China’s live-fire drills around Taiwan enter day two with a blockade-style rehearsal
As of December 30, 2025, China’s “Justice Mission 2025” drills around Taiwan escalated into live-fire activity and a tighter, blockade-style rehearsal. Rockets were fired into waters north and south of the island, alongside coordinated naval and air operations designed to show how quickly Beijing could contain Taiwan in a crisis.
The issue matters now because the shift from loud signalling to practical rehearsal has changed the risk profile. Live-fire zones, coast guard stand-offs, and disrupted routes are not just messaging. These elements form the foundation of a coercive strategy that can intensify economic and political strains without exceeding the boundaries of a declared war.
This piece explains what changed on day two, how the drills map onto a blockade scenario, and what to watch next in the days ahead. It also looks at the overlooked mechanisms that can turn “exercises” into a real-world squeeze on trade, travel, and confidence.
The story turns on whether Beijing can turn recurring drills into a scalable blockade option without triggering a crisis it cannot control.
Key Points
China’s drills moved deeper into live-fire territory on day two, with rockets fired into waters north and south of Taiwan and joint sea-air operations continuing around the island.
The operational emphasis is “containment”: practicing how to restrict access to Taiwan’s airspace and sea lanes while demonstrating strike options at range.
Taiwan’s defense authorities tracked a sharp surge in activity over a 24-hour period, including large numbers of aircraft and a combined presence of navy and coast guard vessels near Taiwan’s contiguous zone.
The drills have a direct civilian footprint: warning zones and route disruption affect aviation planning, regional shipping patterns, and risk pricing.
The political signal is aimed in two directions at once: at Taipei’s leadership and at external partners that supply arms or promise support in a contingency.
The immediate danger is miscalculation—an accident, an overreaction, or a local tactical incident that leaders then struggle to contain.
Background
Taiwan is self-governed, democratic, and militarily supported by the United States through arms sales and security cooperation, even as Washington maintains formal diplomatic ties with Beijing. China claims Taiwan as part of its territory and says it will not rule out the use of force to bring the island under its control.
Since 2022, large-scale Chinese drills around Taiwan have become a recurring feature of the security landscape. The situation has changed from occasional spikes in activity to regular, significant actions: planes flying over the Taiwan Strait's middle line, naval groups getting closer to the island, and law-enforcement ships being used to apply pressure without starting a war.
“Justice Mission 2025” sits inside that trajectory, but day two matters because it adds live-fire and more explicit blockade logic. A blockade, in practical terms, does not require an invasion fleet. It can begin as a set of “temporary” restrictions that force airlines, shippers, and insurers to change behaviour, raising costs and uncertainty for Taiwan long before a decisive battle.
Analysis
Political and Geopolitical Dimensions
Beijing’s incentives are layered. The first is deterrence: discourage moves in Taipei that Beijing frames as steps toward permanent separation. The second is external messaging: signalling to Washington and regional partners that Taiwan's support carries escalating costs.
Taipei’s constraints are also clear. Taiwan wants to project steadiness, avoid panic, and demonstrate readiness without giving Beijing a pretext to claim “provocation.” That creates a narrow lane: defend airspace and waters, communicate calm, and keep the economy functioning.
Washington’s dilemma is timing and credibility. Stronger support can reduce Taiwan’s vulnerability, but it can also be used by Beijing as justification for sharper demonstrations. Regional actors, particularly Japan and Southeast Asian states with significant trade exposure, need to balance public concern and private planning without seeming to choose a definitive stance.
Scenarios to watch are not binary. A short drill can end cleanly while still leaving a strategic residue: higher perceived risk, more frequent “snap” zones, and a new normal of disruption. A sharper scenario is an extended “exercise” that lingers long enough to force commercial actors to reroute and reprice. The worst-case scenario is a tactical incident at sea or in the air that becomes politically impossible to ignore.
Economic and Market Impact
The fastest effects are not always stock-market shocks. They are operational: route planning, freight premiums, and insurance pricing.
If drills normalise the declaration of dangerous zones, airlines and shipping firms face repeated decisions with real costs. Even when flights are not formally cancelled, rerouting burns fuel, reduces capacity, and pushes delays through the system. Shipping faces a similar logic: detours, higher war-risk premiums, and changes in port schedules that hit the whole regional supply chain.
Taiwan’s position in high-end semiconductor manufacturing adds an extra layer of sensitivity. Markets can absorb headlines. They struggle with sustained uncertainty that changes lead times and contract risk. A blockade rehearsal is designed to insert that uncertainty on demand.
