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Taiwan Defense & Security Reports

Taiwan Defense & Security Report – Q2, 2003

Following the US-Taiwan Business Council’s Defense Industry conference this past February in San Antonio, Texas, one may have been left with the impression that the arms sales programs were stalled and the military-to-military relationship between the United States and Taiwan was strained. This appeared to be the case due to the differing assessments made by the two sides of the degree of seriousness of the Chinese threat facing Taiwan, and the level of urgency required to meet that threat. The United States sees the threat as more immediate — one that might impact the cross-Strait situation between 2005 and 2007 — while Taiwan believes that the threat will not become critical until at least the next decade. Consequently, the United States and Taiwan, while both sharing a long-term strategic interest in promoting peace and stability in the Taiwan Strait, each operate with a different sense of urgency, leading to different acquisition priorities and different perspectives on the need to commit resources to the problem. The United States is continuing to refine its set of strategic priorities for Taiwan, emphasizing improvements in missile defense capabilities, C4ISR, and anti-submarine warfare.

Furthermore, the dramatic impact of SARS also contributed to the sense that aspects of the US-Taiwan relationship were stalled. SARS affected the region by greatly restricting business travel, reducing face-to-face contacts, and directing most of the affected regions’ governments to focus on the crisis rather than on defense issues. Finally, with less than a year before Taiwan’s next presidential elections, the maneuvering for advantage in Taiwan’s domestic politics has picked up speed, particularly around the controversial issue of national referendums, which may also affect cross-Strait relations and consequently issues of national defense.

However, as we move into the third quarter of 2003, a brighter picture is emerging. SARS is under control for the time being, and dialogue with the U.S. government during recent visits to Washington by senior Taiwan officials has also helped to clarify priorities for arms sales programs.

 

Executive Summary: Taiwan Defense & Security Report – Q2, 2003

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Taiwan Defense & Security Reports

Taiwan Defense & Security Report – Q1, 2003

In February of 2003, the US-Taiwan Business Council held the second in a series of defense industry meetings focusing on the security relationship between the United States and Taiwan. Our goal was to build on the success of last year’s event in Saint Petersburg, Florida which featured Taiwan’s Minister of National Defense, Tang Yiau-ming, and Deputy Secretary of Defense Paul Wolfowitz as keynote speakers. This year’s keynote speakers were Taiwan’s Vice Minister of Armament & Acquisition, General Chen Chao-min, and the Deputy Assistant Secretary of Defense for East Asia and the Pacific Richard Lawless. Vice Minister Chen brought a delegation to San Antonio comprised of high-level military officials representing each branch of the military and several departments within the Ministry of National Defense (MND). By inviting such a large delegation from Taiwan to the United States, we hoped to provide ample opportunity for all of our members to interact with these officials and to build important relationships.

As was the case in 2002, the event was strictly off the record and all sessions were off-limits to the press. While the keynote speeches were made available to the media the actual sessions remained private, which allowed for a very high level of comfort for our speakers. In addition, it allowed for very candid question & answer periods following each of the sessions, and the dialogue between the audience and the panel participants was more extensive and productive than during the previous Saint Petersburg event.

The Council’s newly appointed Chairman, former Secretary of Defense William S. Cohen, opened the event with an introductory keynote speech. Attendees then spent a day and a half looking at the risks now apparent in the US-Taiwan-China relationship and the barriers to the stated goal of a robust and modern deterrent capability for the people on Taiwan. It is the Council’s view that America’s leading defense and security companies can play a vital role in building that deterrence, and can work with Taiwan to integrate the myriad of complex systems and platforms.

This analysis will summarize the three main topics covered during the conference, including Taiwan’s defense reorganization, the budgetary process in the Legislative Yuan and MND, and Taiwan’s future defense needs.

 

Executive Summary: Taiwan Defense & Security Report – Q1, 2003

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Past Events

February 12-14, 2003 – US-Taiwan Defense Industry Conference 2003

Event:
US-Taiwan Defense Industry Conference 2003

February 12-14, 2003
San Antonio, Texas

2003 US-Taiwan Defense Industry Conference
2003 US-Taiwan Defense Industry Conference

The United States–Taiwan Defense Industry Conference 2003 was held February 12-14, 2003 in San Antonio, Texas. This was the second in a series of ongoing conferences addressing the future of U.S. defense cooperation with Taiwan, the defense procurement process, and providing a progress report on Taiwan’s future defense needs. The conference also looked in-depth at Taiwan’s C4ISR and missile defense programs. The first conference in this series was held in St. Petersburg, Florida in March of 2002, and featured a keynote address by Taiwan’s Minister of National Defense, Tang Yiau-ming.

