Taiwan: Major U.S. Arms Sales Since 1990
Taiwan: Major U.S. Arms Sales Since 1990
Updated October 8, 2008
Specialist in Asian Security Affairs
Foreign Affairs, Defense, and Trade Division
Taiwan: Major U.S. Arms Sales Since 1990
This report, updated as warranted, discusses U.S. security assistance to Taiwan,
or Republic of China (ROC), including policy issues for Congress and legislation.
Congress has oversight of the Taiwan Relations Act (TRA), P.L. 96-8, which has
governed arms sales to Taiwan since 1979, when the United States recognized the
People’s Republic of China (PRC) instead of the ROC. Two other relevant parts of
the “one China” policy are the August 17, 1982, U.S.-PRC Joint Communique and
the “Six Assurances” to Taiwan. U.S. arms sales to Taiwan have been significant.
The United States also has expanded military ties with Taiwan after the PRC’s
missile firings in 1995-1996. However, there is no defense treaty with Taiwan.
At the U.S.-Taiwan arms sales talks on April 24, 2001, President George W.
Bush approved for possible sale diesel-electric submarines, P-3 anti-submarine
warfare (ASW) aircraft (linked to the submarine sale), four decommissioned U.S.
Kidd-class destroyers, and other items. Bush also deferred decisions on Aegis-
equipped destroyers and other items, while denying other requests. Since then,
attention has turned to Taiwan, where the military, civilian officials, and legislators
from competing political parties have debated contentious issues about how much to
spend on defense and which U.S. weapons systems to acquire, despite the increasing
threat (including a missile buildup) from the People’s Liberation Army (PLA), as
described in the Pentagon’s reports to Congress on PRC military power. In February
2003, the Administration pointed Taiwan to three priorities for defense: command
and control, missile defense, and ASW. Some in the United States have questioned
Taiwan’s seriousness about its self-defense, level of defense spending, and protection
of secrets. The Pentagon has broadened its focus from Taiwan’s arms purchases to
its regular defense budget, readiness for self-defense, and critical infrastructure
protection. Blocked by the opposition-controlled Legislative Yuan (LY), the Special
Budget (not passed) for submarines, P-3C ASW aircraft, and PAC-3 missile defense
systems was cut from $18 billion in 2004 to $9 billion (for submarines only) in 2005.
In March 2006, Taiwan’s defense minister requested a 2006 Supplemental Defense
Budget (not passed) in part for submarine procurement, P-3Cs, and PAC-2 upgrades
(not new PAC-3 missiles). In June 2007, the LY passed Taiwan’s 2007 defense
budget with funds for P-3C planes, PAC-2 upgrades, and F-16C/D fighters. While
the LY did not commit to buy subs, in December 2007, it approved $62 million to
start the design phase. The Navy accepted Taiwan’s formal request for this phase.
In 2008, congressional concerns mounted about the delay in the President’s
notifications and briefings to Congress on eight pending arms sales as well as his
refusal to accept Taiwan’s request for F-16C/D fighters. Concerns involved the issue
of whether the President has complied with the TRA and policy, including the
required congressional role. S. 1565 and H.R. 3912 would authorize a sale of excess
naval minehunters. In October 2007, the House passed H.Res. 676 to urge the
President to consider Taiwan’s interest since 2006 in buying F-16C/D fighters. On
September 23, 2008, the House passed H.R. 6646 to require detailed briefings to
Congress. The next day, Representative Tancredo introduced H.R. 7059 to require
the arms sales notwithstanding notifications to Congress. On October 3, 2008,
President Bush finally notified Congress but about only six of the arms sales.
Role of Congress..............................................1
Broad Indicators of Arms Transfers................................2
April 2001 Arms Requests and Status of Arms Sales..................7
April 2001 Decisions.......................................7
Amphibious Assault Vehicles................................8
Attack and Utility Helicopters................................9
P-3C ASW Aircraft.......................................14
Patriot Missile Defense....................................15
Early Warning Radars.....................................17
AMRAAM and SLAMRAAM..............................18
Other Possible Future Sales.................................22
Policy Issues for Congress......................................22
Extent of U.S. Commitment on Defense.......................23
Changes in PLA Missile Deployments........................25
Taiwan’s Commitment to Self-Defense and Budgets.............26
Visits by Generals/Admirals to Taiwan........................39
Taiwan’s Missile Program..................................40
President’s “Freeze” on Arms Sales Notifications...............41
Policy Reviews and U.S. Objectives..........................43
Major Congressional Action....................................46th
Major U.S. Arms Sales as Notified to Congress.........................55
List of Tables
Table 1. Taiwan’s Defense Budgets..................................29
Taiwan: Major U.S. Arms Sales Since 1990
This CRS Report discusses U.S. security assistance for Taiwan, formally called
the Republic of China (ROC), including policy issues for Congress. It also lists sales
of major defense articles and services to Taiwan, as approved by the President and
notified to Congress since 1990. This discussion uses a variety of unclassified
consultations in the United States and Taiwan, as well as open source citations.
Role of Congress
Congress passed and exercises oversight of the Taiwan Relations Act (TRA),
P.L. 96-8, the law that has governed U.S. arms sales to Taiwan since 1979, when the
United States recognized the People’s Republic of China (PRC) instead of the ROC.
The TRA specifies that it is U.S. policy, among the stipulations: to consider any
nonpeaceful means to determine Taiwan’s future “a threat” to the peace and security
of the Western Pacific and of “grave concern” to the United States; “to provide
Taiwan with arms of a defensive character;” and “to maintain the capacity of the
United States to resist any resort to force or other forms of coercion” jeopardizing the
security, or social or economic system of Taiwan’s people. Section 3(a) states that
“the United States will make available to Taiwan such defense articles and defense
services in such quantity as may be necessary to enable Taiwan to maintain a
sufficient self-defense capability.” The TRA also specifies a congressional role in
decision-making on security assistance for Taiwan. Section 3(b) stipulates that both
the President and the Congress shall determine the nature and quantity of such
defense articles and services “based solely” upon their judgment of the needs of
Taiwan. Section 3(b) also says that “such determination of Taiwan’s defense needs
shall include review by United States military authorities in connection with
recommendations to the President and the Congress.” The TRA set up the American
Institute in Taiwan (AIT), a nonprofit corporation, to handle the relationship with
Taiwan. AIT implements policy as directed by the Departments of Defense and
State, and the National Security Council (NSC) of the White House. They have
controlled notifications to Congress of pending major arms sales, as required by the
Arms Export Control Act, P.L. 90-629.
Congress also oversees the President’s implementation of policies decided in
1982. President Ronald Reagan agreed with the PRC on the August 17, 1982 Joint
Communique on reducing arms sales to Taiwan, but he also clarified that arms sales
will continue in accordance with the TRA and with the full expectation that the
PRC’s approach to the resolution of the Taiwan issue will be peaceful. At the same
time, Reagan extended “Six Assurances” to Taipei, including assurances that
Washington had not agreed to set a date for ending arms sales to Taiwan nor to
consult with Beijing on arms sales to Taiwan. (See CRS Report RL30341,
China/Taiwan: Evolution of the “One China” Policy, by Shirley A. Kan.)
Broad Indicators of Arms Transfers
As for U.S. arms transfers to Taiwan, they have been significant despite the
absence of a diplomatic relationship or a treaty alliance. The value of deliveries of
U.S. defense articles and services to Taiwan totaled $5.8 billion in the 1999-2002
period and $4.1 billion in 2003-2006. Among worldwide customers, Taiwan ranked
2nd (behind Saudi Arabia) in 1999-2002 and 4th (behind Israel, Egypt, and Saudi
Arabia) in 2003-2006. In 2006 alone, Taiwan ranked 5th among worldwide
recipients, receiving $970 million in U.S. defense articles and services. Values for
U.S. agreements with and deliveries to Taiwan are summarized below.1
1999-2002 period2003-2006 period
U.S. Agreements$1.1 billion$1.1 billion
U.S. Deliveries$5.8 billion$4.1 billion
From worldwide sources, including the United States, Taiwan received $10
billion in arms deliveries in the eight-year period from 1999 to 2006. Taiwan ranked
6th among leading recipients that are developing countries. Of that total, Taiwan
received $5.9 billion in arms in 1999-2002 and $4.1 billion in 2003-2006. In 2006
alone, Taiwan ranked 5th and received $1.0 billion in arms deliveries, while the PRC
ranked 2nd and received arms valued at $2.9 billion. As an indication of future arms
acquisitions, Taiwan’s arms agreements in 2002-2005 totaled $4.9 billion. However,
in 2003-2006, the value of agreements with Taiwan did not place it among the top
“Software Initiative”. In addition to transfers of hardware, beginning after
the crisis in the Taiwan Strait in 1995-1996 during which President Clinton deployed
two aircraft carrier battle groups near Taiwan in March 1996, the Pentagon quietly
expanded the sensitive military relationship with Taiwan to levels unprecedented
1 CRS Report RL34291, U.S. Arms Sales: Agreements with and Deliveries to Major Clients,
unclassified data as reported by the Defense Security Cooperation Agency (DSCA).
2 CRS Report RL33696, Conventional Arms Transfers to Developing Nations, 1998-2005,
October 23, 2006, and CRS Report RL34187, Conventional Arms Transfers to Developing
Nations, 1999-2006, September 26, 2007, by Richard F. Grimmett; compiled from DSCA
since 1979.3 The broader exchanges have increased attention to “software,”
including discussions over strategy, training, logistics, command and control, etc.
Also, Taiwan’s F-16 fighter pilots have trained at Luke Air Force Base, AZ,
since 1997. However, in 2004, Taiwan’s Minister of Defense Lee Jye surprisingly
wanted to withdraw the pilots and fighters.4 In response, the Defense Department
stressed the value of continuing the training program to develop “mission ready and
experienced pilots” with improved tactical proficiency shown by graduated pilots
who have “performed brilliantly,” as explicitly notified to Congress.5
In July 2001, after U.S. and Taiwan media reported on the “Monterey Talks,”
a U.S.-Taiwan national security meeting that was originally held in Monterey, CA,
the Pentagon revealed it was the seventh meeting (since 1997) held with Taiwan’s
national security authorities “to discuss issues of interaction and means by which to
provide for the defense of Taiwan.”6 Another round of such strategic talks took place
in July 2002.7 The 11th round of the talks took place in late September 2005, after the
Bush Administration postponed the meeting by a couple of weeks to accommodate
PRC ruler Hu Jintao’s scheduled visit to Washington on September 7 (which was
then postponed because of President Bush’s response to Hurricane Katrina).8
These exchanges were prompted by increasing U.S. concerns about Taiwan’s
self-defense capabilities. At a conference on Taiwan’s defense in March 2002,
Deputy Secretary of Defense Paul Wolfowitz said that the United States wanted to
help Taiwan’s military to strengthen civilian control, enhance jointness, and
rationalize arms acquisitions.9 In April 2004, Assistant Secretary of Defense for
International Security Affairs Peter Rodman told Congress that the Pentagon believed
Taiwan’s military needed to improve readiness, planning, and interoperability among
3 Mann, Jim, “U.S. Has Secretly Expanded Military Ties with Taiwan,” LA Times, July 24,
1999; Kurt M. Campbell (former Deputy Assistant Secretary of Defense for Asian and
Pacific Affairs) and Derek J. Mitchell, “Crisis in the Taiwan Strait?,” Foreign Affairs,
4 Jane’s Defense Weekly, October 9, 2004 and June 29, 2005; and author’s consultations.
5 DSCA, notification to Congress, October 25, 2005 (see list at end of this CRS Report).
6 China Times (Taiwan), July 18, 2001; Washington Times, July 18, 2001; Department of
Defense News Briefing, July 19, 2001.
7 Central News Agency, Taipei, July 17, 2002.
8 Project for a New American Century, August 26, 2005; Taipei Times, September 15, 2005.
9 Deputy Secretary of Defense Paul Wolfowitz, “Remarks to the U.S.-Taiwan Business
Council,” March 11, 2002.
10 Testimony before the House International Relations Committee, hearing on “The Taiwan
Relations Act: The Next 25 Years,” April 21, 2004.
Assessments. The Pentagon has also conducted its own assessments of
Taiwan’s defense needs, with over a dozen studies from 1997 to early 2004.11
Congress could inquire about these assessments and any other reports. In September
assess its air defense capability. The Pentagon reportedly completed its classified
assessment in January 2000, finding a number of problems in the Taiwan military’s
ability to defend against aircraft, ballistic missiles, and cruise missiles, and those
problems included international isolation, inadequate security, and sharp inter-service13
rivalries. In September 2000, the Pentagon reportedly conducted a classified
assessment of Taiwan’s naval defense needs — as the Clinton Administration had
promised in April 2000 while deferring a sale of Aegis-equipped destroyers. The
report, “Taiwan Naval Modernization,” was said to have found that Taiwan’s navy
needed the Aegis radar system, Kidd-class destroyers, submarines, an anti-submarine
underwater sonar array, and P-3 anti-submarine aircraft.14 In January 2001, a
Pentagon team reportedly examined Taiwan’s command and control, air force
equipment, and air defense against a first strike.15 In September 2001, a Defense
Department team reportedly visited Taiwan to assess its army, as the Bush
Administration promised in the April 2001 round of arms sales talks.16 In August
communication, computers, intelligence, surveillance, and reconnaissance (C4ISR)17
program. In November 2002, another U.S. team visited Taiwan to assess its
marine corps and security at ports and harbors, and reported positive findings.18 In
November 2003, a U.S. defense team visited Taiwan to assess its anti-submarine
warfare (ASW) capability and rated the overall capability as poor.19
Normalized Relations. The George W. Bush Administration has continued
the Clinton Administration’s initiative and expanded the closer military ties at
different levels. In April 2001, President Bush announced he would drop the 20-
year-old annual arms talks process used to discuss arms sales to Taiwan’s military
11 Statement of Assistant Secretary of Defense for International Security Affairs Peter
Rodman at a hearing on “The Taiwan Relations Act: The Next 25 Years” held by the House
International Relations Committee on April 21, 2004.
12 “U.S. Military Team Arrives in Taiwan for Visit,” Lien-ho Pao [United Daily News],
Sept. 19, 1999, in FBIS.
13 Ricks, Thomas, “Taiwan Seen as Vulnerable to Attack,” Washington Post, March 31,
14 Tsao, Nadia, “Pentagon Report Says Taiwan Can Handle AEGIS,” Taipei Times,
September 27, 2000; Michael Gordon, “Secret U.S. Study Concludes Taiwan Needs New
Arms,” New York Times, April 1, 2001.
15 China Times (Taiwan), January 14, 2001; Taipei Times, January 15, 2001.
16 Taipei Times (Taiwan), September 10, 2001.
17 Taiwan Defense Review (Taiwan), August 27, 2002.
18 Taipei Times, November 21, 2002; January 1, 2003; Tzu-Yu Shih-Pao [Liberty Times]
(Taipei), April 14, 2003; Taipei Times, August 22, 2003.
19 Jane’s Defense Weekly, December 3, 2003; Taiwan Defense Review, January 12, 2004;
Jane’s Defense Weekly, June 30, 2004.
in favor of normal, routine considerations of Taiwan’s requests on an as-needed basis
— similar to interactions with other foreign governments.20
U.S. military officers observed Taiwan’s Hankuang-17 annual military exercise
in 2001, the first time since 1979.21 The Pacific Command’s Asia-Pacific Center for
Security Studies accepted fellows from Taiwan in its Executive Course for the first
time in the summer of 2002.22 By the summer of 2002, the U.S. and Taiwan
militaries reportedly discussed setting up an undersea ASW link to monitor the PLA
Navy’s submarines.23 The U.S. and Taiwan militaries set up a hotline in 2002 to deal
with possible crises.24
In addition, in 2002, the Administration asked Congress to pass legislation to
authorize the assignment of personnel from U.S. departments (including the Defense
Department) to AIT, allowing the assignment of active-duty military personnel to
Taiwan for the first time since 1979. The objective was to select from a wider range
of personnel, without excluding those on active duty. The first active-duty defense
attache since 1979, an Army Colonel began his duty in Taipei in August 2005 with
civilian clothes and a status similar to military attaches assigned to Hong Kong,
except that military personnel in Hong Kong may wear uniforms at some occasions.25
Also, the Acting Under Secretary of Defense for Acquisition, Technology, and
Logistics, Michael Wynne, submitted a letter to Congress on August 29, 2003, that
designated Taiwan as a “major non-NATO ally.” (See 107th Congress below.)
Senior-Level Exchanges. The United States and Taiwan have held high-
level defense-related meetings in the United States. The Bush Administration
granted a visa for Defense Minister Tang Yiau-ming to visit the United States to
attend an industry conference held by the U.S.-Taiwan Business Council on March
20 On the annual arms talks, see CRS Report RS20365, Taiwan: Annual Arms Sales Process,
by Shirley A. Kan.
21 Chung-Kuo Shih-Pao [China Times], Taipei, July 18, 2001. The China Times (May 27,
2004) quotes Defense Minister Lee Jye confirming that U.S. military personnel observed
Hankuang-17, Hankuang-18, and Hankuang-19 exercises to evaluate Taiwan’s military.
22 CNN.com, March 18, 2002; Author’s discussions in Hawaii in July 2002.
23 Tzu-Yu Shih-Pao [Liberty Times], Taipei, July 20, 2002.
24 Jane’s Defense Weekly, October 29, 2003.
25 In addition to Colonel Al Willner, the Defense Security Cooperation Agency (DSCA)
assigned Army Colonel Peter Notarianni to oversee security assistance programs at AIT in
Taipei. A notice was released: Department of Defense, DSCA contract awarded to AIT to
support DSCA active-duty military and civil service personnel, September 24, 2005.
come to the United States on a nontransit purpose since 1979.26 Tang met with
Deputy Secretary of Defense Paul Wolfowitz, who also spoke at the conference.27
However, after that policy change in 2002, Taiwan’s defense minister declined
to visit the United States through 2007. In September 2002, a deputy defense
minister, Kang Ning-hsiang, visited Washington and was the first senior Taiwan
defense official to have meetings inside the Pentagon since U.S.-ROC diplomatic ties
severed in 1979, although a meeting with Wolfowitz took place outside the
Pentagon.28 In January 2003, a Taiwanese newspaper leaked information that a U.S.
military team planned to participate in — beyond observe — the Hankuang-19
military exercise and be present at Taiwan’s Hengshan Command Center for the first
time since 1979.29 On the same day, General Chen Chao-min, a deputy defense
minister, confirmed to Taiwan’s legislature a U.S. plan for a noncombatant
evacuation operation (NEO). However, the leak and confirmation reportedly
prompted annoyance in Washington and contributed to a U.S. decision to limit
General Chen’s visit to the United States in February 2003 to attendance at a private
sector conference on Taiwan’s defense (in San Antonio, TX), without a visit to
Washington.30 Deputy Assistant Secretary of Defense Richard Lawless and Deputy
Assistant Secretary of State Randall Schriver met with General Chen. In October
2004, Taiwan’s Deputy Minister for Armaments, General Huoh Shoou-yeh, attended
a U.S.-Taiwan defense industry conference (in Scottsdale, AZ), instead of Defense
Minister Lee Jye. In May 2005, the Chief of General Staff, General Lee Tien-yu,
visited the United States, but he was the first Chief of General Staff from Taiwan
willing to make the biennial visit since General Tang Fei’s visit in 1998.31 In
September 2005, Deputy Minister Huoh again attended a U.S.-Taiwan defense
industry conference (in San Diego, CA). Deputy Defense Minister Ko Chen-heng
attended the next conference in September 2006 (in Denver, CO). At the conference
in September 2007 (in Annapolis, MD), Deputy Minister Ko again represented
Taiwan, as Defense Minister Lee Tien-yu declined to visit the United States. In only
the second visit by a defense minister from Taiwan since 1979, Minister Chen Chao-
min visited the United States on September 28-October 5, 2008, attending the U.S.-
Taiwan Defense Industry Conference in Jacksonville, FL, and visiting Luke Air
Force Base, Naval Warfare Systems Command in San Diego, and the Pacific
Command in Honolulu.32
26 In December 2001, the previous ROC Defense Minister, Wu Shih-wen, made a U.S.
transit on his way to the Dominican Republic.
27 Deputy Secretary of Defense Paul Wolfowitz, “Remarks to the U.S.-Taiwan Business
Council,” March 11, 2002.
28 Reuters, September 10, 2002.
29 Chung-Kuo Shih-Pao [China Times], January 2, 2003.
30 Taiwan Defense Review, January 18, 2003; Straits Times (Singapore), January 21, 2003.
31 Lien-Ho Pao [United Daily News] (Taipei), May 26, 2005.
32 Speech by Deputy Assistant Secretary of Defense David Sedney, in Jacksonville, FL,
September 29, 2008.
The Hankuang-19 exercise took place in April-May 2003, with participation by
about 20 U.S. military personnel and retired Admiral Dennis Blair, who just resigned
as the Commander of the Pacific Command (PACOM). (Blair has led U.S. observers
through the Hankuang-24 exercise in June 2008.) The exercise reportedly raised
questions about the military’s will to fight and ability to sustain defense before
possible U.S. support.33 Deputy Defense Minister Lin Chong-pin visited Washington
in June 2003 to respond to concerns about Taiwan’s commitment to self-defense.
The Hankuang-20 exercise included a reportedly U.S.-provided computer simulation
in August 2004 that resulted in the PLA invading and capturing the capital, Taipei,
within six days.34 In April 2006, Taiwan’s president and other top officials held a
Yushan exercise to improve homeland security and prepare for a “decapitation”
attack by the PRC, with no U.S. participation.35 In April 2008, U.S. officials,
including AIT Director Stephen Young, observed the Yushan exercise for the first
time, but the KMT party in Taiwan criticized the inclusion of U.S. officials.
