In a National Day speech in Taipei, President Lai Ching-te said Taiwan "cherishes peace" but will not accept subordination to China, describing a record defence budget of about $34.5bn for 2027 (over 3 percent of GDP) as a means "to deter war, not provoke". Beijing, which claims the self-governed island and has refused talks with Lai, continues military and "grey-zone" pressure (coercive tactics short of open war), while Taiwan awaits US approval of a $14bn weapons package after President Donald Trump suggested arms sales could be a bargaining chip with China. The stance matters because the United States, Taiwan's main security backer, is in talks with Beijing, and Lai urged Indo-Pacific democracies to help preserve regional stability.