TAIPEI - The lead U.S. diplomat in Taipei on Wednesday issued a stark warning about the economic consequences of military conflict in the Taiwan Strait, urging cautious diplomacy ahead of a scheduled summit between the United States and China.
Speaking at a defence forum in Taipei, Raymond Greene, director of the American Institute in Taiwan, said the stakes extend far beyond immediate human suffering. "Beyond the human toll, any conflict across the Taiwan Strait would have a bigger impact on the global economy than the Second World War," he said.
Greene noted the unusual diplomatic circumstances surrounding Taiwan: while the United States, like most countries, maintains no formal diplomatic ties with the island claimed by China, it remains Taiwan’s most important international supporter and supplier of arms. He described preserving peace in the Indo-Pacific as a top U.S. priority under the Trump administration and said Washington is pursuing "vigorous" diplomacy, especially at the highest levels.
Regarding near-term diplomatic opportunities, Greene described the upcoming U.S.-China summit as an opening to reduce risk between the two powers. "The upcoming U.S.-China summit is an opportunity to further advance a relationship of strategic stability, on the basis of fairness and reciprocity, that can avoid misunderstandings and miscalculations," he said. Chinese President Xi Jinping is expected to travel to the United States later this month for a meeting with President Donald Trump.
Beyond diplomacy, Greene said the United States is reinforcing its presence and partnerships across the Indo-Pacific to sustain what he called a "favourable regional balance of power." He added: "Third, and especially relevant to today’s discussion, we are supporting Taiwan’s work to enhance its ability to defend itself."
Those comments come as Taiwan’s government has made stepped-up defence spending and military modernisation priorities in response to what it views as a heightened threat level from China. The administration of President Lai Ching-te, which rejects Beijing’s sovereignty claims, has budgeted defence spending for next year to exceed T$1 trillion for the first time.
The series of statements at the Taipei defence forum framed both diplomatic and military measures as complementary approaches to reducing the risk of a major confrontation in the Taiwan Strait. Greene’s remarks underline Washington’s dual approach of high-level engagement with Beijing and tangible support for Taiwan’s self-defence efforts.
Contextual note: The remarks were delivered at a defence forum in Taipei by the director of the American Institute in Taiwan.