Few people would dispute that the relationship between the US and China is the most important in the world, so much so that the term ‘Chimerica’ is used often nowadays to refer to the two countries as a single economy. Both sides generally benefit, if you overlook the huge US trade deficit with China, and although there are grumblings on both sides, neither Washington nor Beijing have an interest in radically altering the status quo. Although doomsayers have been predicting a Sino-US war over Taiwan since the early 1990s, most cool heads generally believe that Beijing will avoid military action against Taipei, and that America and China are too economically intertwined to fight each other (Detractors say that Britain and Germany were also very deeply economically integrated in 1913).

Nevertheless, one thing that is sure to anger China is the sale of American (and other foreign countries’) weapons to Taiwan, which Beijing regards as a renegade province. US President Barack Obama announced last week that Washington plans to sell US$6.4bn worth of arms to Taipei. More broadly, the mainland has never ruled out military force to recapture the island if it ever declares independence. This is where US arms sales come in. China fears that the more heavily armed Taiwan is, the more likely it is to declare independence, or at least act more assertively towards Beijing. Since China regards Taiwan as a part of its territory, it sees American arms sales as rank interference in its domestic affairs, hence all the bluster.

Why Taiwan Matters To China

• China regards Taiwan as part of its sovereign territory, and that having reclaimed Hong Kong and Macau peacefully in 1997 and 1999 respectively, Taiwan must eventually follow. This view is reportedly shared even among Chinese who are considered international in their outlook.

• China fears that Taiwan’s close relations (unofficial, of course) with the US and Japan will embolden it in its dealings with Beijing. Even if Taipei does not declare independence, it can still rile China’s Communist leaders.

• China fears that the US is seeking to integrate Taiwan into a de facto alliance with Japan and South Korea to contain its rising power in Asia.

Why Taiwan Matters To The US

• Under a 1979 treaty in which the US switched recognition of China to Beijing from Taipei, Washington is obliged to sell the island defensive weaponry. The latest arms package is part of a long line, and it will not be the last.

• Taiwan is an established democracy, and the US feels that it must support democratic nations. If authoritarian China were to invade democratic Taiwan and the US did nothing, it would severely undermine Washington’s position as a defender of democracy.

• Some US (and Japanese) security planners fear that Chinese control of Taiwan would confer dominance over Northeast Asia, including the ability to interdict Japanese shipping (however unlikely the latter seems).

It’s About More Than Taiwan

Despite Taiwan’s perceived geopolitical importance, the question must still be asked, why should the US jeopardise its relationship with a 1.3 billion-strong emerging superpower for the sake of an island with only 23 million people? Even more bluntly, why should Washington risk being attacked by nuclear weapons to defend Taiwan?

Ultimately, the answer is that it’s not all about Taiwan. It’s about global power. As I’ve argued previously, China is the only country that can realistically challenge the US as a potential peer competitor (although not without limitations). Hence, had Obama announced that there would be no more American arms sales to Taiwan, he would have sent the message that Washington was scaling back its commitments to Asian security.

Over the coming week, my colleagues and I will be writing a feature on the future of Sino-US relations on Business Monitor Online. Much is at stake. In particular, watch out for rising naval competition, since China will be hard-pressed to project power without an ocean-going navy. A Chinese academic last week proposed setting up bases abroad to defend Chinese interests. This would be the clearest sign yet of China emerging as a global military power.