Abstract

In this study, Taiwan’s dependence on China for the import and export of intermediate goods was found to be at a very high level. It shows the necessity for Taiwan to reduce the dependence on China in supply chain management. At the same time, it suggests that for Taiwan maintaining stable cooperation relations with China is also important. Meanwhile, the proportion of imports from Taiwan out of China’s imports of intermediate goods was the highest in the world. It indicates that Taiwan is of great importance for China as well.
 According to the I-O analysis, the most beneficial country from Taiwan’s electrical and optical equipment industry production was China (US$ 105 billion in value added). It means that 46.4% of the global spillover effects (excluding Taiwan) from the industry production of Taiwan belongs to China., followed by U.S.(10.3%), Japan (7.5%), and Korea (6.7%). In addition, the electrical and optical equipment industry in Taiwan’s industries was found to be the industry that has a great influence on China and IPEF participating countries. It confirms that there is a close interdependence relationship between these countries in the industry.
 The results of this study implies that although political and military conflicts between China and Taiwan have recently deepened, considering their economical interdependence, it would be not easy for bilateral conflicts to be sustained in the medium to long term.

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