Geopolitics › East Asia › Taiwan (Republic of China)
Taiwan Strait tensions and PLA drills
Large PLA drills 2022–25· Conflict or rivalry
FactTreaties, membership, measured data, events.
The sea, about 130 km wide at its narrowest, between China and Taiwan, where China stages ever-larger drills rehearsing a blockade.
See it on the Geopolitics map →The picture
Since US House Speaker Nancy Pelosi's August 2022 visit, the PLA has held major exercises encircling Taiwan: Joint Sword (2023, 2024A, 2024B), Strait Thunder-2025A and Justice Mission-2025 in late December 2025. Warplanes now routinely cross the strait's unofficial median line; a record 153 aircraft were reported in one day in October 2024. China's coast guard patrols near Taiwan's Kinmen islands, and undersea cables to Taiwan have been cut in suspicious incidents.
Why it matters
It is widely seen as the likeliest trigger for a US–China war; the CIA has said Xi ordered the PLA to be ready to take Taiwan by 2027, not that he has decided to.
Key facts and numbers
Taiwan's Defense Ministry daily reports, PLA Eastern Theater Command announcements, ship-tracking data and US intelligence testimony.
What to watch
Disputed: whether the drills are rehearsals for invasion or mainly pressure, and whether China would first try a coast-guard 'quarantine' short of war.
Connections (5)
▸Taiwan Strait tensions and PLA drills is the sharpest flashpoint of US–China strategic rivalryWidely agreed
The relationship
Beijing calls Taiwan a core interest and has not ruled out force; Washington arms Taiwan under the 1979 Taiwan Relations Act and keeps 'strategic ambiguity' about whether it would fight. PLA drills rehearsing blockades, and US warship transits of the strait, make it the place where rivalry could most easily become war.
Since when and why
The roughly 130 km strait between Fujian and Taiwan; crises in 1954–55, 1958 and 1995–96; large PLA drills from August 2022 through December 2025.
How solid?
Most analysts and both governments' own statements treat Taiwan as the top flashpoint; US arms-sale notices, PLA announcements and Taiwan defense ministry data.
What to watch
Disputed: whether Beijing has a timetable. The CIA says Xi wants the PLA ready by 2027, a capability goal rather than a decision to attack.
▸China (People's Republic of China) stages blockade drills in Taiwan Strait tensions and PLA drillsFact
The relationship
China uses large drills to signal and rehearse: warships and aircraft encircle Taiwan, simulate strikes and practice blockading ports, often timed to punish political moves such as a Taiwanese inauguration or US arms sales. Coast-guard 'law enforcement' patrols test how a quarantine might work.
Since when and why
Major drills in August 2022, April 2023, May and October 2024, April 2025 and December 29–30, 2025 (Justice Mission-2025), announced by the PLA Eastern Theater Command.
How we know
PLA announcements, Taiwan Defense Ministry tracking, and satellite and ship-tracking data.
What to watch
Whether the drills are rehearsals for a real blockade, and how much they raise the risk of an accidental clash.
▸Investing amid geopolitics: country risk and exposure must price in Taiwan Strait tensions and PLA drillsWidely agreed
The relationship
A blockade or war over Taiwan is the classic low-probability, very-high-impact risk. Bloomberg Economics estimated a war could cost about $10 trillion, roughly 10% of world GDP. Taiwan is about a fifth of the MSCI Emerging Markets index and TSMC alone about a tenth, so many fund holders carry this risk without realizing it.
Since when and why
Bloomberg Economics estimates, January 2024; Warren Buffett's Berkshire Hathaway sold its entire TSMC stake in 2022–23, months after buying, citing geopolitical concerns.
How solid?
Published scenario studies (Bloomberg Economics, Rhodium Group) and index weightings; how markets price the risk is inferred from muted reactions to drills.
What to watch
Whether markets underprice the risk, and how sanctions, capital controls or asset freezes would hit investors in both China and Taiwan.
▸Taiwan Strait tensions and PLA drills threaten one of the busiest Maritime chokepointsWidely agreed
The relationship
Nearly half the world's container ships passed through the Taiwan Strait in 2022, along with energy cargoes bound for Japan and South Korea. Ships can detour east of Taiwan at extra time and cost, but a blockade or war zone would also threaten the nearby Luzon Strait and East Asia's ports.
Since when and why
The strait is about 130 km wide at its narrowest; Bloomberg ship-tracking analysis found 48% of the global container fleet transited it in 2022.
How solid?
AIS ship-tracking data and analyses by Bloomberg and CSIS; trade-value estimates vary.
What to watch
Disputed legal status: China claims jurisdiction over the strait, while the US and allies sail through it as international waters.
▸Lai Ching-te seeks higher defense spending amid Taiwan Strait tensions and PLA drillsFact
The relationship
Citing growing PLA drills that rehearse blockades, Lai wants defense spending to rise from 3.32% of GDP in 2026 to 5% by 2030, plus a $40 billion special budget for air defenses and drones. The opposition legislature cut that special budget by 38% in May 2026, keeping US arms purchases but stripping homegrown combat drones.
Since when and why
Taipei; 5% goal announced August 2025; special budget proposed November 2025; PLA drills such as 'Justice Mission-2025' in December 2025.
How we know
Executive Yuan budget proposals, Legislative Yuan votes, and Taiwan's defense ministry reports of Chinese aircraft and ships.
What to watch
Disputed: Beijing says Lai's spending raises tension; Taipei says it deters attack. Washington wants more; how much is enough is debated.