US-China relations have always been complex.
Trade disputes were paused. Military risks were discussed but rarely confronted. Taiwan stayed central but unresolved.
But 2026 could change everything. Big choices are now getting harder to delay, and the space for ambiguity is narrowing in ways that will test how serious both sides are about avoiding a confrontation.
The clock that keeps getting louder
The most concrete change is military.
US commanders say China is working toward being ready to take Taiwan by 2027, and the facts behind that warning are not vague.
Over the past few years, China has added more than 400 fighter aircraft and over 20 major warships and has doubled its stockpile of ballistic and cruise missiles.
Its official defence budget is now close to $250 billion and still rising.
Source: China Power
This does not mean war is scheduled. US intelligence assessments still say Beijing prefers to avoid a fight. But readiness changes behaviour even without intent.
The People’s Liberation Army now practices encirclement drills and blockade scenarios around Taiwan as routine activity. These are seen as rehearsals for control of airspace and sea lanes.
Military readiness also interacts with time in uncomfortable ways. The longer China waits, the more capable its forces become. At the same time, other trends move against it.
Taiwan’s political identity continues to diverge from that of the mainland. China’s population is ageing fast.
The United States is selling more weapons to Taiwan and building habits of cooperation that did not exist a decade ago.
Even China’s current advantage in long-range anti-ship missiles may narrow as US defences improve.
The result is a strategic clock where delay helps in one area and hurts in many others.
Why Taiwan feels closer than it looks
Taiwan is often framed as a distant island problem, but pressure points still exist.
Taiwan produces the majority of the world’s semiconductors. Much of that production still sits on the island.
New factories in the US, Europe, and Japan are being built, but they are not yet fully operational.
From Beijing’s view, the value of Taiwan’s chip industry is at an all-time high.
This is why pressure has increased without a single shot being fired. Chinese warplanes cross the median line almost daily. Naval patrols circle the island.
Cyber and information campaigns target politics and public trust. These actions keep risk high while avoiding the economic shock of invasion.
Taiwan is responding with money and reform. The government wants defence spending to reach 5% of GDP by 2030 from just over 3% today.
A $40 billion supplementary defence package is under debate.
But cash alone will not solve the problem. Training integration and command readiness are necessary.
Today, the US and Taiwan still lack full joint exercises and deep interoperability. Over time, that gap closes.
This creates a paradox. China may believe its military is not fully ready. It may also be believed that waiting makes the overall problem harder.
America’s argument with itself is part of the risk
Inside the US, a loud debate is underway over whether the country should pull back from Europe and the Middle East to focus on China.
The argument is framed as realism, as resources are limited and Asia becomes the priority.
The problem is how allies and rivals read that message.
US support for Ukraine has cost a small share of the Pentagon budget but has badly damaged Russia’s military without American casualties.
Ending that support would not free enough missiles or money to decide a Taiwan war. What it would do is tell allies that US commitments are optional.
Asian governments are more focused on Europe.
They do not see Ukraine as a side issue. They see it as proof of whether aggression is punished or rewarded.
If a democracy in Europe is left to fail, it becomes harder to convince voters and soldiers to stand firm in Asia.
The same logic applies to the Middle East. US aircraft carriers are pulled between theatres because the world is still connected.
Energy routes, shipping lanes, and financial flows do not stop at regional borders.
A strategy that treats Asia as separate risks, breaking the very coalitions needed to deter China.
China advances while relations decay
While military clocks tick, experts expect China to keep moving fast in technology.
Surveys of China specialists show nearly 80% expect major progress in artificial intelligence by 2026.
More than half expect strong gains in semiconductors, biotech, and green technology despite US export controls.
Source: MERICS
At the same time, relations with the US are expected to worsen across technology trade and the military.
European experts are pessimistic about their own position.
More than 80% doubt whether Europe can seriously reduce its economic dependence on China or respond to Chinese manufacturing overcapacity.
Most also doubt Europe can align tightly with Washington on China policy.
Beijing appears ready to exploit that gap.
Engagement with the Global South is expected to deepen. Export markets are diversifying.
Support for Russia is likely to continue through trade and dual-use goods even if China avoids leading any peace process.
This combination matters for Taiwan. A China that feels more isolated from the US and Europe may see less diplomatic cost in using force.
A China that believes it can absorb sanctions because of diversified markets may feel more resilient than outsiders expect.
The wild cards that keep piling up
Politics adds more volatility. A second Trump presidency introduces uncertainty rather than clarity. Markets may welcome meetings with Xi Jinping, but personal diplomacy cuts both ways.
Trade deals can flip quickly. Chip restrictions can loosen, then tighten again. Each change sends signals to Beijing and Taipei.
Japan has also become more vocal about linking its own security to Taiwan. China sees that as provocation. North Korea adds another layer.
US intelligence says Pyongyang now has missiles that can reach the US mainland.
Kim Jong Un shows no interest in denuclearisation and draws confidence from closer ties with Russia and China.
More tests and crises on the Korean Peninsula would stretch US attention and alliance management even further.
Put together, the picture is not of an inevitable war. It is a system under strain where multiple pressures align.
Military readiness deadlines. Political identity trends. Technology supply chains. Alliance credibility. Domestic politics in Washington and Beijing. None alone guarantees disaster.
Together, they raise the odds of a serious shock.
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