U.S. President Donald Trump has signaled that Taiwan should shoulder a greater share of its own defense costs, while Defense Secretary Pete Hegseth stressed that the United States should no longer be responsible for fully subsidizing the protection of its allies abroad. Moreover, Elbridge Colby, the nominee for undersecretary of defense for policy, criticized Taiwan’s defense spending – currently “well below” 3 percent of GDP – as insufficient. During his Senate confirmation hearing, he suggested increasing Taiwan’s defense spending to approximately 10 percent of GDP to enhance Taiwan’s defense capabilities.
Although Trump’s remark was initially dismissed as an offhand comment, the follow-up statements from Hegseth and Colby now suggest a significant strategic recalibration in U.S. defense policy toward Taiwan. These statements offer insight into a rapidly evolving Taiwan-U.S. defense relationship.
As U.S. military aid and strategic support for Taiwan are being reshaped, all eyes are on the question: How will Taiwan-U.S. defense relations evolve during Trump’s second term? Will arms sales, military assistance, and strategic commitments undergo fundamental changes?
Unlike the Biden administration – which emphasized rapid response and regional stability – Trump’s approach is markedly different. He insists that allies should bear a larger portion of their own defense costs and questions whether the United States should continue providing military aid to Taiwan without financial compensation. While Biden’s policy focused on delivering smaller, quickly deployable systems, Trump’s strategy favors larger, conventional weaponry. His renewed call for Taiwan to assume more defense costs signals a potential rebalancing of a decades-long partnership.
Arms Sales and Military Financing in Question
Taiwan’s reliance on U.S. arms sales is evident. Critical systems such as the MQ-9B “Sky Guardian” drone, F-16V fighter jets, M1 Abrams tanks, and HIMARS multiple rocket launchers are integral to Taiwan’s defense planning. Yet Taiwan is still awaiting delivery on approximately $21.95 billion worth of U.S. arms orders – many of which have been delayed for over four years. On January 14, incoming U.S. National Security Adviser Mike Waltz addressed this severe backlog by stating that over $20 billion worth of equipment for which Taiwan has already paid must be delivered promptly to ensure effective deterrence.
Roughly 72 percent (about $15.7 billion) of these pending orders were initiated during Trump’s first term. In contrast to the Biden administration’s focus on smaller, rapidly deployable systems, Trump consistently promoted larger, conventional weaponry. His stance that Taiwan must assume a greater share of its defense costs suggests a potential shift in the long-established Taiwan-U.S. defense framework.
Complicating matters further, Trump signed Executive Order No. 14169, which instituted a 90‑day freeze on foreign aid – including funds under the Foreign Military Financing (FMF) program. On January 24, Secretary of State Marco Rubio directed that nearly all foreign aid commitments, including FMF disbursements, be suspended. However, Taiwan was granted an exemption from this freeze, ensuring that FMF assistance will continue as authorized under the Taiwan Enhanced Resilience Act. While this development alleviates concerns about immediate funding cuts, questions remain about how future FMF allocations will be structured under Trump’s transactional approach to foreign military assistance.
Furthermore, key deliveries – such as MQ-9B drones, HIMARS rocket systems, and F-16V jets – may suffer additional delays as the Pentagon undertakes a comprehensive review of its arms export policies. This review could further compress Taiwan’s modernization timeline, compelling Taipei to reassess its defense strategy and resource allocation.
Beyond the arms sale process, the Presidential Drawdown Authority (PDA) has provided Taiwan with rapid, flexible military support by deploying equipment from existing U.S. inventories during emergencies. Under the Biden administration, Taiwan benefited from multiple PDA aid packages, including allocations in July 2023, September 2024, and December 2024.
However, with Trump’s current freeze on foreign aid, future PDA-based assistance may be subject to stricter scrutiny, additional delays, or potential cuts. At his Senate confirmation hearing, Hegseth reiterated that U.S. priorities must focus on U.S. interests and military readiness, leaving the future of PDA support for Taiwan uncertain. This raises important questions about whether the U.S. will continue to provide immediate military support to Taipei or shift the financial burden onto Taiwan.
Taiwan’s Drone Industry
To give one concrete example of how these policies are playing out, let’s look at Taiwan’s drone industry.
In modern warfare, uncrewed aerial systems (UAS) have become indispensable. Taiwan’s “Overall Defense Concept” emphasizes innovation and cost-effectiveness, with drones emerging as a key strategic focus. However, current domestic drone production is hindered by reliance on imported advanced sensors and secure communication modules.
The combined delayed FMS deliveries and uncertainties in PDA aid and FMF funding have compounded the challenges for Taiwan in procuring modern drone technologies from the United States. While the MQ-9B “Sky Guardian” purchase is still underway, future agreements may come with more restrictive conditions.
In response, the Taiwanese government is actively promoting indigenous drone production through initiatives such as the Aerospace and Unmanned Systems Industrial Park, which aims to diversify manufacturing and bolster supply chain resilience. Concurrently, Taiwan’s “Teng Yun” drone project is advancing efforts to enhance autonomous navigation and stealth capabilities, thereby reducing external dependencies.
Recent Policy Shifts in the Trump Administration
Recent signals from the Trump administration further illustrate the strategic shift that is underway. The uncertainty surrounding a possible extension of the current 90-day freeze on foreign military financing could potentially delay critical arms deliveries even further. However, Taiwan’s exemption from this freeze provides a degree of continuity in its defense funding, mitigating some of the immediate financial uncertainties.
At the same time, the Pentagon’s ongoing comprehensive review of its arms export protocols is expected to cause additional delays for key systems like the F-16V fighter jets and HIMARS rocket systems before the new protocols are rolled out, further compressing Taiwan’s modernization timeline.
Senior Trump administration officials have repeatedly stressed that allies, including Taiwan, must contribute more directly to their own defense. This transactional rhetoric represents a significant departure from previous bipartisan norms and implies a pivot toward a model in which reducing U.S. fiscal commitments is prioritized, pushing Taiwan to enhance its self-reliance and seek supplementary funding from alternative partners.
As the geopolitical landscape in the Indo‑Pacific grows increasingly complex amid China’s assertive military expansion in the Taiwan Strait, Taipei must recalibrate its defense planning. While Taiwan’s exemption from the FMF freeze provides continuity in U.S. military aid, broader shifts in Trump’s defense policies still necessitate reassessing budget priorities, investing more heavily in domestic defense industries, and broadening international partnerships.