Speaking at a drone industry forum in the central Taiwanese city of Taichung, Raymond Greene, director of the American Institute in Taiwan, said unmanned systems offered a transformative opportunity to bolster the island’s security amid evolving regional threats.

The United States remains Taiwan’s most important international supporter and principal arms supplier despite the absence of formal diplomatic relations. Washington has consistently backed Taipei’s efforts to modernize its armed forces and increase defense spending as tensions with China persist.

Taiwan says it is accelerating military reforms in response to growing pressure from Beijing, which regards the democratically governed island as part of its territory. President Lai Ching-te has rejected China’s sovereignty claims, maintaining that only Taiwan’s people have the right to determine the island’s future.

Greene said the United States and Taiwan could help establish a democratic supply chain for drone production while strengthening collective deterrence among like-minded partners.

Referring to lessons from the war in Ukraine, Greene said drones have demonstrated their ability to enhance the defensive capabilities of forces confronting larger adversaries.

“Nothing will deter conflict more effectively than turning Taiwan into a hornet’s nest of air, surface, and subsurface drones,” he said.

Taiwan’s government has made asymmetric warfare capabilities, including drones, missiles and unmanned systems, a central pillar of its defense strategy. However, funding proposals have become the subject of political debate between the ruling administration and the opposition-controlled legislature.

In May, Taiwan’s parliament approved only about two-thirds of the government’s proposed T$1.25 trillion ($40 billion) supplemental defense package, allocating funding primarily for purchases of U.S.-made weapons.

The government has since proposed a separate T$210 billion ($6.59 billion) program extending through 2031 to finance surveillance drones, coastal attack platforms and small unmanned surface vessels.

The opposition Kuomintang this week introduced its own proposal that would authorize up to T$240 billion in drone spending over six years, with annual expenditures capped at T$40 billion. Unlike the government’s plan, the opposition proposal would finance the program through Taiwan’s regular budget rather than a special appropriations package.

Taichung Mayor Lu Shiow-yen, a senior Kuomintang figure who also addressed the forum, called for cross-party cooperation to accelerate development of Taiwan’s domestic drone industry.

Lu said recent conflicts, including the wars in Ukraine and Iran, demonstrated how drones and unmanned systems have fundamentally changed the character of modern warfare.

Taichung has emerged as one of Taiwan’s principal drone manufacturing centers and is home to companies including Thunder Tiger and the state-backed Aerospace Industrial Development Corp., both of which play significant roles in the island’s expanding defense industrial base.

On Wednesday, President Lai said strengthening Taiwan’s asymmetric defense capabilities had become increasingly urgent amid shifting geopolitical conditions and rapid changes in modern warfare, describing the effort as a race against time.