Asian stock markets have been rattled by mounting tensions between the United States and China over US House of Representatives Speaker Nancy Pelosi’s expected visit to Taiwan.
Markets across the region slumped on Tuesday amid expectations Pelosi would visit the democratically-ruled island later in the day despite Beijing’s warnings of “serious consequences” if the senior Democratic politician makes the trip.
In mainland China, the CSI300 fell 1.4 percent as of 02:03GMT, while the Shanghai Composite Index dropped 1.7 percent. Hong Kong’s Hang Seng index dipped 2.5 percent.
Taiwan’s TAIEX fell as much as 2.1 percent during the day, while the main indexes in Japan, South Korea and Australia dropped 0.5-1.6 percent during morning trading.
Pelosi is due to spend Tuesday night in Taiwan as part of her five-leg Asia tour that includes Singapore, Malaysia, South Korea and Japan, according to multiple news reports citing unnamed sources.
Zhao Lijian, a Chinese foreign ministry spokesperson, on Monday warned that China would take “strong and resolute measures to safeguard its sovereignty and territorial integrity” and its military would never “sit idly by”.
China’s Communist Party considers self-ruled Taiwan its territory and has promised to achieve “reunification” with the mainland by force if necessary, although the party has never had control of the island.
The Biden administration has said it does not support independence for Taiwan or changing the “one China” policy, but that Pelosi has the right to visit the island.
White House National Security Spokesperson John Kirby told a media briefing on Monday that China could respond to the visit by firing missiles nearby, conducting air or naval exercises or attempting to assert “spurious” territorial claims.
Kirby said there was “no reason” Pelosi’s visit should spark conflict or aggravate tensions between the sides.