One china policy is a diplomatic acknowledgment of Chinese position that there exist only one china and Island of Taiwan is part of china.
ROC controls both Mainland China and Taiwan till 1949. ROC lost its control of mainland china to the communists (People’s Republic of China) in 1949 civil war and exiled to Taiwan. Since then both PRC and ROC claims to be the legitimate rulers of Whole china. Initially many governments recognized Taiwan but the diplomatic winds shifted in favour of Beijing from 1970s with countries cutting ties with Taipei in favour of Beijing.
- It is benefited from this policy since it is able to isolate the Taiwan diplomatically
- But it is not able to completely isolate Taiwan or to make it part of PRC through this policy
- It able to establish formal relations with with china which is its top foreign lender and trading partner while quietly supporting the Taiwan
- But officially US is not able establish relation with the Taiwan
- Not having Official recognition is proved to problematic for Taiwan as it not member in even UN and many other international organizations
- Though it is not recognized officially, it had unofficial presence of US in Taiwan in the form of American Institute in Taiwan. US also passed Taiwan Relation Act which guarantees the support to Taiwan. Under this US able to sell its arms to Taiwan.
- It also maintains vibrant economic and cultural relations with the neighbors
This policy is a delicate balancing act followed by US in the last few decades. With the new president to be on board, It is remained to be seen how US proceed further.