Cost of war over Taiwan infographic
Graphic shows selected impact of Taiwan conflict on GDP.
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POLITICS

War over Taiwan could decimate global economy

January 9, 2024 - War over Taiwan would have a cost so vast that even those unhappiest with the status quo have reason not to risk it, according to estimates by Bloomberg Economics.

The estimated price tag of war would be around $10 trillion, equal to about 10% of global GDP – dwarfing the blow from the war in Ukraine, Covid-19 pandemic and 2007-2008 financial crisis.

Russia’s invasion of Ukraine, and the semiconductor shortage as the world reopened from Covid lockdowns, provide a small glimpse of what’s at stake for the global economy. The impact of war in the Taiwan Strait would be far bigger.

Bloomberg Economics has modeled two scenarios: a Chinese invasion drawing the U.S. into a local conflict, and a blockade cutting Taiwan off from trade with the rest of the world. A suite of models is used to estimate the impact on GDP, taking account of the blow to semiconductor supply, disruption to shipping in the region, trade sanctions and tariffs, and the impact on financial markets, Bloomberg said.

Sources
PUBLISHED: 09/01/2024; STORY: Graphic News
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