Good morning and happy Sunday,

This is Pacific Weekly, a special edition of The Intel Brief intended to keep you updated on events across the hotly contested Indo-Pacific region.

Reporting Period: 20-26 January 2025

Bottom-Line Up Front:

US-Led Patrols In South China Sea Spark Chinese Response

Summary
From 17-18 January, the U.S. Navy and Filipino forces conducted a bilateral Maritime Cooperative Activity (MCA) in the South China Sea.
In response, on 21 January the Chinese Ministry of National Defense issued a navigation warning, stating PLA Navy exercises would be conducted in the South China Sea.

Findings

• MCA: A statement by the Commander of the U.S. Pacific Fleet states Maritime Cooperative Activities “demonstrate a collective commitment to strengthening regional and international commitment in support of a free and open Indo-Pacific.” The MCA is also an opportunity to develop tactical cohesion with allied personnel and their weapons systems.
  This MCA marks the first joint patrol in the South China Sea for 2025 and the fifth iteration total.

• U.S. Fleet: The U.S. 7th Fleet’s Carl Vinson Carrier Strike Group (CSG) carried out the MCA. The Carl Vinson was supported by a cruiser, two destroyers, and a P-8A patrol aircraft.

• Chinese Response: The PLA Navy conducted patrols in response to the U.S.-Filipino maneuvers. China’s navigation warning indicated PLA Navy vessels would be operating off the coast of Hainan, more than 700 miles from both Taiwan and Manila.

• Chinese-Filipino Relations: Relations between Beijing and Manila took a steep dive in 2024 due to various Chinese incursions into Philippine national waters and incidents at the Scarborough Shoal. Recently, the Philippine Coast Guard have been trailing Chinese Coast Guard vessel 3103, which has been patrolling approximately 90 miles off the coast of Zambales. Beijing has also denounced the continued deployment of American Typhon missiles to the Philippines, a decision which has persistently driven a wedge between Manila and Beijing and likely contributed to military incursions and confrontations.

Why This Matters
Continued naval actions in contested littorals, international waters, and national exclusive economic zones indicate the PLA will continue its policy of aggression and agitation as Xi pursues Taiwanese reunification and the pursuit of “9-Dash Line” interests.

Sources: Naval News, Newsweek, China MOD, United States Pacific Fleet, GMA News Online, GMA News Online

Xi Jinping Urges China, Russia To Expand Bilateral Relations

Summary
On 21 January, Russian President Putin and Chinese paramount leader Xi Jinping held a virtual meeting to reinforce the friendly bilateral relationship between Russia and China.

Findings

• Xi’s Remarks: Xi stated China and Russia should jointly focus on “defending” the “UN-centered international system” and safeguard their positions as permanent UN Security Council members. Xi proposed working closer with Russia to address “uncertainties of the external environment,” a dig at uncertainty around Trump’s foreign policy goals.

• Putin’s Remarks: Putin concurred with Xi’s remarks, and stated the two nations have increasingly aligned interests.

Why This Matters
The virtual meeting, which Putin and Xi held immediately following Trump’s inauguration, indicates growing relations between Moscow and Beijing despite common media coverage suggesting President Trump would overtly appease China and Russia and align with their interests.

Xi Jinping was invited to Trump’s inauguration as a sign of respect and diplomatic good-faith, but Xi snubbed the event to instead hold this meeting with Putin — a significant statement when we consider China’s apparent willingness to work with Trump and reach mutual interests.

Sources: YouTube, BBC

Taiwanese Legislature Slashes 2025 National Budget, Appeasing CCP Interests

Summary
On 21 January, opposition in Taiwan’s Legislative Yuan (legislature) finalized amendments to cut the 2025 budget for the Executive Yuan (executive branch). It is likely that the budget cuts will slow the DPP administration’s ability to develop critical anti-China and military growth policies.

Findings

• Legislative Opposition: The DPP government’s opposition in the Legislative Yuan (like a parliament), led by the Kuomintang (KMT) and (Taiwan People’s Party (TPP) filed the amendment for budget cuts.

