Taiwan will allocate an additional $40 billion (NT$1.25 trillion) to its defense budget to underscore its readiness to defend itself in the face of a growing threat from China, President Lai Ching-te said on November 26, as reported by Reuters.
“There can be no room for compromise when it comes to national security,” the president said at a press conference. “Sovereignty and the fundamental values of freedom and democracy are the foundation of our nation.”
The president stressed that, “as history shows,” any compromise in the face of aggression results in nothing but “enslavement.”
Taiwan’s Defense Minister Wellington Koo added that the budget package, covering the period from 2026 to 2033, will finance missiles, drones, and the new T-Dome “dome-shaped” air-defense system.
In August, amid calls from Washington to increase defense spending, Lai Ching-te expressed hope that by 2030 Taiwan would raise defense expenditures to 5% of its GDP.
Taiwan’s authorities plan to increase defense spending in 2026 to NT$949.5 billion ($30.3 billion), which would amount to 3.32% of GDP and exceed the 3% threshold for the first time since 2009.
The spending plan must be approved by the opposition, which holds a majority in Taiwan’s legislature. Cheng Li-wen, chair of the Kuomintang — Taiwan’s largest opposition party — stopped short of saying that her party would vote against the budget amendments but urged the president to “step back from the edge of the cliff.” “I hope the international community understands that the people of Taiwan want peace,” she told a party meeting.
Relations between Japan and China sharply worsened in November after Japanese Prime Minister Sanae Takaichi stated that Japan was prepared to intervene militarily in the event of a confrontation between Beijing and Taipei. According to Takaichi, the use of force by China against Taiwan would constitute an existential crisis for Japan and could justify countermeasures by the Japan Self-Defense Forces. Beijing, which considers Taiwan part of its territory, reacted harshly, threatening military action in response to any Japanese intervention.
China has begun exerting economic pressure on Japan: on November 14, authorities urged Chinese citizens to avoid traveling to Japan. On November 19, Beijing declared that there was “no market” for Japanese goods in China, referring to seafood exports. Chinese airlines started canceling flights to Japan en masse. By November 24, the number of canceled flights through December 31 had risen by around 56% compared with the same period the previous month.
Against this backdrop, Reuters published an investigation showing that China is mobilizing an armada of civilian vessels that could be used in the event of an invasion of Taiwan (Beijing has the legal authority to requisition civilian ships for military purposes). According to the agency, such an operation could exceed the scale of the Allied landings in Normandy during World War II.
