Ministry of National Defense: HIMARS Arms Purchase First Installment Due May 31, Non-Payment Risks Cancellation

Central News Agency

(Central News Agency Reporter Yu Kai-hsiang, Taipei, 6th) The first installment payment for the HIMARS multiple rocket launcher system was originally due on March 30, but the U.S. later agreed to extend it until the U.S. and the contractor finalize negotiations. Major General Huang Wen-chi, Director of the Ministry of National Defense's Strategic Planning Department, pointed out that May 31 is the deadline for the first installment payment. If it is not paid, the case will be cancelled. If a new procurement process has to be restarted at that point, it will be time-consuming and face price increases.

The Legislative Yuan's Foreign Affairs and National Defense Committee invited Minister of National Defense Gu Lixiong to deliver a work report and be questioned this morning.

Regarding issues related to the special defense budget, Gu Lixiong responded to legislator Li Kun-cheng of the Democratic Progressive Party, stating that it is not a normal practice for the Legislative Yuan to authorize the Ministry of National Defense to sign Letters of Offer and Acceptance (LOAs) in advance. In the past, the Ministry of National Defense would first prepare and submit the budget after receiving the U.S. intention to sell, and only after the Legislative Yuan approved the review and obtained the budget would the LOA be signed with the U.S. side.

Gu Lixiong pointed out that when the LOAs for four HIMARS multiple rocket launcher system cases (HIMARS, M109A7 self-propelled howitzers, TOW 2B anti-tank missiles, Javelin missiles) were obtained, the special defense regulations and budget had not yet been passed. Therefore, the Legislative Yuan's authorization for the Ministry of National Defense to sign the LOAs first was required. However, if the budget continues to be delayed, it will encounter the problem of the first installment payment.

Li Kun-cheng expressed concern about the deadline for the first installment payment. Major General Huang Wen-chi, Director of the Ministry of National Defense's Strategic Planning Department, pointed out that the first installment for the HIMARS multiple rocket launcher system is approximately NT$800 million, with a payment deadline of May 31. The deadlines for the other three cases have not yet been announced.

Huang Wen-chi emphasized that the last letter from the U.S. side clearly stated that the condition for delaying the first HIMARS installment payment was that it must be paid on schedule by May 31. If not, "the case will be cancelled." If cancelled, the entire process would have to be restarted. Based on the HIMARS case, it currently takes about 8 months of work under close cooperation between both sides. If Taiwan proposes it again in the future, the work period will definitely exceed 8 months, and it will face price increases.

Li Kun-cheng believes that the chance of obtaining the budget by May 31 is not high, because U.S. President Trump and Chinese President Xi Jinping will meet in mid-month, and Legislative Yuan President Han Kuo-yu will also visit abroad. Even if the regulations are passed, the budget still needs to be reviewed and approved subsequently.

The first installment payment for the HIMARS multiple rocket launcher system was originally due on March 30. On March 29, the Ministry of National Defense stated that after close coordination between Taiwan and the U.S., the U.S. side had agreed to extend the first installment for 82 sets of HIMARS multiple rocket launcher systems until the U.S. and the contractor finalize negotiations.

According to the Foreign Military Sales (FMS) case process, after both parties sign the LOA, Taiwan must remit the first installment to the designated account of the U.S. Defense Security Cooperation Agency (DSCA) by the agreed date. Only after the U.S. government confirms receipt of the payment can it formally negotiate and sign production contracts with weapon manufacturers (Lockheed Martin for HIMARS) and other weapon producers on behalf of Taiwan.

Therefore, if the payment is not made on schedule, the U.S. side usually cannot initiate the negotiation process, which will cause production schedules to be postponed or replaced by other countries, thereby affecting the final delivery schedule. (Edited by Su Chih-chung) 1150506

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