Due to rising cross-strait military tensions surrounding the Taiwan Strait between China and Taiwan, Taiwan's defense budget for next year has once again been finalized at a record high of 1.1225 trillion Taiwan dollars (49.3 trillion won). This is a scale that rivals South Korea's defense budget of 65.8 trillion won this year. Considering that Taiwan's gross domestic product (GDP) is merely half that of South Korea, it can even be described as immense. Naturally, there remains a significant difference compared to China's defense budget of 1.9095 trillion yuan (395.2 trillion won) this year.

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A report by a Chinese media outlet stating that Taiwan's defense budget continues to hit record highs. / China's state-run China Central Television (CCTV)

According to Beijing sources familiar with cross-strait relations on August 21, Taiwan's Executive Yuan (Cabinet) approved this budget bill the previous day during a meeting on the 2027 central government general budget presided over by Premier Cho Jung-tai. Premier Cho also announced at the meeting that next year's revenues and expenditures are both set at record highs of 3.9266 trillion Taiwan dollars.

He further stated that the budget proposal would be submitted by the end of this month to the Legislative Yuan (parliament), where the opposition holds the majority, urging lawmakers to pass it following a reasonable and careful review.

This record-high defense budget was finalized after receiving final approval on August 17 from President Lai Ching-te, who was briefed by the Executive Yuan on next year's central government budget proposal.

Next year's defense budget, finalized the previous day, is an increase of approximately 173 billion Taiwan dollars from this year's previous record high of 949.5 billion Taiwan dollars, marking the first time in history that it has surpassed 1 trillion Taiwan dollars. Calculated against the GDP estimate of 28.6 trillion Taiwan dollars released in August of last year, it accounts for 3.93 percent of GDP. Even based on next year's GDP estimate of 37.3 trillion Taiwan dollars released in August of this year, it amounts to 3.01 percent of GDP.

Formulated with reference to NATO standards, Taiwan's defense budget for next year is reportedly allocated into 691.9 billion Taiwan dollars for the Ministry of National Defense, 27.3 billion Taiwan dollars for the Coast Guard Administration, 103.8 billion Taiwan dollars for the Veterans Affairs Council, 238.8 billion Taiwan dollars in special budgets, and approximately 60.7 billion Taiwan dollars for non-operating special funds.

In particular, the Ministry of National Defense's budget proposal allocates 259.1 billion Taiwan dollars for military investment, up 97.5 billion Taiwan dollars from this year; 224.7 billion Taiwan dollars for operational maintenance, such as procuring ammunition and spare parts, up 25.7 billion Taiwan dollars; and 208.1 billion Taiwan dollars for personnel maintenance costs due to the gradual increase in volunteer soldiers, up 7.3 billion Taiwan dollars.

Prior to this, President Lai announced in January that Taiwan's defense budget would exceed 3 percent of GDP this year and reach 5 percent of GDP by 2030. It seems only a matter of time before China's backlash and military demonstrations materialize.

                                                                                                         Hong Soon-do