As China Raises Stakes, Taiwan Unveils $40B Defense Spree

As China ramps up military activity near Taiwan, the island's president announced a fresh $40 billion defense budget to shore up its defenses. President Lai Ching-te unveiled the plan for the supplementary budget on Wednesday, citing what he described as an "unprecedented military buildup" by Beijing and stepped-up "gray-zone harassment" that includes military drills and political interference, per CNBC. Part of Taiwan's updated defense plan includes erecting the Taiwan Dome, or T-Dome, "an air defense system with high-level detection and interception capabilities," reports the AP.

Lai, who said China wants to bring Taiwan under its control by force by 2027, accused China of an "infiltration and influence campaign" designed to influence public opinion and undermine Taiwan's democracy, per CNBC. "Taiwan's dedication to peace and stability is unwavering," Lai wrote in a Tuesday op-ed in the Washington Post. "No country will be more determined in safeguarding Taiwan's future than our own."

China has increased its defense budget by 7.2% this year, to about $245 billion, with a significant portion of its military assets positioned near the Taiwan Strait. President Xi Jinping has called reunification with the mainland "a historical inevitability," though Taiwan rejects Beijing's territorial claims. Experts say Lai's announcement is seen as "a signal to Washington" that Taiwan is serious about its own defense and is willing to boost imports, possibly to help balance trade between the two.

The US welcomed the new budget, with the director of the American Institute in Taiwan—the de facto US embassy—saying it supports Taiwan's efforts to beef up its deterrence capabilities. China's government, for its part, dismissed the move, saying Taiwan's ruling Democratic Progressive Party's efforts at "resisting reunification and seeking independence using armed forces is doomed to fail." The announcement comes amid a diplomatic spat between China and Japan, after Japanese Prime Minister Sanae Takaichi said that any military action against Taiwan could threaten Japan's survival. Beijing has demanded a retraction, calling Takaichi's remarks "egregious."