Keynote Addresses
The conference featured keynote addresses by a variety of speakers, including an address by Chen Chao-min, Vice Minister for Armament & Acquisition at Taiwan’s Ministry of National Defense. The conference concluded with a summary of the day and a half proceedings by Kurt Campbell, Senior Vice President & Director of the International Security Program at the Center for Strategic and International Studies.

Conference Program
Sessions at the United States-Taiwan Defense Industry Conference featured one moderator and several speakers. Each speaker presented a short summary of a paper on the session topic from his or her own viewpoint, followed by a moderator-driven question and answer period. This format provided the maximum amount of time for exchanges between the panel and the audience, offering a forum for substantial and valuable interaction and discussion.

Breakout Sessions
Three sub-sessions within Session V concentrated on each branch of the services: Army, Air Force, and Navy. These sessions consisted of discussions focusing on the defense procurement process from the perspective of each individual branch.

Archived version of the website for the 2003 US-Taiwan Defense Industry Conference

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Taiwan Defense & Security Reports

Taiwan Defense & Security Report – Annual Review, 2002

The stability of U.S., China, and Taiwan relations constituted one of the relatively bright spots in the world in 2002, particularly given the turbulence and anxiety with which the year began in the aftermath of the horrific events of September 11th. There were no major domestic political crises impacting relations among the three, no severe national disasters or domestic disturbances to challenge the leadership in any of the three countries, and no serious international incidents threatening to throw the cross-Strait region into conflict.

Domestically, each economy placed greater emphasis on their economic challenges and internal political developments, while internationally the U.S.-led global war on terrorism drove the agenda. Cross-Strait political bickering took a back seat to increasing economic and social interactions, and the military components in the relationship – China’s steady military modernization and accompanying training and exercise program, Taiwan’s ongoing military reform, and the U.S.’s continuing provision of arms and defense services—took a back seat to the greater imperative economic development.

Within this context, this report reviews the major developments in China, in the U.S.-China and U.S.-Taiwan military relationships, cross-Strait dynamics, and, finally, the key arms sales programs during 2002.

 

Executive Summary: Taiwan Defense & Security Report – Annual Review, 2002

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Taiwan Defense & Security Reports

Taiwan Defense & Security Report – Q3, 2002

The summer quarter was a remarkable period in the evolution of Taiwan-China-U.S. relations. A number of events transpired that just a year ago might have led to the brink of a cross-Strait war, but this year raised only mild reactions in Beijing. Taiwan President Chen Shui-bian’s August remarks on Taiwan “walking its own road,” First Lady Wu Shu-chen’s highly publicized visit to the United States, and several well reported exchanges of military delegations – particularly Vice Minister of National Defense (MND) Kang Ning-hsiang’s early September visit – all evoked only muted responses from China. Beijing, apparently, is fully focused on its leadership transition in the lead-up to the 16th Party Congress, while Washington continues with the war on terrorism, Afghanistan, and preparations for a potential conflict in Iraq.

Against this backdrop, China steadily continues its modernization program which is producing a visible increase in military capabilities. In turn, Taiwan is carrying out a modernization program that places priority on streamlining and reducing costs, with questionable results in terms of operational capabilities. To close the triangle, the U.S. marches forward with arms sales and enhanced military-to-military relations across the board with Taiwan. This quarterly report will attempt to clarify this complex picture as we look at future developments in the arms sales area and in the cross-Strait political dynamic.

 

Executive Summary: Taiwan Defense & Security Report – Q3, 2002

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Taiwan Defense & Security Reports

Taiwan Defense & Security Report – Q2, 2002

The US-Taiwan Business Council’s Defense Summit in March 2002 was an important event that signaled some changes in the way the US-Taiwan defense relationship is conducted. The conference also raised a number of important issues that will continue to attract our interest over the next few years. This quarterly report will explore developments in the military-to-military relationship after the conference, and present updates on major defense system sales and programs.

This report will also provide some background information on a critical aspect of the arms sales program approval process known as the “national disclosure policy”, and will identify changes in the key players involved in the relationship between the U.S. and Taiwan. Finally, we will identify some upcoming events in China that are of interest to those living and working in the cross-Strait arena.

