Key facts
- Taiwan's cabinet plans to propose a 16% increase in defense spending for 2027.
- The proposed budget is expected to exceed T$1.1 trillion ($31 billion), surpassing T$1 trillion for the first time.
- This spending will account for over 3% of Taiwan's gross domestic product.
- The budget includes funds for the coast guard, veterans, and special projects.
- Taiwan is modernizing its military in response to increased pressure from China.
Taiwan's cabinet is set to propose a significant 16% increase in defense spending for 2027, a move that would push the budget past T$1 trillion ($31 billion) for the first time. This proposed increase reflects Taiwan's commitment to bolstering its military capabilities amid escalating pressure from China, which claims the self-governed island as its territory. The budget, expected to be unveiled on August 20, will also cover funding for the coast guard, veterans, and special projects, and is projected to remain above 3% of the island's gross domestic product.
President Lai Ching-te has actively supported increasing defense expenditure, aligning with calls from the United States for Taiwan to enhance its self-defense capabilities. This strategic focus on military modernization is a key policy platform for Taiwan's government, driven by the persistent threat from China's rapidly modernizing armed forces. China's military activities around Taiwan are frequent, including periodic war games. In contrast, China announced a 7% increase in its own defense spending for 2023.
President Lai, who China refuses to engage with, has emphasized the importance of thorough preparation during peacetime, stating that such efforts contribute to national stability and strength. Taiwan is currently conducting its annual Han Kuang military exercises, underscoring its ongoing efforts to enhance military readiness.