Donald Trump’s second term, and his highly personalized approach to international diplomacy, raises concerns about US foreign policy towards Taiwan amid increasingly fortified China-Russia ties.
Key takeaways:
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Trump’s priorities are expected to shift the focus of US-Taiwan policy from a values-based defense of democracy to a more strategic and transactional approach.
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Trump’s ambiguous stance on Taiwan’s defense and his focus on economic issues could embolden China, potentially destabilizing the delicate balance in the Taiwan Strait.
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The deepening “no limits” relationship between China and Russia poses increased threats to Taiwan’s security.
As Donald Trump wastes no time in shaping US foreign policy in his image, Taiwan faces significant challenges in its relationship with the US. Trump’s “America First” policy and transactional approach to diplomacy have raised concerns about the future of US-Taiwan relations and Washington’s (implicit) commitment to defend the island.
US Vice President JD Vance’s recent speech at the Munich Security Conference has direct implications for US-Taiwan ties, which can no longer be taken for granted. Vance’s speech marked a stark departure from traditional US foreign policy rhetoric, particularly regarding support for American allies facing security threats from China and Russia. He downplayed risks posed by the Sino-Russian partnership, instead focusing on “the threat from within”–what he perceived as internal risks to European democracy. This shift in focus suggests a potential reevaluation of US security priorities under the second Trump administration.
Against this backdrop, the global order is increasingly shaped by the deepening alliance between China and Russia united by their shared adversarial stance toward the United States. This Sino-Russian partnership, described by both nations as having “no limits,” has intensified since Russia’s invasion of Ukraine in February 2022. The current alignment leads one to draw parallels with the Molotov-Ribbentrop Pact between Nazi Germany and the Soviet Union in 1939, which allowed both powers to pursue their territorial ambitions without fear of immediate conflict with each other. This agreement sent shockwaves of aggression through Europe that ultimately set the stage for World War II. Even if the current alliance between Moscow and Beijing is a temporary alignment based on mutual interests rather than deep-seated trust or ideological compatibility it poses no smaller risks to global security and particularly Taiwan.
Taiwan’s to-do list
Trump’s demands for increased defense spending, accusations of Taiwan “stealing” America’s advanced manufacturing industries, and threats of tariffs on semiconductor exports have created uncertainty in Taiwan. Meanwhile, the island nation grapples with budget constraints, evolving security threats from China, and the need to modernize its military capabilities.
The precedent set with Ukraine on the discussed minerals deal has sparked apprehension in Taiwan, as it suggests that Trump might demand similar concessions or economic arrangements in exchange for continued support.
Taiwan may face mounting pressure to significantly increase its defense spending and purchase more American weapons, aligning with Trump’s oft-repeated desire for allies to “pay their fair share.” Trump has previously called on Taiwan to increase its defense spending to 10% of GDP, a dramatic increase from the current level of 2.45%. Taiwan’s President Lai Ching-te has pledged to increase defense spending and has earmarked $2.2 billion for arms purchases from the US in 2025. However, Taiwan’s domestic politics are complicating efforts to meet these demands. The opposition-led legislature recently voted to freeze billions in defense expenditures, potentially frustrating America’s deal-oriented president. This move has been criticized by Taiwan’s leadership, with Premier Cho Jung-tai calling it “suicidal” and Defense Minister Wellington Koo, who warned it sends “the wrong message to the United States”.
Taiwan’s fiscal capacity to significantly increase defense spending as a proportion of GDP is constrained by its relatively low tax revenue. Despite reaching a record high of $112.69 billion in 2024, the low revenue limits the government’s ability to allocate substantially more funds to defense without compromising other essential public services or increasing the tax burden on its citizens.
As Taiwan navigates the geopolitical nuances of Trump’s second term, it faces the dual challenge of meeting increased US expectations and countering the threat from Beijing. To address this situation, Taiwan is pursuing a multifaceted strategy:
First of all, the island nation is stepping up its military modernization effort. Taiwan is expanding its “Sea-Air Combat Power Improvement Plan Purchase Special Regulation,” with a focus on increasing missile production. This initiative has already shown success, with the National Chung Shan Institute of Science and Technology (NCSIST) on track to produce over 1,000 missile units by the end of 2025, two years ahead of schedule.
