As Taiwan navigates its increasingly complex relationship with China and the United States, it faces growing pressure. With Donald Trump resuming the presidency in 2025, Taiwan will encounter new demands, especially in defense spending. During his campaign, Trump urged Taiwan to significantly boost its defense budget, continuing his stance of treating Taiwan as an essential, yet self-reliant partner. These shifts are reshaping the geopolitical landscape in the Taiwan-China-U.S. triangle, which will influence regional dynamics for years.
Taiwan’s current defense challenges
Taiwan’s defense budget has always been a point of contention. Despite strong U.S. military support, Taiwan’s own defense spending has remained low relative to its GDP. In 2024, Taiwan allocated 2.45% of GDP to defense, a figure well below the 3% threshold that many U.S. policymakers consider necessary for credible defense against China. Trump’s call for Taiwan to take on more defense responsibility could result in a major shift in this relationship.
Trump’s geopolitical vision and Taiwan’s role
Trump’s 2024 campaign emphasized Taiwan’s responsibility to significantly increase its defense spending. He proposed raising Taiwan’s defense budget to 5%, or even 10% of GDP. This drastic increase could strain Taiwan’s economy and create political turmoil. Taiwan’s Democratic Progressive Party faces the challenge of balancing defense demands with domestic economic needs. Analysts warn that such demands could deepen internal political divides and complicate Taiwan’s economic strategy.
The growing threat from China
Meanwhile, Taiwan faces the ongoing threat of Chinese military aggression. Beijing views Taiwan as part of its territory and has shown increasing willingness to use force if necessary. Tensions in the Taiwan Strait continue to rise, with China regularly conducting military exercises near Taiwan. Taiwan must bolster its defenses while balancing diplomatic and military risks, particularly as Trump’s demands for increased military readiness coincide with growing Chinese assertiveness.
The U.S.-Taiwan-China triangle: A delicate balance
Trump’s presidency will likely redefine the U.S.-Taiwan-China triangle. While Taiwan must strengthen its defense, it must also avoid further alienating China. The U.S. push for Taiwan to increase defense spending could isolate the island, leading to a reliance on American military support and a potential strain in relations with Beijing. Furthermore, Taiwan’s pivotal role in the semiconductor industry may add economic pressures as the U.S. seeks more technology-sharing.
A challenging road ahead for Taiwan
As Taiwan faces these complex demands, its government must navigate tough decisions. The pressure to increase defense spending comes with significant financial and political costs, especially amid Chinese threats. Taiwan’s leaders must balance defense readiness with economic stability, all while maintaining a delicate diplomatic balance between the U.S. and China.