By Yian Lee
Taiwanese President Lai Ching-te vowed to strengthen defence capabilities after China held its most intrusive military exercises ever around the self-run island democracy.
“My stance has always been clear, that is to firmly safeguard national sovereignty, strengthen national defence and whole-of-society resilience,” Lai said during a New Year address in Taipei on Thursday.
“In the face of China’s severe military ambitions, Taiwan has no time to wait and no time for internal strife,” he said, calling on opposition parties to pass defence-related budget proposals.
The speech came just days after China launched the maneuvers around Taiwan, which included rocket launches and ships crossing into Taiwan’s contiguous zone.
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Beijing said they were punishment for what it called “collusion between the US and Taiwan.” In mid-December, the US approved an $11 billion arms sale to Taiwan — one of the largest ever.
Since Lai took office in May 2024, China has escalated pressure on archipelago of 23 million people it regards as its territory. That includes military drills and daily aircraft incursions into sensitive areas.
Despite the cross-strait tensions, Taiwan’s export-oriented economy has benefited from the global artificial intelligence boom and is expected to record its fastest annual growth since 2010. The AI buildout benefiting Taiwan’s technology companies has also helped send the benchmark stock gauge to record highs in 2025.
Lai, in his remarks, also outlined plans to narrow income gaps and build a more equal society with tax deductions and other measures.
Lai has emphasized strengthening Taiwan’s defences, pledging to raise military spending to more than 5 per cent of gross domestic product by 2030, among other measures.
“Peace can only be secured through strength. It cannot be achieved merely by a piece of peace agreement, nor by accepting the claims of an aggressor,” the president told reporters after his address. “Investing in national defence is investing in peace.”

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