AGP Executive Report

Defense and Security: Taiwan says it will raise defense spending to 5% of GDP by 2030, as its first two F-16V Block 70 fighters arrive. Washington has accepted a preliminary request for up to 20 MH-60R anti-submarine helicopters, though no sale is approved. A Chinese militia-linked vessel was also spotted off Taiwan’s east coast for the first time, while prosecutors indicted four people over alleged surveillance of legislator Puma Shen. AI-Fueled Growth: TSMC reported record third-quarter revenue of US$46.71 billion as AI chip demand surged; Taiwan’s exports also set a monthly record, topping US$87 billion. But a strike vote by Micron workers in Taiwan raises a potential risk for the chip supply chain. Diplomacy: Taiwan marked its 115th National Day with visiting foreign dignitaries, including Eswatini’s king, who pledged support for Taiwan’s global participation. Civil Liberties: A police raid on a Taipei gay bar has sparked protests and renewed scrutiny of the city’s commitment to LGBTQ+ rights.

Cross-Strait Tensions: The U.S. urged Beijing to stop pressuring Taiwan after a Chinese militia-linked vessel was spotted off the east coast for the first time. A senior U.S. diplomat, meanwhile, said markets overstate the risk of a Chinese attack by 2027. Defense: Taiwan received its first two F-16V Block 70 fighters and plans to raise defense spending to 5% of GDP by 2030, President Lai Ching-te said. Security: The FBI arrested a woman accused of spying on Lai’s family in the U.S.; Taiwan prosecutors also indicted four people over alleged surveillance of lawmaker Puma Shen. Economy: TSMC reported record third-quarter revenue as AI chip demand surged, and Taiwan’s September exports hit a monthly high. Micron workers in Taoyuan, however, authorized a strike over bonuses. Civil Rights: A police raid on a Taipei gay bar triggered protests and scrutiny of the city’s LGBTQ-friendly reputation; the mayor apologized and officers were disciplined.

Cross-Strait Tensions: A Chinese maritime militia fishing boat was reported operating with coast guard and research vessels off Taiwan’s east coast—the first known sighting there—raising concern Beijing is rehearsing blockade tactics. Tech and Trade: TSMC posted record third-quarter revenue of US$46.71 billion, up 50% year on year, as AI demand also helped push Taiwan’s September exports to a monthly high above US$87 billion. Energy: Taiwan is preparing to restart its Maanshan nuclear plant as early as 2028, citing rising power needs from chipmaking and AI, though waste and safety concerns remain. Labor: A Micron union in Taoyuan won authorization for a strike over bonuses, adding pressure to Taiwan’s booming semiconductor sector. Security: Prosecutors indicted four people over alleged surveillance of lawmaker Puma Shen for Hong Kong clients, while a separate US case alleges a China-linked agent tracked President Lai Ching-te’s son.

Cross-Strait Security: Former President Tsai Ing-wen told a U.S. audience that Chinese military patrols, cyberattacks and economic pressure are steadily testing Taiwan. Taiwan has also indicted four people over alleged surveillance of lawmaker Puma Shen for Hong Kong clients. International Support: The European Parliament rejected Chinese efforts to restrict Taiwan’s global participation and backed closer EU-Taiwan ties. Three U.S. lawmakers are visiting Taiwan, while the first two of 66 new F-16V fighters have arrived. Economy & Chips: TSMC reported record third-quarter revenue of NT$1.49 trillion, up 50% year on year and above forecasts. Micron workers in Taoyuan won strike authorization amid a bonus dispute. Cost of Living: Premier Cho Jung-tai says the government aims to begin issuing a NT$10,000 cash payment in January, if lawmakers approve the budget by Jan. 5. Legislature: Parties split committee convenerships evenly between the DPP and opposition, with the KMT taking seven posts and the TPP one.

U.S.-Taiwan Ties: Taiwan opened a representative office in Phoenix as chip investment deepens Arizona links. Its envoy said ties with Washington remain strong, while urging timely arms deliveries amid uncertainty over a stalled US$14 billion package. Security: Taiwan indicted four people over alleged China-linked surveillance of lawmaker Puma Shen; separately, the FBI arrested a woman accused of spying on President Lai’s family. The first two of Taiwan’s 66 new F-16V fighters have arrived, while US Marines are set to deploy anti-ship missiles on Japan’s Yonaguni island near Taiwan. Politics and Rights: Protests and scrutiny followed a Taipei police raid on a gay bar that detained 51 people, as the capital’s mayoral race heats up ahead of November’s election. Economy: Micron’s Taoyuan union won authorization to strike over bonuses. Taiwan’s stock market hit record highs as AI demand lifted chip shares, while inflation reached its highest level since February 2024.

