China's economic slowdown could increase prospect of military crisis in Taiwan Strait: Report

Beijing [China], June 21 : China's economic slowdown could increase the prospect of a military crisis in the Taiwan Strait as Chinese President Xi Jinping may further embrace nationalism in his unprecedented third term, a prominent US think tank has warned, Nikkei Asia reported.

The warning came in an extensive report issued on Tuesday by a bipartisan task force convened by the Council on Foreign Relations, covering various aspects of US-Taiwan relations, including politics, diplomacy, economy and security. In it, the experts warned that Washington's four-decade-old framework for dealing with Taiwan since establishing diplomatic relations with China in 1979 had become "more and more brittle".

The task force, co-chaired by Mike Mullen, a former chairman of the Joint Chiefs of Staff, and Sue Gordon, a former principal deputy director of national intelligence, wrote, "This reality, paired with Xi's unease with the status quo and his determination to make progress toward unification, increases the risk of a conflict."

Tuesday's report also concluded that China was likely entering a long-term economic slowdown driven by its ageing and shrinking population, its crackdown on innovative technology companies and US export controls on advanced technology.

China's central bank on Tuesday lowered lending rates for the first time in 10 months, a cut widely regarded as another sign that Chinese policymakers are increasingly concerned about the country's economic forecast.

The report said, "As China's economic growth has slowed under Xi, he has increasingly turned to nationalism to justify the [Chinese Communist Party's] monopoly on power. With a further downturn, he could turn to the Taiwan issue to rally support for the CCP and his personal rule. As Xi approaches the end of his tenure and looks toward his legacy, the risk of a conflict over Taiwan will grow."

Tuesday's report comes a day after US Secretary of State Antony Blinken met with Xi in Beijing. While the two powers agreed to maintain lines of communication, Blinken's trip reaffirmed divergent views on the future of Taiwan, with China's top diplomat Wang Yi stating Beijing has no space for compromise or concession on the island, according to Nikkei Asia.