Taiwanese President Lai Ching-te has announced a significant boost to the island’s defence spending, unveiling a supplementary budget of 1.25 trillion New Taiwan dollars (approximately $40 billion) to counter what he described as China’s rapidly escalating military and political pressure.
At a press conference on Wednesday, Lai said Beijing had sharply intensified its military exercises and “gray-zone” tactics around the island, warning that China aims to build the capability to forcibly seize Taiwan by 2027. He accused China of widening its “infiltration and influence operations” designed to interfere in Taiwan’s domestic politics and weaken public trust in its democratic institutions.
Lai also pointed to a broader pattern of Chinese assertiveness across the region, describing Beijing’s actions in the Taiwan Strait, the East and South China Seas, and the wider Indo-Pacific as increasingly provocative.
China, which claims Taiwan as part of its territory, has repeatedly condemned the island’s leadership for promoting “independence,” and has carried out several rounds of large-scale military drills near Taiwan in recent years. Chinese President Xi Jinping has insisted that reunification with Taiwan is “inevitable,” a stance Taipei rejects.
Beijing raised its own defence budget by more than 7% this year, reaching roughly $245 billion, according to estimates by the Center for Strategic and International Studies, with a major portion of military assets positioned close to Taiwan.
Lai said the expanded defence budget is part of a broader plan to strengthen Taiwan’s self-defence capabilities, improve readiness, and ensure the island can deter any potential invasion. The goal, he said, is to achieve a high state of combat preparedness by 2027.
The development comes amid a diplomatic dispute between China and Japan. Beijing criticised Tokyo after Japanese Prime Minister Sanae Takaichi said any conflict involving Taiwan could trigger a “survival-threatening situation” for Japan. China labelled the statement “egregious” and demanded its withdrawal.
Meanwhile, U.S. President Donald Trump held separate phone conversations this week with Xi and Takaichi. Analysts believe Xi may have pressed Trump to rein in Japan’s increasingly vocal stance on Taiwan.
Just before Lai’s remarks, China’s Taiwan Affairs Office again accused Lai’s Democratic Progressive Party of jeopardising Taiwan’s prosperity and warned against any foreign support for what it described as “separatist activities.”
China’s foreign ministry has yet to issue a formal response to the new defence announcement.
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