When Trump announced his intention to move the U.S. embassy, many observers predicted it would provoke outrage and backlash from the Arab world, and harm prospects for peace in the region. So far, the reverse seems to have proven the case - to the surprise of many.
The administration continues to pursue aggressive trade policies with China, and has made clear its displeasure with Chinese opacity during the early stages of the coronavirus pandemic. At the same time, China has pursued a genocidal campaign against the Uyghurs internally, while driving an aggressive foreign policy - staging increasingly bellicose claims to international waters and even sailing warships into western ports unannounced - largely without international repercussions.
But Trump has been signalling movement toward a "two Chinas" policy. In August, HHS Secretary Alex Azar met with Taiwan's president in Taipei, the highest-ranking U.S. cabinet official to visit Taiwan since diplomatic ties were broken 1979. This week, the U.S. sent a state department official to attend a memorial service for a Taiwanese official.
If Trump continues down this path in weeks to come, and encourages other countries to follow suit, much as he did with Israel, the predictions would likely be dire. Many would forecast an immediate worsening of relations with Beijing and a slew of cyber attacks on U.S. agencies and companies. But Trump might also find willing allies in countries recently subject to intimidating and retaliatory behavior by China, like Australia and India.
From Rome's point of view, American recognition of Taiwan would reset the playing field between the Church and Beijing.
In the first place, China would suddenly have a much greater incentive to keep the Vatican at the negotiating table.
Thus far, Pope Francis has remained on the sidelines regarding China's treatment of the Church on the mainland, its network of concentration camps in Xinjiang province, and its crackdown on civil liberties in Hong Kong, letting regional leaders like Cardinal Joseph Zen and Cardinal Maung Bo talk tough over the Roman silence. But faced with a concerted international campaign recognizing a free and democratic Taiwan and isolating Beijing, keeping the pope quiet could suddenly become a much more urgent goal for China.
Conversely, American recognition of Taiwan would free up Rome's hand and bring China to the negotiating table in earnest.
In the face of a concerted push by America to isolate Beijing, China could actually be more incentivized than ever to open formal diplomatic relations with the Holy See, and consider making actual concessions on issues like religious freedom within the country.
While observers might assume that Xi Jinping considers Vatican relations a sideshow, if he actually considers them at all, the Vatican deal might matter for Xi's political future.
Although his tenure in leadership is supposed to be life-long, in China Xi's position is not considered nearly as secure as is widely assumed in the West.
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The full effects of the coronavirus in China may not have been reported in official statistics, but they have been severe and deeply traumatic. The economic consequences of the pandemic for China have also been - at least by some estimates - as severe as anywhere, if not worse. Intense summer flooding, even to the point of visible strain on the Three Gorges Dam, have also taken thousands of lives and devastated essential industrial areas.
Xi's internal crackdown on dissent and free expression, most visible in Hong Kong but actually more widespread, has not been accepted easily. And sources in China report widespread unease with Xi's antagonist foreign policies, including his courting conflict along the Indian border while also trying to stake claims to international waters in the South China Sea.
It is not an uncommon opinion in China - albeit one not commonly expressed - that, with a growing sense he's overplaying his hand at home and abroad, Xi could face a more-or-less serious challenge to his position during the next meeting of the communist party's National Congress.
In this context, even a threatened American recognition of Taiwan could leave Xi scrambling for diplomatic victories, and reassessing the risks of provoking a Church which he considers a potentially systemic ideological threat. The Vatican's insistently modest requests for the barest measure of progress may suddenly appear a price well worth paying for a small victory.
For the U.S., strengthening the Church's ability to negotiate with China, and winning even the narrowest breathing space for Chinese Catholics, would likely do more to advance civil liberties in China then decades of free trade.
Such a change to the diplomatic order may appear wildly improbable. But there is a U.S. Under Secretary of State in Taipei right now for a memorial service. And Trump, who is known for doing the unexpected, holds the only cards that will decide what happens next.