Taiwan After the DeepSeek Shock

The announcement of DeepSeek has sent shockwaves through Silicon Valley, Wall Street, and Washington, intensifying the U.S.-China rivalry in the “compute power is national power” race for AI supremacy. This acceleration in the AI competition will inevitably shift the Trump administration’s core policy focus from geographical to technological geopolitics.

The global AI supremacy race is still in its early stages. While experts continue to analyze and debate the true significance of the DeepSeek Shock, one preliminary conclusion is clear: AI technology has few natural chokepoints, enabling rivals to rapidly close gaps whenever one party advances. Yet AI compute power remains the crucial competitive advantage—the key factor that determines who can maintain dominance and achieve hegemonic status.

Regardless of how the U.S. and China compete—deploying their best resources across AI compute hardware and software—one unchangeable factor in the near term is the advanced manufacturing ecosystem built through 30 years of globalization. This ecosystem remains heavily concentrated in Northeast Asia.

As a result, the geopolitical significance of the “First Island Chain” will undergo a profound transformation. The Korean Peninsula, Japan, and Taiwan will evolve from their traditional roles as geographical anti-communist allies into vital partners in an “AI compute containment network.” Given this convergence of geographical and technological geopolitical factors, the U.S. now faces even greater pressure to maintain its Northeast Asian alliances than it did during the Cold War.

Historically, losing the First Island Chain in geographical terms merely mean a “strategic retreat” (e.g., MacArthur’s abandonment of the Philippines), with the possibility of launching counteroffensives from the Second Island Chain when conditions improved. Today, however, losing Northeast Asian allies would mean more than just forfeiting the First Island Chain geographically—it would mean surrendering control of advanced technological manufacturing that determines the future of compute power. If Taiwan and South Korea’s supply chains align more closely with Huawei than Silicon Valley, the U.S. would face an existential crisis. The U.S.-led peace order (Pax Americana) would inevitably give way to a China-led peace order (Pax Sinica).

Maintaining control over the internal politics of East Asian allies—who are vital to U.S. compute supremacy—will become as crucial as it was during the U.S.-Soviet Cold War of the 1950s–1970s. The key challenge lies in preventing these nations from pivoting toward China.

While Taiwan ranks below Japan and South Korea in traditional geopolitical measures such as population, economic scale, formal diplomatic ties, U.S. military bases, and security treaties, its technological geopolitical value certainly matches theirs.

Political uncertainty looms over Northeast Asia today. The future of pro-U.S. leadership in Japan, South Korea, and Taiwan hangs in the balance. For Taiwan specifically, maintaining political stability could significantly elevate its alliance status. The next four years present Taiwan with a crucial window to establish itself as a middle power, both politically and economically. Yet any domestic instability could have dire consequences.

(Featured photo by BrianPenny on Pixabay)