Outlandish rumors spread on social media about U.S. military loan and grant to Taiwan

In December 2022, U.S. President Joe Biden signed into law a government funding bill for 2023 that includes provisions to authorize US$2 billion in loans to Taiwan to buy weapons from the United States.

However, the military financing program has sparked rumors and stories taking flight on social media lately, such as “the U.S. reneging on its commitment to provide a military grant to Taiwan,” and that the latter is “forced to take out loans from the U.S. every year.”

Meanwhile, there has also been another fabricated story about the Taiwan Fellowship Program, claiming that U.S. officials will be assigned to government offices in Taiwan this fall and be stationed long-term in the country to interfere in domestic affairs.    

The Taiwan FactCheck Center (TFC) recently spoke to several experts familiar with the matter to debunk these false beliefs.

About the military financing program

The Omnibus Consolidated Appropriations Act covers funding for the U.S. government for the fiscal year 2023, and for providing emergency assistance for the situation in Ukraine, and also other purposes.

In its provisions regarding Taiwan, the Act allows up to US$2 billion in direct loans annually to Taiwan from 2023 to 2027, for military purposes under the "Foreign Military Financing Program,” while requiring loans to be repaid within 12 years.

The bill does not include, however, provisions to provide US$10 billion worth of grants -- US$2 billion over the next five years -- for Taiwan to buy U.S.-made weapons, as authorized in the National Defense Authorization Act for Fiscal Year 2023 (FY23 NDAA). 

The NDAA was signed into law by Biden on Dec. 23, but for its funding provisions to be carried out, they must still be approved in the appropriations act.

About the military grant

Chieh Chung (揭仲), a research fellow with the Association of Strategic Foresight, told the TFC in a fact-checking article that the committees on appropriations in Congress conduct reviews of the appropriations act each year.

For the fiscal 2023 budget, it was determined that there would be no U.S. grant to Taiwan this year, but that does not mean there will be none between 2024 and 2027, Chieh explained.

The U.S. government stopped short of including the grant after Biden met with Chinese President Xi Jinping late last year, probably because Washington did not want to make the U.S.-China relation even more difficult than it already has, he said.

Lee Che-Chuan (李哲全), a researcher at the Institute for National Defense and Security Research, believes the grant was not included in the appropriation bill this year due to the limited U.S. government funding.

Military financing program to Taiwan

There are no provisions within the FY23 NDAA and the Consolidated Appropriations Act that stipulate the financing program must be forced upon Taiwan, Lee said.

The US$2 billion loan mentioned in the appropriations act must be agreed upon by both Taiwan and the U.S. before it can be made available, Chieh said, and therefore Washington will in no way compel Taiwan to seek a loan if it is not needed.

The U.S. will likely not bring this topic up again this year as the country works to improve relations with Beijing, he said.

False claims about the fellowship program

The appropriations bill also authorizes funding from the American Institute of Taiwan's (AIT) budget to support a fellowship program under the Taiwan Fellowship Act that offers the opportunity for U.S. federal government employees to live and work in Taiwan for two years.

The Act states that after consulting with the AIT director, the U.S. secretary of state is required to present an executive plan for the fellowship program to the committee on appropriations.

A Facebook post circulating since last December claimed that under the fellowship program, U.S. officials assigned to Taiwan would be stationed long-term in the country to interfere in domestic affairs. The TFC published a fact-check on this false claim.

Yen Chen-Shen (嚴震生), a researcher at National Chengchi University’s Institute of International Relations, said the program provides support for U.S. federal government employees to live in Taiwan for a two-year fellowship, and therefore they will not be “stationed in the country” as mentioned in the fabricated story.

The selected U.S. officials will spend up to two years in Taiwan, focusing on learning Mandarin, Yen said, and that they will be here to better understand the country and forge friendships with Taiwanese government officials.

The first year is to be spent studying Mandarin and related topics, followed by a year working in a government agency, Lee said.

They will not serve long-term assignments in Taiwan, he said.

According to a senior Taiwanese diplomatic official, the legislation is modeled after the Mansfield Fellowship Program between the U.S. and Japan.

Under that program, established in 1994, U.S. government employees are provided more than one year of Japanese-language education and placed in a Japanese agency, where they work full-time for 10 months alongside Japanese colleagues.

Featured image: Taiwan's President Tsai Ing-wen poses for photos from the cockpit during a ceremony to commission into service 64 upgraded F-16V fighter jets at an Air Force base in Chiayi in southwestern Taiwan Thursday, Nov. 18, 2021. Taiwan has deployed the most advanced version of the F-16 fighter jet in its Air Force, as the island steps up its defense capabilities in the face of continuing threats from China. (Top image/ AP Photo/ Johnson Lai)