Taiwan plans to boost defence spending by a fifth next year, surpassing 3% of gross domestic product, as it invests billions more in new equipment to better face down China and convince the United States it takes seriously calls to bolster its military.

Taiwan's cabinet will propose defence spending of T$949.5 billion ($31.27 billion) for next year, accounting for 3.32% of gross domestic product, the official Central News Agency reported on Thursday.