Taiwan Proposes 16% Defense Spending Increase for 2027

The Cabinet of Taiwan will propose a 16% increase in defense spending for 2027, with the total budget expected to exceed T$1.1 trillion for the first time. Scheduled for unveiling on August 20, the proposed budget will surpass 3% of the island's gross domestic product. The funding will support the coast guard, veterans, and special projects, including the development of domestic submarines.

This spending hike follows intensified military and political pressure from China, which claims Taiwan as its own territory and increased its own 2026 defense spending by 7%. The move also responds to calls from the United States for Taiwan to increase its own defense expenditures.

President Lai Ching-te observed the annual Han Kuang military exercises in Taoyuan on August 9. He stated that only the people of Taiwan can decide the island's future and maintained that "every bit of solid preparation in peacetime adds another measure of stability and strength for our nation."