More US firms in Taiwan say they’re seeing ‘significant disruption’ due to rising tension with China

The content originally appeared on: CNN


The number of companies in Taiwan saying they’re experiencing business disruptions due to rising tensions between Taipei and Beijing has almost doubled, according to the American Chamber of Commerce in Taiwan.

An annual survey, which polled 214 member firms in Taiwan, showed that the number of companies reporting “significant disruption” rose from 17% to 33% between August and December 2022, the chamber said Tuesday.

Last August, then-US House Speaker Nancy Pelosi visited Taipei, and China stepped up military drills in response. China’s ruling Communist Party has increasingly exerted its territorial claims over democratic Taiwan, a self-governing island, despite having never controlled it.

The business disruptions were caused by elevated concern from global headquarters, increased shipping, insurance or financial costs, as well as staff anxiety, the chamber explained.

Almost half of the companies that the chamber surveyed said they’re developing contingency plans in response to the heightened tension.

Just last month, China sent 28 warplanes across the median line of the Taiwan Strait, as Beijing conducted its first large-scale military exercises around the island this year, according to Taiwan’s Defense Ministry.

“For companies in Taiwan, cross-strait relations are very important,” Kristie Hsu, a director at Taiwan’s Chung-Hua Institution of Economic Research, told CNN.

She added that concerns include possible supply chain disruptions or unilateral measures that could undermine trade.

The chamber reported that two-thirds of its members surveyed said political uncertainty was the biggest factor deterring them from further investment in Taiwan.

“It is an unsettled environment, and we would expect firms here on the ground to prudently look forward,” AmCham Taiwan President Andrew Wylegala told reporters, adding that none of its members had left Taiwan due to concerns over rising geopolitical tensions.

To reduce the likelihood of future disruptions, 28% of the businesses that the chamber surveyed said they are working on readjusting supply chains, while 18% said they are expanding to additional locations outside Taiwan.

-CNN’s Brad Lendon contributed to this report