At the risk of deploying a cliché of the parachute correspondent, conversations with Taipei taxi drivers are illuminating - at least for recent arrivals from Beijing.

"They say we belong to them," one said about China's territorial claim over the island, "but the Portuguese, the Japanese, the Dutch, could all say the same".

"We are Taiwanese," he said, as if that was the end of the matter.

Have similar exchanges in Beijing and you are likely to be told that the self-ruling island is a renegade province of China which will inevitably be united with the motherland in the great "national rejuvenation" and the rest of the world should mind their own business.

"We've got America behind us," the Taipei driver said as he laughed off the risks of an invasion from China.

But do they?

The Americans have never given a straight answer.

A Chinese official asked Joseph Nye, the then assistant secretary of defence in 1995 whether America would come to Taiwan’s aid in the event of a conflict.

"We don’t know, and you don’t know," he replied.

This deliberate policy of "strategic ambiguity" has been credited with preserving peace across the strait - serving as a check on China’s territorial ambitions, deterring Taiwanese leaders from declaring independence and leaving Washington’s options open.

But with China’s growing nationalism at home and authoritarian influence on the world stage, internment of ethnic minorities in Xinjiang, systematic erosion of democratic freedoms in Hong Kong, the steady build-up of its military capability and regular warplanes intrusions into Taiwan’s Air Defence Identification Zone, some policymakers say it is time to swap ambiguity for strategic clarity.

Others, though, warn of provoking Beijing and want everyone to calm down.

A new Cold War?

Certainly, with China’s rise, the world has a new Great Power rivalry on its hands.

And this small Pacific island is the tinderbox that could spark catastrophic conflict.

In the old Cold War, Taiwan, then ruled by the Chiang Kai-shek’s Kuomintang - which facing defeat by Mao’s Red Army fled to Taiwan - was seen as a bulwark against communism.

The Taiwanese public, opinion polls show, are increasingly responding to Beijing's overtures and threats by turning their backs on China

Trade and investment from western powers transformed the island into a manufacturing powerhouse supplying the world with cheap goods long before mainland China took that mantle.

Things changed in 1979 when the US cut diplomatic ties with the Republic of China, Taiwan, establishing them instead with the People’s Republic of China, leading ultimately to access to China’s vast market, while still lending strategic and economic support to Taiwan.

Just 15 countries officially recognise the Republic of China today – many of its diplomatic allies peeled away under pressure from Beijing. Taiwan continues to be excluded from United Nations bodies despite repeated requests to be given official status.

The Taiwanese public, opinion polls show, are increasingly responding to Beijing’s overtures and threats by turning their backs on China, burnishing their democratic credentials in contrast to their autocratic neighbour and fostering a distinct Taiwanese identity. Twice, they have voted in the Democratic Progressive Party under Tsai-Ing Wen, whom Beijing sees as a "stubborn secessionist".

As the world’s largest economies face off over trade, technology and who gets to decide what constitute "universal values" in international institutions, Taiwan’s strategic and symbolic importance is on the rise.

"As US-China relations have deteriorated, US-Taiwan relations have been strengthened, in part because of concerns in the US about Chinese threats to Taiwan's security," said Bonnie Glaser, director of the China Power Project at the Center for Strategic and International Studies.

"The US has also stepped up efforts to encourage Taiwan's diplomatic allies to retain their ties with Taipei, and persuaded leaders from many other countries to publicly voice concerns about the importance of preserving peace and stability in the Taiwan Strait," she said.

Last month’s G7 communiqué mentioned Taiwan for the first time since 1975 – when it was the G6 - as US President Joe Biden managed to forge a consensus to counter Chinese assertiveness.

Administering of AstraZeneca vaccines in Taiwan which were given by Japan for free

It sparked ire from Beijing which said the days of a "small group" of rich nations deciding the world’s fate were long gone and promptly set about reaffirming its friendship with Vladimir Putin’s Russia.

"Including any language related to Taiwan in the (G7) joint statement would still be seen by China as interference of its domestic affairs," said Alexander Chieh-cheng Huang, of the Institute of Strategic Studies, Tamkang University, Taiwan.

"The statement will not help to ease tension across the strait; rather enrage Beijing to take even harder position on, if not actions against Taiwan," he said.

Japan also enraged Beijing last week when its deputy defence minister, Yasuhide Nakayama, said it was necessary to "wake up" to China’s threat and that democratic nations should stand by Taiwan – remarks the Chinese foreign ministry blasted as "sinister, dangerous and irresponsible".

Both the US and Japan have sent vaccine donations to Taiwan amid a Covid spike – again inciting a charge of "interference in China’s internal affairs" from Beijing whose offer of Chinese vaccines was roundly rebuffed by Taipei.

