From coast to coast, Taiwan measures roughly 90 miles wide by 245 miles long. An ambitious tourist could land early in Taipei on the island’s northern tip, grab breakfast at T’ai-chung in the west, lunch at Kaohsiung in the south, dinner at Hualien County in the east and return to the capital by midnight. But what Taiwan lacks in land, it makes up for in people. With over 23.5 million residents, it is one of the most densely populated places on earth. It also ranks among the most advanced free market economies in the world 

While remarkable, Taiwan is not unique — other countries punch above their weight. Yet this small island is one of the flashpoints historians and geopoliticians fear could trigger a third world war. Why all the fuss?

The blurred identity

Portuguese sailors, marveling at Yu Shan’s rocky peak — which juts nearly 13,000 feet into the sky — and the alluvial plains on the west coast, called Taiwan ilha formosa or “beautiful island.” Its proximity to mainland China and rich natural resources, such as sulfur deposits and plentiful fisheries, attracted settlers near and far. 

Since early times, Chinese migrants crossed the Taiwan Strait — its narrowest point is about 80 miles — and settled among the island’s native people. The Dutch came in the 1600s, followed by Spaniards. Before the turn of the century, however, the Qing dynasty from mainland China had expelled the Europeans and taken control.

The island changed hands again in 1895, when Japan beat China in the first Sino-Japanese War. Though harsh rulers, the Japanese laid the economic and public infrastructure that have helped Taiwan succeed. Their defeat in World War II marked the end of their rule and the start of Taiwan’s semi-independence.

It has been a rough journey since then. After World War II, Japan surrendered Taiwan to Chiang Kai-Shek, leader of the Republic of China, or ROC, the ruling government at the time. In 1949, Mao Zedong’s communist party defeated Chiang’s forces and established the People’s Republic of China, or PRC, which rules to this day. Chiang fled to Taiwan, where he established a government-in-exile.

Initially, misrule by the ROC caused the economy and public institutions built by the Japanese to deteriorate, breeding unhappiness. Public frustration imploded on Feb. 28, 1947, when a police officer shot a protester. Known as the 2-28 Incident, it led to a grim period of martial law that lasted four decades. Yet during this time, Taiwan also prospered and slowly made reforms that led to the first free presidential election in 1996.

Over time, Taiwan has earned the moniker of being an economic and political “miracle.” It’s the world’s leading chipmaker and one of the most dynamic economies in East Asia — perhaps second only to Japan. However, it is still developing a national identity. The PRC considers Taiwan part of China, not an independent state. The island has strong ties to the mainland, but also has distinct features due to its political history, multicultural society and government structure. According to data from Taipei’s National Chengchi University, nearly two-thirds (63.7%) of residents identify solely as “Taiwanese,” up from 17.6% 30 years ago. About 30% identify as Taiwanese-Chinese, and less than 3% as Chinese.

A conveniently ambiguous strategy

During a recent trip to Taiwan, Speaker of the House Nancy Pelosi remarked, “Today, the world faces a choice between democracy and autocracy. America’s determination to preserve democracy here in Taiwan and around the world remains ironclad.”

Her trip was the stuff of  political dramas: she defied Chinese threats — including live-fire exercises in the Taiwan Strait — and warnings from President Joe Biden’s administration to visit Taiwan, becoming the highest-ranking U.S. official to set foot on the island in 25 years.

Despite the soaring rhetoric, U.S. foreign policy for Taiwan is not so straightforward. Military cooperation began in the 1950s, when President Harry Truman dispatched the Seventh Fleet to the Taiwan Strait to protect the island from communist takeover. The U.S. supported Chiang’s semi-democratic government, and recognized the ROC as China’s representative in the U.N. In 1954, the U.S. struck an agreement to come to Chiang’s aid in case of an attack by the PRC.

Relations began to change in the 1970s, when President Richard Nixon, realizing mainland China would soon become a global power, pivoted from Chiang’s ROC to Zedong’s PRC. By 1979, the U.S. no longer acknowledged the ROC as China’s official government, prompting dozens of other countries to sever their diplomatic ties, too. However, the U.S. stopped short of abandoning Taiwan — as it now called the island — to China’s devices. It remains committed to defending democracy in Taiwan, as well as maintaining trade and diplomacy, though informally.

This “strategic ambiguity,” as the policy is called, has led to clashes with China. The PRC does not hold such a nuanced view of Taiwan. To President Xi Jinping and his communist party, Taiwan is China in every respect. It’s also an extremely valuable military asset (Gen. Douglas MacArthur called it an “unsinkable aircraft carrier”). Control of the island would give China near unlimited access to the East and South China Seas and ultimately the Pacific Ocean. Due to international maritime laws, which determine a country’s territory beyond land, China is constrained by Taiwan and islets that belong to Japan and the Philippines.

In recent decades, the specter of war has loomed over the U.S. and China, as the latter has ramped up military drills in the Taiwan Strait and started building artificial islands in the vicinity. Analysts worry that a miscalculation — such as an errant missile or Chinese overreaction due to a visit by U.S. officials — could lead to a catastrophic war between the world’s two leading military and economic powers. 

America’s “strategic ambiguity” also has caused confusion at home, as it is unclear where exactly the line is determining U.S. military intervention. “The president should not cede to Taiwan, much less to China, the ability automatically to draw us into a war across the Taiwan Strait,” wrote the chair of the Senate Foreign Relations Committee in 2001 after President George Bush said America would do “whatever it took” to defend Taiwan. The senator’s name? Joseph R. Biden Jr.