Thu, Mar 03, 2011 - Page 1 News List

US commitment deteriorating: report

BUSINESS VIEWPOINT:The US-Taiwan Business Council criticized foot-dragging on arms sales to Taiwan by the Obama administration, and Taipei also came under fire

By J. Michael Cole  /  Staff Reporter

The council’s criticism was not only focused on Washington, however, pointing to Ma’s failure to meet his campaign promise on national defense.

“As the US shows increasing angst over selling arms to Taiwan, President Ma and his colleagues have determined that they no longer need stand by their ‘defense spending at 3% of GDP’ commitment, as there is little demand from Washington that they do so,” the report said.

“The overall consensus is that Taiwan isn’t spending enough on national security,” it said, adding that forecasts for this year put direct defense expenditure at 2.16 percent of GDP, a figure that would rise to about 2.73 percent of GDP if non-direct expenditures were factored in.

If Taiwan’s economic -expansion continues apace, the share of defense spending to GDP could fall below 2 percent, it said.

The Ma administration’s failure to substantially increase direct and non-direct spending is taking place during a period when Taiwan has to take on “significant new commitments,” it said.

This “budget squeeze” has “tipped the scales so that the MND is laboring under tremendous budget shortages.”

A likely consequence is that Taiwan will almost certainly have to “refocus its force modernization plans” over the next half-decade and look for lower acquisition cost solutions and the prioritization of mid-life upgrades rather than the acquisition of new, more modern platforms.

Looking to the future, the council said a classified assessment of Taiwan’s air power capabilities to Congress — scheduled for release last year, but likely delayed until the second quarter this year — would hopefully provide a blueprint for US security cooperation with Taiwan.

However, the council said it feared the report “will have been written from the perspective of what the administration is and is not prepared to do when it comes to supporting Taiwan defense, rather than being based on the actual threat facing Taiwan.”

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