Ukraine. Israel. Taiwan?

Business leaders fear that crosss-trait tensions may cause the next geopolitical blowup, putting Taiwan and its top chipmaker TSMC at risk.

- GREGOR STUART HUNTER

THESE DAYS, there are few hotter spots on the global circuit for retired government officials and military strategists than Taiwan. As dozens of policy experts from all over the world touched down for the Taipei Security Dialogue in November-the sort of event where you'd encounter a former U.S. Army secretary clad in a stars-and-stripes tie-a familiar topic took on fresh urgency: how to prevent a Chinese attack on the territory.

"Ukraine continues to fight against the Russian invasion, while conflicts continue to break out in the Middle East," Taiwan President Tsai Ing-wen told delegates. "It is clear that we cannot take peace for granted."

Taiwan has teetered in a precarious geopolitical position for decades. It's a self-governing democracy-it will elect its next president in January-but the Chinese Communist Party regards Taiwan as its own and seeks to unify the island with the People's Republic, and the party says it will do so by force if necessary.

Strategists consider a possible conflict a geopolitical crisis - and an economic one. Taiwan accounts for 30% of the $574 billion global semiconductor industry, the backbone of modern technology. At the heart of that industry is Taiwan Semiconductor Manufacturing Co., the most valuable company in Asia, whose $500 billion market cap puts it in the same league as Walmart. U.S. export controls on chipmaking equipment are squeezing out some TSMC buyers-namely China - but the Taiwanese firm still produces roughly 92% of the world's most advanced chips. TSMC components power Apple's iPhones, Nvidia's AI servers, and F-35 fighter jets. Experts fret about what would happen to technology production if TSMC's foundries fell into Beijing's hands. A blockade of the island alone would cost the global economy $2 trillion, according to a Rhodium Group estimate.