Taiwan Conflict: Situational Updates

Product Serial: B-2022-08-05a

TLP: WHITE

In this briefing, ZeroFox Intelligence provides a situational awareness update on the conflict between China, Taiwan and the United States.

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Scope Note

ZeroFox Intelligence is derived from a variety of sources, including—but not limited to—curated open-source accesses, vetted social media, proprietary data sources, and direct access to threat actors and groups through covert communication channels. Information relied upon to complete any report cannot always be independently verified. As such, ZeroFox applies rigorous analytic standards and tradecraft in accordance with best practices and includes caveat language and source citations to clearly identify the veracity of our Intelligence reporting and substantiate our assessments and recommendations. All sources used in this particular Intelligence product were identified prior to 12:00 PM (EST) on August 4, 2022;; per cyber hygiene best practices, caution is advised when clicking on any third-party links.

Executive Summary

On August 2, 2022, U.S. Speaker of the House, Nancy Pelosi, visited Taiwan in the most high-profile visit by a U.S. official in 25 years, leading to consequential retaliation by China. China initiated heightened military drills and economic retaliatory responses following the visit, sending 27 warplanes into Taiwan's air defense zone with 22 crossing the median line separating Taiwan from China—which neither side's aircraft normally crosses. In addition, some of China's planned military exercises for August 4-6 took place within Taiwan's 12 nautical-mile sea and air territory, disrupting key energy and tech supply chains.

While China's military actions certainly indicate an escalation in cross-strait tensions, it is likely that China will make more use of indirect economic, cyber, and political pressures to express its displeasure at the House Speaker's visit rather than immediately escalate to direct military conflict, which all sides have incentive to avoid. Therefore, expect more indirect pressure on Taiwan and the United States through continued sanctions, cyberattacks, and live-fire drills in the immediate future without sparking an active reunification military campaign.

Key Findings

China views Taiwan as a region that will "inevitably" be reunified with the mainland, and President Xi Jinping aims to do it under his rule.
China will continue its bellicose response over Taiwan, but the aim of reunification is likely a decade away.
The current economy and political and security dynamics make a major military escalation unlikely.
For China to countenance a military invasion of Taiwan, it would need further military advancements, economic and technology upgrades that will take years, and a robust enough economy to handle the subsequent issues that would arrive from such an aggressive move.
A possible military escalation threatens the supply of semiconductor chips.