The most plausible near-term market outcome is not a crash but a creeping risk premium—higher costs of doing business around the strait, more inventory buffering, and a stronger incentive for firms to diversify supply chains even if the economics are imperfect.
Technological and Security Implications
Live-fire activity and long-range strike demonstrations highlight a key shift: Beijing is rehearsing not just presence but coordination. A blockade is a combined-arms problem: air cover, naval positioning, missile and rocket forces, and a parallel campaign of messaging and legal framing.
Taiwan’s defensive challenge is asymmetry. It cannot match scale, so it must focus on survivability, dispersion, and the ability to keep key systems functioning under pressure. That includes air defence, coastal missiles, and command-and-control resilience.
For external partners, the question is not only “Could we intervene?” But, “how early would we know?” Drills that blur into routine activity compress warning time. That increases the value of persistent surveillance, rapid logistics, and clear thresholds for response.
Two plausible next steps are worth watching. One is a more regularised use of the coast guard and maritime enforcement as a frontline tool. The other is the integration of rehearsals that simulate strikes on specific categories of targets—designed to pressure Taiwan’s planners and shape public psychology.
Social and Cultural Fallout
For Taiwan’s public, repeated drills can create two opposite reactions at once: anxiety and habituation. Anxiety rises when live-fire zones appear close to daily life. Habituation grows when crises come and go without immediate consequence.
The political impact can be subtle. Sustained pressure may harden identity and resolve, but it can also elevate debates about economic risk, conscription, and the costs of deterrence. That debate becomes more intense when disruption is felt not as a distant military event but as delayed flights, constrained fishing grounds, or rising prices tied to risk premiums.
In China, the public-facing narrative frames drills as a justified defence of sovereignty. That can limit leadership flexibility if leaders later want to de-escalate quickly without looking weak.
What Most Coverage Misses
The key mechanism is not the rocket launch. It is the calibration.
A blockade does not have to be total to be effective. If Beijing can selectively disrupt routes, declare temporary warning zones, and sustain coast guard presence near Taiwan’s contiguous waters, it can force commercial actors to self-deter. Airlines and shippers can alter their behaviour without physical disruption; they only need to perceive the corridor as unpredictable.
That changes the strategic equation. The threshold is not “invasion”. The threshold is the moment when the region starts behaving as if an invasion might happen at any time. Once that behaviour locks in—through insurance pricing, rerouting, and delayed investment—the coercive effect arrives even if no formal blockade is declared.
Why This Matters
In the short term, the immediate risk is an incident: a near miss, a collision, a misread signal, or a warning shot that goes wrong. Live-fire and close-proximity operations increase the chance of a mistake, especially when multiple forces are operating in tight spaces.
In the medium term, repeated blockade rehearsals can erode Taiwan’s sense of normalcy and raise the day-to-day cost of trade. That matters far beyond Taiwan. The Taiwan Strait and surrounding airspace sit on major commercial routes that connect Northeast Asia to global markets.
In the long term, the strategic danger is that practice becomes policy. If Beijing can demonstrate that it can tighten and loosen pressure on demand, it gains a tool to influence Taiwan’s politics and external support without absorbing the full costs of war.
Next, look for clear signs like new warning zones, how often coast guard ships are sent near Taiwan's waters, and if commercial airlines start giving longer-term travel warnings that suggest ongoing risks instead of just temporary issues.
Real-World Impact
A flight operations manager in Singapore recalculates schedules when warning areas appear, pushing delays downstream and raising costs for carriers already running tight margins.
A logistics coordinator in Osaka fields calls from clients asking whether shipments should be rerouted, whether delivery windows can still be met, and who absorbs the higher insurance premium.
A mid-sized electronics buyer in Munich is told lead times may stretch, not because production stops, but because freight and risk pricing become less predictable.
A fisherman in northern Taiwan finds certain areas temporarily harder to access, with knock-on effects on daily income and local supply to markets.
What’s Next for China’s Live-Fire Drills Around Taiwan?
The immediate question is whether the drills end cleanly or roll into follow-on activities that keep pressure elevated until early 2026. A sharp end would still leave a signal: Beijing can scale up quickly and operate close to Taiwan with live-fire elements. A prolonged pattern would suggest something more ambitious: training the region to accept recurring disruption as normal.
The decision lies between the use of deterrence theatre and the implementation of coercive routine. Theatre fades when the cameras move on. Routine changes behaviour in airlines, shipping firms, insurers, and boardrooms.
The most obvious signs will be based on real actions, not just words: how often danger zones are announced, how long the coast guard stays near Taiwan's waters, and if businesses begin to see the Taiwan corridor as a constant risk instead of just a temporary issue.
