American Marconi Wireless News - Taiwan leader says 'foreign forces' cannot decide island's future

Lai's remarks came days after US President Donald Trump suggested arms sales to Taiwan could be used as a bargaining chip with China, which claims the island is part of its territory and has threatened to seize it by force.

"Taiwan's future cannot be decided by foreign forces, nor can it be held hostage by fear, division, or short-term interests," Lai said in a speech to mark the second year of his presidency.

Trump's comments in an interview with Fox News and on board Air Force One followed a state visit to Beijing last week where Chinese President Xi Jinping pressed the US leader not to support Taiwan.

Since then, Lai's government has been on the offensive, insisting that US policy on Taiwan has not changed and that Trump made no commitments to China on arms sales to the island.

Taipei says China is the "root cause" of regional instability and US arms sales are a legal commitment to the defence of the island democracy.

In his remarks on Wednesday, Lai said his government was increasing defence spending to "prevent a war", not to start one, and noted that "threats are greater than ever before".

"Taiwan must have the capability to protect itself and to uphold peace and stability in the Taiwan Strait," Lai said.

Lai said Taiwan is willing to "engage in healthy and orderly exchanges with China" on an equal footing, but insisted "we will not sacrifice our sovereignty and democratic way of life."

- 'Status quo' -

Since Trump took office, Taiwan has been under intense pressure to spend more on its own protection and increase investment in the United States.

Taiwan has pouring billions of dollars into upgrading its military and developing its own defence industry, but the island remains heavily reliant on US sales of high-tech weaponry that it would need in a conflict with China.

Taiwan's parliament recently approved a $25 billion defence spending bill that will be used for US weapons.

Lawmakers have said the funds will cover nearly $9 billion of the $11.1 billion arms package announced by Washington in December and a second phase of arms sales -- not yet approved by the United States -- worth around $15 billion.

Trump has said China and Taiwan need to "cool down", and that he will decide on arms sales "over the next fairly short period of time".

Lai said Wednesday that if he has the chance to speak to Trump, who has raised the possibility of a call between the two leaders, he will emphasise that his government "upholds the status quo" and it's China "undermining" peace and stability.

Washington switched recognition from Taipei to Beijing in 1979. A conversation between Lai and Trump would be a major break in US diplomatic policy and risk a rupture with Beijing.

O.Norris--AMWN