Why Is China So Upset About Trump’s Taiwan Call – And Could It Lead to War?

The fact that Donald Trump is the first US president to have a call with his Taiwanese counterpart in nearly four decades, seriously upsetting China in the process, might come as a shock when you think that Taiwan is the world’s 22nd largest economy. The answer as to why this call has taken so long – and has caused so much trouble – is fascinating and goes back years. In fact, even though Taiwan has managed to work wonders, including manufacturing 80 percent of the world’s computer notebooks, it somehow has failed to be recognized as an independent state by the rest of the world.
What Is Taiwan’s Dispute With China?
Central to the issue is Taiwan’s tense relations with China. Taiwan was born as a breakaway state out of the conflict between the communists and nationalists in China. When that civil war ended in 1950 and Mao’s communist ‘People’s Republic of China’ was established on the mainland, the previous government of China had become self-exiled on the island of Taiwan and kept the old name of ‘Republic of China’.
Initially, the rest of the world was reluctant to recognize the communist regime on the mainland – it was the Cold War, after all. But as time passed, the world found it increasingly difficult to ignore a mighty China and eventually shifted its recognition from the exiled government in Taiwan to the People’s Republic of China on the mainland.

This post was published at FinancialSense on 12/06/2016.