The warning comes as US-China trade tensions have eased in 2026 following leader summits in May and September, while Donald Trump is holding a planned US$14 billion arms package for Taiwan as a bargaining chip.

Beyond Taiwan, Rudd pointed to potential Chinese territorial interests in the South China Sea, East China Sea and disputed Sino-Indian border, as well as land Russia took from China in the late Qing era.

Rudd said Beijing sees the United States as declining and divided while China rises and gains influence, particularly across the Global South; he considers that assessment premature and flawed.

He said China’s likely aim is to shape and anchor a future international order, securing deference and influence over its rules rather than necessarily replicating the United States’ pattern of military intervention beyond Asia.

Kevin Rudd warned that sharper rhetoric from Xi Jinping and Chinese officials points to an accelerating shift in Beijing’s posture toward Taiwan, with a potential “trip-wire event” emerging around Taiwan’s 2028 presidential election.

He cautioned that US military focus on the Middle East could leave the United States less prepared for a Chinese move against Taiwan, even though its Pacific operations and strategy have not officially changed.

Rudd argued that if the United States failed to prevent Taiwan’s defeat, Japan could lose confidence in its US security guarantee and pursue nuclear weapons, potentially followed by South Korea, with broader consequences for China, North Korea, Southeast Asia, Australia and India.

A forced Chinese takeover could also bring severe economic fallout: Taiwan produces most of the world’s semiconductor chips, and fighting could disrupt supplies, damage Taiwan Semiconductor Manufacturing Company facilities and potentially push the United States into recession.

In a tense exchange, Rudd declined to repeat his past criticism of Trump, saying his think-tank work requires engaging governments and supporting strategic stability; he described his time as ambassador in Washington as a character-building experience.