“Chinese Researchers Plan for U.S. Sanctions Amid Taiwan Conflict Concerns.”
In a potential conflict with the United States over Taiwan, Chinese researchers affiliated with the government suggest that China would need to establish a global network of companies to navigate U.S. sanctions, seize American assets within its borders, and issue gold-denominated bonds. This insight into China’s strategy comes after studying the Western response to Russia following its invasion of Ukraine.
The sanctions imposed on Russia have prompted extensive research by Chinese economists and geopolitical analysts, aiming to prepare China for extreme scenarios, including the loss of access to U.S. dollars. These findings have emerged in over 200 Chinese-language policy papers and academic articles since February 2022.
The researchers emphasize the need to anticipate and counter the financial sanctions model used by the U.S., particularly in the context of escalating Sino-U.S. strategic competition and the Taiwan Strait conflict. They stress China’s requirement to safeguard its financial and economic stability.
While examining Russia’s experience, the researchers recognize that China’s larger economy, dependence on foreign technology, and commodity imports could result in a more destructive sanctions battle. Some advocate for increasing interdependence rather than isolating China.
Notably, senior U.S. military officers have suggested that China may be prepared to invade Taiwan by 2027. The discussions regarding potential U.S. sanctions on China have surged in the wake of the Ukraine conflict, reflecting China’s growing concern about its vulnerability to such actions.
The freezing of Russian assets and exclusion from the SWIFT interbank payments system has raised alarms among Chinese experts due to China’s significant foreign exchange reserves and export-dependent economy. These concerns center on the risk of China’s overseas reserve assets being frozen.
Some researchers propose that if the U.S. implements sanctions on China similar to those imposed on Russia, China should freeze U.S. investment and pension funds and seize assets of American companies. Additionally, unconventional solutions are being explored to reduce China’s dependence on the U.S. dollar.
The research reflects concerns about the impact of Russia’s response to Western pressure on China’s oil, gas, metals, and chip industries, along with calls for strategies to guarantee supplies of strategic metals. Some researchers recommend forming a new economic grouping to protect China from sanctions.
While some suggest that China should strengthen its economic links with the U.S. and its allies to mitigate sanctions, others believe that cooperation and mutual economic interests can deter financial sanctions. Ultimately, these findings highlight the complexities of navigating the global economic landscape amidst geopolitical tensions.
