China’s People’s Liberation Army (PLA) could suffer up to 100,000 fatalities in a conflict with Taiwan, with hundreds of thousands of additional military personnel wounded, captured or missing, according to a study from the German Marshall Fund, a United States-based think tank. Eventually, China would have to retreat after several months of heavy fighting amid multitrillion-dollar economic losses, international sanctions and significant social unrest in Beijing.
The study, “If China Attacks Taiwan,” presumes the conflict occurring by 2030 and unfolding under one of two scenarios: a minor conflict of several weeks of Chinese blockades and air and maritime confrontations between the PLA and Taiwan that ends with a bilateral agreement to de-escalate; or a major monthslong war involving Japanese and U.S. forces that ends in “the humiliation of a defeat” for China.
The January 2026 report examines how use of force against Taiwan could impact China’s economy, military capabilities, social stability and international costs, and how the outcomes could shape Chinese Communist Party (CCP) General Secretary Xi Jinping’s decisions about Taiwan.
“Xi’s risk calculus is crucial to understanding if and under what circumstances Beijing might take aggressive actions against Taiwan because any such decision would carry profound political, economic, and strategic consequences,” the study said.
China claims sovereignty over the self-governed island of Taiwan and threatens to annex it by force. It uses extensive gray-zone tactics of military live-fire exercises, simulated blockades, maritime intrusions, information manipulation, cyberattacks and other coercive actions to bully Taiwan.
The U.S., which has said it expects China to be prepared to invade Taiwan by 2027, supports peace and stability across the Taiwan Strait and opposes unilateral changes to the status quo by force or coercion. The U.S. does not have formal diplomatic relations with Taiwan, but a long-standing federal law requires Washington to make available “defense articles and defense services” in necessary quantities for Taiwan to “maintain a self-sufficient capability.”
The study suggests a major conflict would begin with an amphibious invasion of Taiwan with PLA missiles also targeting U.S. forces stationed in Japan and the U.S. territory of Guam. But sustained strikes by Taiwan and the U.S. on ships and aircraft attempting to cross the 160-kilometer-wide strait would deplete PLA supplies and reinforcements. China’s forces would withdraw after several months of fighting and 100,000 casualties. Taiwan would suffer about 100,000 military and civilian casualties combined, while the U.S. would lose 5,000 military personnel and 1,000 civilians, and Japan would lose 1,000 troops and 500 civilians.
Among the report’s findings:
Economic: Even a limited military engagement would have “a devastating economic impact” on China, with other analysts estimating the cost between $2 trillion and $10 trillion. Potential economic disruptions include Beijing’s $3.1 trillion in overseas assets and $3.6 trillion in foreign direct investments to China, while 13% of China’s domestic employment is attributable to exports.
A conflict could leave China isolated and its economy entirely dependent on weakening domestic demand because of widespread trade embargoes, U.S.-led economic sanctions and disruption of manufacturing supply chains.
Military: China would have to use emergency measures such as extending two-year conscription periods and recalling recently demobilized troops to try to maintain readiness. But Beijing would be hampered by high casualty rates, with fighter pilots and special forces particularly hard to replace.
High casualties or “spectacular losses, such as a sunken aircraft carrier,” would be detrimental to China’s CCP-PLA relations, and defeat could lead PLA members to support a new leader or revolt against “civilian leaders in Beijing perceived to have sacrificed their right to rule.”
A China retreat would raise questions about “China’s decision-making following the humiliation of a defeat,” and Beijing would be strongly tempted to relaunch the war after an extended period of reconstituting its forces and ensuring mainland stability.
International cost: Among other responses, nations and international bodies could freeze foreign assets of Chinese leaders and elites, ban Chinese athletes from international competitions, withdraw from Chinese initiatives such as the One Belt, One Road infrastructure scheme and sever diplomatic ties, effectively setting China “back decades on the global stage.”
Ideally, the report states, leaders in Beijing would accurately assess that a conflict over Taiwan would be highly risky, leading to a strong basis for deterrence. China’s leaders should be wary “since the costs of a failed conflict over Taiwan would be massive.”
About the Author
