Corporates Discount China Invasion Of Taiwan

The smart money is betting that China won’t invade Taiwan, says a piece in the Nikkei by Philip Hou and Eric Guyot which argues that $25 billion of foreign company investment in Taiwan in the last seven years from the likes of AMD, ASML, Alphabet, Micron, Microsoft, Nvidia, Yahoo and other suggest that corporate analysts discount the prospect of war.

Foreign direct investment in the country is up 61% for 2018-2023 compared to 2012-2017.

Last July the Taiwan government approved AMD’s application to build a $263.4 million AI and silicon photonics R&D facility in Taiwan.

Nvidia is developing an AI R&D center in Taipei that will employ 1,000 engineers.

In 2025, AWS launches an AWS Infrastructure Region in Taiwan to serve cloud customers in Asia and says it plans to invest billions of dollars in Taiwan over the next 15 years.

In the property and retail sectors Mitsui Fudosan, Mitsubishi Estate and Daiwa House Industry have been aggressive investors and Japanese firms have invested more than $2.48 billion since 2019.

In the renewable energy, property and hotels sectors, foreign investors have invested or committed to invest more than $19 billion in multiyear projects.

The Canadian pension fund Caisse de depot et placement du Quebec (CDPQ) is the lead investor in the $2.39 billion Greater Changhua Offshore 1 Wind Farm.

Corporates employ smart analysts to assess geo-political risks and, if these corporate investments reflect their collective view, then a China-Taiwan confrontation seems less of a worry.