Taiwan Security Report — February 26, 2026

Security analysis based on open-source intelligence and web research. Period: February 19 — February 26, 2026.

Executive Summary

Taiwan faced a week of heightened security concerns and diplomatic maneuvering from February 19 to February 26, 2026, characterized by persistent Chinese "gray-zone" pressure and significant developments in its defense posture and international partnerships. Key events included ongoing Chinese military activities, including suspected signal spoofing near Taiwanese harbors, and Taiwan's preparations for its annual Han Kuang exercises focused on blockade countermeasures. Diplomatic efforts saw the formalization of a major US-Taiwan trade agreement, reinforcing economic ties, while US arms sales to Taiwan faced potential delays due to US-China high-level talks. A notable cybersecurity incident at a major Taipei hotel underscored persistent digital threats.

Key Security Developments

• Military Activities and Exercises
  Chinese military activity around Taiwan remained frequent, with large-scale exercises conducted in late 2025, such as "Justice Mission 2025," being among the most operationally realistic drills near Taiwan in recent years. These drills involved naval and air units, simulating a blockade and rehearsing elements of a campaign to isolate Taiwan, including port seizure operations and maritime strike missions. Taiwan is preparing for its annual Han Kuang exercises, which will focus on countering a possible blockade of the island and maintaining the combat capability of its forces, with tabletop drills scheduled for May 15-19 and live-fire exercises for July 24-28, 2026. The focus of these exercises will include "combat forces preservation" and "maritime interception," utilizing civilian airports and dispersing air assets.

• Defense Policy and Strategic Shifts
  Taiwan plans to significantly boost defense spending by a fifth in 2026, surpassing 3% of its Gross Domestic Product (GDP) for the first time since 2009, reaching T$949.5 billion (S$40 billion) or 3.32% of GDP. This budget increase includes funding for new fighter jets, naval defenses, and, for the first time, the coast guard, partly in response to calls from the United States to bolster its military. Taiwan is also accelerating the development of a "Taiwan Shield" or "T-Dome" integrated air and missile defense (IAMD) network, with US arms packages reportedly containing key systems to support this initiative.

• Diplomatic Relations
  On February 12, 2026, the US and Taiwan signed the Agreement on Reciprocal Trade (ART), a landmark deal aimed at reducing or eliminating most tariff and non-tariff barriers on American imports in Taiwan. This agreement is complemented by an investment deal from January, which includes $500 billion in new US investment, particularly in the semiconductor and AI-adjacent industries. Taiwan has committed to aligning its export controls with the US Foreign Direct Product Rule on semiconductors and maintaining robust research security measures, including refraining from agreements with the PRC on critical technologies. However, a major US arms sale to Taiwan, reportedly a $20 billion package for the "T-dome" IAMD network, is facing potential delays as the US reportedly hesitates to fulfill it, fearing it could derail President Donald Trump's upcoming visit to Beijing. Chinese Foreign Minister Wang Yi warned the US at the Munich Security Conference around February 13, 2026, against "plotting" on Taiwan, stating it could lead to "confrontation".

• Security Incidents and Threats
  Computer systems at the Taipei Grand Hotel were compromised in a cybersecurity incident discovered on February 17, 2026, during the Lunar New Year holiday. The hotel shut down its networks for forensic analysis, and the Ministry of Justice Investigation Bureau is investigating due to potential national security implications, with customer data possibly compromised. This incident highlights the ongoing threat of cyberattacks, which Taiwan's updated civil defense handbook also addresses, warning citizens about misinformation campaigns, including deepfake videos, designed to undermine national resolve.

• Defense Acquisitions and Arms Deals
  Taiwan conducted its first military exercise of the year involving US-made HIMARS multiple rocket launchers on January 27, 2026, in Taichung, showcasing deep-strike capabilities. Taiwan has acquired 29 HIMARS launchers, with 11 delivered in 2024 and the remaining 18 expected by the end of 2026, alongside plans for an additional 82 systems. Taiwan also expects to receive the first two of four MQ-9B "SkyGuardian" drones from the US in the third quarter of 2026. However, the delivery of all 66 F-16 Block 70 fighter jets from the US is delayed beyond the end of 2026 due to manpower shortages and supply chain disruptions.