April 2001 Arms Requests and Status of Arms Sales
April 2001 Decisions. In 2001, arms sales talks took place on April 24 in
Washington, DC, and Taiwan was represented by its Vice Chief of General Staff,36
General Huoh Shou-yeh. According to the Administration and news reports,
President Bush approved Taiwan’s request for: 8 diesel-electric submarines; 12 P-3C
Orion anti-submarine warfare (ASW) aircraft (linked to the submarine sale); 54
Mark-48 ASW torpedoes; 44 Harpoon submarine-launched anti-ship cruise missiles;
144 M109A6 Paladin self-propelled howitzers; 54 AAV7A1 amphibious assault
vehicles; AN/ALE-50 electronic countermeasure (ECM) systems for F-16s; and 12
MH-53 mine-sweeping helicopters. President Bush approved four decommissioned
Kidd-class destroyers for sale as Excess Defense Articles (EDA), not a program of
Foreign Military Sale (FMS). The Administration also decided to brief Taiwan’s
military on the PAC-3 missile defense missile.37
President Bush deferred decisions on destroyers equipped with the Aegis
combat system. Bush also deferred decisions on M1A2 Abrams main battle tanks
33 Lien-Ho Pao [United Daily News] (Taipei), April 16, 2003; China Times (Taipei), April
34 AFP, August 11, 2004; Taiwan News, August 12, 2004.
35 Liberty Times (Taipei), April 13 and 16, 2006; and author’s interviews in Taipei.
36 White House, press briefing, April 24, 2001; Department of Defense, news briefing, April
24, 2001;David Sanger, “Bush is Offering Taiwanese Some Arms, But Not the Best,” New
York Times, April 24, 2001; Steven Mufson and Dana Milbank, “Taiwan to Get Variety of
Arms,” Washington Post, April 24, 2001; Neil King Jr., “Bush Defers Sale of Aegis to
Taiwan, Will Offer Four Kidd-Class Destroyers,” Wall Street Journal, April 24, 2001; “U.S.
Refuses Taiwan Request for JDAM, HARM, and PAC-3 Missiles,” Aerospace Daily, April
25, 2001; and “U.S. Formally Informs ROC of Arms Sales Decision,” Central News Agency
(Taiwan), April 25, 2001.
37 Taiwan Defense Review, January 18, 2003, reported the briefing took place in late 2001.
and AH-64D Apache Longbow attack helicopters, pending a U.S. assessment of
Taiwan’s army. (The request for Abrams tanks was approved later in 2001.)38
President Bush denied Taiwan’s requests for Joint Direct Attack Munitions
(JDAM) and High-speed Anti-radiation Missiles (HARM) that target radar-equipped
air defense systems. (At the U.S.-Taiwan Business Council’s conference in February
2003, however, Deputy Under Secretary of the Air Force Willard Mitchell indicated
that these requests were under review. A possible basis for reviewing any renewed
requests from Taiwan was found in the Pentagon’s report on PRC Military Power
submitted in July 2003 to Congress, which confirmed that the PLA procured from
Israel “a significant number of HARPY anti-radiation systems.” The press first
reported on the PLA’s acquisition of the HARPY drones in 2002.39 By the second
half of 2004, the Administration reportedly considered a new request for HARM
missiles (submitted in August 2004), while a decision on JDAM guidance kits also
remained pending.40 However, in 2005, the Administration denied these requests.41)
Taiwan’s Decisions. After the U.S. response to Taiwan’s requests in 2001,
attention turned to Taiwan, where the military, civilian officials, and competing
political parties in a newly assertive legislature (Legislative Yuan, or LY) have
debated contentious issues. These issues include the urgency of a possible PLA
attack, how much to spend on defense, which U.S. weapons systems to buy, whether
to respond to perceived U.S. pressure, and what the defense strategy should be. The
debate has taken place as the Pentagon has warned of the PLA’s accelerated buildup
in a coercive strategy targeting Taiwan. In early 2003, the Bush Administration
stressed to Taiwan the imperatives of missile defense, C4ISR, and anti-submarine
defenses. In March 2003, Taiwan’s Defense Ministry issued a new procurement plan42
emphasizing those priorities. However, setting priorities for its national security,
forging a national consensus, and funding defense programs have remained
contentious in Taiwan’s politicized debate over national security.
Amphibious Assault Vehicles. Taiwan agreed to purchase the AAV7A1
amphibious assault vehicles, under a program administered by the U.S. Marine
Corps. The Administration notified Congress in September 2002. United Defense
Industries obtained a contract in June 2003, and deliveries began in March 2005.43
38 Mark Stokes, “Taiwan’s Security: Beyond the Special Budget,” AEI, March 27, 2006.
39 Washington Times, July 2, 2002; Guangzhou Daily (via FBIS), July 4, 2002; Ha’aretz, Tel
Aviv, July 25, 2002; Flight International, November 5-11, 2002.
40 Taiwan News, October 6, 2004; Washington Times, October 8, 2004; Taiwan Defense
Review, November 26, 2004.
41 Wendell Minnick, “U.S. Rejects Taiwan Request for HARM and JDAM Kits,” Jane’s
Defense Weekly, January 18, 2006.
42 Taiwan Defense Review, March 12, 2003.
43 Jane’s International Defense Review, September 2003; Taiwan Defense Review, March
Attack and Utility Helicopters. After deferring a decision on Taiwan’s
request for attack helicopters, the Bush Administration, in May 2002, approved the
request, and Taiwan began negotiations on 30 AH-64D Apache Longbow helicopters
sold by Boeing.44 Afterwards, Taiwan also considered the AH-1Z Cobra helicopters4546
sold by Bell. In April 2007, Taiwan’s military decided to procure 30 Apaches.
Also, Taiwan requested price and availability data for acquisition of 60 utility47
helicopters. In 2005, Bell proposed its UH-1Y Huey utility helicopter, and Sikorsky
proposed its UH-60 Black Hawk helicopters as replacement for Taiwan’s UH-1H
Huey utility helicopters. In the LY in December 2007, inter-party negotiations and
the final decision approved about $203 million but froze two-thirds, or $135 million,
for 60 UH-60M Black Hawk utility helicopters (total cost of about $2.2 billion).
Also in the 2008 defense budget, the LY approved $228 million for 30 Apache
helicopters (total cost of about $1.8 billion).
On October 3, 2008, President Bush finally notified Congress of the proposed
Foreign Military Sale (FMS) program of 30 Apache helicopters for a total value of
$2.532 billion. However, in what observers note was an apparent arbitrary decision,
the President did not notify Congress of the pending sale of Black Hawk helicopters,
which would require a notification at a later time.
Kidd-Class Destroyers. In October 2002, the Defense Committee of
Taiwan’s legislature engaged in a sharp partisan debate over whether to approve
funding (about $800 million) to buy the U.S. Navy’s four available Kidd-class
destroyers, ending with 18 lawmakers from the ruling Democratic Progressive Party
(DPP) and Taiwan Solidarity Union (TSU) voting in favor, against 16 legislators
from the opposition Kuomintang (KMT) and People’s First Party (PFP).48 In
November 2002, the Bush Administration notified Congress of the proposed sale of
four Kidd-class destroyers for about $875 million. Then, on May 30, 2003, Taiwan’s
legislature finally voted to release the funding, after they conditioned funding on
bargaining with the U.S. Navy on a 15% price reduction. The U.S. Navy began
reactivation and upgrade of the Kidds in July 200349 for delivery of the 9,600-ton
destroyers ahead of schedule from October 2005 to 2006. Taiwan’s Naval
Commander-in-Chief, Marine General Chen Pang-chih, attended the transfer
ceremony in Charleston, SC, for the first two destroyers on October 29, 2005, in the
presence of Representative Henry Brown. The destroyers, the largest warships in
Taiwan’s navy, are equipped with SM-2 air-defense missiles and a joint combat
management system. The transfer ceremony for the final two Kidds took place in
Charleston, SC, on August 25, 2006.
44 Taipei Times, May 26, 2002; Jane’s Defense Weekly, June 5, 2002.
45 Jane’s Defense Weekly, March 10 and 24, 2004.
46 AFP, April 12, 2007; Lien-Ho Pao, July 9, 2007; Defense News, July 16, 2007.
47 Jane’s Defense Weekly, August 24, 2005; Defense News, July 16, 2007.
48 Author’s visit to Taiwan; and Taipei Times and China Post (Taipei), November 1, 2002.
49 Taipei Times, September 5, 2003; Taiwan Defense Review, March 10, 2004; Taipei Times,
September 15, 2004; Jane’s Defense Weekly, November 10, 2004.
Aegis-Equipped Destroyers. The Department of Defense considered the
Kidds as platforms to provide Taiwan’s navy with the necessary operational50
experience before any possible acquisition of more advanced Aegis-equipped ships.
The U.S. Navy deploys the Aegis combat system (e.g., on the Arleigh Burke-class
destroyer) for air defense and applies it in development of a future Navy missile
defense system (using SM-3 missiles). An alternative to the Arleigh Burke that
retains the Aegis Spy-1D radar, called the Evolved Advanced Combat System
(EACS) has been considered. The Aegis combat system has the capability to track
over 100 targets and to conduct simultaneous anti-air, anti-surface, and anti-
submarine operations. During the U.S. war in Iraq in 2003, the Aegis combat system51
helped the Patriot missile defense system to detect and intercept Iraqi missiles. In
delivery in 2010 and at a cost of about $4.8 billion, but got no U.S. response.
Submarines. Despite initial skepticism about the Bush Administration’s
April 2001 agreement to sell Taiwan submarines (since the United States no longer
manufactures diesel-electric submarines), the Department of Defense has discussed
options for a Foreign Military Sales (FMS) program for eight boats with U.S. and
foreign companies and Taiwan. In addition to the military and political implications
of selling submarines to Taiwan’s navy, issues for Congress include potential
technology transfers to Taiwan and European countries, and leaks of secrets from
Taiwan to the PRC, that could involve U.S. submarine secrets and implications for
the U.S. military.53 In a report to Congress, as required by the National Defense
Authorization Act for FYs 1992-1993, the Secretary of the Navy reported in May
1992 that “to the extent that a potential diesel submarine construction project would
draw on U.S. resources, it has the potential to tap into the state-of-the-art technology
used in U.S. nuclear powered submarines.” The report also noted “the fact that the
diesel submarine is not a viable asset in the U.S. Navy” and that “construction of
diesel submarines for export in U.S. shipyards would not support the U.S. submarine
shipbuilding base and could encourage future development and operation of diesel
submarines to the detriment of our own forces.” The report also said that “it may be
possible to control the release of the most important information and specific
technologies of concern, but an effective system would also have significant costs.
The problem will be more difficult, however, if a foreign entity is present in the
shipyards during submarine construction.”
50 Consultations; and Wendell Minnick, “What Those Systems are All About,” Topics,
51 Discussion with Lockheed Martin executive, June 10, 2004; and U.S. Army, 32nd Army
Air and Missile Defense Command, Fort Bliss, TX, “Operation Iraqi Freedom: Theater Air
and Missile Defense,” September 2003.
52 Lien-Ho Pao, September 1, 2004; Taiwan Defense Review, December 19, 2004; author’s
53 As for U.S. counter-espionage concerns, the FBI sent agents to Taipei to investigate
alleged compromises of security on the PRC’s behalf at Taiwan military’s Chungshan
Institute of Science and Technology, reported the Central News Agency, August 13, 2003.
In November 2001, seven companies submitted bids and concept papers to the
Department of the Navy. Companies interested in the contract reportedly include
U.S. manufacturers, Northrop Grumman (with its Ingalls Shipbuilding shipyard) and
General Dynamics (with its Electric Boat shipyard); Germany’s HDW; the
Netherlands’ RDM (which sold its Zwaardvis-class submarine design to Taiwan in
the 1980s for two Hai Lung [Sea Dragon]-class submarines); France’s DCN; and
Spain’s IZAR (now Navantia). Although the Administration promised to help
Taiwan buy submarines, not build them, Taiwan’s China Shipbuilding Corporation
also became interested in a part of the contract, with support from some of Taiwan’s
legislators. The U.S. Navy discussed options with Taiwan’s Navy in July 2002 and
initially planned to select the manufacturer(s) to design and build the submarines in
the latter half of 2003.54 On December 6, 2002, Secretary of the Navy Gordon
England informed Congress in a Determination and Findings memo that bidding
would be limited to four U.S. companies and the diesel subs would be of U.S.
origin.55 The U.S. Navy held a second Industry Day on December 17, 2002, with
General Dynamics, Northrop Grumman, Lockheed Martin, and Raytheon interested
in being the prime contractor.56
The U.S. Navy provided the Independent Cost Estimate (ICE) on January 17,
2003.57 The ICE put the sub program at about $10.5 billion, but private sector
estimates have been said to be lower (perhaps $6-7 billion). Greater risks and costs
were factored into the ICE because of uncertainty about funding by Taiwan and the
availability of European designs.
However, by April 2003, the sale became at risk, when the United States and
Taiwan reached an impasse over the program start-up costs estimated by the U.S.
Navy at $333 million, but offered at $28.5 million by Taiwan. On May 20-23, 2003,
Taiwan’s Navy sent a delegation led by Vice Admiral Kao Yang to Washington to
discuss the issue, but the differences reportedly remained unresolved.58 Facing the
delays in Taiwan’s commitment of funds (although it first requested submarines in
1995) and a long acquisition process, the Administration then viewed the program
as a long-term solution for Taiwan that would not meet the near-term blockade and
submarine threats posed by the PLA Navy.59 Defense Minister Tang Yiau-ming told
visiting AIT Chairwoman Therese Shaheen on October 16, 2003, that Taiwan still
54 Central News Agency (Taiwan), July 30, 2002; Taipei Times, July 31, 2002; Defense
Daily, September 16, 2002.
55 Gordon England, Memorandum to Congress with Determination and Findings, December
56 Knight-Ridder/Tribune Business News, December 17, 2002.
57 Tung-sen Hsin-wen Pao, Taipei, September 28, 2005.
58 United Daily News (Taipei), April 21, 2003 and April 22, 2003; Taiwan Defense Review,
May 17, 2003 and May 30, 2003.
59 U.S.-Taiwan Business Council, Defense and Aerospace Report, Second Quarter 2003;
Bloomberg, July 10, 2003; Defense Daily, July 11, 2003; TDReview, September 19, 2003.
placed a high priority on acquiring the submarines.60 Meanwhile, in 2003, the Bush
Administration inquired with Italy about buying eight decommissioning Sauro-class
diesel-electric submarines for the estimated cost of about $2 billion for delivery
starting in 2006, but Taiwan’s military opted for newly built submarines.61
A team from the U.S. Navy’s International Program Office arrived in Taipei in
October 2003, for further talks on whether Taiwan will procure submarines.62 The
U.S. team also met with some of Taiwan’s legislators, including Lin Yu-fang of the
opposition People First Party.63 Lin was one of the sponsors of legislation passed in
May 2002, requiring Taiwan’s navy to arrange for six of the eight submarines to be
built in Taiwan using technology transfers.64 The total cost of new submarines could
reach $9-12 billion,65 leading Taiwan’s political leaders to consider a controversial
Special Budget.66 (See Taiwan’s Commitment to Self-Defense and Budgets, below.)
Taiwan’s new demand for domestic industrial participation had added another
issue and greater potential costs to the program (about $2.5 billion to the total), which
U.S. Navy officials discussed with potential prime contractors at the third Industry
Day meeting on December 15, 2003, in Washington.67 However, Deputy Secretary
of Defense Wolfowitz told Taiwan’s visiting legislative delegation on June 21, 2004,
that the Bush Administration approved Taiwan’s request for assistance in purchasing
submarines but is opposed to Taiwan’s new proposal to build them in Taiwan.68
With U.S. opposition to Taiwan’s domestic production of submarines conveyed in
official letters from the Defense Department in May and July 2004, Minister of
Defense Lee Jye estimated that the cost of the submarines could be reduced.69
Depending on the funds ultimately approved in Taiwan, the scope of a program could
be restricted to fewer than eight boats.
Thus, with delays in Taiwan’s decision-making after 2001, Taiwan’s request for
and the Bush Administration’s approval of a sale of submarines have met with mixed
opinions in Taipei and Washington. In early 2003, senior officials in the Bush
Administration stressed ASW surveillance as one priority for Taiwan’s military to
60 Central News Agency, Taipei, October 16, 2003.
61 Wendell Minnick, “Submarine Decisions Show Lack of Creativity,” Taipei Times,
October 16, 2004.
62 Lien-ho Pao [United Daily News], Taipei, October 23, 2003; Central News Agency,
Taipei, October 26, 2003.
63 Taipei Times, October 31, 2003; Central News Agency, November 2, 2003.
64 Author’s discussion with Lin Yu-fang in Taipei in December 2003.
65 Lien-ho Pao [United Daily News], August 25, 2003; Taipei Times, October 31, 2003.
66 Taiwan Defense Review, April 30, 2004.
67 Ibid., February 6, 2004 and April 30, 2004.
68 United Daily News (Taipei), June 23, 2004.
69 Lien-Ho Pao, September 8, 2004; Central News Agency, October 19, 2004. Deputy Under
Secretary of Defense Richard Lawless referred to his previous letters of May 20 and July
consider, with the focus on static arrays and patrol aircraft to track submarines. The
Administration approved submarines but did not consider them a priority.70
In early 2006, articles appeared alleging that the U.S. Navy failed to effectively
implement the diesel sub program for Taiwan, in part to protect the nuclear-powered
submarine capability.71 The Defense Department and the Navy have repeated that
they support President Bush’s 2001 policy decision on arms sales to Taiwan, but that
Taiwan has to commit to fund the program. In February 2006, Representative Rob
Simmons visited Taiwan, saying that he represented his district in Connecticut, home
to General Dynamics’ Electric Boat shipyard. In a speech at the American Chamber
of Commerce in Taipei, Simmons suggested that the subs could cost less, perhaps
around $8 billion, and proposed an interim step to break the impasse whereby Taiwan
could procure a sub design first, costing perhaps $225 million.72 The Navy and
DSCA said that Taiwan could first submit a request for a sub design phase.73
On April 3, 2006, Taiwan’s military submitted a request for U.S. assessment of
the feasibility of using two phases (design then perhaps construction). Deputy Under
Secretary of Defense Richard Lawless conveyed the U.S. policy response to Taiwan’s
defense minister in an official letter on June 27, 2006, stating that a two-phased
approach was “legally permissible and administratively feasible.” However, Lawless
warned that such a program likely would increase costs and risks, making foreign
design firms and their governments less willing to participate. The Defense
Department estimated the design phase to cost $360 million, if Taiwan requests it.74
Following Lawless’ letter, Representative Rob Simmons wrote a letter to Defense
Minister Lee Jye on July 17, noting that the next step was for Taiwan to request a
letter of offer or acceptance for a phased approach to the design and acquisition of
subs.75 In answer to a question posed by Representative Rob Simmons at a meeting
of the Congressional Shipbuilding Caucus on September 27, 2006, Deputy Secretary
of Defense Gordon England wrote that his department stood ready to support the U.S.
effort to help Taiwan acquire submarines, if Taiwan provided the necessary funds.76
Meanwhile, the U.S. Navy has requested funds from Taiwan to keep an office
to manage the sub program and reportedly warned Taiwan in August 2005 that the
70 U.S.-Taiwan Business Council, Defense and Security Report, 2nd Quarter 2005.
71 Wendell Minnick, “Taiwan Claims U.S. Navy is Sabotaging SSK Plans,” Jane’s Defense
Weekly, Feb. 15, 2006; “Come Clean on Subs,” editorial, Defense News, February 13, 2006.
72 News from Rob Simmons, February 17, 2006; Central News Agency, February 22, 2006;
Taipei Times, February 23, 2006; Defense News, February 27, 2006; and AmCham’s Taiwan
Business Topics, March 2006.
73 Interviews with Navy and DSCA officials, including consultations in Taipei in April 2006.
74 Letter from Richard Lawless to Taiwan’s Defense Minister Lee Jye, June 27, 2006; Jim
Wolf, “U.S. Clears Two-Stage Path to Taiwan Submarine Deal,” Reuters, July 14, 2006.
75 Letter from Rob Simmons to Defense Minister Lee Jye, July 17, 2006.
76 Gordon England, letter to Rob Simmons, October 24, 2006.
“pre-selection” process would stop without such funds. Through March 2006,
Taiwan paid $7.5 million to keep the office open.77
On June 15, 2007, Taiwan’s legislature passed the 2007 defense budget with $6
million to fund a “feasibility study” (with LY participation) and did not commit to
the design phase or full procurement of submarines (the two U.S.-approved options).
Representative James Langevin expressed concerns in a letter to the Secretary of
Defense and asked for a review of the U.S. proposal to Taiwan.78 For the study, a LY
delegation met with companies and officials in the United States in August 2007.
The LY delegation was positive about its visit but did not reach a conclusion about
the sub procurement. In September 2007, the stance of the KMT’s presidential
candidate, Ma Ying-yeou, was to support the sub purchase, but a KMT legislator who
was in the LY delegation of August suggested a possible “new list” of arms requests
depending on the outcome of the presidential election in March 2008.79
Taiwan’s Defense Ministry requested in the 2008 defense budget about US$169
million as the first of three annual installments for the design phase (total of US$360
million). The LY’s defense committee kept the requested amount in the defense
budget that it approved in October 2007, but the question of procurement was left for
inter-party negotiations and the full LY to address. In December 2007, the LY
approved the 2008 defense budget with the funds for the sub program cut to US$61.5
million. With only one-sixth of the required amount, questions remained about
Taiwan’s full funding for the design phase and how the U.S. Navy would be able to
execute the first phase as approved by the Defense Department in June 2006.