Okinawa Security: US forces on Japan’s Okinawa face a month-long curfew and an alcohol ban after a US Marine was accused of murdering and robbing a local woman, with operations paused for 48 hours while discipline training is ordered. Taiwan Strait Tensions: North Korea condemned US arms sales and military support for Taiwan, warning of “unforeseeable” consequences, while China’s foreign ministry reiterated the Taiwan issue is China’s internal affair and urged the US to act prudently. US-Taiwan Ties: A US House delegation is in Taiwan for meetings with President Lai and senior officials on trade, technology exchanges and regional security. Phoenix Office: Taiwan opened a representative office in Phoenix, Arizona, as Foreign Minister Lin attended the launch and discussed investment and tech cooperation amid political pushback from China. Transnational Repression Crackdown: Taiwan is preparing tougher anti-infiltration and public-protection measures after a California woman was arrested in the US for allegedly surveilling Lai’s son for China. Semiconductors & Markets: Intel says it will keep working with Elon Musk on Terafab even as TSMC talks swirl; meanwhile AMD CEO Lisa Su says AI chip demand will last for years and capacity must expand 3–5 years ahead, as Taiwan’s Taiex edges near record levels.

Taiwan Security & China Espionage: Taiwan says China’s alleged surveillance of President Lai Ching-te’s son in the US is part of a wider “transnational repression” pattern, after the FBI arrested Wanying “Heather” Zhang in Los Angeles for allegedly spying in Seattle; authorities say at least 126 Taiwanese have been targeted. US–Japan Missile Posture Near Taiwan: The US plans to deploy the NMESIS anti-ship missile system on Yonaguni, about 60 nautical miles from Taiwan, for the Keen Sword exercise—another deterrence signal as China opposes US arms sales. Defense Deliveries: Taiwan received its first F-16V Block 70 fighters, with more jets expected, as Taipei frames the move as vital against cross-strait air pressure. AI, Chips & Supply Chains: AMD CEO Lisa Su says the company will substantially increase chip supply in 2027; meanwhile, TSMC talks tied to Elon Musk’s Terafab keep Taiwan’s semiconductor role in the spotlight. Economy & Trade: US trade deficits widened again in August, while Taiwan’s own stocks closed near a record high. Local Industry: AUO and Innolux showcased glass-core substrate work for next-gen AI chip materials; Taiwan’s offshore wind sector also faced a second turbine blade failure at Greater Changhua 4. Culture & Society: Protests erupted in Taipei after a police raid on a gay bar and detentions, with city officials defending inclusivity. Sports: Taiwan athletes continued mixed results at the WTT China Smash and the Asian Games wrap-up highlighted regional political tensions. Global Watch: The Busan International Film Festival opens with its first “A-list” accreditation, with Taiwan among the competition nations.

US-Taiwan Ties: US Senator Michael Bennet visits Taiwan for talks on regional security and U.S.-Taiwan cooperation, with AIT saying he’ll meet senior officials. Diplomatic Outreach: Taiwan’s foreign minister Lin Chia-lung attends the opening of a new de facto consulate office in Phoenix, Arizona, as Arizona leaders back the move despite Chinese warnings. China Espionage Case: The FBI arrested California real estate agent Wanying Zhang (“Heather”) for allegedly surveilling Lai Ching-te’s son for China, prompting U.S. vows to protect people from foreign government overreach. Defense & Arms Sales: Taiwan’s defense minister says he hasn’t heard the U.S. plans to split a $14 billion arms package into smaller batches, adding Washington’s commitments remain unchanged. Sports & National Mood: President Lai praises Taiwan athletes after the Asian Games, where Taiwan won 55 medals (15th overall) and its lowest gold haul since 1990. Local Life: Taiwan’s CWA says seasonal northeasterly winds will keep northern and eastern areas cooler, with rain easing and drier weather expected. Energy Watch: Ørsted reports a second turbine blade failure at the Greater Changhua 4 offshore wind farm in under two months. Rights & Protest: Taiwan LGBTQIA+ groups call for police apology after a heavy-handed raid on a Taipei gay bar sparked protests and allegations of warrant issues.

