Taiwan proposes boosting 2027 defence spending by 18% to a record high
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An M60A3 tank fires during Taiwan’s Han Kuang military exercise.
PHOTO: REUTERS
- Taiwan plans to increase its 2027 defence budget by 18% to over NT$1 trillion, focusing on drones, missiles, and modernising its military against China’s threats.
- The government faces opposition challenges but remains committed to boosting defence spending above 3% of GDP, including funds for veterans and the Coast Guard.
- Taiwan recently completed military drills simulating Chinese attacks, while China criticises these exercises and continues its frequent military presence near Taiwan.
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TAIPEI – Taiwan’s government on Aug 20 proposed an 18 per cent rise in defence spending for 2027, including for drones and missiles, taking it above NT$1 trillion (S$39.8 billion) for the first time as Taipei bolsters its military to ward off China.
The budget details come as Beijing, which views democratically governed Taiwan as its own territory, has ramped up military and political pressure over the past few years to assert its claims, which Taipei strongly rejects.
Taiwan also faces calls from Washington to spend more on its own defence, mirroring US pressure on Europe, something President Lai Ching-te has enthusiastically embraced.
The government said in a statement following a Cabinet meeting to approve the 2027 general budget that defence spending in 2027 would reach NT$1.1225 trillion, exceeding 3 per cent of gross domestic product.
Hsieh Chi-hsien, who heads the defence ministry’s comptroller bureau, told reporters that the ministry’s plans include supplementary spending on drones and missiles, for which the government had previously been unable to get parliamentary approval.
Military modernisation a key policy platform
Lai faces a challenge from Taiwan’s opposition-dominated Parliament, which only passed the 2026 budget late on Aug 14 after months of delays.
The two main opposition parties say they will not write blank cheques for the government, though they have repeatedly stressed they support defence spending.
In May, Parliament approved extra defence spending of US$25 billion (S$31.8 billion), or only around two-thirds of what the government had wanted and excluding money for domestic programmes like drones.
The budget includes funds for veterans and also the Coast Guard, which has an auxiliary role to the navy in protecting Taiwan’s maritime areas.
Lai had already announced the defence spending number earlier this week.
Taiwan’s government has made military modernisation a key policy platform and has repeatedly pledged to spend more on its defences, including developing made-in-Taiwan submarines, given the rising threat from China.
China’s military operates almost daily in the waters and skies around Taiwan, and Beijing has also been honing new tactics, such as coast guard “law enforcement” patrols off the island’s east coast in the Pacific Ocean.
Taiwan finished its annual Han Kuang military drills last week, simulating a range of battle scenarios including how to break a potential Chinese maritime blockade.
China's Defence Ministry called the drills a “wasteful charade” that “stoked war panic”. REUTERS
