Taiwan proposes 18% defence budget hike for 2027
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- Taiwan proposed an 18% rise in its 2027 defence spending to NT$1.1225 trillion, exceeding 3% of GDP and marking the first time the budget crosses the NT$1 trillion threshold.
- Lai Ching-te's government prioritized military modernization, allocating funds for drones, missiles, and domestic submarine development amid rising pressure from China.
- Hsieh Chi-hsien confirmed supplementary spending plans for drones and missiles, which previously failed to gain parliamentary approval despite executive requests.
- Taiwan's Parliament delayed the 2026 budget for months and approved only two-thirds of requested emergency defence funds, signaling ongoing fiscal resistance despite cross-party support for defence in principle.
- China maintains near-daily military activity around Taiwan and criticized recent Han Kuang drills as a 'wasteful charade' that stokes war panic, while increasing coastguard patrols near Taiwan’s Pacific coast.
Why it matters: Taiwan is materially escalating its military preparedness with a record budget that exceeds 3% of GDP, yet faces internal legislative hurdles that have already reduced funding for critical capabilities like drones—slowing readiness even as Chinese military pressure intensifies around the island.
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