(soft instrumental music)
- I'm reporting from Taiwan
where this island is increasingly becoming a focal point
between US and China tensions.
I'm going to take you to three places
to explain how the competitions between the two superpowers
from the tech to the military
could determine the future of this place.
But first, a little history about why Taiwan
is so important to China.
This island was where the Chinese Nationalist Party fled
after its military defeat at the end
of the Chinese Civil War in 1949.
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Today, Taiwan holds democratic elections,
uses a different passport, and has its own distinct flag.
And while some politicians here
support closer ties with Beijing,
many people have grown uncomfortable with that idea.
This, our first stop, the capital of Taiwan, Taipei.
Here growing numbers of young Taiwanese
supports closer ties with the US
over closer relations with China.
(warm instrumental music)
(woman speaking in foreign language)
- Security experts say this kind of statement
could mean military actions that puts the US into conflict.
And recently there has been a lot more military activity
in the strait between the island and Mainland China.
- This is the Strait of Taiwan.
"The Wall Street Journal" will tell you
of how many Chinese warplanes were in the region
using information from Taiwan's Defense Ministry
and would find that in 2020,
China sent about 380 warplanes to this region.
But this year there were already about 290 warplanes.
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US officials and former Taiwanese military leaders
say Taiwan will need to do more
to be able to fend off an invasion from China,
especially since China has about 100 times
as many ground force personnel as Taiwan.
China's annual military budget is also 25 times larger.
So in an attempt to fill the gap,
last year Taiwan increased the military spending by 10%
and has been purchasing weapons from the US.
But some military analysts say
it's not in China's interest to attack.
The seas are rough, and Taiwan's coastline
make it difficult for a warship to land.
Most importantly, an invasion could prompt
a military response from the US which would likely escalate.
But if not a military conflict,
Taiwan provides at least one more area of competition
between the US and China.
Behind me is the headquarters of TSMC,
the world's largest contract chip maker.
Its chips ends up in our smartphone and laptop,
but now because of a global chip shortage,
Taiwan is becoming more important to the US and China.
That's because TSMC controls more than 90% of the market
for the most advanced semiconductors.
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TSMC has tried to walk the line between China and the US,
but the tension between these two countries
has made this difficult, especially after Washington
restrict Chinese telecom giants Huawei's access to TSMC
over national security concerns.
The Trump administration has instructed American supplier
to stop working with TSMC
if it kept exporting chips to Huawei.
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To reduce its dependence on Taiwan,
China has made chip manufacturing a priority.
So has the US with a commitment of $15 billion
to building up that sector.
- We're investing aggressively in areas
like semiconductors and batteries.
That's what they're doing in others, so must we.
- [Joyu] But it will take years
before these efforts bear fruit, giving the US and China
yet another reason to focus on Taiwan.
- [Christopher] Thank you.
- [Tsai] I suppose we should do this.
- [Christopher] We can do that, okay.
(woman speaking in foreign language)
And I can say with confidence
that the United States' partnership with Taiwan
is stronger than ever.
- Ultimately, the future of this island
is going to be a key challenge for the Biden administration.
So the US will have to find the right balance
between supporting Taiwan while making sure
ongoing tensions with China doesn't escalate further.
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