At the same time, Taiwan seeks to develop an economic policy that can assuage US concerns. In response to President Trump’s criticisms of Taiwan’s manufacturing dominance, the Taiwanese are exploring measures to address US demands while protecting their critical industries. Potential incentives include reduced tariffs and the streamlining of market entry procedures for US businesses, particularly in high-tech sectors. However, these efforts are complicated by the fallout from the failed Starlink deal, which highlighted burdensome regulatory requirements for majority local ownership in critical infrastructure. Elon Musk’s refusal to comply with these rules, combined with his close relationship with Trump and influence on US policy, underscores the challenges Taiwan faces. The island nation must carefully navigate between appeasing the Trump administration and safeguarding its own national security interests. Musk’s sway over Trump, as seen in recent disputes involving his business aspirations in South Africa, adds another layer of complexity to Taiwan’s strategic calculations.
Finally, Taiwan engages in strategic balancing by diversifying its international partnerships and economic ties. While maintaining strong relations with the US, Taiwan is simultaneously strengthening connections with other key allies and regions. This approach includes implementing the New Southbound Policy to deepen economic and cultural ties with Southeast and South Asian countries; fostering closer relationships with Central and Eastern European countries, as evidenced by increased trade and investment initiatives; pursuing active diplomacy with other democratic powers, particularly in the Indo-Pacific region; and Enhancing economic cooperation with the European Union, as seen in the proposed EU-Taiwan Resilient Supply Chain Agreement (RSCA) and Capital Markets Link (CML).
This approach aims to reduce Taiwan’s overreliance on any single partner, while creating a broader international network of support. Such diversification is crucial in the face of the deepening Sino-Russian alliance and potential shifts in American policy, allowing Taiwan to maintain its political autonomy and economic resilience in the face of emboldened military posturing from Beijing.
While these efforts demonstrate Taiwan’s commitment to self-defense and alignment with its allies, the strategic environment remains volatile. The possibility of aggressive Chinese military action cannot be dismissed, despite current economic challenges across the Strait. Taiwan’s strategy, therefore, must remain flexible and responsive to the evolving geopolitical landscape, integrating military advancements with diplomatic efforts to safeguard its security and sovereignty.
Withering Trump
Complicating matters further is Trump’s unpredictable approach to international politics characterized by a tendency to “personalize” relationships with other world leaders. Trump refers to other countries less through multilateral organizational alliances, but rather directly addresses countries via their political leaders.
This is particularly evident in his interactions with adversaries of the West. He labels Xi Jinping as a “friend”, claims to have a “good relationship” with Putin and views North Korean tyrant, Kim Jong Un, as a “smart guy”.
Trump has also leveled personal attacks against Ukraine’s President Volodymyr Zelensky, attributing blame for the war with Russia and calling him a “dictator”. These attacks escalated dramatically during a February 28 Oval Office meeting, with the US President berating his Ukrainian counterpart in an unprecedented public confrontation before kicking him out of the Whitehouse. The heated exchange, which included accusations of ungratefulness and gambling with World War III, ended with Trump demanding Zelensky “make a deal or we’re out,” marking a stark departure from the “unequivocal and unbending” support under the Biden administration.
This personalized approach to diplomacy may create new opportunities for “deal making”. Despite the appointment of China hawks to senior positions in his administration, there is growing speculation that Trump might attempt to broker a “big deal” between China, Taiwan, and the United States to prevent military conflict in the Indo-Pacific. It is also not unreasonable to assume that Trump considers China as a key player in pressuring Russia to concede to a “deal” on Ukraine.
As Taiwan navigates a path of conflict deterrence, it must carefully consider how to engage with the Trump administration. Taipei should prioritize establishing personal communication with Trump, leveraging intermediaries such as prominent Taiwanese-Americans and pro-Taiwan US politicians to facilitate dialogue. This approach could help align Taiwan’s interests with Trump’s “America First” policy, particularly by emphasizing shared goals in trade and containing China’s influence. Taiwan must, however, remain cautious of Trump’s unpredictability and transactional proclivities, which may necessitate sudden concessions or strategic offerings to maintain US support, potentially compromising economic interests and diplomatic flexibility.