Cross-Strait Security: The FBI arrested Irvine realtor Wanying “Heather” Zhang, 34, at LAX as she tried to leave for China, accusing her of acting as an unregistered agent and surveilling Taiwan President Lai Ching-te’s son and family in the U.S. for PRC handlers. Taiwan-US Defense Politics: Taiwan’s representative in the U.S., Alexander Yui, said he’s confident Washington will approve a stalled US$14 billion arms package, with a decision expected soon. Markets & Tech: Taiwan stocks surged to a record close near 50,000 points, helped by strength in semiconductors; TSMC also hit record highs amid reports of early Terafab talks involving Elon Musk. AI Supply Chain Boost: Foxconn reported record September revenue, topping NT$1 trillion for the first time, as AI-driven demand lifts results. Local Politics & Rights: Taipei’s gay bar raid sparked protests over alleged police misconduct, while the Taipei mayoral race heats up with major party heavyweights backing candidates.

China-Taiwan Espionage: The FBI arrested California realtor Wanying “Heather” Zhang at LAX, accusing her of acting as an unregistered agent for China and surveilling Taiwan President Lai Ching-te’s son and family in the U.S., with Taiwan calling it “transnational repression.” Taiwan-US Ties: Taiwan condemned the alleged surveillance and thanked U.S. law enforcement, while Taiwan’s foreign minister also moved to deepen unofficial ties, including inaugurating a new de facto consular office in Arizona. Markets: Asian stocks climbed after weak U.S. jobs data cooled expectations of another Fed rate hike; Taiwan’s TSMC rose alongside broader tech buying. Tech & Industry: Solidigm plans to expand SSD production sites in Taiwan to support AI data-center demand, while Nvidia and Hon Hai said robots improved GB300 assembly success rates. Economy & Culture: Taiwan Lottery launched two new scratch cards with a combined NT$2.11B prize pool, and Taiwanese electronic artists performed in Spain’s “She Makes Noise” festival. Sports: Taiwan’s Rita Chou won the women’s 9-ball world title, and the CTBC Brothers clinched the CPBL second-half crown.

Local Elections Heat Up: Taiwan’s major parties fanned out across Taipei, Taichung and Kaohsiung ahead of the Nov. 28 local elections, with President Lai Ching-te backing DPP Taipei candidate Puma Shen and contrasting “positive” campaigning with the KMT’s incumbent Chiang Wan-an. Cross-Strait Maritime Tensions: Taiwan’s Coast Guard used water cannons to expel Chinese fishing boats near the Dongsha/Pratas area, disabling a vessel and leaving crews stranded, drawing sharp criticism over safety and “provocation.” US-Taiwan Military Ties: The Pentagon plans to station two representatives inside Taiwan’s defense ministry through 2028 to coordinate policy and assess combat capabilities, marking a shift from embassy-style channels. Diplomacy & Supply Chains: Foreign Minister Lin Chia-lung said Taiwan is working with the US and Guatemala to build a “China-free supply chain,” including plans to open a new Taiwan representative office in Phoenix. Taipei LGBTQ+ Rights: Gender groups urged Taipei officials to investigate a raid on a BDSM-themed gay bar in Ximending, alleging excessive enforcement and discriminatory remarks; hundreds later protested. Justice Reform: Taiwan’s Agency of Corrections said the share of inmates serving drug-related sentences has dropped over five years as more offenders are diverted into community-based addiction treatment. Aviation & Travel: EVA Air plans direct Delhi–Taipei flights starting Dec. 1, five times a week, aiming to boost tourism and connectivity.

Taiwan-US Security & Diplomacy: Taiwan’s Foreign Minister Lin Chia-lung arrived in the U.S. for a trip that includes an unveiling for the Taipei Economic and Cultural Office in Phoenix and a visit to TSMC’s Arizona plant, underscoring deepening economic ties after the Trump-Xi summit. China-Taiwan Tensions: A China expert said U.S.-China differences are too fundamental to “solve” major disputes, creating an opening for Taiwan to integrate more with Washington—especially on security. Defense Posture in the Region: The U.S. plans to deploy an anti-ship missile system on Japan’s Yonaguni island during joint exercises, bringing it closest to Taiwan so far. Local Safety: A deadly fire in Yilan killed four people, including a wife, two children, and the owner’s father; the cause is under investigation. Philippines-Taiwan Cooperation: A Taiwan-donated refurbished patrol vessel entered Philippine Coast Guard service as BRP Sarangani, supporting maritime patrol, rescue, and disaster response. Sports: Taiwan’s Lin Yu-ting won gold at the Asian Games, adding to Team Taiwan’s medal momentum.

