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House Foreign Affairs Chairman Michael McCaul warned that a Chinese invasion of Taiwan could have catastrophic consequences for the global economy, including the United States, as the island is responsible for 90% of advanced semiconductor manufacturing. This prediction came after China conducted aggressive military drills off Taiwan’s coast in response to comments by Taiwan’s President expressing support for independence. McCaul emphasized that a full-scale invasion by China could result in an “electronic shutdown” and an economic crisis similar to the COVID-19 pandemic.

Semiconductors are crucial components used in a wide range of electronics, from healthcare to transportation, military systems, and everyday items like air conditioners and televisions. McCaul highlighted the dependency on semiconductors for the functioning of phones, cars, tractors, and military defense systems, pointing out the vulnerability of the global supply chain due to offshoring manufacturing. He expressed concerns about a potential invasion of Taiwan by China as early as 2027, stating that the United States would not have the capacity to respond in a timely manner.

The U.S. delegation’s visit to Taiwan coincided with the inauguration of Taiwan’s new government officials and the approval of an $8 billion foreign aid package for the Indo-Pacific region, including Taiwan, to deter Chinese aggression. The delegation met with Taiwanese officials to discuss military equipment support and updates on weapons procurement. Despite threats from the Chinese government warning against the visit to Taiwan, the lawmakers proceeded with their trip to demonstrate support for the island nation in the face of escalating tensions.

McCaul described the Chinese military drills off Taiwan’s coast as the most provocative he had ever seen, with a significant number of warships and planes involved. He stressed the importance of moving semiconductor manufacturing back to the United States to reduce vulnerability to supply chain disruptions. McCaul also highlighted the potential impact of a Chinese invasion on the global economy, including disruptions to healthcare, communication, and transportation systems.

The threat of a Chinese invasion of Taiwan poses significant risks to the global economy, with potential implications for Americans in rural, urban, and suburban areas. McCaul warned that the shutdown of semiconductor manufacturing in Taiwan could lead to a worldwide economic crisis. He expressed concerns about Taiwan’s capacity to defend itself against a full-scale invasion by China, stating that the island would likely require support from the United States for parts and supplies. The delegation’s visit to Taiwan aimed to demonstrate U.S. support for the island nation amidst growing tensions in the region.

Despite objections and threats from the Chinese government regarding the U.S. delegation’s visit to Taiwan, the lawmakers proceeded with their trip to strengthen ties and show support for the island nation. McCaul emphasized the importance of countering Chinese aggression in the Indo-Pacific region and providing military aid to Taiwan to deter potential threats. The escalating tensions between China and Taiwan highlight the strategic importance of the island in the global supply chain and the need for international cooperation to ensure stability and security in the region.

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