U.S. Congress passes funding bill that gives loans, but not grants, to Taiwan to buy weapons

Washington, Dec. 23 (CNA) A United States government funding bill for 2023 that includes provisions to authorize US$2 billion in loans to Taiwan, but not grants, to buy weapons from the U.S. cleared the Congress on Friday following a House of Representatives vote.

The US$1.65 trillion Omnibus Consolidated Appropriations Act, covering funding for the U.S. government for fiscal year 2023, was approved by the House of Representatives in a 225-201 vote, with one abstention.

The appropriation bill, which cleared the Senate the previous day and now awaits President Joe Biden's signature to take effect, would provide a record US$858 billion in defense funding - a 10 percent increase over the funding in 2022 - and US$772 billion in non-defense funding.

According to the bill, the U.S. would also allow up to US$2 billion in direct loans to Taiwan under the "Foreign Military Financing Program" and Taiwan would be required to pay off the loans within 12 years.

The bill, however, does not include 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 mentioned in the National Defense Authorization Act for Fiscal Year 2023 (FY23 NDAA) , which was signed into law by Biden earlier on Friday.

Despite the enactment of the NDAA, grants and loans must still be proposed through appropriation bills and approved by the U.S. Congress before Taiwan can receive them. Even though the NDAA includes the provision of grants, according to U.S. law, funding is not provided if it is not included in the Appropriations Act.

The appropriation bill would also authorize funding to support a fellowship program that offers the opportunity for U.S. federal government employees to live and work in Taiwan for two years.

Outside of financing, the NDAA authorizes establishing a regional contingency stockpile for Taiwan using excess defense articles, giving Taiwan the status of NATO allies, major non-NATO allies, and the Philippines.

Furthermore, the NDAA mandates that the Department of State (DOS) and the Department of Defense (DOD) prioritize and expedite the processing of requests for weapons from Taiwan under the Foreign Military Sales program and may not delay the processing of requests for bundling purposes.

In addition, the NDAA includes a nonbinding provision, stating Taiwanese naval forces should be included in the Rim of the Pacific exercise, as appropriate, in 2024, but does not require the U.S. administration to invite Taiwan to join the drills.

Meanwhile, Taiwan's Ministry of Foreign Affairs (MOFA) said in a statement that the NDAA's enactment and the passage of the consolidated appropriation act amply demonstrated Congress' emphasis on relations between Taiwan and the United States and support for strengthening Taiwan's security.

According to the statement, both pieces of legislation contain provisions that would provide a legal basis and policy tools for Washington to expand partnerships with Taiwan in various domains.

The statement added Taiwan's government would work closely with all branches of the U.S. government to ensure those provisions are realized in line with national policy.