TAIPEI: Taiwan’s government plans to increase its 2026 defence budget to more than three percent of GDP, the premier said Thursday, as it faces US pressure to invest more in its own protection.
Taipei has ramped up investment in military equipment and weapons over the past decade in response to intensifying pressure from China, which claims the democratic island as part of its territory and has threatened to seize it by force.
Premier Cho Jung-tai said the latest hike was “another concrete demonstration to the world and the people of Taiwan of our resolve and ability to safeguard national sovereignty and security”.
The proposed spending needs to be approved by the opposition-controlled parliament before it can take effect.
Taiwan’s cabinet has allocated NT$949.5 billion (US$31.1 billion), or 3.32 percent of GDP, for defence spending next year, the government’s budget documents show.
“Our total defence budget is calculated using NATO’s model and standards, including the budget for… the coast guard,“ Cho told reporters.
Cho gave the figure 3.23 percent during the news conference but the cabinet later confirmed to AFP that 3.32 percent is the correct number.
Cho said overall expenditure for 2026 was budgeted at just over NT$3 trillion — up NT$110 billion or around 3.8 percent from 2025.
President Lai Ching-te has previously vowed to increase defence spending to more than three percent of GDP as Washington pressured the island and other governments around the world to spend more on their own security.
The announcement comes as Taipei seeks to strike an agreement with US President Donald Trump’s administration for a lower tariff on Taiwanese shipments to the United States.
Earlier this month, Trump imposed a temporary 20 percent tariff on Taiwan’s imports as part of his global trade war.
The two sides are still trying to reach an agreement.
The China-friendly Kuomintang party which controls the island’s legislature with the help of the Taiwan People’s Party, slashed the Lai government’s 2025 budget.
It had planned to increase defence spending to a record NT$647 billion, or around 2.5 percent of GDP. However, some items were cut or frozen.
The KMT has defended the reductions, saying the party was seeking to stop wasteful spending.
Trump has previously suggested Taiwan should pay the United States for its protection and accused the island of stealing the US semiconductor industry.
While Taiwan has a homegrown defence industry and has been upgrading its equipment, it would be outgunned in a conflict with China and relies heavily on US arms sales to bolster its security capabilities.