Taiwan’s effort to reduce its economic reliance on China could offer a model for other democracies seeking to limit Beijing’s influence without severing trade ties.
American journalist Chris Horton wrote in Nikkei Asia that Taiwan began confronting the issue more than a decade ago. The 2014 student-led Sunflower Movement opposed a proposed cross-strait services trade agreement and helped turn economic dependence on China into a national security debate.
After taking office in 2016, then-President Tsai Ing-wen sought to diversify Taiwan’s trade and investment while strengthening ties with the United States and other democracies. The shift has produced measurable results a decade later. The United States imports more goods from Taiwan than from China for the first time in 25 years.
Taiwanese investment has also shifted dramatically. China received more than 83 percent of Taiwan’s outbound investment at its peak in 2010. During the first five months of this year, that share fell to just 0.9 percent.
Taiwan has not fully decoupled from China, which remains its second-largest trading partner. But booming demand for artificial intelligence hardware has strengthened Taiwan’s position in global technology supply chains.
Horton says Taiwan’s experience shows that reducing exposure to China does not have to come at the expense of economic growth. It also highlights a growing interdependence: Taiwan relies on the United States for security, while Washington increasingly relies on Taiwan for advanced technology and its strategic position in the Pacific.