Nevertheless, in January 2008, Navy Secretary Donald Winter assured Representative
Joe Courtney that Taiwan was required to commit to fully fund phase one, but
incremental payments would be acceptable.80 Later in January 2008, the Navy
accepted Taiwan’s Letter of Request (LOR) for the design phase.81 Then, a Navy
team visited Taiwan in March 2008 to discuss details of the program.82
However, on October 3, 2008, the Bush Administration did not submit for
congressional review the pending submarine design program, while notifying
Congress of six proposed arms sales to Taiwan.
P-3C ASW Aircraft. After the United States approved Taiwan’s request for
12 P-3C planes, the two sides have negotiated the proposed sale. But Taiwan
questioned the estimated cost of $300 million per new plane (in part due to Lockheed
Martin’s need to reopen the production line) for a total cost of $4.1 billion (including
77 National Journal, April 6, 2006; and author’s interviews in Taipei in April 2006.
78 James Langevin, letter to Secretary of Defense Robert Gates, July 20, 2007.
79 Su Chi’s remarks at U.S.-Taiwan Business Council, Defense Industry Conference,
Annapolis, September 10-11, 2007; author’s consultations in Taipei in November 2007.
80 Assistant Secretary of the Navy John Thackrah, letter of response, January 18, 2008.
81 Consultations with TECRO, January and February 2008.
82 Wendell Minnick, “Hurdles Await Taiwan Efforts to Move Forward on Submarines,”
Defense News, March 17, 2008.
parts and training) and sought alternatives in 2003, such as refurbished P-3Bs or
surplus P-3Cs retired from the U.S. Navy’s fleet. A longer-term option is the Multi-
Mission Maritime Aircraft (MMA) under development by Boeing’s subsidiary,
McDonnell Douglas, for the U.S. Navy. In 2004, Taiwan’s Ministry of Defense
sought approval from the Legislative Yuan (LY) of a Special Budget to include funds
(about $1.6 billion) for 12 refurbished P-3C ASW planes (sold as Excess Defense
Articles) with possible delivery in 2008-2011.83 The sale became more complicated
in 2006, when L-3 Communications wanted to compete.84 The LY committed to the
procurement of the P-3C planes by budgeting about $188 million in the 2007 defense
budget passed on June 15, 2007 (with a total program cost of $1.4 billion). About
three months later in September 2007, the Bush Administration notified Congress of
the proposed sale of 12 excess P-3C aircraft (and related support) worth $1.96
billion. Upon this notification, China’s military showed its displeasure by refusing
to carry out U.S.-PLA military exchanges for about a month.
Patriot Missile Defense. After U.S. approval in 1992, Taiwan in 1997
acquired three Patriot missile defense fire units with PAC-2 Guidance Enhanced
Missiles. After the Bush Administration in 2001 decided to brief Taiwan on the
advanced PAC-3 hit-to-kill missile, Taiwan has considered buying the PAC-3
system. (The U.S. Army completed developmental testing of the PAC-3 in October
2001 and conducted operational tests in 2002. The PAC-3 has been deployed with
the U.S. Army, as seen in Operation Iraqi Freedom during March-April 2003.
Raytheon describes its Patriot system as the world’s most advanced ground-based
system for defense against aircraft, theater ballistic missiles, and cruise missiles.)
In late 2002, the Pentagon reportedly was disappointed with Taiwan’s delay in85
requesting the PAC-3 missiles. At a private sector conference on Taiwan’s defense
in February 2003, Bush Administration officials openly stressed to Taiwan’s visiting
Deputy Defense Minister Chen Chao-min the imperative of acquiring advanced
missile defense systems. (See Policy Issues for Congress, below.) In March 2003,
Mary Tighe, the Director of Asian and Pacific Affairs, led a Defense Department
delegation to Taiwan to urge its acquisition of missile defense systems, including the86
PAC-3. After Chen criticized the Patriot’s performance in Operation Iraqi Freedom
in 2003, a Pentagon spokesperson, Jeff Davis, publicly corrected Chen to Taiwan’s87
media on March 27, 2003. According to the U.S. Army, the Patriot missile defense
system (with Guidance Enhanced Missiles and PAC-3 missiles) intercepted nine Iraqi88
missiles out of nine engagements. In April 2003, Taiwan submitted to the United
83 Taiwan Defense Review, April 30, 2004.
84 China Times, Taipei, September 4, 2006; Jane’s Defense Weekly, October 18, 2006.
85 Taiwan Defense Review, December 6, 2002.
86 Central News Agency (Taiwan), March 11, 2003.
87 Taipei Times, March 29, 2003.
88 U.S. Army, 32nd Army Air and Missile Defense Command, Fort Bliss, TX, “Operation
Iraqi Freedom: Theater Air and Missile Defense,” September 2003. For a skeptical view,
see Randy Barrett, “Pentagon Releases Candid Glimpse of Missile Defense During Iraq
States a request for price and availability data in a step towards a contract, and in
May 2004, Defense Minister Lee Jye requested six PAC-3 units and upgrade of three
PAC-2 Plus units (around Taipei) to the PAC-3 standard for about $4.3 billion.89
Complicated by the failure of a referendum to pass in March 2004, Taiwan’s
military reportedly has looked to buy PAC-3 units, originally seeking funds out of a
Special Budget submitted in May 2004.90 Acquisition of missile defense systems has
been controversial in Taiwan, with some supporting the development of domestic
long-range missiles instead and some preferring short-range missile defense systems.
(See discussions on Taiwan’s defense budgets and missile program below.) Missile
defense also became politicized, when President Chen Shui-bian pushed for a
referendum on buying more missile defense systems that was held on the presidential
election day on March 20, 2004. That referendum became invalid when only 45%
of eligible voters cast ballots (with 50% needed). (Out of the valid ballots cast, 92%
agreed with the proposal.) The opposition KMT and PFP parties objected to
acquiring PAC-3 missiles for three years, based on their claim that the referendum
“vetoed” the question.91
In 2006, Taiwan’s military and lawmakers debated whether to upgrade Taiwan’s
PAC-2 missile defense units, if PAC-3 missiles were not purchased. Legislative
Yuan President Wang Jin-pyng promoted PAC-2 upgrades, but other KMT
lawmakers did not support additional purchases of Patriot missile defense. KMT
Legislator Shuai Hua-ming, a retired army lieutenant general, preferred more “cost-
effective” weapons and “offensive” missile systems as “deterrence.”92 At the time,
Taiwan had not upgraded its Patriot missile defense systems (to the latest
configuration for radars and command and control with new training and hardware).
The cheaper option to first upgrade the ground systems for Taiwan’s three PAC-2
units was estimated at $600 million. In April 2006, after first rejecting Patriot
upgrades, Taiwan’s defense ministry requested U.S. price and availability data for
PAC-2 upgrades and requested a supplemental budget for Patriot upgrades in 2006
(not passed).93 In the end, Taiwan’s LY deleted the defense ministry’s request of
about $347 million (out of a total program cost of $3.6 billion) to procure PAC-3
missiles in the 2007 defense budget passed on June 15, 2007, and opted to fund about
$110 million for PAC-2 upgrades (out of a total program cost of $603 million). The
President notified Congress in November 2007 of the proposed Patriot ground
systems upgrade program, valued at $939 million.
War,” Space News, November 10, 2003.
89 Far Eastern Economic Review, May 15, 2003; Jane’s, July 23, 2003; Taiwan Defense
Review, June 15, 2004.
90 Central News Agency, March 3, 2004; China Times, April 13, 2004; Taiwan Defense
Review, April 30, 2004.
91 A KMT lawmaker, Su Chi, voiced his objections to missile defense based on the
referendum’s result during the author’s visit to Taiwan in October 2004, before his election.
92 Taipei Times, April 10, 2006; and author’s interview with Shuai Hua-min in April 2006.
93 Central News Agency, February 21, 2006; Taipei Times, February 22, 2006; author’s
interview with Raytheon in March 2006; and author’s interviews in Taipei in April 2006.
In late 2007, Taiwan’s LY partially resolved whether to procure PAC-3 missiles.
In October 2007, the LY’s defense committee retained a requested budget of about
US$539 million in the 2008 defense budget to begin to procure PAC-3 missiles.
However, the question was left for inter-party negotiations and the full LY to address
in December 2007, which decided to fund four sets but freeze the funds for two
more, freezing NT$5.8 billion (US$179 million) out of NT$17.5 billion (US$539
million). By the second quarter of 2008, the LY’s Foreign Affairs and National
Defense Committee released frozen funds, for the total program of six PAC-3 missile
batteries with 384 missiles.94 On October 3, 2008, President Bush notified Congress
of a proposed sale of 330 PAC-3 missiles for the estimated value of $3.1 billion.
However, the sale of PAC-3 missile defense systems was broken up, excluding three
of seven firing units (including one training unit) and about 50 missiles which would
require another notification to Congress to proceed, in an apparent arbitrary decision.
Early Warning Radars. In 1999, some in Congress encouraged the Clintonth
Administration to approve a sale of early warning radars (see 106 Congress, below),
approval that was given in 2000. The Pentagon has stressed the importance of long-
range early warning and tracking of ballistic and cruise missile attacks against
Taiwan. Taiwan reportedly considered two options: a radar similar to AN/FPS-115
Pave Paws sold by Raytheon and the LM Digital UHF Radar proposed by Lockheed
Martin.95 Despite divided opinions among lawmakers, in November 2003, Taiwan’s
legislature approved the Defense Ministry’s request for about $800 million to fund
one radar site (rather than an option for two).96 Nonetheless, on March 30, 2004, the
Defense Department notified Congress of the proposed sale of two ultra high
frequency long range early warning radars, with the potential value of $1.8 billion,
that would enhance Taiwan’s ability to identify and detect ballistic missiles as well
as cruise missiles, and other threats from the air, and improve the early warning
capability of Taiwan’s C4ISR architecture. The formal notification pointed out that
U.S. personnel will not be assigned to the radar(s). By early 2005, Taiwan had not97
contracted for the controversial program, and Lockheed Martin withdrew its bid.
In June 2005, Raytheon concluded a contract worth $752 million to provide one98
Early Warning Surveillance Radar System to Taiwan by September 2009. By early
C4ISR. In addition, after approval in 1999, the United States reportedly has
assisted Taiwan’s C4ISR program (named Po Sheng program), involving sales of
datalink systems and integration of the services into a joint command and control
94 U.S.-Taiwan Business Council, “Defense & Security Report,” Second Quarter 2008.
95 Jane’s Defense Weekly, March 26, 2003 and February 11, 2004.
96 Taiwan Defense Review, November 26, 2003; Jane’s Defense Review, December 3, 2003.
97 Jane’s Defense Weekly, February 9, 2005.
98 Raytheon, June 23, 2005; Department of Defense, Air Force Contract for Raytheon, June
99 Wendell Minnick, “Taiwan’s Military Grapples with a Major C4ISR Upgrade,” C4ISR
Journal, March 2, 2007.
system.100 In July 2001, the Bush Administration notified Congress of a proposed
sale of Joint Tactical Information Distribution Systems (JTIDS)/Link 16 terminals,
a basis for an expanded program. In early 2003, the Administration signaled to
Taiwan that this FMS program (managed by the U.S. Navy’s SPAWAR command)
should be given top priority. Taiwan opted for a program costing a total of about
$1.4 billion, rather than a more comprehensive option costing about $3.9 billion.101
In September 2003, Lockheed Martin obtained a contract with the initial value of
$27.6 million.102 The notification to Congress submitted on September 24, 2003,
indicated that the total value could reach $775 million. Taiwan’s Defense Ministry
also decided not to integrate U.S. communications security (COMSEC) equipment
that could facilitate crisis-management and interoperability.103 Full Operational
Capability of the Po Sheng C4ISR program is expected at the end of 2009.104
AMRAAM and SLAMRAAM. In April 2000, the Clinton Administration
approved the sale of AIM-120 Advanced Medium-Range Air-to-Air Missiles
(AMRAAMs) to Taiwan, with the understanding that the missiles would be kept in
storage on U.S. territory and transferred later to Taiwan, if/when the People’s
Liberation Army (PLA) acquires a similar Russian missile, like the R-77 (AA-12)
air-to-air missile, or threatens to attack Taiwan. In September 2000, the
Administration notified Congress of a potential sale of 200 AMRAAMs.
On July 1, 2002, the Washington Times reported that, in June, two SU-30
fighters of the PLA Air Force test-fired AA-12 medium-range air-to-air missiles
acquired from Russia. The report raised questions as to whether the PLA already
deployed the missiles. According to Reuters (July 10, 2002), Raytheon planned to
finalize production of the AMRAAMs for Taiwan by the fall of 2003. Some in
Congress urged the Bush Administration to transfer the AMRAAMs to Taiwan after
production. (See 107th Congress, below.)
By the end of 2002, the Bush Administration authorized delivery of the105
AMRAAMs to Taiwan and briefed its air force on ground-launched AMRAAMs.
(The U.S. Army has developed the Surface Launched Advanced Medium Range Air-
to-Air Missile, or SLAMRAAM, for cruise missile defense.) By November 2003,
Taiwan received its first delivery of AMRAAMs, and a pilot of Taiwan’s air force
test-fired an AMRAAM at Tyndall Air Force Base in Florida on November 10,
100 Chung-Kuo Shih-Pao [China Times] (Taiwan), July 18, 2001; Defense and Aerospace
(U.S.-Taiwan Business Council), 2001; Taiwan Defense Review, August 27, 2002.
101 SPAWAR briefing at U.S.-Taiwan Defense Industry Conference, February 12-14, 2003;
Taiwan Defense Review, July 17, 2003; Tzu-Yu Shih Pao [Liberty Times], July 14, 2003.
102 Taiwan Defense Review, September 17, 2003; Jane’s Defense Weekly, October 1, 2003.
103 U.S.-Taiwan Business Council, “Defense & Security Report,” Third Quarter 2004.
104 U.S.-Taiwan Business Council, defense conference, San Diego, CA, September 19, 2005.
105 Lien-Ho Pao [United Daily News], Taipei, January 5, 2003; Remarks of Deputy Under
Secretary of the Air Force Willard Mitchell at the U.S.-Taiwan Business Council’s
conference in February 2003.
2003.106 However, although the Clinton Administration agreed to Taiwan’s request
for 200 AMRAAMs for Taiwan’s 150 F-16 fighters, Taiwan’s Air Force actually
purchased only 120 AMRAAMs (although some U.S. observers think Taiwan needs
at least 350 AMRAAMs).107 By April 2004, the Defense Department reportedly
encouraged Taiwan to acquire the SLAMRAAM to help counter the PLA’s expected
deployment of land attack cruise missiles.108
F-16C/D Fighters. In 2006, Taiwan’s Defense Ministry requested initial
funding from the LY to acquire 66 F-16C/D fighters and to boost the defense budget
in 2007 (an attempt to reach 2.85% of GDP).109 On November 6, 2006, the LY’s
defense and budget committees jointly passed an amended 2007 defense budget,
which froze the requested budget for F-16C/D fighters for five months (ending on
May 31, 2007), pending U.S. provision of price and availability data. When the LY
passed the final 2007 defense budget on June 15, 2007, the deadline for releasing the
funds (about $488 million) for F-16C/Ds was extended until October 31. The total
program cost was estimated at $4.9 billion. In the LY, there was broad political
support for procurement of new fighters, but there was uncertainty about next steps
if President Bush did not approve the release of pricing data (a potential sale).
The Bush Administration has refused even to accept a formal Letter of Request
(LOR) for F-16C/D fighters, after Taiwan tried to submit one in July 2006, February
2007, and June 2007.110 Nonetheless, in October 2007, the LY’s defense committee
passed a 2008 defense budget that retained the requested F-16 procurement program.
In December 2007, inter-party negotiations and the final decision in the LY deleted
NT$2.2 billion from NT$22.2 billion leaving NT$20 billion (US$615 million). But
the whole amount was frozen pending U.S. price and availability data. On
September 22, 2008, Defense Minister Chen Chao-min reported to the LY that the
military needed to acquire the F-16 fighters. The Defense Ministry had to return the
unspent funds in the 2007 defense budget and needs to return the funds in the 2008
budget. NT$15 billion (US$484 million) was included in the 2009 budget.111
In 2006, President Bush reportedly was reluctant to consider a formal request
for new F-16 fighters without Taiwan’s resolution of pending arms sales and without
a 2007 defense budget that included funds for the fighters, given questions about
Taiwan’s credibility on arms purchases. Moreover, the Administration expressed
106 Taiwan Defense Review, November 15, 2003; Central News Agency, November 18, 2003.
107 Wendell Minnick, “Taiwan’s Military will Fire Blanks,” Taipei Times, May 25, 2005.
108 Jane’s Defense Weekly, April 7, 2004.
109 In spring of 2006, Taiwan’s Defense Ministry considered asking to purchase new F-
16C/D (not F-15) fighters (author’s interviews in Taipei in April 2006). Also: Wendell
Minnick, “Airplane Race in Taiwan Straits,” Defense News, May 15, 2006; Jim Wolf,
“Taiwan Seeks 66 F-16 Fighters,” Reuters, July 27, 2006; Minnick, “U.S. Debates Taiwan
Request for 66 F-16s,” Defense News, August 28, 2006; author’s consultations in September
110 Liberty Times, Taipei, November 2, 2007; information from TECRO, February 29, 2008;
and U.S.-Taiwan Business Council, “Defense & Security Report,” Second Quarter 2008.
111 Youth Daily News, Taipei, September 23, 2008; author’s consultations, September 2008.
disapproval in April 2007 about Taiwan’s domestic development of land-attack
cruise missiles for an “offensive” capability (see below). Then, within days after the
LY’s passage of the 2007 defense budget in mid-June 2007, Taiwan President Chen
proposed a referendum on membership in the U.N. under the name “Taiwan” to be
held on the day of the next presidential election (scheduled for March 22, 2008). At
a U.S.-Taiwan defense industry conference on September 10-11, 2007, at which there
was concern about the persisting status of “no decision” on whether to consider
Taiwan’s interest in F-16s, the Administration issued a policy address that stressed
U.S. opposition to this referendum while linking strength and moderation as two
requirements for the broader and longer-term security of Taiwan.112 President Bush
has looked to Beijing to cooperate in nuclear nonproliferation efforts targeting North
Korea and Iran. After the last sale of fighters to Taiwan, when President George H.
W. Bush approved the sale of 150 F-16A/B fighters to Taiwan in September 1992,
the PRC ended its participation in the “Arms Control in the Middle East” talks.
Some critics argued that the sale in 1992 of F-16 fighters violated the 1982
Communique on reducing arms sales to Taiwan.113 In addition to concerns about the
political context of cross-strait stability and not undermining the tough message to
Taipei, there are issues about whether Taiwan’s limited defense dollars might be
better spent on other defensive requirements, such as munitions, logistics, training,
professional personnel, etc. Another question concerns the impact of only 66 fighters
on the military balance in the Taiwan Strait.
Advocates say that Taiwan’s legitimate request for F-16C/D fighters needed to
maintain air-superiority should not be linked to other pending procurement or
political considerations.114 Taiwan is showing commitment to self-defense, a U.S.
goal for cross-strait stability. Section 3(b) of the TRA stipulates that the President
and Congress shall determine arms sales “based solely upon their judgment of the
needs of Taiwan.” In 1994, Congress passed the Foreign Relations Authorization
Act for FY1994-FY1995 (P.L. 103-236), with language to affirm that Sec. 3 of the
TRA (on arms sales) takes primacy over policy statements (1982 Joint
Communique). Moreover, in issuing the August 17, 1982 Joint Communique,
President Reagan wrote in a memo that “it is essential that the quantity and quality
of the arms provided Taiwan be conditioned entirely on the threat posed by the PRC.
Both in quantitative and qualitative terms, Taiwan’s defense capability relative to that
of the PRC will be maintained.”115 According to Lockheed Martin, a sale to Taiwan
would provide about 8,000 U.S. jobs. Moreover, supporters argue that the United
States should consider Taiwan’s request when Taiwan has shown a commitment to
increasing its defense budget and defense capabilities (long-sought U.S. goals), and
the less provocative KMT Party’s Ma Ying-jeou became Taiwan’s president in May
112 Deputy Assistant Secretary of State Thomas Christensen, “A Strong and Moderate
Taiwan,” U.S.-Taiwan Defense Industry Conference, Annapolis, MD, September 11, 2007.
113 Chas. Freeman, Jr., “Preventing War in the Taiwan Strait,” Foreign Affairs, July/August
114 U.S.-Taiwan Business Council, “Defense & Security Report,” 3rd Quarter 2006; 2nd
Quarter 2007; John Tkacik, “Approve Taiwan Arms Buy,” Defense News, July 30, 2007.
115 James Lilley, China Hands (Public Affairs, 2004); see CRS Report RL30341.
of discouraging Taiwan’s deployment of long-range cruise missiles. Finally,
supporters point out that in April 2001, President Bush dropped the 20-year-old
annual arms talks process used to discuss arms sales to Taiwan in favor of normal,
routine considerations of Taiwan’s requests on an as-needed basis.
In March 2008, in answer to Senators Tim Johnson and James Inhofe of the
Senate Taiwan Caucus, Under Secretary of Defense for Policy Eric Edelman
promised that the department will consider carefully any request from Taiwan for
defense articles and services, “including replacement airframes.”116 See discussion
on major congressional actions in the section on the 110th Congress below.
Nevertheless, some are concerned that the Administration has stressed China’s
objections over U.S. policy consideration of arms sales based solely upon Taiwan’s
legitimate defense needs. Even after Taiwan approved a defense budget in December
2007 and the less provocative Ma Ying-jeou succeeded Chen Shui-bian as Taiwan’s
president in May 2008, President Bush reportedly has continued to rebuff Taiwan’s
efforts to request F-16 fighters, in part because of the Olympic Games in August.117
The F-16C/D (single-seat/two-seat versions) multi-role (air-to-air and air-to-
surface combat) fighters would not be a new type of weapon sold to Taiwan, as they
are the improved versions of F-16s sold in 1992. In September 1992, the President
notified Congress of the sale of 150 F-16A/B fighters with a value of $5.8 billion.
