Taiwan puts QDR priority on offsets and self-reliance

Taiwan’s newly issued defence policy has outlined a requirement for the island to lean on defence offsets to support its industrial and technology capability advancements.

The 2021 Quadrennial Defense Review (QDR), which details Taiwan’s defence priorities over the next four years, states that such development is necessary against a background of rising security threats.

“The regional situation is becoming more complex and precarious,” states Taiwan’s defence minister Chiu Kuo-Cheng in the QDR foreword. “The PRC [People’s Republic of China] is postured as the major threat to our national security.

“In order to maintain national security on our own, the MND [Taiwan’s Ministry of National Defense] remains steadfast to developing indigenous weapon systems, to endeavor to make major technological breakthroughs, and to rejuvenate defence industries and economic development,” he added.

Accordingly, the QDR outlines several priorities for Taiwan, one of which is focused on building self-reliance through methods including strengthened offset ties with foreign suppliers and implementing initiatives in line with the island’s Defense Industry Development Act, which was approved in late 2019.

“Offset resources are to be combined with local capacities to form a supply chain of defence industries,” says the QDR, “so as to motivate domestic industries to upgrade and enhance self-reliance in defence”.

The policy goes on to outline a requirement for the country’s offset policy – called the Industrial Cooperation Program (ICP) – to play a central role in stimulating industrial development.