US, Taiwan save F-16 upgrade deal after budget cut

US officials have found a formula to upgrade Taiwan’s aging F-16 fighter jets despite a Pentagon budget cut, helping the island to defend itself as its large neighbor, China, increases military spending.

The US government will cover the fitting of new radars over the next eight years by redirecting money saved on other F-16 upgrade items that came in under their estimated costs, a US official told the Monitor on Monday.

The US Air Force took F-16 radar research and development out of its 2015 budget to meet a cost-cutting target, initially raising concern that it would suspend the upgrades. Taiwanese defense officials quickly demanded answers from the US side once the budget cut was proposed.

The new go-ahead for Taiwan’s upgrades comes as China plans to increase its military budget by 12.2 percent this year, amid maritime disputes with Asian neighbors and what Beijing calls terrorist threats from its ethnic Uighur population.

China has seen Taiwan as part of its territory since the Chinese civil war of the 1940s, when the Nationalists lost to the Communists and rebased themselves on the island, 100 miles away. Relations have improved over the past six years, but China has not renounced the use of force, if needed, to reunify the two sides. 

“We have a lot of F-16s in operation now and they’re becoming obsolete compared to China’s modernization,” says Andrew Yang, former Taiwan defense minister and general studies professor at National Sun Yat-sen University in Kaohsiung, Taiwan. “In terms of easing the military imbalance toward China, the upgrade is indispensable.” 

Washington agreed in 2011 to upgrade Taiwan’s 146 US-made F-16s, which Taiwan bought in the 1990s, after declining to sell it a batch of newer ones. New F-16s, like other arms sold to Taiwan, would have angered Beijing and soured Sino-US relations. 

Washington hopes to maintain ties with China as well as Taiwan, a cold war ally and a link in its Asia-Pacific military alliance today. The US sees Taiwan along with Japan, South Korea, and the Philippines as part of its network to check China's rise, and offers military support accordingly.

Taiwan, which has committed $3.735 billion for F-16 upgrades overall, will not need to approve more money to cover radar installation, says the US official, who was not authorized to speak on the record.

“There are amounts on the funding that came in under the initial estimates, which provides [Taiwan] with flexibility in [their] budget to fund the remaining amount that Taiwan needs to fund,” the official says. “Taiwan won’t need to go back to the parliament to ask for more money."

“But in the end what it means is that there’s a small percentage, a small amount of money, that since the US Air Force didn’t fund for R&D, Taiwan will have to pay,” the official adds, declining to give any exact amounts.

Taiwan’s military was notified of the new funding formula on March 4, and a defense ministry spokesman says it will go ahead with the upgrades as agreed in 2011. Payments and work on the F-16 fleet are set be completed by 2022.