(The first F-16A fighters had entered service in the U.S. Air Force in 1979. In 1980,
the Air Force began a program to improve the F-16’s capabilities for precision strike,
night attack, and beyond-visual-range interception, with advanced controls and fire
control radars, etc. The Air Force received the first F-16C fighters in 1984.)118 The
Secretary of Defense’s annual report to Congress on PRC military power warned that
the modernizing PLA has been shifting the military balance in its favor. The
Pentagon reported that the PLA Air Force has 490 aircraft (330 fighters and 160
bombers) within range of Taiwan (without need to refuel), while Taiwan has 390
fighters.119 Since 1990, the PLA Air Force has bought Russian Su-27 and Su-30
fighters, and in late 2006, received the first J-10 fighters (developed in China based
on the Israeli Lavi program of the 1980s). The PLA Air Force also acquired Russian
S-300PMU2 surface-to-air missiles with a range that extends over Taiwan’s airspace.
Taiwan’s advanced fighters include 146 F-16A/Bs, 56 Mirages, and 128 IDFs
(Indigenous Defense Fighters). Taiwan has a requirement to replace aging F-5
fighters but also needs to replace the IDFs.
116 Eric Edelman, letter to Senators Tim Johnson and James Inhofe, March 28, 2008.
117 Washington Times, May 9 and 30, 2008; Rupert Hammond-Chambers, President of the
U.S.-Taiwan Business Council, “Taiwan’s Security on Hold,” op-ed, The Hill, June 6, 2008.
118 Jane’s All the World’s Aircraft, 1986-1987; U.S. Air Force fact sheet, June 2006.
119 Defense Department, “Military Power of the People’s Republic of China, 2008,” March
Other Possible Future Sales. In addition to the major weapon systems
discussed above, possible future arms sales to Taiwan’s military include:120
!signals intelligence (SIGINT) aircraft (perhaps sold by Gulfstream,
Raytheon, or Cessna) for which Taiwan reportedly requested price
and availability data in 2002;
!C-27J Spartan medium transport aircraft (sold by Lockheed Martin);
!F-35 Joint Strike Fighters (JSF), particularly the short take-
off/vertical landing (STOVL) version, under development by
Lockheed Martin and foreign partners (including Singapore);
!Stryker armored wheeled vehicles (sold by General Dynamics);
!upgraded engines for F-16s (Pratt & Whitney or General Electric);
!CH-53X minesweeping helicopters (developed by Sikorsky)
!search-and-rescue helicopters (Sikorsky or Bell)
!KC-135 Stratotanker aerial refueling aircraft;
!Phalanx Close-In Weapons System (CIWS) (sold by Raytheon).
Policy Issues for Congress
Since the early 1990s, and accelerated after the Taiwan Strait crisis of 1995-
primarily from Russia. As a result of the PLA’s provocative exercises and missile
test-firings in 1995 and 1996 that were directed against Taiwan, Congress has
increasingly asserted its role vis-a-vis the Administration in determining security
assistance for Taiwan, as stipulated by Section 3(b) of the TRA, as well as in
exercising its oversight of Section 2(b)(6) of the TRA on the U.S. capacity to resist
any resort to force or other forms of coercion against Taiwan. Congress increasingly
asserted its role in determining arms sales to Taiwan before sales were decided.
Moreover, Section 3(c) of the TRA requires the President to inform Congress
“promptly” of any threat to “the security or the social or economic system” of the
people on Taiwan and any danger to U.S. interests, so that the President together with
the Congress shall determine the appropriate U.S. response. (In March 1996, during
the Taiwan Strait Crisis when President Clinton deployed two aircraft carrier battle
groups near Taiwan, the State Department nonetheless testified that the situation did
not constitute a “threat to the security or the social or economic system” of Taiwan
and therefore did not invoke Section 3(c) for a congressional role.122) Policy issues
120 Flight International, November 25-December 1, 2003; Jane’s Defense Review, January
14, 2004; U.S.-Taiwan Business Council, Defense and Aerospace Report, First Quarter
2004; Taiwan Defense Review, May 7, 2004; Central News Agency, June 21, 2004; Flight
International, July 13-19, 2004; Flight International, September 7-13, 2004; Flight
International, December 7-13, 2004; Taiwan Defense Review, December 30, 2004; AFP,
Hong Kong, March 8, 2005; Jane’s Defense Weekly, May 4, 2005; Defense News, May 7,
121 See the Defense Department’s annual reports to Congress on PRC Military Power.
122 Assistant Secretary of State for East Asian and Pacific Affairs Winston Lord, before the
House International Relations Subcommittee on Asia and the Pacific, hearing on “Crisis in
center on how effectively the Administration is helping Taiwan’s self-defense, the
role of Congress in determining security assistance to Taiwan, and whether aspects
of U.S. security assistance are stabilizing or destabilizing and should be adjusted
based on changing conditions. Overall, the question for policy is whether to
disengage from or increase engagement with Taiwan in a number of specific areas.
Extent of U.S. Commitment on Defense. The persistent question for U.S.
decision-makers in the military, Administration, and Congress is whether the United
States would go to war with the PRC over Taiwan and the purpose of any conflict.
The TRA did not replace the Mutual Defense Treaty of 1954 that ended in 1979.
Nonetheless, some have called for a clear commitment (to shore up deterrence and
help Taiwan’s self-defense), advanced arms sales, interoperability with Taiwan’s
military, combined operational training and planning, high-level meetings, and visits
by U.S. flag and general officers to Taiwan. Others have argued that the United
States should avoid a war with China and needs a cooperative China in a number of
global problems, that trends in the Taiwan Strait are destabilizing, and that the United
States should limit security assistance as leverage to prevent provocative moves by
Taiwan’s leaders. The question of U.S. assistance for Taiwan’s defense involves
two aspects: intention (willingness) and capability to assist Taiwan’s self-defense.
In March 1996, President Clinton deployed two aircraft carrier battle groups
near Taiwan in response to the PLA’s provocative missile test-firings and exercises.
Another question arose in April 2001 when President Bush initially said that he
would do “whatever it took to help Taiwan defend herself” if China attacked.
Supporters have viewed such clarity as needed to prevent miscalculations in
Beijing and deter attacks against Taiwan. However, critics have argued that Bush
encouraged provocations from Taipei, even if the message was not meant for Taiwan,
and weakened willingness in Taiwan to strengthen its own defense. Later, when
Taiwan’s President Chen Shui-bian advocated referendums and a new constitution,
President Bush said that “the comments and actions made by the leader of Taiwan
indicate that he may be willing to make decisions unilaterally to change the status
quo, which we oppose,” in appearing with PRC Premier Wen Jiabao in the Oval
Office on December 9, 2003.
At a hearing in April 2004, in answer to Representative Gary Ackerman’s
questions about whether President Bush’s phrase on “whatever it took to help Taiwan
defend herself” means that the United States would go to war with China if Taiwan
makes unilateral moves toward independence, Assistant Secretary James Kelly stated
that what the president said has a meaning “at the time he says it to those listeners,”
we intend to fulfill the defense responsibilities under the TRA “to the extent
necessary,” “we oppose actions that would unilaterally alter Taiwan’s status,” leaders
in Taiwan “misunderstood” if they believe that President Bush supports whatever
they do, and “decisions of war and peace are made by the president with consultation
with Congress.” Assistant Secretary of Defense Peter Rodman replied that President
Bush’s phrase was a reaffirmation of the TRA, which leaves a certain “ambiguity.”
the Taiwan Strait: Implications for U.S. Foreign Policy,” March 14, 1996, 104th Congress.
Rodman also warned Beijing that its use of force would “inevitably” involve the
In December 2004, Deputy Secretary of State Richard Armitage also clarified
the U.S. defense commitment by saying, “we have the requirement with the Taiwan
Relations Act to keep sufficient force in the Pacific to be able to deter attack. We are
not required to defend. And these are questions that actually reside with the U.S.
Congress, who has to declare an act of war.”124
On June 8, 2005, President Bush qualified U.S. assistance for Taiwan’s self-
defense if it is invaded by saying that “If China were to invade unilaterally, we would
rise up in the spirit of the Taiwan Relations Act. If Taiwan were to declare
independence unilaterally, it would be a unilateral decision, that would then change
the U.S. equation, the U.S. look at ... the decision-making process.”125
In September 2005, the Defense Department further clarified the mutual
obligations under the TRA and limits to U.S. ability to assist Taiwan’s defense.
Deputy Under Secretary of Defense Richard Lawless issued a speech, stressing the
TRA’s focus on Taiwan’s self-defense. He declared that,
inherent in the intent and logic of the TRA is the expectation that Taiwan will be
able to mount a viable self-defense. For too long, the Taiwan Relations Act has
been referenced as purely a U.S. obligation.... Under the TRA, the U.S. is
obligated to “enable” Taiwan to maintain a sufficient self-defense, but the reality
is, it is Taiwan that is obligated to have a sufficient self-defense. There is an
explicit expectation in the TRA that Taiwan is ready, willing, and able to
maintain its self-defense. Taiwan must fulfill its unwritten, but clearly evident
obligations under the Taiwan Relations Act by appropriately providing for its
own defense while not simply relying on the U.S.’s capacity to address a threat
in the Strait. The TRA requires both parties to do their part to deter aggression126
or coercion vis-a-vis Taiwan.
A co-chair of the House Taiwan Caucus, Representative Steve Chabot, stated
on September 27, 2005, at the Heritage Foundation that Taiwan is only one ally and
that it is principally Taiwan’s responsibility to defend itself. He said that it has been
“frustrating” and “disappointing” to many Members of Congress that Taiwan delayed
passage of the Special Budget on arms procurement. He warned that if Taiwan does
not pass the Special Budget, many Members of Congress will “re-evaluate the extent
of support for Taiwan.”
123 House International Relations Committee, hearing on “The Taiwan Relations Act: The
Next 25 Years,” April 21, 2004.
124 Richard Armitage, Interview with PBS, December 10, 2004.
125 President George W. Bush, “Your World with Neil Cavuto,” Fox News, June 8, 2005.
126 The speech was read by a DSCA official, Ed Ross, on September 19, 2005, in San Diego,
CA, at the Defense Industry Conference of the U.S.-Taiwan Business Council, while
Lawless was delayed in Beijing at the Six-Party Talks on North Korea’s nuclear weapons.
Taiwan’s President Chen Shui-bian announced on February 27, 2006, that he
would “terminate” the National Unification Council, again raising questions about
new tensions. Senator John Warner, Chairman of the Armed Services Committee,
told Admiral William Fallon, PACOM Commander, at a hearing on March 7, 2006,
that “if conflict were precipitated by just inappropriate and wrongful politics
generated by the Taiwanese elected officials, I’m not entirely sure that this nation
would come full force to their rescue if they created that problem.” On April 24,
2007, at a hearing of the Senate Armed Services Committee with the new PACOM
commander, Admiral Timothy Keating, Senator Warner said Taiwan should not play
the “TRA card” when the U.S. military is engaged heavily in the world.
Changes in PLA Missile Deployments. There has been interest among
U.S. academic circles and think tanks for Washington to pursue talks with Beijing
on its military buildup and U.S. arms sales to Taiwan (instead of simply enhancing127
security assistance to Taiwan). One catalyst for this debate arose out of the U.S.-
PRC summit in Crawford, TX, on October 25, 2002. As confirmed to Taiwan’s
legislature by its envoy to Washington, C.J. Chen, and reported in Taiwan’s media,
then-PRC ruler Jiang Zemin offered in vague terms a freeze or reduction in China’s
deployment of missiles targeted at Taiwan, in return for restraint in U.S. arms sales
to Taiwan.128 President Bush reportedly did not respond directly to Jiang’s linkage.
Editorials in Taiwan were divided on whether to pursue Jiang’s offer.
Some argued that confidence building measures, such as a freeze or reduction
in PLA missile and other military deployments, would improve the chances for cross-
strait political dialogue and lead to greater stability. They said that the United States
could explore how the PRC might reduce the threat against Taiwan, such as
dismantling missile brigades in a verifiable manner, since sales of U.S. systems are
based on Taiwan’s defense needs. They argued that Jiang’s offer represented the first
time that the PRC offered meaningfully to discuss its forces opposite Taiwan. Others
said that a freeze or redeployment of missiles would not eliminate the PRC’s
continuing and broader military threat against Taiwan (including mobile missiles that
can be re-deployed) and that the PRC should hold direct talks with leaders in Taipei
instead. They argued that Jiang did not seek to reduce the PLA’s coercive threat but
to undermine the relationship between Washington and Taipei, including sales and
deliveries of weapons systems which take years to complete. They pointed out that
the PLA’s missile buildup has continued.
127 See David Lampton and Richard Daniel Ewing, “U.S.-China Relations in a Post-
September 11th World,” Nixon Center, August 2002; David Shambaugh’s arguments at
conference by Carnegie Endowment, Stanford University, Center for Strategic and
International Studies, and National Committee on U.S.-China Relations, on “Taiwan and
U.S. Policy: Toward Stability or Crisis?,” October 9, 2002; Michael Swaine, “Reverse
Course? The Fragile Turnaround in U.S.-China Relations,” Carnegie Endowment Policy
Brief, February 2003; and David Lampton, “The Stealth Normalization of U.S.-China
Relations,” National Interest, fall 2003.
128 Chung-Kuo Shih-Pao [China Times], Taipei, November 22, 2002; Taipei Times,
November 23, 2002.
One issue for congressional oversight has concerned whether and how the
Administration might deal with Beijing on the question of U.S. arms sales to Taiwan.
Policy considerations include the TRA, the 1982 Joint Communique (which
discussed reductions in U.S. arms sales to Taiwan premised on the PRC’s peaceful
unification policy), and the 1982 “Six Assurances” to Taiwan (including one of not
holding prior consultations with the PRC on U.S. arms sales to Taiwan). At a
hearing in March 2001, Secretary of State Colin Powell assured Senator Helms that
the “Six Assurances” would remain U.S. policy and that the Administration would
not favor consulting the PRC on arms sales to Taiwan.129 The Bush Administration
reportedly did not counter Jiang’s verbal offer, noting the accelerated missile buildup,
continued military threats against Taiwan, the need for the PRC to talk directly to
Taiwan, the TRA, and the “Six Assurances” to Taiwan. Nonetheless, in April 2004,
Assistant Secretary of State James Kelly testified that if the PRC meets its stated
obligations to pursue a peaceful resolution of the Taiwan issue and matches its
rhetoric with a military posture that bolsters and supports peaceful approaches to
Taiwan, “it follows logically that Taiwan’s defense requirements will change.”130 In
May 2005, an official PRC newspaper reported that the PLA continued to debate the
question of whether to “withdraw” missiles opposite Taiwan.131
China has continued its buildup of short-range ballistic missiles, whose
“adequate precision guidance” could destroy key leadership facilities, military bases,
and communication and transportation nodes with “minimal advanced warning,”
warned the Pentagon’s 2004 report to Congress on PRC military power. Later, the
Secretary of Defense reported to Congress that by late 2007, the PLA had deployed
opposite Taiwan an arsenal of 990-1,070 mobile M-9 and M-11 short-range ballistic
missiles, a buildup that has continued to expand by over 100 a year.132
Taiwan’s Commitment to Self-Defense and Budgets. Congress has
oversight of the Administration’s dialogue with Taiwan about its self-defense and
military budgets. Congress also has discussed with Taiwan these responsibilities.
Since 2002, some have expressed increasing concerns about Taiwan’s commitment
to its self-defense and lack of national consensus on national security. The
Pentagon’s report on PRC Military Power submitted to Congress in July 2002 said
that reforms in Taiwan’s military were needed to achieve a joint service capability
to meet the growing challenge from the PLA’s modernizing air, naval, and missile
forces, but warned that “the defense budget’s steady decline as a percentage of total133
government spending will challenge Taiwan’s force modernization.” The
Pentagon’s report issued in July 2003 further stressed that the relative decline in
129 Senate Foreign Relations Committee, Hearing on U.S. Foreign Policy, March 8, 2001.
130 House International Relations Committee, Hearing on “The Taiwan Relations Act: The
Next 25 Years,” April 21, 2004.
131 Qingnian Cankao [Youth Reference News], Beijing, May 26, 2005.
132 Secretary of Defense, “Annual Report on the Military Power of the People’s Republic
of China,” May 29, 2004, and “Annual Report to Congress: Military Power of the People’s
Republic of China, 2008,” March 3, 2008.
133 Department of Defense, “Annual Report on the Military Power of the People’s Republic
of China,” July 12, 2002.
Taiwan’s defense budget “increasingly” will challenge its force modernization.134
Starting in 2003, observers have criticized Taiwan’s civilian and military leaders for
not placing more urgent priority on upgrading their self-defense capability.135
Taiwan’s regular defense budget for 2004 was about US$7.8 billion, which
accounted for 2.4% of GDP and 16.7% of the total government budget, as compared
with 3.8% of GDP and 24.3% of total spending in 1994. (See the table below.)
These relative declines took place even as the Pentagon has warned of an increased
threat posed by the PLA to Taiwan, U.S. support for Taiwan has increased after the
Meanwhile, the PRC has significantly increased military budgets, budgets that
the Defense Department has assessed as markedly understating actual defense-related
expenditures (by excluding funds for weapons research, foreign arms purchases, etc.).
The Secretary of Defense’s latest report on PRC military power estimated that
China’s total defense spending for 2007 could be $97-139 billion, about two to three136
times the announced military budget. The PRC’s defense budget can be used as
one indicator of the priority placed on the PLA’s modernization. In March 2008, the
PRC announced its military budget for 2008 that totaled $58.8 billion, claiming a
17.6% increase over last year’s military budget. Actually, the announced 2008
budget is an increase of 19.1% over last year’s announced budget (vs. actual budget).
Using the PRC’s own announced military budgets, the 2008 budget is a doubling of
the 2004 budget. This trend of double-digit percentage increases has continued for
years. Nominally, China has raised its announced military budget by double-digit
percentage increases every year since 1989. After the Taiwan Strait Crisis of
1995-1996, China’s announced military budget has increased in real terms
(accounting for inflation) every year, including real double-digit percentage increases
every year since 1998. China’s military budget is the highest in Asia.
Some legislators in Taiwan have argued that Taiwan’s defense spending has
been sufficiently significant, that the legislature in the newly consolidated democracy
has the right to scrutinize the defense budget, that economic challenges constrain
defense spending, and that Taiwan does not need U.S. weapons in an accommodation
with the PRC. The U.S. approvals of significant arms sales in 2001 came in the one
year of negative real change in Taiwan’s GDP (-2.2%), according to Global Insight.
Also, Taiwan’s officials and legislators pointed out that Taiwan had funded defense
out of separate Special Budgets in addition to the regular (annual) defense budgets.
134 Department of Defense, “Report on PRC Military Power,” July 30, 2003.
135 Peter Brookes, “The Challenges and Imperatives in Taiwan’s Defense,” Heritage
Lectures, January 9, 2003; John Tkacik, “Taiwan Must Get Serious About Defense,”
Defense News, January 27, 2003; John Tkacik, “Taiwan Must Grasp on True Defense
Needs,” Defense News, December 1, 2003; Wendell Minnick, “Taiwan Procurement in
Shambles,” Defense News, March 19, 2007; Randall Schriver, “Defense: Time to Take
Ownership,” Taipei Times, April 4, 2007; Ted Galen Carpenter, “Taiwan’s Free Ride on
U.S. Defense,” Wall Street Journal, April 23, 2007.
136 Secretary of Defense, “Military Power of the People’s Republic of China, 2008,” March
3, 2008. The Defense Department has estimated China’s total military spending at 3.5% to
Taiwan’s Special Budgets for defense in 1994-2003 totaled US$22.6 billion and
funded procurement of fighter aircraft and military housing construction.137 Since
“extortion,” “sucker’s arms deals,” and “arms dealers’ profits.”138
In June 2003, Deputy Defense Minister Lin Chong-pin and a Defense
Committee delegation led by Legislative Yuan President Wang Jin-pyng visited
Washington to reassure the Bush Administration and Congress that the government
in Taipei remained committed to self-defense.139 A former official in the Pentagon
involved in arms sales decisions wrote in early 2006, that the impasse over Taiwan’s
defense spending does not symbolize a lack of commitment to self-defense. Mark
Stokes contended that the Bush Administration’s policy on arms sales to Taiwan was
right, but it came at the wrong time.140
For 2005, Taiwan’s Ministry of Defense requested a defense budget of
NT$260.7 billion, a reduction of NT$3.1 billion from 2004, and the final 2005141
defense budget was NT$258.5 billion (about US$8.0 billion).
In August 2005, the Defense Ministry requested a budget for 2006 of NT$265.7
billion, an increase of NT$7.2 billion from 2005. However, that budget included an
initial request to buy PAC-3 missile defense units, after the Ministry lowered the
Special Budget by removing funds for PAC-3. Minister of Defense Lee Jye
acknowledged a major “crowding out” impact on the 2006 budget resulting from
adding the PAC-3 request to the annual budget. He lamented that he had to cut out
2006, the legislature voted to cut NT$11.2 billion (US$348 million) from the annual
defense budget for 2006 (funds that would have been supplementary funds to support
procurement of PAC-3 missile defense, P-3C aircraft, and submarines) and did not
direct those funds to be used for munitions, training, or other defense needs.
Taiwan’s final 2006 defense budget was NT$252.5 billion (about US$7.8 billion),
a reduction of NT$6 billion from the previous year. Meanwhile, the Minister of
Defense requested a Supplemental Budget for the 2006 defense budget partly to
procure U.S. submarines, P-3C ASW aircraft, and PAC-2 missile defense upgrades,
given the lack of legislative approval for the requested Special Budget. In March
2006, the Defense Ministry requested a 2006 Supplemental Budget totaling NT$13.7
billion (US$420 million) for 74 defense programs, including NT$5.6 billion (US$172
million) for the three weapon systems, but the Cabinet did not agree with it.
