Taiwan Defense & Security Report – Annual Review, 2003

The US-Taiwan military relationship saw a major, positive evolution during 2003. Although the year started out at low ebb, apparently hampered by major differences in strategic outlook and planning, it ended with a comprehensive, shared strategic vision to guide Taiwan’s modernization program over the next decade. This annual issue of the Defense & Aerospace Report will address those developments in the US-Taiwan military relationship, where funding is a key component, as well as the successful implementation of the plan for procurement, tied to the annual budget and to the special arms budget, which will be critical to achieving the shared strategic objectives that have emerged in the US-Taiwan relationship

In addition, we will examine the upcoming Taiwan presidential elections in March, a closely contested race that will have wide-ranging consequences not only for Taiwan’s domestic economic and political situation, but that will also impact China’s cross-Strait policies and influence the full scope of US-PRC-Taiwan relations. Incumbent President and Democratic Progressive Party (DPP) candidate Chen Shui-bian, with running mate Vice President Annette Lu, and the allied Kuomintang/People’s First Party (KMT/PFP) candidates Lien Chan and James Soong are already pulling out all the stops as they vie for popular support. Chen is appealing heavily to a populist sense of identity and nationalism with calls for constitutional change and a public referendum. Lien was carving out a platform calling for a more moderate approach to cross-Strait relations, but the Pan-Blue (KMT/PFP) coalition did not make headway attacking the quality of DPP governance, and has in recent weeks launched its own “nationalist” appeal with competing proposals for referenda and constitutional changes.

Finally, we will review some of what is known of the 2004 national defense budget, and provide a status report on the special arms budget and on the progress of Taiwan’s major arms programs. If President Chen wins the election, the special arms budget will likely move through as expected during the summer months, whereas a Pan-Blue victory could potentially delay the process as a result of the change in administration. As for the overall procurement program – addressing all the systems and projects that the Bush Administration approved in April 2001 – it is moving fairly slowly. With a plan finally in place, however, that pace should accelerate over the course of 2004. Barring unforeseen disruptions, the Taiwan military is poised to move forward on addressing its defense modernization objectives.


Executive Summary: Taiwan Defense & Security Report – Annual Review, 2003

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