Beijing Rebukes Taiwan’s Record NT$1T Defense Budget

China’s State Council Taiwan Affairs Office has sharply criticized the Lai Ching-te administration’s announcement that Taiwan’s 2027 defense budget will exceed NT$1 trillion (approximately US$31.4 billion) for the first time, calling the move an attempt to “resist reunification by force” that will bring disaster to Taiwanese people. Spokesperson Zhang Han delivered the rebuke at a routine press conference on September 2, according to Xinhua News.

A Historic Budget Milestone

The controversy stems from Taiwan’s Executive Yuan approval of the 2027 central government general budget on August 20, which set overall defense spending at NT$1.1225 trillion—an 18.2 percent increase over the previous year and the first time the figure has surpassed the NT$1 trillion threshold. The budget, which exceeds 3 percent of Taiwan’s projected GDP, includes Ministry of National Defense expenditures of NT$691.9 billion, special budget allocations of NT$218.2 billion, and additional funding for veterans’ benefits and Coast Guard operations, as reported by RFI.

President Lai Ching-te has publicly framed the increased spending as essential to Taiwan’s self-defense, stating on August 17 that “investing in defense is investing in peace” and pledging that defense spending would reach 5 percent of GDP by 2030, according to Voice of America.

Beijing’s Response

At the September 2 press conference, Zhang Han said the Lai administration “stubbornly adheres to the ‘Taiwan independence’ separatist position, ignores the mainstream public opinion on the island for peace, development, exchange, and cooperation, blindly incites cross-strait confrontation, and wastefully spends people’s hard-earned money.” She characterized the administration’s efforts as attempts to “resist reunification by force” and “seek independence by force,” calling them “purely overestimating one’s own strength” that will only bring deep disaster to Taiwanese compatriots.

Zhang emphasized that China’s “determination to defend national sovereignty and territorial integrity is unwavering, and our capability is extremely powerful,” adding that Beijing will “never leave any space for any form of ‘Taiwan independence’ separatist activities.” She urged Taiwanese compatriots to recognize the “extreme harm and danger” of separatism and to firmly oppose such acts.

The response follows a similar rebuke from the PLA Ministry of National Defense on August 27, when spokesperson Zhang Xiaogang said the Lai administration “wastefully spends people’s hard-earned money, is excessively militaristic, greatly harms the welfare of people on the island, will ultimately empty Taiwan’s resources, and cannot escape defeat,” as reported by NetEase.

Escalating Rhetoric and Military Posturing

The latest exchange marks an escalation in Beijing’s response to Taiwan’s defense buildup. In April, Taiwan Affairs Office spokesperson Chen Binhua warned that no matter how much budget the Lai administration allocates or how many weapons it purchases, it is “overestimating its own strength and hitting a stone with an egg,” as documented by China Taiwan Net. By June, Chen had declared that “‘Taiwan independence’ and peace in the Taiwan Strait are incompatible” and that “‘protection fees’ cannot buy protection,” according to Xinhua News.

Lai has used recent commemorative occasions to rally support for the defense budget. At the 68th anniversary of the 823 Battle in Kinmen on August 23, he urged all political parties and citizens to “uphold the spirit of 823 military-civilian unity and anti-communism to protect Taiwan” and to jointly support the defense budget, as reported by CNA.

Domestic and Regional Dynamics

The defense budget increase reflects multiple pressures on Taiwan. The United States has been urging allies and partners to raise defense spending to 3.5 percent of GDP, and Taiwan’s strong economic growth—projected at 11.05 percent for 2026—has provided fiscal space for expanded military expenditures. However, the budget still faces review in Taiwan’s Legislative Yuan, where cross-party tensions over its size and composition are expected to be contentious.

Analysts have noted that while the NT$1.1225 trillion figure marks a significant milestone, questions remain about whether Lai’s 5 percent of GDP target by 2030 is achievable, particularly given Taiwan’s rapid GDP growth projections. The budget approval process in the coming months will serve as a key test of Taiwan’s political consensus on defense spending.

What to Watch

As the 2027 budget moves through the Legislative Yuan, several factors will shape the trajectory of cross-strait tensions: the outcome of the budget review, Taiwan’s continued weapons procurement from the United States, and Beijing’s response to what it views as provocative defense posturing. The coming months will reveal whether the escalating rhetoric on both sides translates into concrete policy shifts or remains a diplomatic standoff with significant regional implications.