137 Taiwan’s official defense budgets and special budgets were provided by Taiwan’s
representative office in Washington, DC.
138 United Daily News, April 21, 2003; China Times, May 8, 2003 and August 18, 2003.
139 Meeting at CRS with Lin Chong-pin and congressional staff, June 5, 2003; Luncheon at
the Heritage Foundation with Taiwan’s legislative delegation led by Wang Jin-pyng, June
140 Mark Stokes, “Taiwan’s Security: Beyond the Special Budget,” AEI, March 27, 2006.
141 Consultations in Taipei and Washington; and FBIS report, October 22, 2004.
142 Central News Agency, Taipei, August 30, 2005.
With general U.S. support, Taiwan’s leaders stated a goal of reversing the
declining spending trends and increasing the defense budget to 3% of GDP by 2008.
In May 2005, Taiwan’s Defense Minister Lee Jye requested that the defense budget
increase from 2.4% of GDP to 3.0% of GDP in the next five years.143 President Chen
Shui-bian announced on September 12, 2005, the goal of increasing the annual
defense budget to 3% of GDP by 2008, and this goal was officially stated in Taiwan’s
first National Security Report issued by President Chen in May 2006. In reaction to
the report, the State Department issued a statement on May 19, 2006, to stress that
the United States encourages “Taiwan to boost its defense spending, concentrating
in particular on immediate challenges of hardening and sustainability.” Taiwan
finally reversed the negative trend in defense spending with an increase in 2007.
Table 1. Taiwan’s Defense Budgets
Military% of total
Military budget budgetgovernment
Fiscal year(NT$ bil.)(US$ bil.)% of GDPspending
1994 258.5 9.8 3.8 24.3
1995 252.3 9.5 3.5 24.5
1996 258.3 9.5 3.4 22.8
1997 268.8 9.4 3.3 22.5
1998 274.8 8.2 3.2 22.4
1999 284.5 8.8 3.2 21.6
2000 402.9 12.9 2.9 17.4
2001 269.8 8.0 2.9 16.5
2002 260.4 7.5 2.7 16.4
2003 257.2 7.6 2.6 15.5
2004 261.9 7.8 2.4 16.7
2005 258.5 8.0 2.3 16.1
2006 252.5 7.8 2.1 16.1
2007 304.9 9.2 2.4 18.7
2008 341.1 10.5 2.5 20.2
Notes: This table was compiled using data on the regular, annual defense budgets provided by the
ROC’s Ministry of National Defense, LY and news reports, as well as data on GDP and exchange rates
reported by Global Insight. The currency is the New Taiwan Dollar (NT$). The FY2000 budget
covered the 18-month period from July 1999 to December 2000.
143 Taipei Times, May 24, 2005.
Special Budget Proposed in 2004. In 2002, Taiwan’s Ministry of
National Defense said that it needed the legislature to approve NT$700 billion (about144
US$21 billion) over the next 10 years for arms procurement. Taiwan’s Defense
Ministry has considered a Special Budget of $15 billion-$20 billion to procure the
PAC-3 missile defense system, submarines, and P-3 ASW aircraft over 10-15 years.
As discussed above, in 2003, Taiwan’s military received the U.S. cost estimate for
new submarines as well as price and availability data for PAC-3 missile defense
systems and refurbished P-3C planes. In May 2003, Minister of Defense Tang Yiau-
ming sent a letter to U.S. Deputy Secretary of Defense Wolfowitz, saying that
Taiwan planned to submit a Special Budget to the legislature to procure the three
weapon systems. However, Tang allegedly doubted the Special Budget would pass,
while looking to the regular defense budget to fund items of priority to the Army.145
As Taiwan considered a Special Budget, the Pentagon encouraged a decision.
In April 2004, Assistant Secretary of Defense for International Security Affairs Peter
Rodman testified to Congress that “we have made clear to our friends on Taiwan that
we expect them to reverse this budget decline. Though our commitments to Taiwan
are enduring, the American people and both the Executive Branch and Congress
expect the people of Taiwan to make their own appropriate commitment to their
freedom and security.” Rodman also stressed that “we expect Taiwan to go forward
with its plan to pass a Special Budget this summer to fund essential missile defense
and anti-submarine warfare systems and programs” [emphasis added].146 On May 29,
stressing that “the principal indicator of Taiwan’s commitment to addressing its
shortfalls will be the fate of its annual defense budget” and that “the island’s apparent
lack of political consensus over addressing [its military challenges] with substantially
increased defense spending is undoubtedly seen as an encouraging trend in Beijing.”
On May 21, 2004, Taiwan’s Defense Minister Lee Jye — a retired Naval
Admiral personally committed to procuring new submarines — submitted to the
Executive Yuan (Cabinet) a request for a Special Budget for defense totaling about
US$20 billion.147 On June 2, the Executive Yuan, controlled by the ruling
Democratic Progressive Party (DPP), then passed a Special Budget of NT$610.8
billion (about US$18.2 billion), with about $4.3 billion for PAC-3 missile defense148
systems, $12.3 billion for submarines, and $1.6 billion for P-3 aircraft. Taiwan’s
legislators have had the options of procuring all three systems, procuring one or two
items, alternatives, or none. However, Taiwan’s priorities remained unclear.
Taiwan’s 2004 Legislative Delegation. The Special Budget was not
passed in 2004, although the United States urged passage and welcomed the LY’s
144 Chung-Kuo Shih-Pao [China Times] (Taipei), May 17, 2002; Taiwan Defense Review,
August 30, 2002.
145 U.S.-Taiwan Business Council, “Defense and Security Report,” 3rd Quarter 2005.
146 Statement before the House International Relations Committee, hearing on “The Taiwan
Relations Act: the Next 25 Years,” April 21, 2004.
147 Central News Agency, Taipei, May 26, 2004; China Times, Taipei, May 27, 2004.
148 Central News Agency, Taipei, June 2, 2004.
president, Wang Jin-pyng of the KMT, who led a multi-party legislative delegation
to the United States on June 17-27, 2004, to gain direct information on the weapons
systems. The LY delegation visited Pearl Harbor Naval Base, HI; Washington, DC;
and Fort Bliss, TX. Under Wang’s leadership, legislators from different political
parties reached a preliminary consensus in support of the Special Budget during their
visit to Washington, where they met with Members of Congress and defense
officials. They said they would seek a new cost estimate for the submarines, with the
options of a construction or maintenance role for Taiwan’s shipbuilding industry and
delivery in 10 (not 15) years (after Deputy Secretary of Defense Wolfowitz
personally expressed to the delegation U.S. opposition to Taiwan’s more expensive
proposal to build submarines domestically); and that they would consider splitting
up the Special Budget to approve funds for the P-3C aircraft and PAC-3 missile
defense systems, ahead of considering the subs.149
However, politicians made the Special Budget into a controversial political issue
in gearing up for legislative elections on December 11, 2004. Opposition parties of
the “blue coalition,” the Kuomintang (KMT) and People First Party (PFP), called for
drastic cuts in the Special Budget and retained their majority in the LY.
Rising U.S. Frustrations. In a speech in October 2004, Deputy
Undersecretary of Defense Richard Lawless urged Taiwan’s legislature to “vote in
favor of Taiwan’s national security.”150 In a strong tone, he warned that the Special
Budget was a “litmus test” of Taiwan’s commitment to its self-defense and that
“inability” to pass the Special Budget would have “serious long-term consequences”
(for foreign support, further intimidation from Beijing, and perceptions of Taiwan as
a “liability”). Lawless also called for Taiwan to expand its efforts from “national
defense” to “national security,” including countering coercion and managing crises
by protecting critical infrastructure (national command facilities,
telecommunications, energy, water, media, computer networks, etc.).
Raising frustrations in the Bush Administration and Congress that Taiwan has
not placed a priority on self-defense, it became increasingly doubtful in 2005 that the
LY would vote on the Special Budget and fund it at the full level, even if it is
considered. Meanwhile, the United States has increased concerns about and shifted
focus to the regular defense budget and other questions about Taiwan’s self-defense.
Cutting the Special Budget in 2005. In January 2005, President Chen
Shui-bian told visiting Representative Tom Lantos that PFP Chairman James Soong
changed his position on the Special Budget after visiting Washington where he met
with Deputy Under Secretary of Defense Richard Lawless and Deputy Assistant151
Secretary of State Randy Schriver. The following month, Lawless warned that
149 Discussion with CRS and Congress on June 22, 2004; United Daily News, June 23, 2004.
150 Richard Lawless, Deputy Undersecretary of Defense for Asian and Pacific Affairs,
Keynote Address, U.S.-Taiwan Defense Industry Conference, U.S.-Taiwan Business
Council, October 4, 2004, Scottsdale, AZ. One of the ROC’s Deputy Ministers of Defense,
General Huoh Shou-Yeh, attended the conference.
151 Agence France Presse, Hong Kong, January 17, 2005. The author also confirmed
Taiwan’s failure to approve the Special Budget signaled that it lacked seriousness
about its own security, raising questions about whether U.S. support has been
necessary or not.152 In February 2005, the Defense Ministry announced that the
Special Budget’s figure dropped to NT$590 billion (after appreciation of the NT
dollar relative to the U.S. dollar) and that the request would be reduced to NT$480
billion (US$15.5 billion) (after removing certain costs, including an estimated
US$2.3 billion associated with producing submarines domestically in Taiwan).153
The reduced figure also factored in moving some infrastructure costs to the annual
defense budget, but that budget has faced cuts. The Cabinet approved the new
request on March 16 and submitted it to the LY.154 Two days earlier, the PRC’s
National People’s Congress adopted its “Anti-Secession Law,” warning that the
government in Beijing “may” use force against Taiwan.
However, Chen and Soong issued a “Ten-Point Consensus” on February 24,
2005, that did not mention the Special Budget. Indeed, the PFP raised another
objection, saying that the major items should be funded out of the annual defense
budget instead of a Special Budget.155 The Defense Ministry began to consider
asking for funds for the PAC-3 missile defense systems out of the annual defense
budget, with submarines as the top priority rather than missile defense stressed by
the Bush Administration.156 In April-May 2005, the chairmen of the opposition
parties, KMT’s Lien Chan and PFP’s James Soong, made historic visits of
reconciliation to mainland China, meeting with Hu Jintao, Communist Party General-
Secretary, Central Military Commission Chairman, and PRC President. These visits
to the PRC further dampened prospects that the Special Budget would be passed.
Congressional Appeals. On May 24, 2005, the LY’s Procedure Committee
failed to place the Special Budget on the legislative calendar, blocking consideration
before the session’s end on May 31. On May 27, Representative Rob Simmons and
32 other House Members wrote to KMT chairman Lien Chan, urging him to help
expedite passage of the Special Budget in May. They warned that “failure to pass the
special budget has raised concerns in the United States about Taiwan’s ability to
defend itself against potential aggression.”157 However, Lien responded in a three-
page letter by making partisan attacks on the DPP and President Chen Shui-bian, and
criticisms of the Special Budget although the KMT used special budgets in the
Soong’s meeting with Lawless with the KMT/PFP’s representative in D.C.
152 Taipei Times, February 26, 2005; Lawless gave a speech that was not publicly released,
apparently at a meeting in Washington of the U.S.-Taiwan Business Council.
153 Taipei Times, February 16, 2005; February 23, 2005.
154 Ettoday, Taipei, March 16, 2005 (via FBIS).
155 Lien-ho Pao [United Daily News], Taipei, March 21, 2005.
156 Tzu-yu Shih-pao [Liberty Times], Taipei, March 21, 2005; China Post, March 22, 2005.
157 Rep. Rob Simmons, et al., letter to Chairman Lien Chan, Kuomintang, May 27, 2005.
1990s.158 Moreover, KMT and PFP members of the LY’s Defense Committee
refused to attend a luncheon on June 9 with the top U.S. representative, AIT’s
Director Doug Paal, while his strained relationship with the DPP apparently required
Deputy Director Dave Keegan to host the DPP lawmakers who showed up to discuss
the arms sales.159 There was no special session in the summer as the ruling DPP
requested. On July 16, 2005, the KMT overwhelmingly elected Ma Ying-jeou
(Taipei’s Mayor) instead of Wang Jin-pyng (LY’s President) to replace Lien Chan
as KMT Chairman, prompting some to ask whether Ma would show leadership in
considering the Special Budget. However, he focused on the city and county
elections on December 3, 2005, when the KMT won 14 out of 23 seats.
On August 1, 2005, three co-chairs of the House Taiwan Caucus wrote to Ma
Ying-jeou as the new KMT chairman. They urged him to “lead efforts in Taipei to
ensure that the Legislative Yuan quickly passes a special arms procurement package
or increases its annual defense spending.” They also invited Ma to visit
Washington.160 However, Ma responded as the Mayor of Taipei on August 18 (one
day before becoming KMT Chairman), by blaming the DPP administration for
“procrastinating for three years,” “negligence,” and “lack of leadership,” with no
mention of Wang Jin-pyng’s LY delegation in June 2004. Ma promised to focus his
attention on the issue and to “work closely with the KMT caucus” in the LY after
taking over the KMT chairmanship. He also declined to visit in September, writing
that the LY will “address tough bills like the arms procurement bill.”161 However,
after PFP Chairman James Soong met with Ma on September 7, he announced that
the KMT and PFP party caucuses will continue to “consult each other” on whether
to advance the Special Budget for consideration in the LY.162 Meanwhile, Ma set up
a KMT task force to study the arms issue, and there have been questions about
whether the KMT would support certain arms purchases and incur rising differences
with its weakening coalition partner, the PFP, after the December 2005 elections.
Before the LY’s session began on September 13, 2005, the Defense Ministry
submitted a new Special Budget to cover submarines and P-3C aircraft, moving the
request for PAC-3 missile defense to the regular budget (so that the Special Budget
was about half of the original amount). LY President Wang Jin-pyng of the KMT
acknowledged the reduction as a goodwill gesture and said that “it is time to address
the issue.”163 On August 31, 2005, the Executive Yuan approved a Special Budget
of NT$340 billion (US$10.3 billion), after removing NT$140 billion (US$4.2 billion)
for PAC-3s. On September 28, 2005, the Defense Ministry issued details on its latest
158 Lien Chan, Chairman of the KMT, letter to Rep. Simmons, et al., June 8, 2005.
159 Taipei Times, June 10, 2005.
160 Letter from Representatives Robert Wexler, Steve Chabot, and Sherrod Brown (without
Dana Rohrabacher) to Ma Ying-jeou, KMT Chairman, August 1, 2005.
161 Letter to the Taiwan Caucus from Ma Ying-jeou, Mayor of Taipei, August 18, 2005.
162 Chung-kuo Shih-pao [China times], Taipei, September 7, 2005.
163 Central News Agency, Taipei, August 24, 2005; Taipei Times, August 25, 2005.
funding request for 8 submarines: about NT$288 billion in the Special Budget and
NT$10.1 billion in the regular budget for a total of about US$9 billion.164
Defense Department Warns of Limits to U.S. Help. When asked about
the LY’s delay in deciding to purchase U.S. weapons, Secretary of Defense Donald
Rumsfeld said in August 2005 that under the TRA, the U.S. obligation is “to work165
with Taiwan” on security assistance, but it is up to Taiwan make its own decisions.
On September 19, 2005, Deputy Under Secretary of Defense Richard Lawless issued
another strong speech, this time directed at Taiwan’s people and saying that he was
not urging the passage of the Special Budget because it has become a political
“distraction.” Lawless applauded the goal of increasing the defense budget to 3% of
GDP. He warned of the danger that “Taiwan’s steadily declining defense budgets,
and the resulting erosion in its own defense capabilities, also adversely affect the
status quo,” in addition to the PLA build-up. He expressed the U.S. expectation that
Taiwan has the “collective will to invest in a viable defense to address a growing
threat and be in a position to negotiate the future of cross-strait relations from a
position of strength.” He criticized the military for “short-changing itself on reserves
of critical munitions” and inadequate “hardening” for defense. Lawless stressed that,
under the TRA, Taiwan also has an obligation for its self-defense. He warned that
the time of reckoning is upon us.... The U.S. ability to contribute to Taiwan’s
defense in a crisis is going to be measured against Taiwan’s ability to resist,
defend, and survive based on its own capabilities.... As the lone superpower, our
interests are plentiful and our attention short. We cannot help defend you, if you166
cannot defend yourself.”
Separately, the Commander of the Pacific Command (PACOM), Admiral
William Fallon raised questions in press articles and interviews about his assessment
of whether Taiwan should prioritize its limited defense resources on “defensive”
weapons rather than submarines, given Taiwan’s urgent need to effectively upgrade
its self-defense. Admiral Fallon reportedly raised this question with Taiwan’s Chief
of General Staff, General Lee Tien-yu, who recently had visited Hawaii. Admiral
Fallon also told the United Daily News his concern that if he is to be able to maintain
the U.S. commitment to assist Taiwan’s defense, then Taiwan should have a strong167
self-defense capability. On October 26, 2005, eight Members, led by
Representative Simmons, asked Admiral Fallon to explain his discussions with
Taiwan on submarines. Admiral Fallon responded that he has not tried to discourage
this purchase. He added, however, that PACOM has “strongly and consistently
164 Tung-sen Hsin-wen Pao, Taipei, September 28, 2005.
165 Secretary of Defense Donald Rumsfeld, news briefing, August 23, 2005.
166 Speech issued on September 19, 2005, in San Diego, CA, at the Defense Industry
Conference of the U.S.-Taiwan Business Council, while Richard Lawless was delayed in
Beijing at the Six-Party Talks on North Korea’s nuclear weapons. Edward Ross, a DSCA
official, delivered the speech for Richard Lawless.
167 Japan Times, September 26, 2005 [reprinted in Washington Times, October 8, 2005];
Liberty Times [Chinese-language newspaper in Taipei], October 12, 2005, which named
General Lee Tien-yu; Associated Press, October 14, 2005 [reprinted in Taipei Times,
October 16, 2005]; and Lien-Ho Pao [United Daily News in Taipei], October 18, 2005.
encouraged [Taiwan] to acquire capabilities that would have an immediate impact
on [its] defense,” and “while submarines would provide Taiwan with significant
capabilities, a lengthy period of time would be needed to fulfill this long-term
On October 29, 2005, at the transfer ceremony for the first two Kidd-class
destroyers, Marine Brigadier General John Allen, Principal Director for Asian and
Pacific Affairs in the Office of the Secretary of Defense, gave a speech, saying that
“it is imperative that the people of Taiwan hold their leaders of all political parties
accountable for reaching a consensus to increase defense spending,” while it is not
appropriate for the United States to tell Taiwan what “budgeting mechanism” to use.
The U.S. role, he said, is to provide the “assistance necessary” to help Taiwan’s
strategy for stability, “but at the end of the day, it is Taiwan that must decide its fate.”
In the first notification to Congress on arms sales to Taiwan since March 2004,
the Defense Department in October 2005 put a new stress on the TRA’s objective,
which is to assist Taiwan to provide for its “own self-defense.”
Like Lawless, the Director of DSCA, Air Force Lt. Gen. Jeffrey Kohler, also
highlighted Taiwan’s inadequate attention to its stocks of air-defense missiles and
other munitions as well as pending decisions on defense spending, in an interview in
At a hearing of the House Armed Services Committee on March 9, 2006, in
response to Representative Rob Simmons’ question about the submarine sale to
Taiwan, Admiral William Fallon expressed the dilemma for PACOM regarding
Taiwan. Fallon said that he was:
in bit of a box here, because I’m committed to defend this country in the event
of any military aggression should that occur from the PRC, and yet the history
is that they have not been forthcoming in investing in their own defense.... What
I’d like to see is some steps being made, some investment by Taiwan to actually
acquire some of these capabilities and to boost their own readiness and ability to
provide for their own defense.
Special Budget Blocked in Legislature. On December 13, 2005,
opposition lawmakers in the Procedures Committee voted for the 41st time to block
the statute governing the Special Budget, keeping it from the LY’s agenda since it
was first introduced in 2004. However, at the Procedures Committee meeting on
December 20, the DPP and its allied lawmakers called a vote at a moment when they
had a majority, and the committee voted 12-5 to report the statute to the LY. On the
eve of full LY consideration, the KMT and PFP chairmen, Ma Ying-jeou and James
Soong, met and announced their joint opposition to a “wealthy fool’s arms deal.”
The Ministry of Defense announced it will move the request for P-3s and reduce the
Special Budget to one request of NT$299 billion (US$9 billion), about half of the
original Special Budget, for submarines. Meanwhile, Representatives Rob Simmons
168 Letter to Representative Simmons from Admiral William Fallon, November 8, 2005.
169 Jim Wolf, “Pentagon Official Says Taiwan Short on Weapons,” Reuters, Dec. 7, 2005.
and Tom Tancredo issued statements, saying the Special Budget was “critical for the
defense of Taiwan” and applauded its passage out of the Procedures Committee.
Representative Simmons also said that “blocking this arms package tells the United
States — correctly or not — that Taiwan’s leadership is not serious about the security
of its people or its freedom. The American People have come to the aid of foreign
countries in the name of freedom many times in our history; but Americans will not
in good conscience support countries that are unwilling to defend themselves.”170
When the LY convened on December 23, 2005, to consider the Special Budget,
KMT and PFP lawmakers proposed to end the meeting before debating the bill.
Taiwan’s lawmakers voted 113-100 to end the meeting 20 minutes after it began.
This move effectively sent the bill on the Special Budget back to the Procedures
Committee, which then voted as before to block its progress on December 27, 2005,
January 3, and January 10, 2006, the 45th time that opposition lawmakers in the LY
blocked the statute on the Special Defense Budget after its introduction in 2004.
