Taiwan President Lai Announces Record Defense Budget to Deter China

President Lai Ching-te delivered a National Day speech in Taipei on October 10, 2026, announcing a record defense budget of NT$1.1 trillion (US$34.5 billion) for 2027. The spending, which exceeds 3% of GDP, is intended to deter war and counter China's military and grey-zone activities. Lai asserted that while Taiwan cherishes peace, it will not accept subordination or surrender its freedom, arguing that increased defense spending ensures future dialogue with China occurs on the basis of parity and dignity.

The Taiwan Affairs Office of the State Council of the People's Republic of China condemned the speech, claiming it distorts the truth and reveals separatist thinking. The agency reiterated that Taiwan is part of China, describing this as the true status quo in the Taiwan Strait.

The Government of the United States welcomed Lai's commitment to stability, stating that a routine speech does not justify aggressive or coercive actions by China. Taiwan continues to rely on the U.S. as its primary security backer and is currently awaiting President Donald Trump's signature on a $14 billion arms package, which includes the Patriot air defense system. Parliamentary Speaker Han Kuo-yu emphasized the importance of U.S. support while noting the desire of the majority of Taiwanese citizens to live in peace.