 

Executive Summary: Taiwan Defense & Security Report – Q2, 2002

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Taiwan Defense & Security Reports

Taiwan Defense & Security Report – Q1, 2002

It has been projected that Taiwan will spend in excess of US$26 billion over the next ten years on its defense needs, and the defense industry is also one of the largest sectors represented in the US-Taiwan Business Council’s membership. To better serve those members, the Council hosted a defense conference entitled the “US-Taiwan Defense Summit” in Saint Petersburg, Florida, in early March of 2002. The objective of the event was to bring together all of the principals in the US-Taiwan defense relationship, both from U.S. and Taiwan industry and from both governments.

Unlike in most other industries, the defense relationship between Taiwan and the U.S. is one that is highly sensitive. Because of that sensitivity, the Council determined that the entire event should be considered off-the-record, and the event was also off-limits to the media. We wanted all of our attendees to feel comfortable talking about these sensitive issues, and to focus on issues related to furthering the commercial relationship between our two economies.

Rather than discussing specific arms sales, the focal point of the event was on the process itself, as we wanted to bring clarity and transparency to the often-complex defense procurement process. That is not, of course, a task that could be accomplished with one conference. In fact, the Council feels that this event was merely the beginning of a long road towards normalizing defense procurement so that less attention will be paid to it, with less media hype, hopefully resulting in a more efficient and productive process.

The planning for this conference began more than a year ago with the decision to invite Taiwan’s Minister of National Defense to speak. It was to be the first time since 1962 that a Minister of National Defense from Taiwan would visit the United States for anything other than a transit stop. In addition, Taiwan’s Premier Yu Shyi-kun tapped Chief of the General Staff General Tang Yao-ming to be the new Minister of National Defense only a matter of weeks before the scheduled start of the conference. This made for a fortuitous meeting, as Minister Tang could benefit from being introduced to U.S. industry leaders so soon after his appointment.

The purpose of this analysis is to focus on what took place during those three days in Florida. We will attempt to clarify the objectives of the conference, while summarizing the four main topics of the meeting, including Taiwan’s defense procurement process, offset requirements, Taiwan’s defensive position and military strategy, and the outlook for future military sales to Taiwan.

 

Executive Summary: Taiwan Defense & Security Report – Q1, 2002

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Past Events

March 10-12, 2002 – United States-Taiwan Defense Summit

Event:
US-Taiwan Defense Summit

March 10-12, 2002
St. Petersburg, Florida

2002 US-Taiwan Defense Summit
2002 US-Taiwan Defense Summit

The United States – Taiwan Defense Summit was the first in a series of ongoing sector-specific events organized by the US-Taiwan Business Council. Subsequent events focused on defense and national security issues, on biotechnology, and on semiconductors. This Defense and National Security event provided the opportunity to bring together the U.S. and Taiwan government and private sectors to clarify, for both the American and the Taiwan business and policy making communities, the future of U.S. defense sales to Taiwan and the defense procurement process.

Sessions at the United States-Taiwan Defense Summit featured one moderator and several speakers. Each speaker presented a short summary of a paper on the session topic from his or her own viewpoint, and the presentation was followed by a moderator-driven question and answer period. This format provided the maximum amount of time for exchanges between the panel and the audience, offering a forum for substantial and valuable interaction and discussion. Three breakout sessions during the Monday program concentrated on each branch of the services: Army, Navy, and Air Force. These sessions consisted of roundtable discussions, focusing on the defense procurement process from the perspective of each individual branch.

Keynote speakers at this inaugural event included Taiwan’s Minister of National Defense Tang Yiau-ming, U.S. Deputy Secretary of Defense Paul Wolfowitz, and U.S. Assistant Secretary of State James Kelly.

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Taiwan Defense & Security Reports

Taiwan Defense & Security Report – Q3, 2001

In April of this year, the new Bush administration announced the approval of an extraordinary package of arms to Taiwan at what appeared to be the last formal US-Taiwan Arms Sales Meetings. Tied to the list of approvals was a decision by the new president to do away with these annual talks and instead handle Taiwan’s legitimate defense requirements in a routine, case-by-case manner as is done with other friends and allies of the United States. This and the arms sales decisions, which included breakthrough support for the sale of diesel electric submarines to Taiwan, generated speculation as to the direction the new administration would take in its relationships with Taiwan and the PRC.