Waiting for Ma Ying-jeou’s KMT Defense Policy. LY president Wang
Jin-pyng (KMT) visited Washington on January 24-25, 2006, and promised a KMT
policy on defense from Ma Ying-jeou, including on arms sales, in February or March.
Unlike his visit in 2004, Wang’s highest-level interlocutors in the Pentagon were
Deputy Assistant Secretary of Defense Mary Beth Long and the Principal Director
for Asian and Pacific Affairs, Brigadier General John Allen. There were no results
from this visit.
In February 2006, Representative Rob Simmons visited Taipei and suggested
a lower cost for the submarine sale (perhaps $8 billion) and an interim step for
Taiwan to procure a sub design (perhaps $225 million). Also in February,
Representative Henry Hyde, Chairman of the House International Relations
Committee sent a letter to Ma, citing “deep concern” in Congress about the LY’s
failure in the past two years to pass the Special Budget and about significant cuts in
other defense spending that would improve readiness. Hyde also wrote that
Americans are left wondering whether Taiwan’s legislators have the resolve to meet171
the challenges in providing for Taiwan’s own defense. In a March 7 letter, Ma
responded to Representative Hyde by blaming the DPP administration and promising
his own policy in the near future.
While the House Taiwan Caucus, in August 2005, had invited KMT chairman
Ma Ying-jeou to visit, he scheduled a trip to Washington for March 22-23, 2006,
while Congress was in recess. Ma failed on March 14 to gain his party’s approval
to issue a long-awaited policy on defense and arms procurement, despite his
upcoming visit to Washington. Ma had no details on his defense priorities in
meetings during his visit (with the private sector and the Bush Administration).
While campaigning to be president, Ma issued a defense policy in September 2007
with a stance that supported purchases of U.S. weapons, including submarines.
170 Rep. Rob Simmons, “U.S. Congressman Congratulates Taiwan on Defense Spending Bill
Progress,” news release, December 21, 2005.
171 Letter from Henry Hyde to Ma Ying-jeou, Chairman of the KMT, February 15, 2006.
2006 Supplemental Budget Instead of Special Budget. When the LY
reconvened on February 21, 2006, the Procedures Committee blocked the statute onth
the Special Budget for the 46 time. Thus, in a March 20 special report to the LY,
Defense Minister Lee Jye decided to request procurement of subs and P-3s through
supplemental funds in the regular 2006 defense budget (instead of the Special
Budget): NT$200 million (about US$6 million) as “working fees” to study a sub
procurement program and NT$1.7 billion (about US$52 million) for P-3C aircraft.
The Defense Ministry then decided also to request supplemental funds of NT$3.7
billion (about US$113 million) for PAC-2 upgrades (not PAC-3 missiles). The
supplemental request for the 2006 budget for these three weapon systems totaled
NT$5.6 billion (about US$172 million). This amount for the three proposed
programs was included in the minister’s broader 2006 Supplemental Budget request172
of NT$13.7 billion (about US$420 million) for 74 programs.
In March 2006, the Defense Ministry submitted its request to the Executive
Yuan (EY), or Cabinet, which then approved on May 24 a Supplemental Budget for
the 2006 defense budget of NT$6.3 billion (about US$194 million) with the three
weapons requests plus NT$700 million for construction of an airstrip on Taiwan-
controlled Taiping island (in the Spratly Islands in the South China Sea). The
Supplemental Budget also needed to be approved by the LY, but its session ended on
May 30 and KMT legislators, including Lin Yu-Fang, raised concerns, particularly
about the supplemental budget’s legal basis.173 The LY decided on June 12 to hold
a special session on June 13-30, but consideration of the Supplemental Budget for
defense was not on the agenda that focused on trying to recall President Chen from
office. On June 14, the EY approved a draft bill to govern the Supplemental Budget.
The KMT demanded in mid-October 2006 that the DPP Administration withdraw the
original Special Budget if the Supplemental Budget was to be considered. While the
DPP agreed to this compromise, it fell apart when the KMT and PFP still voted on
October 24 to oppose placing the 2006 supplemental request on the LY’s agenda.
This outcome prompted the U.S. Representative in Taipei, Stephen Young, to
call a press conference two days later, at which he strongly urged the LY to “pass a
robust defense budget in this fall’s legislative session.” He pressed the legislators to
“permit the supplemental budget to pass through the procedural committee and be174
taken to the floor of the legislature so that an open debate can begin.” However,
his remarks stirred controversy in Taiwan’s charged domestic political context. In
defiance of this latest U.S. message, the opposition KMT and PFP legislators voted
in the Procedures Committee on October 31 to block the Supplemental Budget. On
December 26, 2006, after some opponents forgot to vote against the supplemental
bill, it was passed out of the Procedures Committee. Three days later, the LY voted
172 CNA, March 20 and April 4, 2006; Special Report of the Ministry of Defense, March 20,
173 During consultations in Taipei in April 2006, Lin Yu-fang said that a Supplemental
Budget request would be illegal, that the issue is not the budgeting mechanism but whether
the three weapon systems should be procured, and that such requests could “crowd out”
other funding needs of the army and air force or other ministries.
174 AIT Director Stephen Young, press conference, Taipei, October 26, 2006.
(194-162) to allow committee review of the draft bill governing the supplemental
budget but returned the supplemental budget to the Procedures Committee.
2007 Defense Budget. Taiwan finally reversed the negative trend in defense
spending with an increase in 2007. In August 2006, Taiwan’s Executive Yuan
(Cabinet) approved a proposed 2007 defense budget of NT$323.5 billion (US$9.8
billion), an increase of NT$71 billion (US$2.2 billion).175 A proposal to buy F-
Without a Special Budget or 2006 Supplemental Budget, the Bush Administration,
U.S. industry, and Congress shifted the focus to whether the LY would approve the
2007 defense budget with a spending increase during what was considered its critical
September 2006 to January 2007 session. At the U.S.-Taiwan defense industry
conference on September 10-12, 2006, the Defense Department declined to even
issue a policy address to Taiwan, after making the effort in 2004 and 2005. The State
Department’s Director of the Taiwan office warned Taiwan’s political figures from
opposition and ruling parties that “leaders who aspire to represent the Taiwan
people” to the United States should recognize that their decisions “right now on core
national security issues” will have an impact on the future bilateral relationship. He
also focused attention on how the LY will pass the 2007 defense budget “this fall.”177
On November 6, 2006, the LY’s defense and budget committees jointly passed
an amended 2007 defense budget. They approved requested funds to procure P-3C
ASW planes and PAC-2 upgrades; deleted about US$347 million for PAC-3
missiles; and cut the request for the sub program from about US$139 million to
US$6 million (for the LY’s own “feasibility study” for subs). They also froze funds
for F-16C/D fighters for five months (ending on May 31, 2007), pending U.S.
provision of price and availability data. However, the LY session ended on January
because of another political dispute. Finally, on June 15, 2007, the LY passed the
2007 Defense Budget, with about: $6 million to conduct a “feasibility study” on
buying submarines (not a commitment to either design phase or submarines); $188
million for P-3C planes; $110 million for PAC-2 upgrades (and no funds for PAC-3
missiles); and $488 million for F-16C/D fighters (with funds frozen until October 31
pending U.S. approval). The final 2007 defense budget totaled NT$304.9 billion
(US$9.2 billion), accounting for 2.4% of GDP. However, without U.S. discussion,
the Defense Ministry lost the funding for F-16C/Ds in the 2007 defense budget.
2008 Defense Budget. Regarding the 2008 defense budget, the Defense
Ministry requested and the Executive Yuan approved in August 2007 a budget of
NT$349.5 billion (US$10.6 billion), an increase of 15%. However, on December 20,
2007, the LY approved the final 2008 defense budget that totaled NT$341.1 billion
(US$10.5 billion), making up 2.5% of GDP. The budget included funds (but also
175 CNA, August 23, 2006.
176 Author’s consultations with MND officials, September 2006.
177 Clifford Hart, speech to the U.S.-Taiwan Defense Industry Conference, September 12,
froze some of the funds) for procurement of PAC-2 upgrades, PAC-3 missiles, P-3C
planes, sub design phase, F-16C/D fighters, utility helicopters, and attack helicopters.
2009 Defense Budget. The Bush Administration advanced the process for
the programs for the P-3C planes and PAC-2 upgrades by formally notifying
Congress of the proposed sales in September and November 2007. However,
Taiwan’s military has unused budgeted funds to apply to 2009 with no progress (no
presidential notifications to Congress) on several other arms programs and with the
U.S. refusal to accept a request for F-16C/D fighters through August 2008, when
Taiwan’s Executive Yuan submitted the 2009 defense budget to the LY. With the
unused funds as one explanation, the proposed 2009 defense budget is a reduction
from the previous year’s budget. President Ma’s administration submitted a 2009
defense budget of NT$315.2 billion (US$10.2 billion), accounting for 17.2% of the
total government budget. This budget would be 2.3% of Taiwan’s GDP.
Visits by Generals/Admirals to Taiwan. As for senior-level contacts, the
United States and Taiwan have held high-level defense-related meetings in the
United States, as discussed above. U.S. policy previously restricted high-level
military contacts but changed to welcome Taiwan’s senior military officers and
defense officials to visit the United States, shifting the question to their willingness
to make the visits. At the same time, the State Department’s policy has avoided
sending to Taiwan U.S. flag and general officers or officials at or above the level of
Deputy Assistant Secretary of Defense or State. For a hearing in 1999, Assistant
Secretary of State Stanley Roth responded to a submitted question on this issue by
writing that “following the 1994 policy review, the Administration authorized travel
by high-level officials, including cabinet officers, from economic and technical
agencies. However, restrictions remained at the same level for visitors from military
or national security agencies at or above the position of Deputy Assistant Secretary
and at the rank of one-star flag officer or above. This policy is based on the
determination that visits of such officials would be inconsistent with maintaining an
The State Department issued guidelines on relations with Taiwan to continue
the policy to ban official travel to Taiwan for State or Defense Department officials
above the level of office director or for uniformed military personnel above the rank
of O-6 (colonel, navy captain).179 The Pentagon and some in Congress have sought
to lift this restriction in order to advance U.S. interests in boosting Taiwan’s
deterrence capability and U.S. leverage in Taiwan. Senior-level exchanges could
help to understand Taiwan’s crisis-management and self-defense capabilities and
limitations.180 The TRA does not specify unofficial or official relations with Taiwan.
Some have cited the NSC’s record of sending senior officials to Taipei for clear and
178 Senate Foreign Relations Committee, hearing on “United States-Taiwan Relations: the
179 Department of State, “Guidelines on Relations with Taiwan,” February 2, 2001,
September 5, 2006.
180 Dan Blumenthal and Gary Schmitt, “A Strange Calculus,” Wall Street Journal, August
21, 2006; Therese Shaheen, “Why is the U.S. Ignoring Taiwan?” Wall Street Journal, June
direct talks.181 The NSC, State Department, and some in Congress have opposed
sending senior military officers and defense officials to Taiwan as an unnecessary,
ineffective change to a sensitive situation. (See congressional actions, below.)
Taiwan’s Missile Program. Referencing the TRA’s Section 2(b)(5) “to
provide Taiwan with arms of a defensive character,” policy-makers face a question
of how to respond to Taiwan’s increasing interest in counter-strike missiles (ballistic
and cruise missiles). Some politicians in Taiwan and U.S. advocates talk about182
missiles as a deterrent. Some Americans see Taiwan’s strategy as inherently
defensive against the PRC, with tactical utility for missiles. Others call this desire183
for long-range weapons unhelpful for stability and U.S. escalation control. Bush
Administration officials reportedly raised objections to Taiwan’s missile programs.184
However, this objection raised an issue of whether the Administration contradicted
its past position and undermined Taiwan’s defense.185 Another issue covered whether
the refusal to consider Taiwan’s request for F-16C/Ds undermines this position. A
third issue was whether the U.S. stance should be stronger and clearer.
At a press conference in October 2006, the U.S. Representative in Taipei,
Stephen Young, said that U.S. policy helps Taiwan to have self-defense, “not to
attack the mainland, because that was never in the cards and still isn’t now, but to
defend itself.” By April 2007, the Administration became more concerned about a
misperception of U.S. assistance for or approval of Taiwan’s Hsiung-feng 2E (HF-
2E) land-attack cruise missile program. Also, U.S. officials reportedly linked
Taiwan’s planned deployment of such missiles to consideration of a request for186
F-16C/D fighters. Right after Taiwan’s Han Kuang exercise in April 2007, the
new PACOM Commander, Admiral Timothy Keating, testified to Congress about the
situation in the Taiwan Strait while expecting Dennis Blair’s full briefing on the
exercise. Keating stressed “how emphatically we emphasize to [Taiwan] that [its]187
actions should be defensive in nature and not offensive.” Finally, because the Han
Kuang military exercise included demonstration of the use of the LACM to Blair, a
National Security Council official publicly stated,
We think that developing defensive capabilities is the right thing to do. We think
that offensive capabilities on either side of the Strait are destabilizing and,
therefore, not in the interest of peace and stability. So when you ask me whether
I am for offensive missiles, I’m not for offensive missiles on the Chinese side of
181 The NSC has sent the Senior Director for Asian Affairs, including James Moriarty and
Michael Green, to Taiwan. For example: Far Eastern Economic Review, May 20, 2004.
182 John Tkacik, “The Best Defense is a Good Offense,” Taipei Times, February 14, 2007.
183 Michael McDevitt, “For Taiwan, the Best Defense is not a Good Offense,” PacNet
Newsletter #9, February 22, 2007.
184 Lien-ho Pao, Taipei, October 21, 2006, quoting unnamed U.S. officials.
185 Rupert Hammond-Chambers, President of the U.S.-Taiwan Business Council, “Taiwan
Goes It Alone,” Defense News, and “Special Commentary,” February 25, 2008.
186 Defense News, July 16, 2007.
187 Senate Armed Services Committee’s hearing on April 24, 2007.
the Strait, and I’m not for offensive missiles on the Taiwan side of the Strait. But188
appropriate defense capabilities are certainly the right of the people of Taiwan.
AIT Director Stephen Young followed up at a press conference in Taipei in
early May, stating that “there were claims that the United States Government
approved of the use of long-range offensive missiles during the [Han Kuang military]
exercise and that they even offered a name for these systems. I want to say
categorically here, on behalf of the U.S. Government, that these stories are
inaccurate.” He added that “what we think Taiwan should be placing its emphasis189
on, is missile defense,” citing the PAC-3 missile defense system. Despite the lack
of U.S. support, in December 2007, Taiwan’s LY approved about $117 million but
froze $77 million for the HF-2E program in the final 2008 defense budget.
President’s “Freeze” on Arms Sales Notifications. In 2008,
congressional concerns and frustrations mounted about the delay in the President’s
notifications and briefings to Congress on eight pending arms sales as well as his
refusal to accept Taiwan’s request for F-16C/D fighters. As discussed above,
President Bush changed policy in April 2001 to consider Taiwan’s arms requests
routinely on an as-needed basis, similar to acceptance of other foreign requests for
security assistance. However, the Administration’s refusal to accept a formal request
from Taiwan for F-16C/D fighters since 2006 has raised the issue of whether the
Administration violated or changed its own policy without public discussion. In
October 2007, the House passed H.Res. 676, and Senator Lisa Murkowski wrote a
letter to National Security Advisor Stephen Hadley. (See 110th Congress below.)
In addition to the uncertainty of the Bush Administration’s decision-making,
there were also questions about any changes in the security strategy and defense
policy of President Ma Ying-jeou, particularly given the past ambivalence of the
KMT party. There were questions about the KMT’s review of pending U.S. arms
programs, reportedly including whether to pursue the submarine purchase.190 In the
summer and fall of 2008, President Ma’s military viewpoint reportedly was
influenced by a U.S. article critical of the proposed arms sales programs.191 After the
inauguration of Taiwan’s KMT President Ma Ying-jeou on May 20, 2008, he
promptly resumed a dialogue with the PRC on June 12-13, resulting in expanded
charter flights and tourism across the Taiwan Strait in July. While the resumption
of the dialogue for the first time in a decade was welcomed, both the Ma and Bush
Administrations were concerned about the timing of announcements on arms sales
to Taiwan during the first round of the resumed dialogue.192 Nonetheless, Taiwan
later showed concern about the Bush Administration’s delay in making progress on
188 Dennis Wilder, Special Assistant to the President and Senior Director for East Asian
Affairs, NSC, remarks at a Foreign Press Center Briefing, April 26, 2007.
189 AIT Director Stephen Young, press conference, Taipei, May 3, 2007.
190 See CRS Report RL34441, Security Implications of Taiwan’s Presidential Election of
March 2008, April 4, 2008, by Shirley Kan.
191 William Murray, “Revisiting Taiwan’s Defense Strategy,” Naval War College Review,
192 Washington Post, June 12, 2008; Defense News, June 16, 2008.
pending arms sales. On July 12, 2008, Ma finally clarified publicly that Taiwan still
considered the U.S. arms programs as important and urgent, in spite of the cross-
strait talks.193 Visiting Washington on July 27-August 1, Wang Jin-pyng, President
of the LY, said that U.S. officials told him that the Administration had not imposed
a “freeze,” continued to adhere to the TRA, and was working on the notifications.
Taiwan’s military was increasingly concerned about the potential loss of unspent
budgeted funds for programs as it neared the end of the 2008 budget year.
Members of Congress suspected that the President effectively suspended arms
sales to Taiwan in violation of the TRA and other aspects of U.S. policy. Congress
also was concerned about the lack of timely and complete information requested
from the Administration, with disregard for the Congressional role. They feared that
President Bush was deferring to objections in Beijing or other policy considerations.
Even before June, Deputy Secretary of State John Negroponte testified to Senator
Lisa Murkowski at the Foreign Relations Committee on May 15, 2008, that after
Taiwan’s legislature approved funding of the weapons programs (which was in
December 2007), the Administration did not take or plan to take subsequent steps in
arms sales. Despite the lack of notifications to Congress on pending arms sales to
Taiwan (since the last notification in November 2007), Assistant Secretary of
Defense for Asian and Pacific Security Affairs James Shinn denied at a hearing that
“we made a decision to put things in abeyance” in testimony on June 25.194
On July 16, 2008, PACOM Commander Admiral Timothy Keating confirmed
at a public event at the Heritage Foundation that the Administration’s policy was to
freeze arms sales to Taiwan. He reportedly confirmed discussions with PRC officials
about their objections, raising a question about the Administration’s violation of the
TRA and Six Assurances. Moreover, Keating implied that arms sales would be
“destabilizing” to the situation in the Taiwan Strait and that there was no pressing
need for arms sales to Taiwan at this moment, even as he acknowledged a cross-strait
military imbalance favoring the PRC. In contrast, former PACOM Commander
Dennis Blair who just visited Taiwan in June said that Taiwan’s military and civilian
leaders understood the need to negotiate with the PRC from a position of strength and
to maintain Taiwan’s defense.195 Also, former Bush Administration officials urged
President Bush to keep his commitment on Taiwan.196
Some in Congress became concerned that the Administration suspended arms
sales, but the Administration publicly denied a “freeze” or change in policy.
Nonetheless, the Administration delayed sending any notifications to Congress on
eight approved, pending arms sales programs with a total value of $12-13 billion (for
193 DPA, July 12, 2008, and Taiwan News, July 13, 2008.
194 House Armed Services Committee, hearing on China: Recent Security Developments,
June 25, 2008.
195 Wendell Minnick, “China Wields New Diplomatic Skills Against Taiwan,” Defense
News, July 7, 2008.
196 Ed Ross, (former DSCA official), “Arming Taiwan,” Wall Street Journal Asia, July 18,
2008; Dan Blumenthal, Aaron Friedberg, Randall Schriver, Ashley Tellis, “Bush Should
Keep His Word on Taiwan,” Wall Street Journal, July 19, 2008.
a submarine design, Patriot PAC-3 missile defense systems, Apache helicopters,
Blackhawk helicopters, E2-T airborne early warning aircraft upgrade, aircraft parts,
Harpoon submarine-launched anti-ship missiles, and Javelin anti-tank missiles).
As late as September 29, 2008, after the originally-scheduled congressional
adjournment on September 26, the Deputy Assistant Secretary of Defense for Asian
and Pacific Security Affairs gave a speech at the U.S.-Taiwan defense industry
conference, stating that he had “no news” on the long-awaited notifications on arms
sales and that the Administration’s “internal processes” were still continuing.197 On
October 3, the last day of congressional session, President Bush finally notified
Congress. A Pentagon spokesman said that the PLA canceled military meetings and
port visits through the end of November, in “continued politicization” of contacts.198
However, President Bush submitted only six of the eight pending sales for a
total value of $6.5 billion, or about half of the pending total. The Administration did
not submit for congressional review the pending programs for Black Hawk
helicopters or the submarine design. Moreover, the sale of PAC-3 missile defense
systems was broken up, excluding three of seven firing units and about 50 missiles.
Representative Ileana Ros-Lehtinen stated on the day of the formal notifications that
they were in accordance with the TRA but criticized the President for not following
the “letter and spirit” of the law and for keeping Congress “in the dark about U.S.
arms sales policy toward Taiwan.” She noted this “grave breach of Executive Branch
cooperation with Congress.” Also, Senator John McCain pointed out that the arms
sales have been “on hold for too long” and urged the Administration to reconsider its
decision not to provide submarines or F-16 fighters.199 Congress might further
reassert its legislated role in policy decisions. The Administration’s long-awaited
decision to submit the notifications raised more questions about arbitrary decisions
in addition to piling up the notifications for months. One policy option is to resurrect
the annual arms sales talks.200 Other options are to reassess U.S. arms sales in a
strategic approach as well as to hold a serious defense dialogue with Taiwan.