• Cybersecurity
  Beyond the Taipei Grand Hotel incident, Taiwan is actively addressing cybersecurity threats. The CYBERSEC 2026 conference, Taiwan's leading cybersecurity event, is centered on "RESILIENT FUTURE" and is taking place, featuring over 300 expert sessions and 400+ international cybersecurity brands. An International Conference on Cybersecurity and Cloud Computing (ICCCC) was also scheduled for February 26, 2026, in Taipei City. Chinese "gray-zone" tactics are predicted to include intensified cyber disruptions in 2026.

• Maritime and Border Security
  The PRC may be employing signal spoofing to create illusory Automatic Identification System (AIS) signals of Chinese vessels, including a China Coast Guard (CCG) ship, within a Taiwanese harbor (Tamsui River in New Taipei). This activity, observed since May 2023 through February 2026, is assessed as a cognitive warfare effort to degrade Taiwan's threat awareness. Taiwan's increased defense budget for 2026 includes, for the first time, funding for its coast guard, indicating a strengthened focus on maritime security.

• Intelligence Activities
  Chinese "gray-zone" measures are expected to intensify in 2026, encompassing cyber disruptions, economic coercion, and maritime incidents, creating a dangerous "new normal" where miscalculation is increasingly possible. The updated civil defense handbook explicitly warns against "hostile foreign forces" exploiting misinformation, including deepfake videos, and local collaborators to divide and weaken Taiwan.

Geopolitical Impact and Regional Dynamics

The period from February 19-26, 2026, underscored Taiwan's central position as a strategic flashpoint in East Asian geopolitics, with developments significantly impacting regional stability and relations with major powers. The ongoing "Fourth Taiwan Strait Crisis" is characterized by graduated pressure and strategic signaling rather than immediate full-scale conflict, reflecting an evolution in great-power competition. China's persistent military posturing and "gray-zone" tactics, including large-scale exercises and suspected signal spoofing, aim to demonstrate capability and normalize pressure on Taiwan, directly challenging the existing status quo.

Relations with the United States remain robust but complex. The signing of the Agreement on Reciprocal Trade (ART) on February 12, 2026, solidifies economic ties, particularly in the critical semiconductor and AI sectors, and aligns Taiwan's export controls with US regulations. This economic interdependence acts as both a stabilizer and a vulnerability in the broader strategic landscape. However, reported US hesitation on a significant arms package to Taiwan, potentially to facilitate an upcoming summit between Presidents Trump and Xi, introduces uncertainty and raises concerns in Taipei about the consistency of US commitment. The US House of Representatives' passage of the PROTECT Taiwan Act, threatening financial exclusion for China if it threatens Taiwan, signals strong bipartisan legislative support for Taiwan's security.

China's actions are driven by its long-held claim over Taiwan and President Xi Jinping's political timeline, with the CCP's next major party congress in 2027 potentially compelling him to demonstrate resolve. Beijing views US and allied engagement with Taiwan as a direct challenge to its sovereignty and has issued strong warnings against "plotting" on Taiwan, threatening "confrontation". The recent purges within the People's Liberation Army (PLA) high command, while potentially reducing near-term invasion risk, are expected to lead to more aggressive invasion drills as new leadership seeks to demonstrate progress towards a 2027 readiness target. The joint statement from the US and the Philippines on February 18, 2026, reaffirming collective defense in the "first island chain" and condemning China's "coercive actions" in the South China Sea, further highlights regional efforts to deter Chinese aggression and maintain freedom of navigation.

Military and Defense Analysis

Taiwan's military and defense posture during this period reflects a determined effort to enhance its deterrence capabilities against a potential Chinese invasion. The planned 22.9% increase in defense spending for 2026, reaching 3.32% of GDP, marks a significant commitment to modernization and self-reliance. This funding is crucial for acquiring new equipment, including advanced fighter jets and naval defenses, and notably, the integration of the coast guard into the overall defense budget for the first time.

