Taiwan plans extra $40bn in defence spending to counter China’s ‘intensifying’ threats

Original article by Helen Davidson in Taipei

Beijing’s threats to Taiwan are “intensifying” and its preparations to invade are speeding up, Taiwan’s government has said while announcing a $40bn special defence budget and a swathe of measures to counter Chinese attacks.

The Taiwan president, Lai Ching-te, said there was “no room for compromise on national security”, and he was committed to boosting Taiwan’s defences in conjunction with US support.

“This is not an ideological struggle, nor a ‘unification vs independence’ debate, but a struggle to defend ‘democratic Taiwan’ and refuse to submit to being ‘China’s Taiwan’.”

Lai and defence minister, Wellington Koo, announced the spending bump – an increase of at least $8bn on what had previously been flagged – on Wednesday after a briefing from the national security council.

He said Chinese authorities had escalated military harassment, international pressure, and propaganda, as well as espionage and infiltration inside Taiwan.

Lai said the most threatening annexation scenario wasn’t Chinese military action, but Taiwan “giving up”, according to a translation of his remarks.

“History has proven that compromising with aggression only brings war and enslavement,” he said.

He said Beijing’s offer of a Hong Kong-style ‘one country two systems’ governance under Chinese rule should be formally considered an “inviolable red line for Taiwanese society”.

Koo said the extra budget, covering 2026-2033, would include AI tools to improve current systems, as well as new missiles and drones.

The government would also make improvements to military procurement (several big ticket orders from the US have faced significant delays), and would create new measures to protect Taiwanese abroad from Chinese transnational repression, he said.

The defence budget increase is expected to lift Taiwan’s spending to 3.3% of GDP in 2026, and Lai has pledged to reach 5% by 2030.

Raymond Greene, the representative at the US de-facto embassy, the American Institute, said the announcement was “a major step towards maintaining peace and stability across the Taiwan Strait by strengthening deterrence”.

A spokesperson for China’s Taiwan Affairs Office, Peng Qingen, earlier told a press briefing that Taiwan was squandering money on “currying favour with external powers”.

“This will only plunge Taiwan into disaster.”

The announcement followed a phone call between Donald Trump and Xi Jinping on Tuesday, in which Xi reiterated his claim over Taiwan and intention to eventually annex it.

“Taiwan’s return to China is an integral part of the post-war international order,” he told Trump, according to a Chinese readout.

It also comes amid an ongoing diplomatic spat between China and Japan over the latter’s stance on Taiwan, after Japan’s prime minister, Sanae Takaichi, said her country would likely get involved militarily if China attacked Taiwan. China launched a swathe of economic retaliations in response. It has also been further angered by Japanese plans to install a missile on Yonaguni Island, Japan’s closest territory to Taiwan, just 110km off its east coast.

Tokyo’s defence minister, Shinjiro Koizumi, visited Yonaguni on Saturday, telling press that preparations were “progressing steadily” for the installation of a medium-range, surface-to-air missile deployment.

China’s government accused Japan of deliberately stoking regional tensions.

“Japan’s deployment of offensive weapons in areas adjacent to China’s Taiwan region is extremely dangerous, deliberately creating regional tensions and provoking military confrontation,” said Peng on Wednesday.

“We have a firm will, strong determination and a strong ability to defend our national sovereignty and territorial integrity… We will crush all foreign interference.”

Lillian Yang and agencies contributed to this report