With Ukraine distracting much Western military force and policy attention, Commander-in-Chief Biden’s visible mental declineand Pelosi’s reckless visit, Xi may be correct in gambling that escalating drills will soften up Taiwan, maybe without serious Western intervention.
China’s missile, aircraft and warship live fire drills in sea-space surrounding Taiwan is damaging Taiwan’s economy. This is through slowing airliner, passenger ship and other shipping traffic. Some airlines don’t want to risk being mistakenly hit by missiles MH17 style. Insurance premiums may be rising making it uneconomic for airlines and shipping to/from Taiwan’s area if it is seen as a conflict zone.
Taiwan's already troubled semiconductor sector (eg. TSMC) has global supply chain problems. Greater semiconductor disruption may be an encouragement or deterrent to any timely Western military intervention in support of Taiwan.
China turning up politico-strategic salami slicing may continue for months, even years. This is aimed at triggering a Western reaction that China can paint as “Western aggression”. In China's and its ally Russia’s eyes this would justify a Chinese takeover of Taiwan by all means possible, eg:
- missile impacts on Taiwan itself
- fighter-bomber airstrikes
- Chinese SSK and SSN submarine blockade, even attack
- Chinese equivalents to US Hammerhead naval smart mines that can discriminate between "friend and foe" shipping and submarines in Taiwanese waters
- economic including food supply strangulation
- cyber attacks
- ending in amphibious landings once Taiwan is severely weakened and Western forces have been cruise and ballistic missile area isolated from assisting.
Western forces, especially SSKs and SSNs under US leadership, could react decisively against Chinese moves, but whether there is the will remains questionable.