When policymakers in Jakarta, Bangkok or Manila think about cross-strait tensions, the instinct is often to treat them as a problem centered on Taiwan, China and the US, but that view is becoming harder to sustain.
Southeast Asia has a direct stake in what happens across the Taiwan Strait. A crisis would not stay confined to Northeast Asia. It would disrupt shipping, unsettle technology supply chains, and expose the region to economic and strategic shocks.
That is why Taiwan’s quieter transformation deserves more attention. Taipei is not only preparing for a possible war with China, it is also reshaping its defense posture through technology. Drones, secure communications, semiconductors and dual-use systems are becoming central to how Taiwan thinks about deterrence.
This matters for Southeast Asia, because it links Taiwan’s security more closely to the industrial and technological future of the wider region. The New Southbound Policy helps explain this shift. It began as a strategy to reduce dependence on China by expanding trade and investment ties with Southeast Asia, South Asia, Australia and New Zealand, but it now carries a wider meaning. Technology, security and economic resilience are becoming more closely connected.
Taiwan is no longer only trying to diversify markets. It is trying to become part of trusted supply chains and strategic partnerships that could support it in a more dangerous regional environment. Nowhere is this clearer than in drones. The Ministry of National Defense in July last year announced plans to procure nearly 50,000 drones over two years. These systems range from smaller multi-rotor platforms to longer-range fixed-wing models.
What matters is not only the number. Taiwan wants them built at home, and it has explicitly barred Chinese-made components. This tells us that Taipei sees drone production not simply as procurement, but as industrial capacity tied directly to national security.
That is part of a wider push. Taiwan is trying to build an entire ecosystem around uncrewed systems: secure flight-control chips, artificial intelligence (AI)-enabled software, communications modules, testing capacity and domestic assembly. This fits its broader move toward asymmetric defense.
Taiwan cannot hope to match China platform for platform. It is instead trying to field systems that are cheaper, harder to eliminate all at once and better suited to raising the cost of attack. Drones fit that logic well. They can support surveillance, disrupt an approaching force and buy time in the opening stages of a conflict.
For Southeast Asia, this has at least two implications. First, Taiwan’s attempt to develop self-reliant production could create new openings for regional suppliers able to provide non-Chinese components and specialized technologies. Second, if Taiwan succeeds in bolstering deterrence, that could help reduce the risk of a conflict, the spillover of which would be felt well beyond the Strait.
However, drones are only one part of the story. Taiwan is also investing in space-related technologies and secure communications. That matters because modern deterrence depends on more than weapons. It also depends on tracking, transmitting and staying connected under pressure. Programs such as the Taiwan Accelerator Plus have supported start-ups working on space defense technologies, while firms such as BaseTech are developing systems that combine optical, radar and AI capabilities to track satellites and drones.
Taiwan is also putting money into free-space optical communications, which could provide more resilient links between systems in contested conditions. This is where semiconductors come back into the picture. Taiwan’s chip industry is often discussed as either a strategic asset or a strategic vulnerability. In reality, it is both.
However, for Southeast Asia the key point is different: Taiwan’s semiconductor strength is becoming part of its defense logic. A country that can produce advanced components, scale precision manufacturing and sustain secure digital systems under pressure has advantages that go far beyond export earnings. Taiwan’s relevance now lies not only in what it sells, but in the industrial ecosystem it can anchor.
That has clear regional implications. Southeast Asia is deeply tied to electronics, manufacturing and logistics. If Taiwan can bolster its chip production and diversify its partnerships, that could reduce the risk of supply shocks that would reverberate across ASEAN economies. It could also create opportunities for firms and research institutions in the region to connect with higher-value segments of advanced manufacturing.
That is also why Taipei talks so much about trusted or “non-red” supply chains. Chinese dominance in many commercial drone components has made dependency a strategic risk. Taiwan is trying to position itself as part of an alternative. That effort is starting to move from rhetoric to practice. At last year’s Taipei Aerospace and Defense Technology Exhibition, Taiwanese institutions announced coproduction and codevelopment projects with US firms in loitering munitions and uncrewed aerial vehicle platforms. Exports of Taiwanese uncrewed systems to the US have also risen sharply, and Thunder Tiger became the first Taiwanese company to be added to the US Department of Defense’s Blue UAS Cleared Drone List.
These are still early steps. Taiwan’s industry faces real limits in scale, cost and access, but the direction is clear enough. The nation is trying to move from buyer to partner. So what does this mean for Southeast Asia? It means Taiwan’s security strategy is no longer only about arms sales and military planning. It is also about production, technology and supply chain resilience.
For ASEAN governments and firms, that creates opportunities and dilemmas. Closer engagement with Taiwan’s technology sectors could support diversification, industrial upgrading and regional resilience. However, it could also carry political costs, especially given China’s weight in the region.
Still, one thing is increasingly clear: Taiwan’s defense technology shift is not a side story to regional security. It is part of regional security, and Southeast Asian countries have more reason than before to pay attention.
Aniello Iannone is a lecturer in Indonesian and Southeast Asian politics in the Department of Political Science and Government at Diponegoro University in Indonesia. His research focuses on ASEAN regionalism, Indonesian politics and the international political economy of Southeast Asia.
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