Opinion: Taiwan needs to boost defense spending, but it must be part of a long-term strategy

While Taiwan’ relationship with the US is vital, defense spending must target national security priorities, not be used to support US defense contractors.

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Taiwan’s defense spending has been in the spotlight once again this week after the US State Department urged the Taiwanese Government to increase its budget to meet the country’s growing security needs. 

An unnamed State Department official was quoted in the Liberty Times as saying that the US continued to stand beside Taiwan and would continue to offer material and logistical support. They added that the US’s strong relations with Taiwan were seen as essential for the stability of the region. 

But the official also urged Taiwan “to further increase its defense budget to a level that realistically reflects the security challenges it is facing.”

The comments come at a time when Communist China is proving an increasingly hostile adversary to Taiwan, while the US’s commitment to Taiwan has rarely looked stronger. The recently approved NDAA 2019 Bill, which includes provisions for supporting Taiwan’s defense and for enhancing bilateral security cooperation between the two countries, is just one example of this. 

Meanwhile, in a visit to Taiwan earlier this week, former US Defense Secretary Ash Carter reconfirmed the crucial role Taiwan plays in the US’s Indo-Pacific strategy.

Why is the US pushing for a higher defense budget? 

But with relations between the United States and Taiwan so strong, it does beg the question about why the comment about increasing defense spending was made.

After all, Taiwan’s defense budget is already on the rise. Earlier this year, President Tsai Ing-wen (蔡英文) noted that it would grow by 20% by 2025. And speaking alongside Ash Carter at the 2018 Asia Pacific Security Dialogue this week, she restated this, saying that “Our defense expenditures will keep pace with our needs and GDP growth and we are developing our indigenous defense industry as well."

One possibility is that the State Department comment was intended to nudge Taiwan into increasing the amount of money it is spending on defense equipment and services from the US. 

Under the administration of President Donald Trump, the country has become increasingly inward-looking. The priority of the Trump administration is to boost their domestic economy, and there is plenty of evidence to suggest that he is willing to put this priority ahead of everything else, including international peace and security. 

It is entirely in keeping with the Trump Administration’s behavior for the State Department to be using their undoubted influence over Taiwan defense for their own economic benefit. And after all, as Taiwan's own Minister of Foreign Affairs, Joseph Wu (吳釗燮), has noted this week, without US support, Taiwan would be vulnerable to invasion from China. 

In this situation, Taiwan needs to tread carefully. It needs to balance maintaining positive US relations with acting in the best interests of the Taiwanese people. And these two priorities may not always lead to the same outcome.

What this means is that while the US will undoubtedly remain Taiwan’s most important defense supplier, it must not be able to cajole Taiwan into buying military equipment or services that are not needed or are not competitively priced. Taiwan must not allow its security needs to be exploited in order to prop up defense industries in the USA.

The need for a long-term defense-spending strategy

The Taiwanese government needs to ensure that it has a fully-rounded defense spending strategy in place that addresses the national security needs of Taiwan right now and does everything it can to anticipate future needs too. 

That doesn’t necessarily mean spending money on traditional military hardware. Undoubtedly Taiwan needs to have up-to-date conventional equipment, but this alone will not keep a Chinese invasion at bay. 

Image Credit: Taiwan Ministry of Defense Facebook Page

Any strategy also needs to consider the bigger picture. Equipment such as cyber-security and counter-surveillance tools, the development of elite special forces, and measures to protect Taiwan’s critical national infrastructure and assets may be deemed a greater priority. 

It is possible that the US may be the best supplier of such things. But they may not. And the priority of the Taiwanese government needs to be ensuring that they are getting the best possible return on their investment, both for national security purposes and in the interests of the Taiwanese taxpayer. 

In recent comments on defense spending, President Tsai has stressed that Taiwan is looking to develop its own domestic defense industrials. Plans are afoot to develop a domestic submarine-building program while there has also been talk of an ambitious new military shipbuilding program too. New Amphibious Transport Ships built in Taiwan are already under construction and are expected to enter service by 2021.

This is a hugely positive development, not just in terms of Taiwan’s military capabilities, but also because of the economic boosts it will bring. Seeking assistance and support for domestic military development programs from the US should be prioritized and no doubt there will be an important role for some US defense contractors to play.

Whether defense projects are taking place in Taiwan or overseas, another priority needs to be ensuring value for money for the Taiwanese taxpayer. This means major defense projects should be subjected to a transparent tendering process wherever possible to ensure that everything is being carried out legitimately and tax dollars are being wisely spent. While US defense contractors should, of course, be invited to participate, if they do not offer the best value for money bids, then Taiwan should be free to take its business elsewhere. 

Any long-term defense spending strategy should also have two other overarching priorities. The first is to seek a cross-party consensus to ensure a stable and long-term strategy can be implemented in full. The worst thing for Taiwan’s national security is a defense strategy which is chopped and changed every time a new administration comes into office. Such an approach is also likely to see large amounts of taxpayer’s money being wasted on aborted schemes. 

It might seem difficult in Taiwan’s highly polarized political climate, but it is in the interests of both major political parties and the Taiwanese people for politicians to seek an agreed strategy that is in the best interest of everyone. 

The other main priority must be the exclusion of Chinese companies, and any defense companies with direct links to the Chinese Communist regime, from being able to bid or participate in Taiwanese defense projects. Because Chinese companies are all propped up by the CCP, they will often be able to offer cheaper alternatives to contractors from other countries. 

But China remains the principal threat to Taiwan’s national security and there is a long track record of Chinese companies leaking information, stealing intellectual property, and even spying on behalf of the Communist regime. With Taiwanese defense at stake, the risks of such actions, or even worse, are magnified and it is clear that Chinese involvement will not represent value for money for Taiwan and is even likely to put national security at risk. 

It is absolutely right that Taiwan should be increasing its defense budget and enhancing its military capabilities. But this must be done as part of a long-term strategy and in the best interests of Taiwanese national security and the Taiwanese people. The need to boost the US defense sector must not be allowed to influence Taiwan’s future military spending plans.