Taiwan proposes USD20 billion defence budget for 2025

Taiwan's defence budget is forecast by Janes Defence Budgets to reach nearly USD30 billion by the end of the decade. (Janes Defence Budgets)

Taiwan's government announced on 22 August a proposed 2025 defence budget of TWD647 billion (USD20.2 billion).

The new budget, which includes funding for seven additional submarines, is an increase of TWD46.4 billion or nearly 8% compared with the defence allocation in 2024, according to statistics published by the government's Directorate General of Budget, Accounting and Statistics (DGBAS).

The 2025 expenditure includes TWD476 billion for ‘core' defence spending, with the remaining TWD171 billion set aside for ‘special' expenditures, including major military acquisition programmes and other activities.

Allocations

Taiwan's core defence budget includes TWD145.8 billion for military investment, which is also thought to include procurement, TWD148.7 billion for operations and maintenance, and TWD181.5 billion for military personnel. Military investment spending increases by 16% in 2025, with the two allocations rising by 13.5% and 2% respectively.

Special funds include TWD43 billion for Taiwan's ongoing procurement of Lockheed Martin F-16V fighter aircraft and TWD47.4 billion for Taiwan's ‘naval and air force capability enhancement programme'. The latter programme is mainly focused on the local development and production of missiles.

Another allocation is for ‘non-operating special funds' – believed to pay for military infrastructure, housing, and defence production – which will receive TWD80.6 billion in 2025.

Submarines

The DGBAS did not clarify the source of funding for the new submarines.

However, Taiwan's Ministry of National Defense (MND) said in a press release that 2025's defence budget “focuses on continuing to promote the domestic production of aircraft and ships, including seven domestically produced follow-on submarines”.