Taiwan
Plans Military Spending Surge to Counter Rising China
by Adela
Lin and Ting Shi
March 16,
2017, 12:44 PM GMT+7 March 16, 2017, 5:40 PM GMT+7
- Defense expenditures to rise to 3
percent of GDP by next year
- Tensions have grown as island’s
president shifts from Beijing
Taiwan plans
to raise military spending by about 50 percent next year as President Tsai
Ing-wen attempts to offset China’s growing might and support the local defense
industry.
Military
expenditures are targeted to rise to 3 percent of gross domestic product next
year, up from about 2 percent this year, Minister of National Defense Feng
Shih-kuan said Thursday while presenting a report outlining Tsai’s
first major security review since becoming president. Taiwan plans to develop
indigenous ships, airplanes, weapons and unmanned aerial vehicles, he told
lawmakers in Taipei.
The report
cited China’s capacity to blockade Taiwan or invade its outer islands as a main
reason to increase this year’s NT$356 billion ($11.6 billion) budget. Tensions
between the long-time rivals have been simmering since Taiwanese voters swept
Tsai’s pro-independence Democratic Progressive Party into power last year,
raising concern locally about China’s recent military-modernization
drive.
While China
saw improved relations under Tsai’s predecessor, it still considers Taiwan a
province to be united with the mainland, by force if necessary, and points some
1,200 missiles at the island. Authorities in Beijing have expressed increasing
frustration with Tsai’s refusal to endorse their “One China” negotiating
framework, under which both sides agree they belong to the same country even if
they differ on what that means.
Trump
Factor
“It may make
sense from Taipei’s perspective to invest more in defense at this juncture,”
said Ja Ian Chong, an assistant professor with the National
University of Singapore, who specializes in Asia-Pacific relations. “Beijing is
currently already dissatisfied with Taiwan. Unless Beijing wishes to escalate
matters, relations between the two sides are unlikely to get worse, just as
they are unlikely to get better.”
President
Donald Trump’s election in the U.S., which sells weapons to Taiwan and is
obligated to defend the island under a 1979 law, has also increased
uncertainty. Tensions escalated after Trump publicized a protocol-breaking
phone conversation with Tsai in December. He later reaffirmed U.S. support for
the One-China policy in a call with Chinese counterpart Xi Jinping.
Premier Li
Keqiang on Wednesday reiterated China’s opposition for Taiwanese independence
and support for peaceful reunification. “We are one family,” Li said.
Economic
Stimulus
Taiwan’s
defense-spending boost may also help Tsai support hi-tech industries and
stimulate an economy expected to grow 1.9 percent this year, according to data
compiled by Bloomberg. Local companies such as Aerospace Industrial Development Corp., which is
planning to develop jets
for the air force, and CSBC Corp., Taiwan, which is designing submarines,
are among those that could benefit.
Local defense
expenditures have declined since the 1980s, when Taiwan spent more than 5
percent of GDP on its military, according to data compiled
by the Stockholm International Peace Research Institute. Taiwan hasn’t spent 3
percent of GDP on the military since 1999, according to Sipri.
The increase
would help fulfill a campaign pledge by Tsai. Defense Ministry spokesman Chen
Chung-chi said defense expenditures last exceeded 3 percent in 2008. “We hope
for an increase to 3 percent next year, but the government also needs to
consider revenue and balance it among other ministries,” Chen said.
China earlier
this month announced plans to increase defense spending by 7 percent to 1.044
trillion yuan ($151 billion) this year, although independent estimates put
actual expenditures much higher. Either way, China now spends more than any
other country apart from the U.S.
Liu Fu-kuo,
executive director of National Chengchi University’s Taiwan Center for Security
Studies, said the security review shows Tsai’s administration realizes its
disadvantage and is focused on asymmetrical defense strategies.
“It would be
difficult for Taiwan to compete with China’s world-class military power,” Liu
said. “The wisest choice for Taiwan would be refraining from provocative
measures and refraining from giving any excuses for China to take military
actions.”
Original
post: bloomberg.com
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