Taiwan Cabinet Proposes Supplementary Budget to Boost Defense Spending

Taiwan's Cabinet approved a supplementary budget request totaling NT$607.6 billion, or US$19.12 billion, on Thursday. A portion of this request includes NT$145.7 billion specifically for defense spending, which pushes the island's total defense related spending for the year above NT$1 trillion for the first time. This increase is expected to raise overall defense spending from 3.32 percent of gross domestic product to approximately 3.83 percent, marking the highest level in decades.

The supplementary defense funding is intended to address gaps created after opposition lawmakers cut NT$470 billion from a special defense budget proposed in May. The new proposal earmarks NT$55.9 billion for uncrewed systems, including coastal attack drones, coastal reconnaissance drones, and small one way unmanned surface vessels. The government aims to acquire over 40,000 coastal attack drones, 600 coastal reconnaissance drones, and 100 small one way USVs by 2027.

Additional defense allocations include funding for indigenous Albatross II intelligence, surveillance, and reconnaissance drones, as well as Chiang Kong mid altitude anti tactical ballistic missile systems. The budget also allocates NT$7.3 billion for urgent munitions stockpiles, NT$900 million for the Taiwan Tactical Network, and NT$64.5 billion for two classified projects.

Beyond defense, the largest share of the supplementary budget is designated for the government run oil supplier CPC Corp, Taiwan, which is set to receive NT$233.8 billion to support operations following deficits accrued since 2020.