ABSTRACT
This chapter outlines the internal and external challenges to Taiwan's defence in more detail. It discusses the Taiwan's defence options, developments as well as the remaining obstacles for military modernization. Taiwan's current strategic situation is affected by several long-term trends. Externally, China has gradually altered in its favour the military balance across the Taiwan Strait. The days when a numerically smaller Taiwanese defence force enjoyed a qualitative edge over the People's Liberation Army's (PLA) through a range of offensive and defensive capabilities are over. Domestically, Taiwan's armed forces face an interrelated set of challenges in the form of declining defence spending, negative demographics, and a relative benign threat perception among large parts of the population. In the face of these external and domestic factors shaping Taiwan's strategic landscape, the Taiwanese armed forces have been obliged to rethink their defence strategy and force posture.