Modernization programs are actively underway, with Taiwan conducting its first military exercise of 2026 involving US-made HIMARS multiple rocket launchers on January 27, demonstrating its deep-strike and joint operations capabilities. The anticipated delivery of the first two MQ-9B "SkyGuardian" drones in the third quarter of 2026, along with 28 Abrams tanks, will further bolster intelligence, surveillance, reconnaissance, and strike capabilities. However, delays in the delivery of F-16 Block 70 fighter jets due to external factors present a challenge to air force modernization timelines. The ongoing development of the "Taiwan Shield" or "T-Dome" integrated air and missile defense network is a strategic priority, aiming to create a multi-layered defense against aerial threats. Taiwan's decision to extend compulsory military service to one year also reflects a commitment to strengthening its manpower and readiness. The focus of the upcoming Han Kuang exercises on countering a blockade and preserving combat forces, including the use of civilian infrastructure, indicates a realistic assessment of potential invasion scenarios and a shift towards asymmetric defense strategies.

Outlook and Forecast

Short-term trends (1-3 months) indicate a continuation of heightened tensions in the Taiwan Strait, characterized by persistent Chinese "gray-zone" activities. We can expect an increase in the volume and aggressiveness of Chinese invasion drills, particularly as new military leadership in Beijing seeks to demonstrate progress following recent purges. These drills may include further maritime incidents, airspace incursions, and sophisticated cognitive warfare tactics, such as AIS signal spoofing, aimed at degrading Taiwan's threat awareness and undermining public confidence. Taiwan will proceed with its Han Kuang exercises in May, focusing on blockade countermeasures, which will likely be closely monitored and potentially provoke further reactions from Beijing. The fate of the proposed US arms package to Taiwan will be a critical indicator, as any suspension could embolden Beijing and signal a shift in US commitment.

Critical flashpoints and risk areas include potential disruptions to commercial aviation and maritime traffic due to intensified Chinese drills. The ongoing cybersecurity threat remains significant, as demonstrated by the Taipei Grand Hotel incident, and critical infrastructure and government systems are likely to remain prime targets for state-sponsored attacks. Misinformation campaigns, including deepfakes, will continue to be a tool for "hostile foreign forces" to sow discord within Taiwan. The upcoming summit between US President Trump and Chinese President Xi Jinping in April 2026 will be a crucial period, as any concessions regarding Taiwan could significantly alter the regional dynamic.

Indicators to monitor include the frequency and scale of PLA military exercises, particularly those simulating blockades or amphibious assaults. Any changes in the rhetoric or actions of Chinese Foreign Minister Wang Yi and other senior officials regarding Taiwan will be important. The progress of US arms sales and the implementation of the US-Taiwan Agreement on Reciprocal Trade will also provide insights into the strength of bilateral ties. Domestically, public and legislative reactions to Taiwan's increased defense spending and civil defense initiatives will be key indicators of societal resilience.

Strategic recommendations for Taiwan include continuing to prioritize asymmetric defense capabilities, focusing on mobile, survivable systems that can counter a larger adversary. Accelerating the "Taiwan Shield" IAMD network and investing in robust cybersecurity defenses are paramount. Diplomatically, Taiwan should continue to strengthen substantive ties with like-minded democracies, diversifying its partnerships beyond the US where possible, while advocating for consistent and clear support from Washington. Domestically, enhancing public awareness and resilience against cognitive warfare and misinformation campaigns is crucial for maintaining social cohesion and national resolve.

Sources

• visiontimes.com
• onedecision.com
• navalnews.com
• understandingwar.org
• militarnyi.com
• straitstimes.com
• understandingwar.org
• latimes.com
• globaltaiwan.org
• moderndiplomacy.eu
• arabnews.jp
• taiwannews.com.tw
• tbsnews.net
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• allconferencealert.com
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• ocac.gov.tw