Policy Reviews and U.S. Objectives. During Taiwan’s politically-
motivated impasse over funding for self-defense, a former Pentagon official warned
that if Taiwan did not pass the Special Budget and there were no expected
improvements in defense, the United States would be more hesitant to approve future
requests for weapons and possibly conduct a review of policy toward Taiwan.201
After Taiwan passed arms procurement funds in 2007, the Bush Administration in
197 David Sedney, speech at the U.S.-Taiwan Defense Industry Conference held by the U.S.-
Taiwan Business Council, Jacksonville, FL, September 29, 2008.
198 VOA and AP, October 6, 2008; Xinhua and Zhongguo Xinwen She, October 7, 2008.
199 Representative Ileana Ros-Lehtinen, Ranking Republican, Foreign Affairs Committee,
press release, October 3, 2008; and Senator John McCain, press release, October 7, 2008.
200 Mark Stokes, “Taiwan Must Review Security Risks,” Taipei Times, March 12, 2008. See
CRS Report RS20365, Taiwan: Annual Arms Sales Process, by Shirley Kan.
201 Interview with Mark Stokes, retired Air Force Lieutenant Colonel and Country Director
in the Office of the Secretary of Defense, in Taipei Times, April 24, 2005.
2008 delayed progress on some programs to sell arms to Taiwan. A better defined
strategy to set clear objectives and improve mutual agreement might be needed.
Congress has a role in oversight of any reviews of policy toward Taiwan. In
September 1994, the Clinton Administration explicitly and publicly testified to
Congress about a major Taiwan Policy Review.202 Defense ties would likely be
included in any policy reviews of how to enhance leverage over Taiwan and affect
the cross-strait situation, including whether to limit defense ties, apply conditions, or
strengthen ties. Policy promotes the U.S. objectives of assisting Taiwan’s self-
defense capability, preventing conflict, minimizing the chance of U.S. intervention,
dispelling dangerous misperceptions, and promoting cross-strait dialogue. While
U.S. objectives have been consistent, developments in China and Taiwan since the
In late 2002, the Pentagon reportedly conducted a policy review of cooperation
with Taiwan that examined whether its leaders have taken defense seriously, whether
defense cooperation with Taiwan has been effective, and whether U.S. policy should
change.203 (The NSC, State Department, and AIT would have input into any review
by the Administration of policy toward Taiwan.)204 At the U.S.-Taiwan Business
Council’s conference on Taiwan’s defense in February 2003, in San Antonio, TX,
Deputy Assistant Secretary of Defense Richard Lawless told Taiwan’s Vice Defense
Minister Chen Chao-min and others that, while the President said that we will do
whatever it takes to help Taiwan defend itself, Taiwan “should not view America’s
resolute commitment to peace and stability in the Taiwan Strait as a substitute for
investing the necessary resources in its own defense.” At the same occasion, Deputy
Assistant Secretary of State Randall Schriver indicated a new proactive U.S.
approach to Taiwan’s defense modernization, pointing Taiwan to three priorities:
missile defense, C4ISR, and ASW.
Taiwan’s election in March 2004 brought the re-election of President Chen
Shui-bian and his advocacy of a new constitution for Taiwan by 2008. In April 2004,
the Defense and State Departments testified to the House International Relations
Committee, expressing a readjustment in the Bush Administration’s policy toward
Taiwan.205 Assistant Secretary of State James Kelly clarified U.S. policy by stating:
!The United States “does not support” independence for Taiwan or
unilateral moves that would change the status quo “as we define it”
202 Testimony of Assistant Secretary of State for East Asian and Pacific Affairs Winston
Lord, “Taiwan Policy Review,” before the Senate Foreign Relations Committee on
September 27, 1994. See CRS Report RL30341, China/Taiwan: Evolution of the “One
China” Policy — Key Statements from Washington, Beijing, and Taipei, by Shirley Kan.
203 Taiwan Defense Review, January 18, 2003.
204 The Nelson Report (January 31, 2003) reported there was an interagency East Asia Policy
205 House International Relations Committee, hearing on “The Taiwan Relations Act: The
Next 25 Years,” April 21, 2004.
and opposes statements or actions from either side that would
unilaterally alter Taiwan’s “status.”
!U.S. efforts at deterring PRC coercion “might fail” if Beijing ever
becomes convinced Taiwan is embarked upon a course toward
independence and permanent separation from China, and concludes
that Taiwan must be stopped.
!It would be “irresponsible” of us or of Taiwan’s leaders to treat the
PRC’s statements as “empty threats.”
!The United States looks to President Chen to exercise the kind of
responsible, democratic, and restrained leadership that will be
necessary to ensure a peaceful and prosperous future for Taiwan.
!There are “limitations” with respect to what the United States will
support as Taiwan considers possible changes to its constitution.
!We urge Beijing and Taipei to pursue dialogue “as soon as possible”
through any available channels “without preconditions.”
One policy issue is the relative stress on cross-strait dialogue vs. deterrence. In
his testimony, Assistant Secretary of State Kelly argued that a premise of arms sales
to Taiwan has been that “a secure and self-confident Taiwan is a Taiwan that is more
capable of engaging in political interaction and dialogue with the PRC, and we
expect Taiwan will not interpret our support as a blank check to resist such
dialogue.” However, some observers have begun to question the continued validity
of this premise. James Lilley, former ambassador in Beijing and representative in
Taipei, warned in April 2004 that:
The implicit American premise was that a secure and stable Taiwan would be a
more willing and successful partner in dealing with China. Judicious arms sales
to Taiwan were part of this formula and in the past it has worked.... If elements
of this broader formula are disregarded by the current Taiwan authorities,
however, then the successful historic pattern has been broken. U.S. military
support and arms sales cannot be used by Taiwan to move away from China —
they were meant to make Taiwan feel secure enough to move toward
accommodation with China. Our support should be conditional on upholding our206
Any policy review might be coordinated with allies in Asia and Europe. While
in Beijing in August 2004, Australian Foreign Minister Alexander Downer reportedly
expressed doubts about whether any U.S. military help for Taiwan’s defense against207
China would involve invoking Australia’s defense treaty with the United States.
In February 2005, Secretary of Defense Donald Rumsfeld and Secretary of State
Condoleezza Rice with Japan’s Ministers for Defense and Foreign Affairs issued a
Joint Statement of the U.S.-Japan Security Consultative Committee (“2+2
statement”). They declared that a common strategic objective is to “encourage the
peaceful resolution of issues concerning the Taiwan Strait through dialogue.” China
objected to the alliance’s mere mention of Taiwan. In December 2007, the Council
206 James Lilley, “Strait Talk,” Wall Street Journal, April 19, 2004.
207 Catherine Armitage, “Downer Assures China on Taiwan,” The Australian, August 18,
of the European Union (EU) approved “Guidelines on the EU’s Foreign and Security
Policy in East Asia” that expressed concerns about stability in the Taiwan Strait.
Greater cross-strait integration has raised concerns about the leakage of military
technology and secrets from Taiwan to mainland China. As supporters of Taiwan
wrote in October 2006, “there is little sense in America’s continued support of
Taiwan’s defenses if Taiwan has no intention of using them to deter attack by the
Chinese. Washington is increasingly alarmed that Taiwan’s politicians — wittingly
or unwittingly — are shifting responsibility for their island’s defense from Taipei to
Beijing, thus jeopardizing the integrity of U.S. defense technology that has already
been transferred to Taiwan.”208
Major Congressional Action
105th Congress. In the 105th Congress, the FY1999 National Defense
Authorization Act (P.L. 105-261) required the Secretary of Defense to study the U.S.
missile defense systems that could protect and could be transferred to “key regional209
allies,” defined as Japan, South Korea, and Taiwan. In addition, the conference
report (H.Rept. 105-746 of the FY1999 Defense Appropriations Act, P.L. 105-262)
required a report from the Pentagon on the security situation in the Taiwan Strait, in
both classified and unclassified forms.210
Chairman of the House International Relations Committee, wrote President Clinton
on April 19, 1999, urging approval for the sale of long-range early warning radars to
Taiwan. He also wrote Secretary of State Madeleine Albright on April 22, 1999,
saying that if the Administration did not approve the sale, he would introduce
legislation to do so. In the end, the Clinton Administration decided in principle to
sell early warning radars to Taiwan. The State Department spokesperson confirmed
that the United States agreed on the request in principle and acknowledged that under
the TRA, “the President and Congress determined which defense articles and services211
Taiwan needs.” The Pentagon spokesperson also confirmed that the United States
“agreed to work with the Taiwanese to evaluate their early warning radar needs, and
208 Michael Needham and John Tkacik, “Grim Future for Taiwan’s Defenses,” Heritage
Foundation Web Memo, October 31, 2006.
209 Department of Defense, “Report to Congress on Theater Missile Defense Architecture
Options for the Asia-Pacific Region,” unclassified version, May 1999; CRS Report
RL30379, Missile Defense Options for Japan, South Korea, and Taiwan: A Review of the
Defense Department Report to Congress, by Robert D. Shuey and Shirley A. Kan.
November 30, 1999.
210 Department of Defense, “Report to Congress Pursuant to the FY99 Appropriations Bill,
The Security Situation in the Taiwan Strait,” unclassified version, February 1, 1999; CRS
Report RS20187, Taiwan’s Defense: Assessing the U.S. Department of Defense Report,
“The Security Situation in the Taiwan Strait,” by Robert Sutter.
211 Shenon, Philip, “U.S. Plans to Sell Radar to Taiwan to Monitor China,” New York Times,
April 30, 1999; Department of State, Daily Press Briefing, April 29, 1999.
that will take place over the next year or so, but there is no specific agreement on a
specific type of radar, specific sale, or specific terms of sale at this time.”212
In July 1999, after President Clinton reportedly delayed a visit to Taiwan by
Pentagon officials and considered a cutoff of arms sales after President Lee Teng-hui
said Taiwan and the PRC have a “special state-to-state relationship,” Representative
Gilman responded by threatening to suspend all U.S. arms sales. He stated that “I
cannot accept undercutting Taiwan’s national security and its right under the 1979
Taiwan Relations Act to receive appropriate security assistance from our nation to
meet its legitimate self-defense needs. Accordingly, as a result of my concern, I plan
at this point to withhold my approval for arms transfers notified to the Congress until
this matter is resolved to my satisfaction.”213
Also, Members debated whether the “Taiwan Security Enhancement Act
(TSEA)” (S. 693, Helms; H.R. 1838, DeLay) was needed to better assist Taiwan or
was unnecessary and counterproductive in a delicate situation, as the Clinton
Administration maintained. The TSEA also raised attention to U.S.-Taiwan military
exchanges, including that on communication and training. The Pentagon was said
to have supported the spirit of the bill, although not its passage.214 The TSEA was
not enacted, although the House passed H.R. 1838 on February 1, 2000, by 341-70.
Seeking more information from the Pentagon on which to base its
considerations, Congress passed the FY2000 National Defense Authorization Act
(P.L. 106-65), requiring annual reports on PRC military power and the security
situation in the Taiwan Strait.215 Also, in consolidated appropriations legislation for
FY2000 (P.L. 106-113), Congress required a report on the operational planning of
the Department of Defense to implement the TRA and any gaps in knowledge about
PRC capabilities and intentions affecting the military balance in the Taiwan Strait.216
Concerning Congress’s role before the Administration’s decisions on arms sales
and formal notifications, the 106th Congress passed language, introduced by Senator
Lott, in the FY2000 Foreign Operations Appropriations Act (in Div. B of P.L. 106-
113), requiring the Secretary of State to consult with Congress to devise a mechanism
for congressional input in determining arms sales to Taiwan. Again, in the FY2001
Foreign Operations Appropriations Act (P.L. 106-429), Congress passed the Taiwan
Reporting Requirement, requiring the President to consult on a classified basis with
Congress 30 days prior to the next round of arms sales talks. (Those required
consultations took place on March 16, 2001.)
212 Defense Department News Briefing, April 30, 1999.
213 Quoted in “Clinton Confirms Rebuke to Taiwan,” Washington Times, July 22, 1999.
214 Steven M. Goldstein and Randall Schriver (former official in the Office of the Assistant
Secretary of Defense for International Security Affairs), “An Uncertain Relationship: The
United States, Taiwan, and the Taiwan Relations Act,” China Quarterly, March 2001.
215 Department of Defense, “Annual Report on the Military Power of the People’s Republic
of China,” unclassified version, June 2000 and July 2002.
216 Department of Defense, “Report to Congress on Implementation of the Taiwan Relations
Act,” unclassified version, December 2000.
107th Congress. In the 107th Congress, some Members opposed the sale of
Aegis-equipped destroyers, because they could be interpreted as offensive rather than
defensive sales and could involve significant interaction with the U.S. military, as
Senators Feinstein and Thomas (chairman of the Foreign Relations Subcommittee on
East Asian and Pacific Affairs) wrote in the Washington Times on March 28, 2001.
Other Members — 83 in the House (led by Representatives Cox and Wu) and 20 in
the Senate (led by Senators Helms and Torricelli) — wrote letters to President Bush
on April 3, 2001, urging approval of the sale of those destroyers. A March 2001 staff
report to Senator Helms of the Foreign Relations Committee called for meeting
Taiwan’s defense needs, particularly for submarines and destroyers.217
In addition, some in Congress urged the Administration to deliver AMRAAMs
to Taiwan after the Washington Times on July 1, 2002, reported that, in June, two
SU-30 fighters of the PLA Air Force test-fired AA-12 medium-range air-to-air
missiles acquired from Russia. The report raised questions as to whether the PLA
already deployed the missiles, meeting one of the conditions by which the United
States would deliver the AMRAAMs to Taiwan — rather than keep them in storage
— as approved for sale by the Clinton Administration in 2000. On July 16, 2002,
Senators Kyl, Helms, Bob Smith, and Torricelli wrote Secretary of State Colin
Powell, urging the Bush Administration to allow the transfer of AMRAAMS to
Taiwan “as soon as they are produced” rather than “quibble over whether the AA-12
tests mean that China has an ‘operational’ capability.”
The National Defense Authorization Act for FY2002 (P.L. 107-107), enacted
on December 28, 2001, authorized the President to transfer (by sale) the four Kidd-
class destroyers to Taiwan (Section 1011), under Section 21 of the AECA. Also,
Section 1221 of the act required a new section in the annual report on PRC military
power (as required by P.L. 106-65) to assess the PLA’s military acquisitions and any
implications for the security of the United States and its friends and allies. The scope
of arms transfers to be covered was not limited to those from Russia and other former218
Soviet states, as in the original House language (H.R. 2586).
The Foreign Operations Appropriations Act for FY2002 (P.L. 107-115),
enacted on January 10, 2002, brought unprecedented close coordination between the
Executive and Legislative branches on arms sales to Taiwan. Section 573 required
the Departments of State and Defense to provide detailed briefings (not specified as
classified) to congressional committees (including those on appropriations) within
The briefings were required to report on U.S.-Taiwan discussions on potential sales
of defense articles or services to Taiwan.
Some Members called for ensuring regular and high-level consultations with
Taiwan and a role for Congress in determining arms sales to Taiwan, after President
217 Senate Foreign Relations Committee, “U.S. Defense Policy Toward Taiwan: In Need of
an Overhaul,” a Staff Trip Report to the Committee on Foreign Relations, S. Prt. 107-26, by
James Doran, printed April 2001.
218 Still, the Pentagon’s report, issued on July 12, 2002, discussed China’s military
acquisitions from states of the former Soviet Union, and not other countries (e.g., Israel).
Bush announced on April 24, 2001 (the day of the last annual arms sales talks), that
he would drop the annual arms talks process with Taiwan in favor of normal, routine
considerations on an “as-needed” basis.219 Due to the absence of diplomatic
relations, successive administrations used a process in determining arms sales to
Taiwan that was institutionalized in the early 1980s as annual rounds of talks with
Taiwan defense authorities consisting of several phases leading up to final meetings
usually in April.220 In overseeing the new process, factors or implications to consider
included the following:
!Congress’s role in decision-making and ability to exercise oversight
!role of arms sales talks in the broader long-range and joint defense
strategy for Taiwan (vs. a narrower focus on specific requests)
!role of arms sales in U.S. diplomatic and defense policies (including
various elements of the “one China” policy)
!U.S. objectives for the Taiwan military
!nature of the U.S.-Taiwan military relationship
!extent of high-level U.S.-Taiwan military exchanges
!effect of an annual high-profile controversy on U.S. interests
!usefulness to Congress and Taiwan of a deadline for decisions
!influence of various interest groups in a more defused process
!changes in high-level, intensive attention given by the White House
and its coordination of the inter-agency debates
!changes in the Pentagon’s basis for recommendations
!Taiwan’s desire to receive similar treatment given to others
!consultations with allies, including Japan.
The Foreign Relations Authorization Act for FYs 2002 and 2003 (H.R. 1646),
passed in the House on May 16, 2001, contained provisions on arms sales to Taiwan.
First, H.R. 1646 included authority (in Section 851) for the President to sell the four
Kidd-class destroyers to Taiwan. Second, as proposed by Representative Brad
Sherman in the House International Relations Committee, Section 813 sought to
require that Taiwan be treated as the “equivalent of a major non-NATO ally” for
defense transfers under the AECA or the Foreign Assistance Act, while the language
stopped short of designating Taiwan as a major non-NATO ally. According to the
Member’s office, the provision would show tangible support for Taiwan’s defense,
provide it with status similar to that given to Australia, New Zealand, and Argentina,
offer it the “right of first refusal” for EDA, and treat it with enhanced status for anti-
terrorism assistance, cooperative research and development projects in the defense
area, and expedited review in satellite licensing. Third, Representative Gary
Ackerman introduced Section 814 to require the President to consult annually with
Congress and Taiwan about the availability of defense articles and services for
Taiwan. The consultations with Taiwan would occur at a level not lower than that
of the Vice Chief of General Staff and in Washington, DC — as has been the case.
219 Milbank, Dana and Mike Allen, “Bush to Drop Annual Review of Weapons Sales to
Taiwan,” Washington Post, April 25, 2001.
220 See CRS Report RS20365, Taiwan: Annual Arms Sales Process, by Shirley A. Kan.
Finally enacted as P.L. 107-228 on September 30, 2002, the Foreign Relations
Authorization Act for FY2003 authorized — at the Bush Administration’s request
— the Department of State and other departments or agencies (including the
Department of Defense) to detail employees to AIT (Section 326); required that
Taiwan be “treated as though it were designated a major non-NATO ally” (Section
1206); required consultations with Congress on U.S. security assistance to Taiwan
every 180 days (Section 1263); and authorized the sale to Taiwan of the four Kidd-
class destroyers (Section 1701).221 Section 326, amending the Foreign Service Act
of 1980, has significant implications for the assignment of government officials to
AIT, including active-duty military personnel for the first time since 1979.
(Employees have been separated from government service for a period of time in the
name of “unofficial” relations, but personnel issues have affected AIT and its
contractors. Defense Department personnel, including those supporting security
assistance, have been civilian staff and retired or resigned military personnel.)
In signing the bill into law on September 30, 2002, President Bush issued a
statement that included criticism of Section 1206 (“major non-NATO ally”). He said
that “Section 1206 could be misconstrued to imply a change in the ‘one China’ policy
of the United States when, in fact, that U.S. policy remains unchanged. To the extent
that this section could be read to purport to change United States policy, it
impermissibly interferes with the President’s constitutional authority to conduct the
Nation’s foreign affairs.”
Nonetheless, the Acting Under Secretary of Defense for Acquisition,
Technology, and Logistics, Michael Wynne, submitted a letter to Congress on August
The are implications for defense industrial cooperation with Taiwan, under Section
The FY2003 National Defense Authorization Act, passed in the House on May
10, 2002, contained Section 1202 seeking to require the Secretary of Defense to
implement a comprehensive plan to conduct combined training and exchanges of
senior officers with Taiwan’s military and to “enhance interoperability” with
Taiwan’s military.222 The language was similar to that of Section 5(b) in the “Taiwan
Security Enhancement Act” proposed in the 106th Congress. The Senate’s version,
passed on June 27, 2002, did not have the language. The Washington Times reported
on August 9, 2002, that the Department of State opposed the language as unnecessary
(given U.S. support under the TRA).
As Members worked out differences in conference, Deputy Defense Secretary
Paul Wolfowitz wrote in a letter to the House and Senate Armed Services
Committees on September 27, 2002, that “while we welcome Congress’ support for
221 For more details on proposed House and Senate language, see “Arms Sales to Taiwan,”
in CRS Report RL31046, Foreign Relations Authorization, FY2003: An Overview,
coordinated by Susan B. Epstein.
222 For an argument for enhancing interoperability with Taiwan, see Justin Bernier (staffer
for the House Armed Services Committee) and Stuart Gold, “China’s Closing Window of
Opportunity,” Naval War College Review, summer 2003.
the U.S. commitments under the Taiwan Relations Act and for the President’s
commitment to the defense of Taiwan, we believe that the objectives of Section 1202
are best achieved by preserving the traditional statutory role of the Secretary to
exercise authority, direction, and control over the Department of Defense to conduct
such activities as are needed to support those commitments, including his authority
to preserve the confidentiality of those activities.” The Pentagon “strongly
recommends that this provision be deleted, although we would not object to language
that would call upon the Department to brief the Congress periodically on progress
we are making to meet our commitments to Taiwan security,” Wolfowitz wrote. As
enacted on December 2, 2002, the FY2003 National Defense Authorization Act
(P.L. 107-314) contained a revised section (1210), requiring a Presidential report 180
days after the act’s enactment (due May 31, 2003) on the feasibility and advisability
of conducting combined operational training and exchanges of senior officers with
Taiwan’s military. (U.S. policy has allowed Taiwan’s senior military officers and
defense officials to visit the United States, while not sending U.S. flag and general
officers to Taiwan, or senior officials.)
