British firms’ race to exit Taiwan ahead of Chinese invasion

British firms are in a race against time to exit Taiwan and China before Beijing launches an invasion of the island nation.

Brompton Bicycle – which manufactures commuter-friendly foldable pedal bikes out of parts sourced from both Taiwan and China – is among one of the first Western companies to sound the alarm in the face of the impending conflict.

Taiwan lives under constant threat of invasion by China, which claims the self-ruled democracy as part of its territory to be retaken one day, by force if necessary. 

The threat means the company is now working towards sourcing parts from other Asian countries instead, according to The Daily Telegraph, amid a growing rift between the countries that experts have likened to a new Cold War.

‘[Should China invade] what does that mean for Taiwan? And what does that then mean for imports/exports out of China?’ Brompton Bicycle’s managing director Will Butler-Adams told the newspaper on Wednesday.

‘Taiwan probably makes the best quality, most innovative bicycle components. We are very unlike most other bike brands, where we make most of the parts ourselves. But we still need some of those unique, very bike specific elements.

‘There is actually a more nuanced de-risking of the China/Taiwan supply chain rather than necessarily trying to pull everything from Asia into Europe,’ he said.

A third of the company’s suppliers are Asian, while two-thirds are Europe-based.

He said that many countries that find themselves in a similar situation are seeking ‘dual source’ supplies, which would see them work with partners in both China and Taiwan, but ensures business can continue in the event of an invasion.

Butler-Adams told the newspaper that Giant – the world’s largest bicycle manufacturer – had ‘thrown down the gauntlet’ to some of its suppliers by ordering them to move away from Taiwan in the next two years.

Brompton’s managing director explained that Giant is not asking its suppliers to move to Europe, or change suppliers, but is rather pushing for the same suppliers to set up subsidiary companies in places such as Vietnam or Thailand.

This, he said, would mean the company would have the same knowledge base, but mean that they diversify away from a conflict zone. 

The bicycle industry is not the only industry that would be severely impacted by China’s potential future invasion of Taiwan.

Taiwan produces a third of the world’s microchips that are needed for countless products, including fridges, smartphones, laptops and electric cars.

Taiwan Semiconductor Manufacturing Company and United Microelectronics Corporation, both based in the country, and the world’s largest chip makers.

However, China’s economic shutdown caused by the pandemic demonstrated that Western companies can manage supply chain disruption.

Research by trade body Make UK, cited by the Telegraph, found more than half of companies have increased the number of suppliers they use. 

In recent years, fears have been increasing in the West that China could launch an invasion of its neighbour, with some analysts suggesting Russia’s invasion of Ukraine has emboldened President Xi Jinping after seeing the West’s reaction – and could be used as a blueprint on how to deal with economic sanctions.

Taiwan has been a thorn in the side of China’s ruling Communist party ever since Mao Zedong’s victory on the mainland in 1949.

Xi Jinping has made his intentions to take the island clear.

At the party’s 20th National Congress in October – when he secured a third term as leader – he said that ‘complete reunification of our country must be released, and it can, without doubt, be realised’.

Writing for MailOnline in August last year, military expert Samuel Cranny-Evans said that China would likely attempt to starve Taiwan into submission.

‘There are two scenarios that defence analysts tend to settle on when thinking about China’s military options against Taiwan,’ he wrote at the time.

‘The first is a naval blockade, an enormous challenge for an island nation that is reliant upon its ports for survival as only 35 per cent of its food is produced domestically – according to 2018 figures – with the rest of it imported.’ The second, he said, was an amphibious invasion of Taiwan akin to the D-Day landings.

‘It is thought that a naval blockade conducted by the People’s Liberation Army Navy and the People’s Armed Forces Maritime Militia would present a significant challenge to the US Navy,’ Cranny-Evans wrote.

‘And, as demonstrated by China’s frequent flights into Taiwan’s air defence identification zone, Taiwan is within easy reach of the PLA Air Force.’  

Meanwhile, NATO’s former head warned on Wednesday that democracies must join together to resist ‘advancing autocracies’ during a high-profile visit to Taiwan, which he said must be allowed to decide its own future.

Anders Fogh Rasmussen, a former Danish prime minister who served as secretary general of NATO from 2009 to 2014, made the remarks at a meeting with Taiwanese President Tsai Ing-wen.

‘We need to strengthen our fight against, or our attempts to counter, the advancing autocracies,’ said Rasmussen, founder of the Alliance of Democracies foundation, which hosts an annual democracy summit in Copenhagen.

‘The world’s democracies represent 60 percent of the global economy, if we can work together, then we are representing a formidable force that will create respect in Beijing and other capitals of autocratic nations’.

In his remarks to Tsai, Rasmussen said Taiwan had the ‘right to exist in freedom and peace’ as well as the right to decide its own future.

Last year saw a spike in tensions as Beijing ramped up military pressure and launched its largest war games in decades to protest against a visit by US House Speaker Nancy Pelosi in August.

China opposes any official exchanges between other countries and Taiwan and has reacted with increasing anger over visits by Western politicians.

Rasmussen’s foundation, which invited Tsai to address its annual democracy summit for three consecutive years from 2020, was sanctioned by Beijing in 2021.

In a New Year speech Sunday, Tsai said ramped-up Chinese military activities around Taiwan were ‘unhelpful’ for maintaining relations between the two.

‘War has never been an option to solve problems. Only dialogue, cooperation and the common goal of promoting regional stability and development can make more people feel safe and happy,’ she said.