Congress funds Taiwan military support as foreign aid bill stalls

Congress funded cash assistance for Taipei’s military while directing the State Department and Pentagon to “prioritize the delivery of defense articles and services for Taiwan.”

The fiscal 2024 State Department spending bill Congress passed on Saturday includes $300 million in Foreign Military Financing, or FMF, for Taiwan. The funding to buy more military equipment comes more than a year after Congress first authorized the cash assistance for Taipei. But the $300 million falls far short of the cumulative $4 billion in Taiwan military assistance in the foreign aid bill that remains stalled in the House.

“It provides new tools to use to try and contribute to the deterrence effort and get weapons to Taiwan more quickly and in larger quantities,” Bonnie Glaser, the managing director of the German Marshall Fund’s Indo-Pacific program, told Defense News. “Another benefit of it is that it signals to the people of Taiwan that the United States prioritizes their defense and is willing to put our money where our mouth is.”

The $300 million figure represents a halfway point between House appropriators – who sought $500 million in Taiwan FMF – and their Senate counterparts who only wanted $113 million.

Taiwan must spend most of that $300 million in FMF grants or loans to procure weapons from US defense contractors but could use $45 million of that money to purchase equipment and services on-island – a privilege called offshore procurement that only Israel has enjoyed so far.

Of the 25-plus countries that receive FMF annually, the largest recipients are Israel with an annual $3.3 billion, Egypt with an annual $1.3 billion and Jordan with an annual $425 million. The State Department has asked for $100 million in Taiwan FMF as part of its FY25 budget request. It provided Taiwan with $55 million in FMF last year from a portion of Egypt aid frozen over human rights concerns.

Appropriators initially were wary of allocating large FMF sums for Taiwan given pressures on the State Department budget and the relative wealth of the island, whose GDP came in at an estimated $800 billion in FY23.

Glaser noted that Taiwan has increased its defense spending consecutively over the past several years and now spends 2.6% of its GDP on defense, “which is still not enough given the nature of the threat they face.”

The US hopes that rushing an influx of weapons into Taiwan will help deter a potential Chinese invasion. China considers Taiwan to be a rogue province and has threatened to take it by force if necessary. President Xi Jinping has seen 2027 – the 100th anniversary of the founding of the People’s Liberation Army – as the date he hopes the Chinese military will have the capabilities to take Taiwan.

“Yes, it’s our taxpayer money and they should be paying for more themselves, but there’s also some value in signaling that this is a priority for the United States,” said Glaser. “It does help to boost the determination of the Taiwanese to defend themselves because they know that the United States cares about their defense.”

Another $4 trillion

The Taiwan FMF in the FY24 State Department spending bill pales in comparison to the $3.9 billion in additional military assistance for Taipei that the Senate’s foreign aid bill. The Senate in February passed the bipartisan bill, which primarily provides $60 billion in economic and security aid to Ukraine and another $14 billion in military aid to Israel, in a 70-29 vote.

House Speaker Mike Johnson, R-La., has so far refused to put it on the floor amid opposition to the Ukraine aid from former President Donald Trump, the presumptive Republican presidential nominee, and the right-flank of his caucus. Meanwhile, some progressive Democrats oppose the additional Israel aid in the bill amid the humanitarian crisis in Gaza.

Johnson has told Republican defense hawks the House will hold foreign aid votes in April after it returns from its two-week recess, although it will not necessarily take up the bipartisan Senate bill, which hews closely to President Joe Biden’s request.

The Senate bill includes an additional $2 billion in Taiwan FMF and another $1.9 billion that would allow the Defense Department to rush weapons to Taipei from US stockpiles and replenish it.

Using Presidential Drawdown Authority from US stockpiles would allow the US to move materiel into Taiwan faster than through FMF-funded arms sales. The Biden administration has primarily armed Ukraine through drawdowns of US stockpiles since Russia’s 2022 invasion.

“That makes it easier to deliver something if we already have it in our own stockpiles, and we can just give it to Taiwan,” said Glaser. “That seems to cut through quite a bit of the red tape that might be involved in using other methods.”

Lawmakers estimate that there is a roughly $19 billion backlog in US arms sales to Taiwan due to a confluence of issues, including industrial base constraints, a sometimes slow pace of contracting and acquisition and a medley of lengthy technology and security reviews in the Foreign Military Sales process.