Taiwan 2027 defence spending to hit $35.2bn, Lai says

Taiwan's government will propose record defence spending for 2027, President Lai Ching-te said Monday, with annual and special defence budgets reaching NT$1.1225 trillion ($35.2 billion).

Lai said the total would exceed NT$1 trillion for the first time and account for more than three percent of GDP. He said it demonstrated Taiwan's resolve to strengthen its self-defence capabilities.

“Investing in national defence is an investment in peace,” Lai said in a statement issued by the Presidential Office. He said Taiwan would continue to build a stronger defence force to maintain peace and stability in the Taiwan Strait and the region.

China claims Taiwan as part of its territory and has threatened to use force to annex the island of 23 million people.

Taiwan has been increasing defence spending for years and acquiring smaller weapons, including drones, to support asymmetric warfare against China. Lai's government has vowed to raise defence spending to five percent of GDP by 2030.

The plan comes amid disputes between Lai's Democratic Progressive Party government and opposition parties, which hold a majority in parliament, over defence spending.

The Kuomintang, which favours closer ties with China, and the Taiwan People's Party passed a $25 billion special defence budget in May, cutting by a third the amount sought by Lai's party. The opposition removed about $15 billion the government wanted for domestic drone procurement and other defence efforts.

Lawmakers are considering rival drone investment proposals worth billions of dollars that could be passed as early as this week.

Parliament approved the government's annual budget for 2026 on Friday after a record delay and shortly before it is expected to receive next year's spending proposal. Opposition lawmakers agreed to cut this year's budget by NT$48 billion, or about 1.6 percent. Parliament is likely to receive the 2027 budget for review by the end of August.