As tensions rise, some analysts warn of Taiwan getting caught in the middle.

China's military threat cannot be ignored and Taiwan needs to urgently beef up its own defences.

"Taiwan’s strategic importance is indeed elevated as the rivalry between China and the US intensifies," said Alexander Chieh-cheng Huang "but that will also make Taiwan a more dangerous place".

"This polarized competition takes away Taiwan’s flexibility in China policy making," he added, "pushes Taiwan to choose sides, and makes the cross-strait relations even harder to be managed."

But for Enoch Wu, Chair of Taipei Democratic Progressive Party, China’s military threat cannot be ignored and Taiwan needs to urgently beef up its own defences.

"Beijing is intent on taking Taiwan - by force if necessary - while Washington views assisting with Taiwan's defence as consistent with American interests."

"It should be very clear where Taiwan needs to stand, if we care about our survival," he added.

In his first address this year to China’s armed forces, China’s leader Xi Jinping called on the military to be ready for combat "at any moment".

"In addition to the fly-bys and maritime incursions, which are what end up in the headlines these days, equally important are the investments and reorganizations that PLA has made over the last two decades, enhancing capabilities that it did not have just a short time ago," said Mr Wu.

"None of this should come as a surprise, though, as the CCP has been very transparent about what it's doing. As an example, its militarisation of the South China Sea took place gradually since 2013, in full view of the world, rock by rock," he said.

Is China likely to follow through on its pledge to take Taiwan by force if necessary any time soon? In March, a US military commander, Navy Admiral John Aquilino, warned it could be "closer than most think".

"My view is that China is unlikely to use military force to achieve unification in the near future unless the threat of Taiwan independence increases and becomes intolerable," said Bonnie Glaser, director of the China Power Project at the US thinktank, Center for Strategic and International Studies.

"Instead, Beijing will rely on its expansive toolkit of grey zone tactics to sustain pressure on Taipei and the US to not cross China's redlines, and to try to persuade the Taiwanese people that resisting unification is ill-advised," she said.

Taiwan's pre-eminence is likely to remain for decades to come, which is an incentive for other countries to keep it sweet.

The Silicon Shield

But Taiwan has a secret weapon and it is probably embedded in the device that you are using to read this.

Over the past three decades Taiwan has become the world’s leading manufacturer of semiconductors. Its industry is now so advanced, no one, not even the US or China can compete.

Complex manufacturing outfits called foundries churn out the world’s smallest and most sophisticated computer chips that power everything from smartphones to fridge freezers. TSMC (Taiwan Semiconductor Manufacturing Company) alone accounts for more than half of the globe’s market share and includes Apple, Qualcomm, Nvidia among its clients.

The disruption caused by Covid to the global semiconductor supply chain over the past year highlighted Taiwan’s critical importance to the industry and focused minds in Tokyo, Washington, Beijing and Europe.

"Look at the impact of the current chip shortage on the auto sector over the past several months," said Craig Addison who coined the phrase Silicon Shield in his 2001 book of the same name, "then multiply that 1,000 times, across dozens of tech-dependent industries, if Taiwan's ability to make chips is disabled."

"It is a bit like the MAD (mutual assured destruction) concept during the Cold War," he added, "if China attacks Taiwan, it would harm itself (and the US) just as much as it harms Taiwan, so that acts as a deterrent."

It is a mutually assured dependency that has accelerated China’s push for self-reliance in tech while US companies scramble to bring some American-designed chip manufacturing back home. But Taiwan’s pre-eminence is likely to remain for decades to come, which is an incentive for other countries to keep it sweet.

"Self-reliance in semiconductor production - if that includes the entire supply chain from design of chips to wafer fabrication - is a practical impossibility in my view (and even if it were technically possible, the cost of achieving it would be prohibitive for any single country)" Mr Addison said.

"And that not only goes for China, but the US as well," he added.

President of China Xi Jinping called on the military to be ready for combat "at any moment"

National rejuvenation

While dependency on chips coupled with a more united show of support for Taiwan internationally might give Beijing pause, nationalists inside China are champing at the bit for the national rejuvenation promised by their leaders.

In Thursday’s 100th year birthday party for the Communist Party held amid great pomp and pageantry in Beijing’s Tiananmen Square, the loudest cheer went up when China’s president, Xi Jinping, mentioned "reunification of the motherland" in a speech (which also warned that anyone who dared to oppress China would "have their heads bashed bloody against the Great Wall of Steel forged by over 1.4 billion Chinese people".)

In response, Taiwan called China a dictatorship that "tramples on people’s freedoms".

While that view is supported widely in Taiwan including by my Taipei taxi driver, it is, of course, just one of a range of opinions you can find here.

Then again, the same could be said for Beijing - but there, some things are spoken more quietly than others.