Lai Ching-te: Additional $40 Billion Defense Budget to Counter CCP Threat

On November 26, 2025, Taiwan President Lai Ching-te speaks at the press conference for the “Safeguarding Democratic Taiwan National Security Action Plan.”

[People News] Taiwan President Lai Ching-te said Wednesday (November 26) that Taiwan will add 1.25 trillion New Taiwan dollars (about 40 billion USD) to its defense budget to strengthen Taiwan’s asymmetric warfare capabilities and demonstrate Taiwan’s determination for self-defense amid the CCP’s continued intensification of military and political pressure against Taiwan.

According to Voice of America, Lai Ching-te said at the “Safeguarding Democratic Taiwan National Security Action Plan” press conference held at the Presidential Office that history has proven that compromising in the face of aggression only brings “enslavement,” and that Taiwan has “no room for compromise” in national security. He emphasized that national sovereignty and the core values of freedom and democracy are the “fundamental basis” of Taiwan’s founding.

Taiwan’s Minister of National Defense, Wellington Koo, stated that the additional budget will be used for missiles, drones, and the construction of a new integrated air-defense system known as the “Shield of Taiwan.” The entire special budget will be implemented in annual phases from 2026 to 2033.

Raymond Greene, Director of the American Institute in Taiwan (AIT), issued a statement on Facebook welcoming Taiwan President Lai Ching-te’s announcement of the additional 40 billion USD defense budget. Greene said in the statement, “The United States supports Taiwan in rapidly acquiring the key asymmetric capabilities needed to strengthen deterrence, which is consistent with the Taiwan Relations Act and the consistent commitments across many U.S. administrations over decades.”

The United States and Taiwan do not have formal diplomatic relations, but they maintain strong unofficial relations. Under the Taiwan Relations Act, the U.S. provides Taiwan with defensive weapons and is Taiwan’s primary supplier of defense materials and services. The U.S. government has consistently stated its commitment to maintaining peace in the Taiwan Strait but continues to oppose any actions that attempt to change the status quo in Taiwan through force or coercion.

President Donald Trump, after returning to the White House, has already announced two arms sales to Taiwan: On November 13, he approved the sale of fighter jet and other aircraft parts valued at 330 million USD; and on November 17, the U.S. Department of War announced it had awarded Raytheon Co. a contract worth nearly 700 million USD to procure advanced surface-to-air missile systems for sale to Taiwan.

Taiwan has long pursued an “asymmetric warfare” strategy to counter the PRC military, which is far larger than Taiwan’s. Taiwan’s government expects overall defense spending to reach 3.32% of GDP in 2026, surpassing 3% for the first time since 2009. However, the budget must still be approved by Taiwan’s Legislative Yuan, where opposition parties currently hold the majority.

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