Neutrality would leave countries exposed to the economic effects of a Taiwan war. Risk-averse investors would try to protect capital as shipping and production became uncertain. Money could leave Taiwanese and Chinese markets before sanctions or controls prevented transfers. The resulting contraction is expected to deepen the economic shock, even though some investors could profit from buying assets after prices fall.
Notable Point · 10:07-13:07
Capital flight could compound the shock to maritime trade
Attempts to protect investments could spread the economic damage beyond shipping and manufacturing.