108th Congress. On May 20, 2004, the House passed H.R. 4200 (FY2005
National Defense Authorization Act) with Section 1013 to authorize the sale to
Taiwan of a dock landing ship (Anchorage) as an Excess Defense Article and Section
1215 to require the Defense Department to send general or flag officers and officials
at or above the level of deputy assistant secretary of defense to Taiwan (as proposed
by Representative Jim Ryun). After a floor debate about whether his amendment was
necessary or dangerous, the House passed it by 290-132. Supporters cited the
Defense Department’s support for this policy change and challenges in Taiwan’s
military in integrating new acquisitions and prioritizing self-defense needs against
the PLA. Opponents cited resistance by the NSC and State Department, the TRA as
existing authority for security assistance, and the need for caution in a tense part of
Asia. On May 19, 2004, Senator Sam Brownback submitted for the record a similar
amendment intended to be proposed to the Senate’s bill (S. 2400). However, on June
During conference, the House receded, and the conference report did not contain
Section 1215 (H.Rept. 108-767, issued on October 8, 2004). President Bush signed
H.R. 4200 into law (P.L. 108-375) on October 29, 2004.
109th Congress. In January 2005, eight Members led by Representative Rob
Simmons wrote to Secretary of State Condoleezza Rice to express concerns that the
Bush Administration has delayed notifications to Congress on the three major items
until after LY decided on the Special Budget. The State Department responded that
it supports the President’s decision of April 2001 to make available to Taiwan P-3s,
PAC-3s, and submarines, but that it does not believe “notification at this time will
have any influence on the Taiwan Legislature’s decision.”223 At issue are the Bush
Administration’s effectiveness in encouraging Taiwan to boost its self-defense,
extent of U.S. leverage in Taiwan, and risks in relations with Beijing.
223 Letters between the State Department and Representatives Rob Simmons, Lane Evans,
Roskoe Bartlett, Chris Smith, John Hostettler, Madeleine Bordallo, Trent Franks, and Jeb
Bradley, January 31 and February 15, 2005.
On May 20, 2005, the House Armed Services Committee reported its National
Defense Authorization Act for FY2006 (H.R. 1815, H.Rept. 109-89), again
proposing language to change U.S. policy to allow U.S. flag and general officers and
senior officials at or above the level of deputy assistant secretary of defense to visit
Taiwan (Section 1203). Such visits would reciprocate visits by senior military
officers and officials from Taiwan that already take place in the United States. Also,
Chairman Duncan Hunter’s press release noted that the Defense Department
exchanged with the PLA over 80 senior-level visits in the 1990s and about 14 in
recent years.224 The bill added new language that would ensure that Capstone classes
at the National Defense University (for new general and flag officers) conduct trips
to the PRC and Taiwan (Section 528). The House passed H.R. 1815 on May 25
without debate on the Taiwan-related language. The bill reported by the Senate
Armed Services Committee on May 17, 2005 (S. 1042) did not contain similar
sections. On December 18, 2005, the conference committee filed its report for H.R.
The House passed the conference report on December 19, and the Senate agreed on
December 21. The President signed it into law (P.L. 109-163) on January 6, 2006.
As mentioned above on the impasse over the Special Budget, on May 27, 2005,
Representative Simmons and 32 other House Members wrote to KMT chairman Lien
Chan, urging him to help expedite passage of the Special Budget in May. They
warned that “failure to pass the special budget has raised concerns in the United
States about Taiwan’s ability to defend itself against potential aggression.”225 On
August 1, 2005, three co-chairs of the House Taiwan Caucus wrote to Ma Ying-jeou
as the new KMT chairman. They urged him to “lead efforts in Taipei to ensure that
the Legislative Yuan quickly passes a special arms procurement package or increases
its annual defense spending.” They also invited Ma to visit Washington.226
On July 27, 2005, Representative Robert Andrews introduced H.Con.Res. 219
to express the sense of Congress that the President should abolish restrictions on
visits by senior U.S. military officials to Taiwan and should authorize the sale of the
Aegis combat system to Taiwan (among other stipulations).
As mentioned above on Pacific Commander Admiral Fallon’s questions about
Taiwan buying submarines, eight Members of Congress led by Representative Rob
Simmons wrote a letter in October 2005 to ask Admiral Fallon to explain his
discussions with Taiwan on submarines.227 Also discussed above, in February 2006,
Representative Simmons visited Taiwan and suggested a lower cost for the subs and
an interim design phase to break the impasse over whether to procure U.S.
224 CRS Report RL32496, U.S.-China Military Contacts: Issues for Congress, by Shirley A.
225 Rep. Simmons, et al., letter to Chairman Lien Chan, Kuomintang, May 27, 2005.
226 Letter from Representatives Robert Wexler, Steve Chabot, and Sherrod Brown (without
Dana Rohrabacher) to Ma Ying-jeou, KMT Chairman, August 1, 2005.
227 Letter to Admiral William Fallon, Commander of the Pacific Command, from
Representatives Rob Simmons, Dan Burton, Robert Andrews, Henry Brown, James
Langevin, Phil Gingrey, Thomas Tancredo, and Patrick Kennedy, October 26, 2005.
submarines, and House International Relations Committee Chairman Henry Hyde
wrote a letter to KMT Chairman Ma about the defense issues.
On May 3, 2006, the House Armed Services Committee reported H.R. 5122, the
National Defense Authorization Act for FY2007, after approving amendments with
relevance for Taiwan and the PRC that were introduced by Representative Simmons.
The bill added new language that would make it U.S. policy to make available to
Taiwan plans and options for design work and construction on future diesel electric
submarines and would require the Navy to report to Congress on its dealings with
Taiwan on the submarine sale (Section 1221). Other provisions would again seek to
change policy to require at least one CAPSTONE visit to Taiwan every year (and one
to the PRC) (Section 1205); to authorize general and flag officers to visit Taiwan
(reciprocating Taiwan’s senior-level visits to the United States and balancing
exchanges with the PLA) (Section 1206); and to restrict procurement by the Defense
Department from foreign firms that supply weapons to the PRC (Section 1211). On
May 11, the House passed H.R. 5122 with these sections. On June 22, the Senate
passed its version, S. 2766, without similar language, and incorporated it into H.R.
to oppose a policy change to allow generals/admirals to visit Taiwan, in line with the
views of the State Department and White House.228 So, for the conference report
dated September 29, the House receded, and Sections 1205, 1206, 1211, and 1221
were deleted. On October 17, 2006, President Bush signed the bill (P.L. 109-364).
On June 28, 2006, Representative Tom Tancredo introduced an amendment
(Section 801) to H.R. 5672, the Science, State, Justice, Commerce Appropriations
Act for FY2007, to ban funds from being used to enforce the State Department’s
guidelines restricting contact with Taiwan’s officials. The House agreed to the
amendment by voice vote. On June 29, the House passed H.R. 5672. The Senate
Appropriations Committee reported H.R. 5672 on July 13 without that section. The
Senate did not pass the bill. On September 7, 2006, the Senate passed S. 3722
(Lugar), the Naval Vessels Transfer Act of 2006, that included authority for the
President to sell to Taiwan two Osprey-class minehunter coastal ships. It was
referred to the House as the last action.
Tom Tancredo’s amendment to H.R. 2764 (State Department appropriations act for
FY2008) to ban funds from being used to enforce the “Guidelines on Relations With
Taiwan” (Sec. 699E). (As discussed above, the guidelines include a ban on official
travel by senior Defense officials and general or flag military officers to Taiwan.)
The House passed H.R. 2764 on June 22. The Senate Appropriations Committee
reported the bill (S.Rept. 110-128) without this section. The final version that
became P.L. 110-161 on December 26, 2007, did not have the section.
Also, on July 31, 2007, the Senate Foreign Relations Committee reported S.
which would authorize the sale to Taiwan of two retiring Osprey-class coastal
228 Dan Blumenthal and Gary Schmitt, “A Strange Calculus,” Wall Street Journal, August
minehunters as Excess Defense Articles, among other foreign transfers. On October
introduced by Representative Tom Lantos.
On September 26, 2007, the House Foreign Affairs Committee approved H.Res.
676, introduced by Representative Ileana Ros-Lehtinen, that noted the Bush
Administration’s lack of response to Taiwan’s interest in buying F-16C/D fighters
and that urged the President to determine security assistance “based solely” upon the
legitimate defense needs of Taiwan (consistent with Section 3(b) of the TRA). The
House passed H.Res. 676 on October 2, 2007.
Also in October 2007, Senator Lisa Murkowski, Ranking Member of the Senate
Foreign Relations Subcommittee on East Asian and Pacific Affairs, wrote to National
Security Advisor Stephen Hadley, noting that the Administration refused to accept
Taiwan’s request for F-16 fighters and asking if it was subjecting Taiwan to “unequal
treatment” in the FMS process. At a hearing of the Foreign Relations Committee in
May 2008, the Senator noted that Hadley failed to provide any response.229
In January 2008, Representative Joe Courtney wrote to Navy Secretary Donald
Winter asking about the Navy’s understanding of Taiwan’s funding for a submarine
design (phase one of the program).230 Concerning the Administration’s refusal to
accept Taiwan’s formal request for F-16C/D fighters since 2006, Senators Tim
Johnson and James Inhofe, Co-chairs of the Senate Taiwan Caucus, wrote a letter in
March 2008 to Secretary of Defense Robert Gates, asking if his department received
such a request and offering their “assistance” if he needed it. Gates simply responded
that Under Secretary of Defense for Policy Eric Edelman would answer the Senators.
Edelman promised that the department will consider carefully any request from
Taiwan for defense articles and services, “including replacement airframes.”231
On June 17, 2008, Representatives Joe Courtney and James Langevin wrote to
Secretary of State Rice, requesting an explanation on the reported suspension of arms
sales and timeline for notifications to Congress.232 In late June, Senators Inhofe and
Johnson led a total of 14 Senators in sending a letter to President Bush, noting that
a “freeze” on arms sales to Taiwan violates the spirit of the TRA and that their
attempts to clarify the status of Taiwan’s requests have been to no avail. They
requested a briefing on the status of arms sales and urged the Administration to
expeditiously consider Taiwan’s requests. They wrote that upon receipt of
Congressional Notifications, they look forward to the opportunity to work with the
Administration in completing these sales as soon as possible.233 In late July, 25
229 Senator Lisa Murkowski, letter to Stephen Hadley, October 12, 2007; Senate Foreign
Relations Committee, hearing on U.S.-China Relations, May 15, 2008.
230 Representative Joe Courtney, letter to Donald Winter, January 3, 2008.
231 Tim Johnson and James Inhofe, letter to Robert Gates, March 19, 2008; response letter
from Robert Gates, March 25, 2008; letter to Senators from Eric Edelman, March 28, 2008.
232 Joe Courtney and James Langevin, letter to Condoleezza Rice, June 17, 2008.
233 Senators Inhofe, Johnson, Coburn, Vitter, Kyl, Brownback, Sessions, Chambliss,
Members in the House, led by a Co-chair of the Taiwan Caucus, Representative
Shelley Berkley, sent a similar letter to President Bush, warning against a “freeze,”
requesting a briefing on arms sales, and looking forward to the notifications.234
The Ranking Member of the House Foreign Affairs Committee, Representative
Ros-Lehtinen, introduced H.R. 6646 on July 29, 2008, to require the Secretaries of
State and Defense to provide detailed briefings to Congress on arms sales to Taiwan
not later than 90 days after enactment and not later than 120 days thereafter. Without
the President’s response or notifications on pending arms sales, on September 23, the
House passed H.R. 6646 by voice vote. Members expressed frustration at the
President’s continued refusal to notify and brief Congress. Representative David
Scott who brought up the bill on the floor, said “the White House does not
understand the Taiwan Relations Act.” Mr. Ed Royce stated that the bill would assert
the TRA’s authority for the role of Congress, which has been left out, and the bill
would “right that wrong.” Ms. Ros-Lehtinen also questioned the President’s
compliance with the “Six Assurances” policy, suspecting that U.S. officials have
discussed China’s objections and “while Congress has been left in the dark ... the
Chinese leadership has been kept fully abreast of our Nation’s intentions.” A Co-
Chair of the Taiwan Caucus, Ms. Berkley, lamented that “we have written letters,
Members of this body have made statements, and now we’re passing a law just to get
simple answers from the President of the United States.” On the same day, the
Departments of State and Justice wrote letters to oppose H.R. 6646, claiming that it
would “infringe” upon the President’s constitutional authority. However, the TRA
explicitly provided for a congressional role, and there were previous laws enacted to
require the Executive Branch to consult or brief Congress on arms sales to Taiwan.
The next day, September 24, 2008, Representative Tom Tancredo introduced
H.R. 7059 to require progress on pending arms sales, notwithstanding notifications
to Congress required by Section 36(b) of the Arms Export Control Act.
Major U.S. Arms Sales as Notified to Congress
The following table provides information on U.S. sales (not deliveries) of major
defense articles and services to Taiwan, as approved by the President and formally
notified to Congress since 1990. Based on unclassified notices and news reports, this
list includes the date of notification, major item or service proposed for sale, and
estimated value of the defense package. The list was compiled based on unclassified
notifications to Congress or announcements by the Administration as well as press
reports. These were primarily government-to-government FMS programs. Before
the Defense Department may issue Letters of Offer and Acceptance, the President
must notify major FMS to Congress as required by Section 36(b) of the Arms Export
Martinez, Lieberman, Graham, Bond, Allard, Grassley, letter to President George W. Bush,
June 27, 2008.
234 Representative Shelley Berkley, et al, letter to President George Bush, July 31, 2008.
Control Act (AECA), P.L. 90-629.235 If 30 calendar days pass after the formal
notification and Congress does not pass a joint resolution of disapproval, the
Executive Branch is allowed to proceed with the proposed arms sales to Taiwan. Not
all of these approved sales were necessarily purchased by Taiwan. There have been
other transfers of U.S. defense articles and services not included in this list (that
amounted to billions of dollars), including sales and technical assistance with smaller
individual values not required to be notified to Congress, those with classified
notifications, and other direct commercial sales licensed for export by the
Department of State and notified to Congress under Section 36(c) of the AECA (but
subject to the confidentiality requirements of Section 38(e)). There have also been
leases of naval vessels and other equipment. Moreover, each year, hundreds of
Taiwan’s military personnel at different levels receive training and education at U.S.
military colleges, academies, and other institutions or units.
Date ofMajor item or service as proposedValue ofpackage
notification(usually part of a package of related support)($ million)
07/26Cooperative Logistics Supply Support$108
09/06(1) C-130H transport aircraft$45
01/07(100) MK-46 torpedoes$28
07/24(97) SM-1 Standard air defense missiles$55
09/13(110) M60A3 tanks$119
11/18Phase III PIP Mod Kits for HAWK air defense systems$170
05/27Weapons, ammunition, support for 3 leased ships$212
05/27Supply support arrangement$107
08/04(207) SM-1 Standard air defense missiles$126
09/14(150) F-16A/B fighters$5,800
09/14(3) Patriot-derived Modified Air Defense System236$1,300
(MADS) fire units
09/18(12) SH-2F LAMPS anti-submarine helicopters$161
06/17(12) C-130H transport aircraft$620
235 As with all U.S. arms sales, months or years after the President’s decisions on Taiwan’s
requests and Taiwan’s subsequent decisions on which sales to pursue, the role of Congress
includes informal and formal review of major proposed FMS deals notified to Congress
(during which Congress may enact a joint resolution of disapproval) as stipulated under
Section 36(b) of the AECA. See CRS Report RL31675, Arms Sales: Congressional Review
Process, by Richard F. Grimmett.
236 Commercial sale. Opall Barbara and David Silverberg, “Taiwanese May Soon
Coproduce Patriot,” Defense News, February 22-28, 1993; Military Balance 1999-2000.
Date ofMajor item or service as proposedValue ofpackage
notification(usually part of a package of related support)($ million)
07/29(38) Harpoon anti-ship missiles$68
07/30Logistics support services for 40 leased T-38 trainers$70
08/(4) E-2T Hawkeye airborne early warning aircraft237$700
09/08Logistics support services for MADS $175
11/04(150) MK-46 Mod 5 torpedoes$54
11/09Weapons, ammunition, and support for 3 leased frigates$238
11/23MK-41 Mod (short) Vertical Launch Systems for ship-$103
based air defense missiles
08/01(80) AN/ALQ-184 electronic counter measure (ECM)$150
09/12MK-45 Mod 2 gun system$21
03/24(6) MK-75 shipboard gun systems,$75
(6) Phalanx Close-In Weapon Systems
06/07Supply support arrangement$192
05/10Improved Mobile Subscriber Equipment$188
05/10(30) TH-67 training helicopters,$53
(30) sets of AN/AVS-6 night vision goggles
05/23(465) Stinger missiles,$84
(55) dual-mounted Stinger launcher systems
06/24(300) M60A3TTS tanks$223
08/23(1,299) Stinger surface-to-air missiles,$420
(74) Avenger vehicle mounted guided missile launchers,
(96) HMMWVs (high-mobility multi-purpose wheeled
09/05(110) MK-46 MOD 5 anti-submarine torpedoes$66
02/14(54) Harpoon anti-ship missiles$95
05/23(1,786) TOW 2A anti-armor guided missiles,$81
(114) TOW launchers, (100) HMMWVs
07/24(21) AH-1W Super Cobra helicopters238$479
09/03(13) OH-58D Kiowa Warrior Armed Scout helicopters$172
11/09Pilot training and logistics support for F-16 fighters$280
237 Flight International, September 1-7, 1993.
238 Taiwan reportedly ordered 63 AH-1W helicopters, 42 of which were delivered by early
Date ofMajor item or service as proposedValue ofpackage
notification(usually part of a package of related support)($ million)
01/28(3) Knox-class frigates,239$300
(1) MK 15 Phalanx Close-In Weapons System (CIWS)
06/01(28) Pathfinder/Sharpshooter navigation and targeting240$160
pods for F-16 fighters
08/27(58) Harpoon anti-ship missiles$101
08/27(61) Dual-mount Stinger surface-to-air missiles$180
08/27(131) MK 46 Mod 5(A)S anti-submarine torpedoes$69
10/09(9) CH-47SD Chinook helicopters$486
05/26(240) AGM-114KS Hellfire II air-to-surface missiles$23
05/26(5) AN/VRC-92E SINCGARS radio systems, (5)$64
Intelligence Electronic Warfare systems, (5) HMMWVs
07/30Spare parts for F-5E/F, C-130H, F-16A/B, and$150
Indigenous Defense Fighter (IDF) aircraft
07/30(2) E-2T Hawkeye 2000E airborne early warning241$400
03/02Modernization of the TPS-43F air defense radar$96
to TPS-75V configuration
03/02(162) HAWK Intercept guided air defense missiles242$106
06/07(39) Pathfinder/Sharpshooter navigation and targeting$234
pods for F-16 fighters
06/07(48) AN/ALQ-184 ECM pods for F-16s$122
09/28(146) M109A5 howitzers, 152 SINCGARS radio$405
09/28(200) AIM-120C Advanced Medium-Range Air-to-Air$150
Missiles (AMRAAMs) for F-16 fighters
09/28(71) RGM-84L Harpoon anti-ship missiles$240
239 In 1992, the Bush Administration submitted legislation that Congress passed to lease
three Knox-class frigates to Taiwan. Reports say that Taiwan leased a total of six (and
subsequently bought them in 1999) and purchased two in 1998 (plus one for spares).
240 The sale of the navigation/targeting pods excluded the laser designator feature, but the
Pentagon notified Congress on May 16, 2000, that 20 sets would be upgraded to include the
241 Northrop Grumman delivered the first one on August 10, 2004, at St. Augustine, FL.
242 On June 23, 2000, the Pentagon notified Congress of a sale of 156 excess HAWK air
defense missiles to Taiwan for about $7 million.
Date ofMajor item or service as proposedValue ofpackage
notification(usually part of a package of related support)($ million)
07/18(50) Joint Tactical Information Distribution Systems$725
(JTIDS) terminals (a version of Link 16) for data links
between aircraft, ships, and ground stations
09/05(40) AGM-65G Maverick air-to-ground missiles for F-$18
10/26(40) Javelin anti-tank missile systems$51
10/30Logistical support for spare parts for F-5E/F, C-130H,$288
F-16A/B, and IDF aircraft
06/04(3) AN/MPN-14 air traffic control radars$108
09/04(54) AAV7A1 assault amphibious vehicles$250
09/04Maintenance of material and spare parts for aircraft,$174
radar systems, AMRAAMS, and other systems
09/04(182) AIM-9M-1/2 Sidewinder air-to-air missiles$36
09/04(449) AGM-114M3 Hellfire II anti-armor missiles to243$60
equip AH-1W and OH-58D helicopters
10/11(290) TOW-2B anti-tank missiles$18
11/21(4) Kidd-class destroyers$875
09/24Multi-functional Information Distribution Systems$775
(for Po Sheng C4ISR data link upgrades)
03/30(2) Ultra High Frequency Long Range Early Warning$1,776
10/25(10) AIM-9M Sidewinder and (5) AIM-7M Sparrow air-$280
to-air missiles; continuation of pilot training and
logistics support for F-16 fighters at Luke AFB, AZ
02/28(218) AMRAAMs and (235) Maverick air-to-ground$421
missiles for F-16 fighters
08/08(60) AGM-84L Harpoon Block II anti-ship missiles$125
09/12(144) SM-2 Block IIIA Standard air-defense missiles$272
(for Kidd-class destroyers)
09/12(12) P-3C maritime patrol/ASW aircraft$1,960
11/09Patriot configuration 2 ground systems upgrade$939
243 On January 4, 2005, Lockheed Martin announced a letter of agreement worth about $50
million for more than 400 Hellfire missiles.
Date ofMajor item or service as proposedValue ofpackage
notification(usually part of a package of related support)($ million)
10/3(32) UGM-84L sub-launched Harpoon anti-ship missiles$200
10/3spare parts for F-5E/F, C-130H, F-16A/B, IDF aircraft$334
10/3(182) Javelin anti-armor missiles$47
10/3upgrade (4) E-2T aircraft (Hawkeye 2000 configuration) $250