The EU sees itself as a normative power. In its common foreign and security policy, it wants to represent fundamental values. The EU also sees itself – and rightly so – as a global power. From its undeniably great economic importance, the EU derives – again quite rightly – the need to represent its interests globally, especially in the Indo-Pacific. The EU is thus becoming an increasingly important factor in the escalating conflict between the US and China. Be it with regard to the strategic readjustment of trade flows, the imposition of technology boycotts against Chinese companies or the treatment of Taiwan in the global system.
The European Commission under Ursula von der Leyen emphasizes its strategic autonomy. However, although formally a strategic partnership continues to exist with the People’s Republic of China, increasing rivalries in terms of political, social and economic orders are forcing a growing distancing from the East Asian power. Globally, Europe is once again standing more firmly at the side of its most important military ally, the USA.
In this field of tension, the European Union has now rediscovered a protagonist that for a long time was at best on the fringes of European attention: Taiwan, the colorful democracy in East Asia, victim of the One-China policy; at the same time, the technology country that houses 90 percent of the world’s production of the most advanced semiconductors. Without the chips produced by Taiwan Semiconductor Manufacturing Company Ltd. the most forward-looking projects in the global technology industry would collapse.
Too good to be true
The EU faces a massive dilemma here: It must make its supply chains more resilient, reduce its strategic dependence not only, but above all, on China as quickly as possible, and prevent Europe from becoming a complete technological developing country. To do this, it needs to work more closely with Taiwan. It also wants to support Taiwan as a value partner in its de facto independence, especially in the face of pressure from China, and prevent a further escalation of tensions between Beijing on the one hand and Washington and Taipei on the other.
At first glance, normative convictions and geostrategic interests of the EU meet here in the most excellent way: The EU promotes cooperation with Taiwanese democracy, thus securing access to one of the central building blocks of modern economies and sending an important signal to Beijing that Taiwan’s security is a very concrete concern of the EU.
However, this narrative is too good to be true. Deepening cooperation with Taiwan, especially in the high-tech sector, i.e., in the most advanced computer chips, erodes what is perhaps Taiwan’s most important security guarantee: its “silicon shield”. China’s economy is also still dependent on the top products from Taiwan.
Beijing cannot afford to see this resource disappear due to military pressure or even an invasion of the island. It is true that TSMC production facilities in the US – under construction – and in Europe – under exploration – strengthen the ties between Taiwan and powerful allies. But the establishment of these production facilities abroad also means that the importance of the facilities in Taiwan itself will diminish.
In the event of war, these central building blocks of the global economy would continue to be manufactured, but outside Taiwan. The EU’s intended closer cooperation in the area of semiconductors and the relocation of production facilities out of Taiwan, therefore, considerably weakens Taiwan’s “silicon shield”.
So what does Brussels do? The EU must keep a clear view of its own interests – and these mean not only rhetorical and practical support for Taiwan, but also ensuring its own ability to act. So the EU must continue to try to work with Taiwan to diversify the global supply chains for semiconductors and to secure access to this strategically so enormously important resource even in the event of a Chinese blockade or an attack by the People’s Liberation Army – in other words, to build production facilities outside Taiwan as well.
In return for the accompanying weakening of Taiwan’s “silicon shield”, comprehensive technology cooperation in other areas would be conceivable: green energies and green hydrogen, new battery technologies, Big Data-driven medical technology, et cetera would be particularly suitable here. Integrating Taiwan into European economic cycles on many levels simultaneously, without creating excessive dependencies, would be an option to strengthen Taiwan while sending a strong signal to Beijing.
It is becoming increasingly important for the EU to steer a clear and differentiated course toward Beijing. Even if the People’s Republic is increasingly becoming a system rival, it remains an indispensable partner in important policy areas. Global challenges such as climate protection, peacekeeping or peace restoration, poverty reduction and development can ultimately only be solved together with China.
German politics – and with it, society and the economy – will therefore have to endure tensions and contradictions and learn to deal much more soberly with the actual capacities of German foreign policy. A first step would be a more honest discussion of what specifically Germany’s interests are with regard to Taiwan and China. This discussion must not be hijacked by professional lobbyists and raving idealists.
A second step should be the open admission that Germany needs the cooperation and support of its partners in the EU in order to be able to represent its own position in the Indo-Pacific – and to be taken seriously by Beijing. Only on this basis can the difficult balancing act of a closer cooperation with Taiwan while maintaining partnership and rivalry with China be set in motion at all.
National thinking in black-and-white templates – decoupling from Beijing, flirting with Taiwan – is dangerous and harms everyone, not least Taiwan.
Joern-Carsten Gottwald has been Professor of East Asian Politics at the Ruhr University Bochum since 2011. Previously, he worked at the Center for Chinese and East Asian Politics at Freie Universitaet Berlin and the Irish Institute of Chinese Studies at the National University of Ireland Cork.
Steffi Weil is a professor at Antwerp Management School and the University of Antwerp. She has more than 15 years of professional experience inside and outside academia. She is the academic director of the Executive PhD Program and the China-Europe Master there.
Markus Taube holds the Chair of East Asian Economics / China at the Mercator School of Management of the University of Duisburg-Essen and is a founding partner of THINK!DESK China Research & Consulting.
The authors of this text wrote a study on the possibilities of a Resilient Supply Chain Agreement of the EU with Taiwan for the Green / EVA Group in the EP in December 2022.