Taiwan-US Security: Taiwan says its talks with the US on arms sales are ongoing after Trump-Xi diplomacy left a key USD 14 billion package “on hold,” while US senators urged faster delivery of defense aid as China pressure continues. Cross-Strait Pressure: Taiwan accused China of “transnational repression” after people allegedly impersonated a Taiwanese documentary distributor and issued threats, prompting a joint investigation with police and prosecutors. Defense Arrivals: Taiwan received its first F-16V Block 70 jets after years of delay, with officials framing the deliveries as vital “time and space” against air coercion. Regional Maritime Tensions: Taiwan’s Coast Guard expelled Chinese boats from its waters and reported patrols monitoring Chinese vessels near the Philippines and around Pratas waters. Asian Games Spotlight: Taiwan’s Hsieh Su-wei and Liang En-shuo won all-Taiwan women’s doubles gold after a handshake dispute with Chan Hao-ching, while Taiwan also added medals including a bronze in women’s team golf. AI & Data: A Synology survey found Philippine firms—highlighting regional concerns—see data security and privacy as major barriers to AI adoption, underscoring the wider challenge for Taiwan-linked tech ecosystems.

F-16V Deliveries & China Pressure: Taiwan’s Ministry of National Defense released footage and photos of F-16V Block 70 jets escorted by Brave Eagle trainers as the first batch arrived at Chihhang Air Base in Taitung, ending years of delays under the US$8 billion 2019 deal. Cross-Strait Maritime Tensions: Taiwan’s Coast Guard used water cannon to drive off two Chinese fishing boats in restricted waters near Dongsha, towing one vessel out after it lost power. Defense Watch in the Region: Satellite imagery review suggests China’s Antelope Reef runway construction is accelerating, with analysts estimating possible completion by mid-2027. Diplomacy & Industry Links: Taiwan’s deputy economics minister said a “reliable strategic partnership” is key to Taiwan-U.K. cooperation, while Taiwan’s foreign minister is set to visit Arizona to meet officials and semiconductor firms. Sports (Taiwan at the Asian Games): Hsieh Su-wei and Liang En-shuo won women’s doubles tennis gold for Taiwan, and Taiwan also secured a golf women’s team bronze. Local Life: A crane accident at Yilan Science Park killed one worker and injured another during exterior wall cleaning. Culture: Italian translator Silvia Pozzi won a Pisa Book Translation Award for translating a Taiwan novel by Kevin Chen.

Defense Deliveries: Taiwan received the first two of 66 new US-made F-16V Block 70 jets at Chihhang Air Base in Taitung, a milestone meant to bolster air defenses as China’s military pressure grows. Cross-Strait Security: Taiwan’s Coast Guard used water cannon to expel two Chinese fishing boats from prohibited waters near the Dongsha (Pratas) Islands, citing unauthorized activity and jurisdiction. US-Taiwan Tensions: The F-16 arrival comes while Taiwan awaits a separate, paused $14 billion US arms package, with Washington saying policy hasn’t changed. Local Governance & National Day: Speaker Han Kuo-yu says Double Ten National Day celebrations will spotlight Taiwan’s diversity and vitality, with events planned in Taipei and Taitung. Sports Spotlight (Taiwan): Olympic boxer Lin Yu-ting won Asian Games gold in the women’s 60kg final, adding another title after her earlier Hangzhou success. Maritime Tech: Taiwan’s Ocean Affairs Council says a domestically developed AI navigation and federated-learning system completed autonomous patrol tests to improve maritime object recognition without sharing sensitive imagery.

Defense & Cross-Strait Security: Taiwan received the first two of 66 US-made F-16V Block 70 jets at Chihhang Air Base in Taitung, after months of delays tied to software and production issues, as Taipei weighs continued pressure from Beijing and uncertainty over a separate paused $14 billion arms package. Regional Military Watch: Reuters reports China’s runway construction on Antelope Reef in the Paracels is progressing, with analysts estimating a possible mid-2027 completion that could expand Beijing’s South China Sea military reach. Sports (Asian Games): Taiwan’s Lin Yu-ting won women’s 60kg boxing gold, taking a second Asian Games title after her Paris gender-row controversy; Korea also swept Taiwan 3-0 in the LoL final. Economy & Markets: Taiwan’s labor funds posted a record-style August gain of NT$366.7 billion, driven by a global stock rebound, while the Taiex edged up amid mixed Asian markets after bond sell-off fears. Diplomacy: Former President Tsai Ing-wen said she will visit the US next week to speak at a Stanford security conference.