industry once provided would diminish.[35]
2027: Countdown to war?
In 2017, Admiral Philip Davidson, Commander of U.S. Indo-Pacific Command, testified before Congress that China would be capable of launching a military invasion of Taiwan by 2027, an assessment later reinforced by his colleagues in the intelligence, military, and other government agencies. The so-called "Davidson Window" has since drawn widespread attention from global media outlets and governments. Beijing explicitly denied the claim, with Xi Jinping himself personally rejecting any specific timeline during a 2024 summit with U.S. President Joe Biden. U.S. officials later clarified that being ready to invade is different than having plans to invade, as there was no definite indication that China would attack Taiwan by 2027 despite the PLA’s ongoing military modernization.[36]
While war remains a possibility, Beijing's actions suggest a strategy of maximizing pressure on Taipei to force negotiations rather than following a set timeline for war. Beyond the lack of evidence for military mobilization, Beijing's authoritative Taiwan policy documents continue to emphasize "peaceful reunification and one country, two systems" as the core approach.[37] Three factors support this assessment. First, Taipei is unlikely to cross Beijing's red lines through constitutional changes that would sever cross-strait connection—the legal threshold is too high, and Taiwan lacks domestic consensus for such moves. Second, Beijing still sees economic integration as a viable path to unification, as shown by its ongoing policies promoting "cross-strait integrated development" targeting Taiwanese citizens and businesses. Third, the potential costs of war remain too high for Beijing. It would face not only significant casualties and economic disruption, but also likely direct confrontation with Washington and sanctions from its major trading partners such as the EU.[38]
That being said, when might Beijing resort to military actions? How likely are these scenarios to materialize in the coming years?
- When peaceful reunification becomes impossible, specifically if Taiwan amends its constitution to formalize independence or if cross-strait economic integration collapses. As discussed previously, this possibility remains low.
- When Washington chooses not to intervene militarily, or Beijing gains sufficient capabilities to prevent intervention. Given Taiwan's geopolitical and economic significance, Washington is unlikely to remain passive. U.S. and its allied forces in the region still maintain military superiority over the PLA, though the advantage is diminishing.
- When the cross-strait military balance shifts decisively in Beijing's favor—even assuming U.S. and allied intervention—allowing for swift occupation at minimal cost. There is no evidence that Beijing is close to acquiring the capability or confidence to achieve such a swift victory.
- On top of military capabilities, when domestic political imperatives dictate that China resort to force to take Taiwan, and as Beijing develops sufficient resilience to withstand potential sanctions, making the economic consequences manageable. This possibility is relatively high, as the Chinese economy has demonstrated remarkable resilience despite pressures from US President Trump's tariff war.
How Europe should respond
EU member states maintain their own "One China" policy as they have official relations with Beijing, do not recognize Taipei diplomatically, and remain ambiguous about Beijing's sovereignty claims over Taiwan. Nevertheless, their strategies to addressing escalating tensions in the Taiwan Strait are becoming increasingly divergent. France, Germany, and the EU adopt a cautious approach: emphasizing peace, opposing unilateral changes to the status quo, while avoiding measures that might provoke Beijing. The Czech Republic and Lithuania are strengthening their substantive relations with Taipei, which lead to frequent clashes with Beijing. In contrast, Hungary's stance increasingly aligns with Beijing, endorsing the latter's "One China" principle and unification claims.
This divergence may limit the EU's influence on this matter as a unified entity, but it could also provide policy flexibility that earns recognition from the rival parties. In that sense, while we recognize the need for the EU to develop a coordinated strategy for a Taiwan contingency, we suggest the focus should be to leverage Europe's unique position as an influential third party, serving as a peacemaker between Beijing, Taipei and Washington. Moreover, policymakers should recognize that the EU lacks not only the capability to exert military deterrence against Beijing, but possibly also effective economic leverage as long as Trump remains in the White House.
Finally, the EU should approach the cross-strait issues within the broader context of its Indo-Pacific Strategy, which places greater emphasis on the region’s security and prosperity, including the importance of upholding the rules-based order and managing disputes through dialogues, which Europe has had experiences acquired during the Cold War and remains recognized as a normative power promoting peaceful resolutions of disputes. The EU should actively engage in strengthening regional institutions and promoting measures that can mitigate and prevent disputes from escalating to serious military conflicts, from the South China Sea to the cross-Strait relations. This way, it can and should present itself as an interested, neutral, and acceptable partner working with countries to maintain the region’s peace and prosperity as a whole rather than being perceived as a party to the existing disputes and having to choose side.
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Funded by the European Union. Views and opinions expressed are however those of the author(s) only and do not necessarily reflect those of the European Union or European Research Executive Agency (REA). Neither the European Union nor the granting authority can be held responsible for them. |
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