Beijing insists that Taiwan is the immovable core of its national interest, the issue on which there can be no compromise and no retreat.

Yet when confronted with the largest American arms package ever approved for the island, China’s response has been conspicuously feeble. The result is not deterrence, but dilution — a steady hollowing out of the very credibility Beijing claims to prize.

The latest sanctions, announced with familiar indignation, target a list of American defence firms and executives deemed responsible for supplying Taiwan. Assets in China are frozen. Business dealings are prohibited. Entry visas are revoked. It all sounds severe enough, until one confronts the awkward reality that almost none of those targeted had meaningful exposure to China in the first place. The sanctions land with a thud rather than a bang.

This is not strength. It is signalling without substance.

Set against the behaviour of other authoritarian powers, the contrast is stark. When Russia retaliates against Western pressure, it does so with measures that are economically ruinous — not just for its adversaries, but often for itself. Assets are seized. Industries are nationalised. Energy supplies are weaponised. The Kremlin’s approach is reckless, destructive and morally indefensible, but it is undeniably credible. Threats are backed by action.

Iran offers a similar lesson. Despite decades of sanctions, Tehran has chosen escalation over symbolism: proxy wars, missile programmes, maritime disruption. Again, the costs are enormous, but the regime has demonstrated a willingness to absorb pain in pursuit of strategic aims.

China, by contrast, appears unwilling to sanction anything that might actually hurt.

This is especially striking given that Beijing presents Taiwan as an existential question. If ever there were an issue that justified maximal economic retaliation, this would be it. Yet there are no sanctions on major civilian aerospace operations. No meaningful financial measures. No pressure on Western multinationals whose exposure to China would make them genuinely nervous. Instead, Beijing has carefully selected targets that are already insulated.

This is deterrence theatre — loud, ritualised and increasingly transparent.

The uncomfortable truth is that China’s economic coercion, much vaunted over the past decade, has begun to look selective and risk-averse. It has been deployed aggressively against smaller states — Lithuania being the obvious example — but shrinks markedly when directed at the United States. Power that only functions against the weak is not power at all; it is intimidation masquerading as strategy.

There are two plausible explanations, neither flattering. The first is capability. China simply lacks leverage over American defence firms, which have long structured their operations to avoid dependence on the Chinese market. Beijing cannot freeze assets that do not exist, nor disrupt supply chains that were never integrated. That is not a temporary problem; it is a structural one.

The second explanation cuts deeper: a lack of political resolve to escalate in ways that risk real economic consequences. China’s economy is slowing, investor confidence is brittle, and the leadership is acutely aware of the dangers of accelerating Western decoupling. Unlike Russia or Iran, China remains profoundly dependent on global trade, capital flows and export markets. That dependence constrains its options — and its courage.

If this is the ceiling of China’s response to U.S. arms sales to Taiwan, then Beijing’s red lines are beginning to look perilously elastic.

Deterrence depends not on rhetoric but on belief. Once adversaries conclude that threats will not be followed by painful consequences, those threats lose their power. Washington will draw the obvious lesson: China complains loudly, but acts cautiously. Taipei will take note as well. Even regional allies, watching from Tokyo to Canberra, will quietly recalibrate their assumptions about Beijing’s willingness to follow through.

This is not a trivial development. China’s entire Taiwan strategy rests on convincing others that escalation would be catastrophic — that resistance is futile, that intervention would be unbearably costly. Sanctions that amount to symbolic inconvenience undermine that narrative. They suggest not inevitability, but hesitation.

None of this implies that China is weak, or that the Taiwan question is defused. Military pressure continues, and the risk of miscalculation remains grave. But strength is not merely a matter of ships, missiles or exercises. It is the willingness to impose costs — and endure them — when core interests are challenged.

By opting for gestures over genuine economic force, Beijing may be reassuring itself domestically while quietly eroding its external credibility. That is a dangerous trade. Deterrence, once hollowed out, is not easily restored. And in the unforgiving arithmetic of geopolitics, the gap between what a state says and what it does is where misjudgement is born.

China should be careful. The world is watching — and drawing conclusions.

Main Image: By Dong Fang https://commons.wikimedia.org/w/index.php?curid=22649337

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