Why China’s Decline Could Make Taiwan More Dangerous

Summary

China may become most dangerous not while rising, but when its leaders believe their window to act is closing. Its population began shrinking in 2022 after decades of the one-child policy, leaving fewer workers, taxpayers, consumers, and potential parents. China has about 105 million women aged 20 to 34, projected to fall to around 58 million by 2050, while its total population could decline to around 630 million by 2100. Raising one child to age 18 already costs roughly seven times average annual earnings, making cash incentives and family subsidies ineffective. Economic consequences are spreading globally. China reportedly has 65 to 80 million empty homes, weakening construction demand that once consumed about half the world’s steel and 3/4 of its iron ore. Its pension fund is projected to run dry around 2035. Meanwhile, surplus exports threaten overseas manufacturers, and Beijing controls refining for 19 of the 20 most strategic minerals, including around 98% of gallium and germanium supplies. The greatest concern is Taiwan. China has constructed replicas of Taiwanese government and military sites for training, while Taiwan produces more than 90% of the world’s most advanced computer chips. Historical examples suggest peaking powers sometimes attack when decline seems imminent. With China’s military ordered to be ready by 2027, demographic and economic pressure could accelerate rather than restrain Beijing’s ambitions.