Taiwan announced a massive $40-billion supplementary defence budget on Wednesday, signaling its strongest commitment yet to counter growing military pressure from China. President Lai Ching-te said the new package demonstrates Taiwan’s determination to safeguard its sovereignty and defend democratic values against increasing threats.
The additional T$1.25 trillion plan, covering 2026 to 2033, includes major investments in missiles, drones, and the new “T-Dome” air defence system. Moreover, Lai warned that history shows compromise in the face of aggression leads only to “enslavement,” insisting there can be no concessions on national security. Washington has also urged Taipei to boost spending, mirroring pressure placed on European allies.
Lai added that the spending reflects a clear divide between protecting democratic Taiwan and refusing to submit to becoming “China’s Taiwan.” Taiwan’s Defence Minister Wellington Koo explained that the military continues shifting toward an asymmetric strategy designed to counter China’s far larger armed forces with more agile and targeted capabilities.
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Additionally, the United States welcomed the new defence budget, with its de facto ambassador saying the plan strengthens deterrence across the Taiwan Strait. Taiwan expects defence spending to reach T$949.5 billion in 2026, marking 3.32% of GDP and crossing the 3% mark for the first time since 2009. However, the opposition-dominated parliament must still approve the proposal.
Opposition leader Cheng Li-wun urged caution, saying the people of Taiwan deeply desire peace and hope to avoid war, though she did not state whether her party would reject the budget. Meanwhile, Beijing criticised Taiwan for allowing “external forces” to shape its decisions, arguing that the increased spending will harm residents’ livelihoods and pull the island “into disaster.”
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Lai reaffirmed that only Taiwan’s citizens can decide their future, rejecting China’s accusations of separatism and highlighting strong ties with the United States. As tensions rise across the region—especially after Japan warned it could act if China attacked Taiwan—the new defence package underscores Taipei’s growing sense of urgency and its resolve to deter any possible aggression.