Taiwan's President Lai uses National Day address to ease China tensions

President Lai Ching-te (賴清德)'s National Day address highlighted peace and stability.

On October 10, Taiwan, officially the Republic of China, celebrated its 114th National Day. Taiwan's President Lai Ching-te delivered a National Day address focused on peace, stability, and Taiwan’s global role.

In a 26-minute speech, Lai highlighted Taiwan’s competitive strengths in public health, intergenerational care, cross-strait relations, and national security. His remarks on Taiwan-China relations marked a shift toward a more moderate tone compared to prior statements.

Emphasizing Taiwan’s strategic role in the region, Lai stated: “Democratic Taiwan is a crucial link for the peace and stability of the Indo-Pacific and a responsible member of the international community.” “Taiwan will work to uphold the status quo, ensure peace and stability across the Taiwan Strait, and promote the prosperous development of the region,” he added.

On cross-strait relations, Lai said: “We look forward to the day when China can take responsibility as a major power and cease its distortion of United Nations General Assembly Resolution 2758 and historical World War II documents. We also hope it will renounce the use of force or coercion to change the status quo across the Taiwan Strait so that we can jointly maintain the peace and stability of the Indo-Pacific.”

Unlike Lai's 2024 National Day speech, which struck a more assertive tone and featured lines like "The People’s Republic of China has no right to represent Taiwan", this year’s address was more ballanced, signalling a more conciliatory approach to cross-strait relations.



Lai’s address may cool tensions

Professor Liu Fu-Kuo (劉復國), Director of the Taiwan Center for Security Studies at National Chengchi University, told TCN that compared to his May 20 inaugural address in 2024 and other major speeches, Lai’s 2025 remarks were notably balanced, particularly on foreign affairs and cross-strait relations.

Lai’s moderated stance likely stems from three factors. “First,” Liu said, “Taiwan had just concluded a series of recall elections in July and August, with results showing that most voters opposed the recall motions. This outcome likely reaffirmed the public’s preference for political stability.”

Liu continued: “The second factor is the international context. The possibility of a Trump‑Xi meeting is now at a crucial stage. The United States would not want any new variables or escalation in cross-strait tensions, so Washington likely hopes Lai will avoid adopting stronger or more provocative rhetoric.”

Liu added: “The third factor was Chinese President Xi Jinping’s (習近平) remarks during the October 1 National Day gala on the mainland, where he signaled a willingness to deepen cross-strait exchanges and cooperation. Taken together, these three elements likely influenced President Lai’s decision to deliver a more cautious and steady National Day address.”

This year's speech did not reference the complex and tense relationship between Taiwan and China.

Former Legislator and current Hudson Institute Senior Fellow Hsu Yu-Jen (許毓仁) told TCN this “can be interpreted as an attempt to de-escalate cross-strait tensions and avoid giving Beijing an opportunity to criticize or respond." "This also may be related to the upcoming Trump-Xi meeting. Taiwan likely hopes to avoid providing China with material to exploit before the meeting, which is also a sign of respect toward the US and an important signal," he added.

Hsu said he believed the US side has likely advised Taiwan given the current state of US-China relations.

Hsu said, “The Trump administration does not want Taiwan to become an irritant in US-China trade negotiations. This year’s National Day speech feels like a test assigned to Lai Ching-te by the US, a test from Washington to Taipei, which Lai resonded to steadily and competently.

Liu echoed Hsu's analysis. “With the Trump‑Xi meeting expected soon, Washington would not welcome any statements from Taipei that could irritate Beijing. In that sense, Lai’s measured and composed tone helps reinforce mutual trust between Taiwan and the US,” he said.

Cross-strait relations remain uncertain

Liu said “After President Lai introduced his so-called ‘Seventeen-Point Policy’ last year, cross-strait tensions gradually escalated, and many were concerned that relations might move toward conflict. This year’s speech, however, helps reduce confrontational sentiment and seems intentionally aimed at cooling tensions.” “The CCP may welcome the steady tone of President Lai’s speech, but it will likely observe for some time, given that Lai has previously taken a relatively hardline stance toward China,” he added.

Hsu offered a different perspective noting, “In the next three months, the Chinese military is expected to continue routine military exercises, with frequent but controlled and manageable maritime and air activities, as well as legal measures. Additionally, we can expect more political and economic measures targeting Taiwan, such as market access restrictions, tourism groups, specific products, and tariff barriers.”



National defense emerged as a key focus of Lai’s address

During his speech Lai said “At the end of this year, we will be proposing a special budget for national defense. Defense spending, as it is defined by NATO, will exceed 3 percent of GDP next year, and will reach 5 percent of GDP by 2030, showing our determination to safeguard the nation.”

Lai said increased defense spending targets three goals:

• Strengthen air defense with a rigorous, with the "T-Dome" multi-layered air defense system, high-level detection, and effective interception capabilities
  
  
• Integrate high-tech and AI for smart defense with high-tech and artificial intelligence technologies, a smart combat defense system, and maximized deterrence through asymmetric strategy
  
  
• Invest in innovative defense and international collaboration with military industries of advanced nations while bolstering Taiwan’s domestic defense industry capabilities
  
  

The announcement appears to address the Trump administration’s demands for Taiwan to increase defense spending, though to some the goal of reaching 10% of GDP seems ambitious.

Hsu noted: “I believe a military budget exceeding 10% of GDP is unrealistic, but 5% aligns with international expectations. I think Lai’s National Day speech adhered to this baseline.” He added, “Reaching 10% might not gain public consensus, but achieving 3.2% next year and striving for 5% by 2030 is acceptable and reasonable for most people.”

On the defense goals, Liu noted: “Domestic strategic experts have differing views on developing the T-Dome, and whether to allocate resources to this project remains debated. Implementing a high-tech, AI-driven smart defense combat system is widely regarded as essential for Taiwan’s current needs.”

“The most critical aspect may be fostering defense technology innovation through collaboration with leading international military-industrial firms, which holds profound significance for advancing Taiwan’s defense technology and military equipment in a new era,” he added.

President Lai’s National Day speech demonstrates Taiwan’s pragmatic and steady policy direction at a critical moment in US-China trade negotiations.

Hsu said, “Taiwan has very little ability to influence the broader situation between the US and China, so there is no need to overreact, especially regarding the Trump-Xi meeting. Instead, Taiwan should approach the changes in US-China relations pragmatically and steadily.”