No one sees the Taiwan crisis

The next crisis in the Taiwan Strait may not come with warships or missile tests. This may come through border negotiations.

Japan and the Philippines recently announced plans to hold talks on demarcating maritime boundaries in waters east of Taiwan — a move that has drawn protests from Taipei and Beijing.

It has exposed Taiwan’s growing vulnerability to international standing and revealed how the cross-strait rivalry is evolving beyond the military domain.

Both Tokyo and Manila insist that the proposed negotiations must comply with international law and not legally bind Taipei.

But that framework misses the point, as an agreed maritime boundary establishes new operational status, shaping enforcement, resource management, and jurisdictional expectations over waters.

UN Convention on the Law of the Sea For Taiwan, which claims the affected area under the Convention, opting out of that process has concrete consequences.

Taiwan’s deep-sea fishing fleet is the largest in the region. A new bilateral framework between Japan and the Philippines could create enforcement zones where Taiwanese boats have long operated.

It speaks to the fact that Taiwan’s interests are largely being decided in chambers where it does not have a seat.

Opening ceremony of Beijing

China’s response was swift. Officials condemned the talks, arguing that waters east of Taiwan would fall within China’s territorial waters.

Beijing launched what state media described as a “special maritime law enforcement operation” in the area.

In general, Beijing faces simultaneous pushback from Taipei, Tokyo and Manila over maritime claims.

A dispute between the three governments briefly shattered that alignment, giving Beijing room to cast itself as the defender of sovereignty as Taipei struggles to balance competing priorities.

China’s legal arguments carry little weight internationally, but the chapter shows how maritime disputes can open up diplomatic space even for a government facing broader strategic opposition elsewhere.

The episode’s sharpest effects are domestic. It has reopened a fundamental debate within Taiwan about what sovereignty is and how it should be protected.

President Lai Tsing-tae has structured his administration as a staunch defender of Taiwan’s sovereignty and a leading democratic state.

His government responded to the Japan-Philippines negotiations by demanding that Taiwan’s rights be respected and included.

But the response was noticeably more restrained than the Taipei language reserved for Beijing, and it was that asymmetry that the opposition seized upon.

The Kuomintang (KMT), the largest party in Taiwan’s parliament, has argued that the conflict will force the ruling Democratic Progressive Party (DPP) to take on Japan and the Philippines more vocally against China.

Under Taiwan’s official status as the Republic of China (ROC), the fact that the land and sea zones remain a separate sovereign subject rather than two separate states presses a deep constitutional question.

The KMT argues that Taipei does not need to agree to Lie’s move, which sees China as synonymous with the mainland government.

The partisan argument linked a sovereign defect with the charge of hypocrisy, and the maritime dispute provided a new example of it.

The competition is also being held in the US as KMT leader Cheng Li-wun spent the first half of June on an extended tour, speaking at the Hoover Institution, Harvard, MIT and Columbia University.

The trip, which a sitting president cannot make because Washington has no formal ties with Taipei, also included meetings with Congress, the administration and think tanks in Washington.

Cheng’s six-day April trip to China came just weeks after he met Xi Jinping, before underscoring his pitch that cross-flow engagement and economic ties should underpin Taiwan’s interests, rather than conflict.

Little pink and green birds

Cheng has built that pitch around China’s economic rise, pointing to tech hub Shenzhen and financial center Shanghai as evidence.

He reminded Taiwanese voters that economics, not ideological position, was the ROC’s core national interest.

Because the dispute is often reduced to a pure democracy-versus-authoritarian contest, that framing of cross-conflict politics achieves the most reflexive errors.

A more useful question is whether ideology should be the axis of the Taiwan-China debate.

Each page has a caricature of aggressive believers. On the mainland, the “Little Pinks” police any suggestion that Taiwan is not part of China. In Taiwan, the “green birds” regard any talk of cross-strait accommodation as treason.

Both camps misunderstand the extent of their identity as the substance of an argument—and both make it difficult to discuss the material stakes that drive people’s lives, such as fishing grounds and investment.

China’s model operates on a kind of internal competition. Provincial and local officials compete against each other for economic growth, with promotions prized through the party hierarchy — a system scholars have described as a “true federalism” layered on top of a centralized state.

This resulted in extraordinary growth. Cities such as Shenzhen, Shanghai, Beijing and Suzhou now record GDP per capita figures comparable to those of high-income economies.

Over the past 30 years, more than a dozen metropolitan cities have moved from poverty to cross the threshold, which economists use to define developed-world living standards.

But its opaqueness breeds corruption and weak accountability, and Beijing officials manage the risk of a departure from central control through a tight staff force and frequent party inspection tours.

Taiwan’s democracy is held to account by elections, media scrutiny, and a free society that can express dissent through votes.

But democratic politics can reward identity and identity-based struggles for the hard, slow work of economic reform, which is the subject of Cheng’s critique of Lai.

Neither system cleanly resolves the central tension. Beijing offers growth while struggling with accountability. Taipei offers accountability while struggling to focus on growth.

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A regional issue

The broader significance of Taipei’s continued absence from regional negotiations reveals the next phase of cross-Strait rivalry.

And the stakes have rarely been higher.

In late May, Nvidia Chief Executive Jensen Huang established the company’s new Taiwan headquarters in Taipei’s Beo-Shilin Technology Park — a complex expected to employ 4,000 people, and the company’s annual spending in Taiwan is now US$150 billion ($212 billion).

When the KMT’s Taipei Mayor Chiang Wan-an successfully secured the campus site and handed Huang an honorary key to the city, the tech titan did not meet DPP’s leader Lai.

The moment captured the irony that Taipei sits at the physical center of the global AI economy, but its sovereign rights are often locked outside diplomatic chambers where they are negotiated by others.

For regional middle powers such as Australia, this is more important than familiar invasion scenarios.

Stability in the Taiwan Strait depends not only on Beijing’s management of its behavior, but also on how regional actors handle the legal and political questions surrounding Taiwan’s place in the Indo-Pacific order.

As the current dispute shows, it is becoming harder to avoid and more costly when mishandled.