The Ministry of National Defense yesterday rebutted a press report saying that the ministry would need to add US$800 million for the purchase of PAC-3 air defense missiles from the US, saying that Taiwan would only be required to pay part of the quoted amount.
“It is normal for the US government to ask for such a fee from whoever is purchasing weapons from them,” ministry spokeswoman Major General Lisa Chi (池玉蘭) said.
“But we will not have to pay [as much as speculated]. We will continue to negotiate and work with them on the issue,” she said.
Chi made the remarks in response to a story in yesterday’s Chinese-language United Daily News, which said that the US government was asking for an additional US$800 million as a research and development fee as part of the purchase plan for the PAC-3 missiles.
Chi said it was common practice for the US government to ask for a “research and development” payment as well as a “production line reinitiation” fee.
The production fee is usually paid by the first country to sign a contract with the US, while the “research and development” fee is shared by whoever purchases similar weapons.
Chi said that a Middle Eastern country had also purchased the same missiles from the US and that the contract had been signed earlier this year.
As a result, that country would have to pay the production fee requested by the US.
Taiwan will have to share the “research and development” fee, she said, but did not elaborate on how much that would be.
“We will share the fee with the other country. But the fee is refundable if more countries purchase the same weapon,” Chi said.
Asked for comment, Chinese Nationalist Party (KMT) Legislator Shuai Hua-ming (帥化民), a member of the legislature’s Foreign and National Defense Committee, called the US request “extortion.”
Shuai said the request was “unacceptable,” adding that the US could “forget about the arms sales” if the request proved true.
KMT Legislator Lin Yu-fang (林郁方), head of the committee, said that although it was true that Washington tended to ask countries procuring arms from the US to share the cost of arms research and development, the government would have to determine why the US had not requested the money until recently.
“What’s more, some other countries are also acquiring the PAC-3. We should know whether these countries are also sharing [the cost of research and development for the system],” Lin said.
The PAC-3 is a high velocity interceptor that defeats incoming targets by direct, body-to-body impact.
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