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August 17, 2020updated 20 Aug 2020 11:35am

Covid-19 exacerbates tensions between US and a rising China in the Straits of Taiwan

The COVID-19 pandemic, whilst bringing much of the global daily life to a halt, has exacerbated the already rising tensions between China and the US. This growing adversarial relationship is driven by a number of factors.

By GlobalData

The COVID-19 pandemic, whilst bringing much of the global daily life to a halt, has exacerbated the already rising tensions between China and the US. This growing adversarial relationship is driven by a number of factors. The COVID-19 pandemic has degraded the US-China relationship in a number of ways. Rhetorically, the politicization of the Chinese origin of COVID-19 in the US has served to further entrench an adversarial attitude between the world’s two greatest powers. Competition regarding the development of a vaccine has also served to degrade relations.

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What is driving and impacting South Korea’s Defense Market?

South Korea’s defense budget is currently valued at $48.3 billion after experiencing impressive and robust annual growth of 10.5% in 2022. Over the forecast period, South Korean defense expenditure is anticipated to register a strong CAGR of 6.3% over 2023-27 and reach $66.2 billion by 2027. The country’s acquisition budget, which includes research and development (R&D) funding, is also anticipated to register significant growth, projected to reach $21.6 billion in 2027, seeing significant rise from the anticipated $17 billion in 2023. South Korean defense spending is continuing to be fueled by the country’s hostile relationship with North Korea, coupled with the need to develop its own domestic industry. If you want to strategize successfully off this growing market, it is important to be fully informed. This report’s key findings include:
  • Details on the defense budget
  • Drivers of defense spending
  • Key trends impacting the market
Download the full report so you can formulate winning strategies for the road ahead.
by GD50 ADS
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The People’s Republic of China has repeatedly affirmed its resolve to use all measures necessary, including military force, to prevent Taiwan from declaring its independence from Beijing. Given this commitment, in addition to the rapid modernisation of the People’s Liberation Army Navy (PLAN) in recent years, the need for Taiwan to maintain anti-ship capabilities in increasingly acute. In late December 2019, the PLAN sailed its aircraft carrier, the Shandong, through the Taiwan Strait. In early August two Taiwanese F-16A Vipers flew an air patrol mission armed with live AGM-84 Harpoon anti-ship missiles. This mission was conducted in response to the People’s Liberation Army’s military exercise which simulates the seizing of Taiwan’s Dongsha Islands. These events are the latest in a series of confrontations which have taken place during the COVID-19 pandemic.

Given the proximity of mainland China to Taiwan, it is crucial that Taiwan maintains the ability to resist a fait accompli strategy, by which the People’s Liberation Army rapidly seizes territorial control of Taiwan before a coherent response from allies can be rallied. Anti-ship capabilities are vital in this regard.

It is clear that whilst the current crisis has brought the global economy largely to a halt, it has enflamed already strained tensions. Australia’s 2020 Defence Strategic Update characterises the COVID-19 pandemic as a destabilising agent, creating a world, in Morrison’s words, that is “poorer, that is more dangerous and that is more disorderly”. It is in this context, in which a confrontation between China, Taiwan, and the US is more likely, not less, that procurement of defense articles has become a more pressing concern.

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What is driving and impacting South Korea’s Defense Market?

South Korea’s defense budget is currently valued at $48.3 billion after experiencing impressive and robust annual growth of 10.5% in 2022. Over the forecast period, South Korean defense expenditure is anticipated to register a strong CAGR of 6.3% over 2023-27 and reach $66.2 billion by 2027. The country’s acquisition budget, which includes research and development (R&D) funding, is also anticipated to register significant growth, projected to reach $21.6 billion in 2027, seeing significant rise from the anticipated $17 billion in 2023. South Korean defense spending is continuing to be fueled by the country’s hostile relationship with North Korea, coupled with the need to develop its own domestic industry. If you want to strategize successfully off this growing market, it is important to be fully informed. This report’s key findings include:
  • Details on the defense budget
  • Drivers of defense spending
  • Key trends impacting the market
Download the full report so you can formulate winning strategies for the road ahead.
by GD50 ADS
Enter your details here to receive your free Report.

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