Lai Ching-te of Taiwan's ruling Democratic Progressive Party won Saturday's presidential election, defying continued warnings from China regarding the self-ruled democracy’s sovereignty.

Lai, the current vice president, won with 40.1 percent of the vote, outpacing Hou Yu-ih from the conservative Kuomintang, who garnered 33.5 percent, and former Taipei Mayor Ko Wen-je from the Taiwan People’s Party, who secured 26.5 percent.

The high-profile election result is expected to have an impact on security and business across the Asia-Pacific region, as it could ratchet up tensions with China, which views the island as its territory.

If China responds to Lai’s election with stronger military threats and economic pressure across the Taiwan Strait, the China-US conflict is feared to intensify in a way that affects other countries, including South Korea.

“We are telling the international community that between democracy and authoritarianism, we will stand on the side of democracy,” Lai said in a victory speech, a remark that can be interpreted as a sign that Taiwanese voters prefer independence from China.

But the stance of Taiwan is more complex than it seems. Lai will follow the policy direction set by current President Tsai Ing-wen, who pushes for Taiwan’s position as a sovereign, democratic nation as opposed to the territory of China.

But there is a limit for Lai to assert independence. Experts say that most people in Taiwan want to maintain the status quo of “de facto independence” rather than immediate unification or independence, and the public preference for the status quo is reflected in Lai's victory.

The problem is that China does not accept Taiwan’s de facto independence. Ahead of Taiwan’s presidential election, China’s President Xi Jinping vowed to prevent anyone from “splitting Taiwan from China in any way” and said Taiwan’s unification is a “historical inevitability.”

China has been consistently ramping up pressure on Taiwan in the military, political and economic fronts to assert its sovereignty claims, building tensions across and beyond the Taiwan Strait in recent years.

In its first response to Lai’s victory, the Chinese government office for Taiwan affairs said in a statement the election outcome showed that the DPP “does not represent mainstream opinion on the island” and that China will continue to focus on “national unification.”

As the rocky situation stemming from China’s intimidation remains unchanged, Taiwan’s new leader is likely to confront tough challenges in connection with thorny relations with China when he takes office in May. Notably, the DPP secured a third term in a row in the presidential office, but the party lost its majority in the Legislative Yuan, Taiwan’s parliament, casting a cloud over the political landscape in Lai’s four-year term.

Outside the Taiwan Strait, other countries have to reckon with China’s threats over its sovereignty claims. For instance, China called on foreign governments not to interfere in its “internal affairs” after they had congratulated Lai on winning the presidential election.

Korea’s policymakers and companies remain cautious about the Taiwan issue. After all, any military or economic conflict between China and Taiwan -- or between China and the US -- spells real troubles for Korea, as the country’s ships carrying oil and other energy products pass through the Taiwan Strait.

Semiconductors, a key South Korean export item, comprise a sector that deserves close monitoring. Taiwan is home to global front-runners in the semiconductor industry and if its supply chain suffers disruptions over the geopolitical row with China, international buyers might switch their eyes toward Korean chipmakers as an alternative source. However, there is also a possibility that Korean chip businesses might suffer a setback if the US steps up pressure on China over the chip supply chain in a way that restricts exports.

The complex diplomatic and economic relations involving Taiwan, China and the US require the Korean government to keep a stance focused on peace and stability, while closely monitoring geopolitical trends with a flexible and forward-looking view.