Taiwan plans extra $40 billion in defence spending
Taiwan’s President Lai Ching-te has announced a special $40 billion budget for arms purchases, as the U.S. pressures the island to increase its defence spending.
The arms purchases include building a Taiwan Dome, an air defence system with high-level detection and interception capabilities.
The budget will be allocated over eight years, from 2026 to 2033, and comes after Lai already pledged to raise defence spending to 5% of the island’s GDP, as part of his strategy amid China’s threats of invasion.
Currently, Taiwan has set an increase in its defence budget to 3.3% of its GDP for 2026, allocating $949.5 billion Taiwan dollars ($31.2 billion). US President Donald Trump has demanded Taiwan raise its defence spending to as much as 10% of GDP, a proportion well above what the US or any of its major allies spend.
Wellington Koo, Taiwan’s defence minister, said Wednesday the $40 billion is an upper limit for the special budget and that it will be used to buy precision-strike missiles and toward the joint development and procurement between Taiwan and the US of equipment and systems, according to AP.
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