Taiwan Warns Budget Delay Risks 'Rupture'
Taiwanese President Lai Ching-te has warned that the parliament's failure to pass a delayed US$40 billion special military budget could create a "rupture" in the island's defenses against China. Defense Minister Wellington Koo echoed the sentiment, stating the delay risks creating a defensive breach. The warnings underscore an urgent appeal for political unity on national defense in the face of escalating regional threats.
- The eight-year, NT$1.25 trillion (US$39.6 billion) special defense budget was first proposed by President Lai Ching-te in November 2025. It is intended to accelerate the acquisition of asymmetric warfare capabilities and develop a multi-layered air defense system sometimes referred to as the "Taiwan Dome." - This special budget is in addition to Taiwan's annual defense spending, with Lai's government aiming to have the yearly defense budget exceed 3% of GDP in 2026 and reach 5% by 2030. The special budget is earmarked for an eight-year period from 2026 to 2033. - The legislative delay is a result of the January 2024 elections, where President Lai's Democratic Progressive Party (DPP) lost its majority in the Legislative Yuan. The Kuomintang (KMT) is now the largest party with 52 seats, followed by the DPP with 51, and the Taiwan People's Party (TPP) holding a key 8 seats in the 113-seat chamber. - A previous special budget, the "Sea-Air Combat Power Improvement Plan," is set to be completed by 2026 with a total budget of NT$228.9 billion (US$7.38 billion). That plan focused heavily on domestic missile production, including Hsiung Feng anti-ship missiles and Wan Chien air-to-ground munitions. - Specific U.S. arms offers are at risk due to the current impasse, with a March 15 deadline looming for letters of offer and acceptance for items including TOW and Javelin anti-tank missiles, and M109A7 self-propelled howitzers. President Lai has warned the delay could cause Taiwan to lose its priority status for U.S. arms sales. - The budget is meant to counter increasing military pressure from China, which conducted large-scale military exercises simulating a blockade of Taiwan twice in 2025. Chinese President Xi Jinping is focused on military modernization goals for 2027, including capabilities for a potential full-scale invasion of Taiwan. - Key indigenous defense programs are also affected, such as the new Hai Kun-class submarine, which recently completed its first shallow-water diving trials but has faced delays. The goal is to have at least two domestically produced submarines in service by 2027. - Delays in separate procurement programs are already creating potential defense gaps, particularly the delivery of 66 F-16V Block 70 jets from the U.S. Originally scheduled for completion by the end of 2026, supply chain issues and labor shortages have pushed back the timeline, creating a possible air defense gap between 2027 and 2028.
