Part 1. Strategic Environment

The defense budget of the PRC has been growing every year to accelerate the modernization of its defenses and armed forces. The PRC is also strengthening its area denial capabilities, leading to increased concerns from the surrounding countries. The PRC has remained the leading threat to the ROC as it has yet to abandon military solutions against Taiwan and is still conducting targeted military exercises for such ends. Over a thousand short- and medium-range ballistic missiles as well as cruise missiles have also been deployed by the PRC along the Taiwan Strait. Other challenges to the ROC's defense and security include strategic competitions between the PRC and the US, intensifying island and maritime disputes in the East China Sea and South China Sea, as well as unconventional security threats posed by cyberspace and information security issues.