In the following weeks and months, some answers began to emerge. The Bush administration allowed President Chen Shui-bian of Taiwan to make transit stops in New York and Texas, en route to and on his return from an official visit to South America. Rather than being strictly constrained in his activities during these transit stops as had been the case in previous instances, the administration allowed Chen significant freedom to tour the host cities and meet with local and national political leaders. On the military front, indications were that military-to-military relations were becoming much closer and more substantive in recognition of and in response to the inexorably growing threat posed by Chinese ballistic missile deployments, military modernization, and unabated use-of-force rhetoric. At the same time, imminent WTO accession by both the PRC and Taiwan, Beijing’s being awarded the 2008 Olympics, and steadily deepening concerns about an economic recession appeared to mitigate against the possibility of conflict in the Taiwan Strait at least in the short term.

The focus of this report is to provide some thoughts on where the US-Taiwan military relationship stands; summarize the progress to date on the arms sales decisions of April 2001 and certain other key programs; and offer some brief concluding comments on Taiwan’s economic situation and potential budget problems and on the effects of the defense reorganization program and upcoming leadership changes.

 

Executive Summary: Taiwan Defense & Security Report – Q3, 2001

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Taiwan Defense & Security Reports

Taiwan Defense & Security Report – Q1, 2001

Typically, coverage of Taiwan in general – and of US-Taiwan military matters in particular – is sparse and infrequent. Who could have foreseen therefore the combined effects of the EP-3E incident and the surprisingly detailed public dissemination of the Bush Administration’s US-Taiwan Arms Sales Talks decisions? As a result of these virtually consecutive but quite coincidental events, US-Taiwan military ties, US-PRC relations and the overall security situation in the Taiwan Strait area and Western Pacific suddenly have received an unprecedented amount of coverage in all forms of public media.

The year 2001 dawned with the Taiwan political and military leadership, and Taiwan’s supporters in the U.S., hoping that the incoming Bush administration would be an improvement over the preceding eight years of what many believed had been lukewarm support, particularly in the area of critically needed arms sales. There had been no major arms sales released for Taiwan since the outgoing Bush I administration had approved the sale of 150 F-16s in 1992.

On April 25, 2001, at the 20th annual US-Taiwan Arms Sales Conference, they got a clear and unmistakable answer. The new administration reportedly approved release of 4 ex-USN Kidd Class destroyers, 12 P-3C Orion ASW aircraft, M-109A6 SP howitzers, AAV-7 amphibious assault vehicles, CH-53 mine sweeping helicopters, other equipment, technical support and training, and agreed, after more than two decades of emphatic turn-downs, to assist Taiwan in obtaining up to eight diesel-electric submarines.

Although AEGIS destroyers, the priority request of greatest long-term importance for Taiwan, were again deferred, this is being described as the largest – potentially valued at close to $5 billion — arms sales package since the F-16 sale. However, in terms of the number and significance of the major weapons systems included in the decision, it is arguably the largest arms talks approval since diplomatic de-recognition in 1979. President Bush characterized the approvals as “the right package for this moment,” and made it clear that his administration would continue to ensure that Taiwan’s defensive needs would be met in the face of a growing threat from China. He also indicated that the annual arms sales conference with Taiwan would be phased out, and that in the future, Taiwan’s defensive arms requirements would be addressed as needed on a case-by-case basis.

And, as icing – sweet or bittersweet, depending on one’s perspective — on the cake, President Bush stated categorically during a nationwide television interview a few days later that the United States would come to Taiwan’s aid in the event of an attack from the People’s Republic with “whatever it takes.” The verdict is still out as to whether this was an inadvertent slip and that “strategic ambiguity” is still alive and well – the president modified his statement the following day and administration officials insisted that US policy had not changed. But, slip up or not, taken in context with Candidate Bush’s campaign rhetoric, the EP-3E incident, the arms talks decisions, and the reported contents of Secretary of Defense Rumsfeld’s strategic review, it appears that the U.S. relationship with Beijing is shifting to one of strategic competition. And, relations with Taiwan, while still unofficial, are moving towards closer cooperation, particularly in the military arena.

Given the size, significance and context of this arms sales package, it deserves closer examination. Specifically, attention needs to be focused on what reportedly was approved; what was deferred or disapproved; what was decided in conjunction with the Talks; and what the implications are for Taiwan and the US.

 

Executive Summary: Taiwan Defense & Security Report – Q1, 2001