• Budget Cuts: The amendment cuts 6.6% from the Executive Yuan’s budget. It is the largest budget cut in Taiwanese history. The budget was originally approved in August 2024 and included a record-breaking $19.75 billion defense budget.
  Taiwan’s Ministry of National Defense (MND) experienced a 3% budget cut. It includes the following:

  • 15% cut to personnel travel expenses (slows logistics, procurement, and training)

  • 60% cut to media and publicity expenses (slows recruitment, ability to counter CCP media narratives)

• Budget Freezes: The MND stated it experienced the following freezes:

  • 30% budget freeze to operating costs (affects procurement, maintenance, system’s combat readiness)

  • 50% budget freeze to submarine development program (slows submarine production, maintenance)

  • 50% budget freeze to drone manufacturing (slows drone production, research)

• Response: On 23 January, Taiwan’s Premier Cho Jung-tai said he intends to ask the Legislative Yuan to hold a revote in a bid to reverse the budget cut.

Why This Matters
The budget cuts pose serious risks to Taiwan which is critical due to the possibility of conflict with China in 2027.

Premier Cho Jung-tai stated 5 ways in which budget cuts will harm Taiwan:

• Weaken Taiwan’s economic competitiveness

• Weaken national defense by slowing growth of capabilities

• Slows investment into technological development

• Diminishes funding for public services and projects

• Restricts government communication channels with the public

From a defense perspective, the cuts hamper Taiwan’s ability to invest-in and expand projects that would help the island deter a PLA invasion.

From a political perspective, the cuts to administrative and cross-strait associated agencies reduces Taipei’s ability to resist CCP narratives regarding sovereignty over the island or the nature of Beijing’s cause.

The incident, overall, reflects the KMT’s growing sympathy and affinity for the CCP as it tries to find itself in leadership positions again. A 15 January 2025 article by the Council on Foreign Relations suggests that “The KMT opposes Taiwan’s independence and has consistently called for closer ties with Beijing,” and assessment that is supported by the deterioration of the Cross-Strait relationship following the DPP’s control of Taiwan since 2016.

Sources: Radio Free Asia, Focus Taiwan, ISW, CFR

Trump’s Pacific Policy Taking Shape: Rubio Makes Statement With “Quad” Allies, Holds Call With CCP Counterpart

Summary
Trump’s policy for China, Taiwan, and the Indo-Pacific region is beginning to take shape following the appointment of Marco Rubio as Secretary of State. Shortly after his appointment, Rubio held various meetings or calls with high-level foreign officials.

Findings

• U.S. Training Agreement: On 22 January, the American Institute in Taiwan (i.e. the unofficial embassy) stated it signed a deal with the Taiwanese navy which will establish and fund a two-year training program for the Taiwanese Navy.

• Quad Meeting: Hours after being sworn in as Secretary of State, Marco Rubio hosted the “Quad” members in Washington. The Quad — made of the U.S., Japan, Australia, and India — are a loose (due to India’s position) security and strategic partnership that is committed to “a free and open Indo-Pacific.” The Quad supports diplomatic solutions to ongoing security concerns, but implies it would act in a unified military manner against the CCP if deemed necessary.
  The joint statement clarifies that the Trump administration will increase coordination, cooperation, and investment with its Pacific allies.

• Call With Wang Yi: On 25 January, Secretary of State Marco Rubio held a call with his Chinese counterpart — Wang Yi — and affirmed America’s commitment to its Indo-Pacific allies will not waver under President Trump. Rubio voiced “serious concerns” over Chinese activity around Taiwan and the South China Sea, and stated he and Trump intend to advance “U.S. interests and put the American people first.”
  Rubio is also likely to draw criticism — and confusion — for his reported statement that “The United States does not support “Taiwan independence” and hopes that the Taiwan issue will be peacefully resolved in a way accepted by both sides of the Taiwan Strait.”

• Statement by The Select Committee: On 22 January, the Select Committee on the CCP outlined the myriad Chinese threats to the United States and the committees intention to work closely with the Trump administration.

Why This Matters
I am optimistic that Rubio’s initial meetings and statements are merely laying the groundwork for an Indo-Pacific policy that is much more clear and aggressive than it was under the Biden administration.

Biden’s critical failure in the Pacific was when he stated the United States may or may not intervene with military force during a Chinese invasion of Taiwan. There were some great deals made with Japan and the Philippines under Biden and then-Secretary of Defense Austin III, but U.S. policy was confused and disjointed.

It is my opinion that Trump and Rubio are testing the waters by laying out their “America First” ambitions; they are looking to see how Beijing reacts and what discussions they will bring to the table. It is very likely that when Trump and Rubio hold initial meetings with their counterparts, they will primarily discuss Sino-U.S. trade relations, economic sanctions and tariffs, Chinese espionage and IP theft, and the designation of Chinese firms as military affiliates.

Why? Depending on how those deals/conversations go, the Trump administration is likely to clarify its relationship to Taiwan. Formally, the U.S. does not (and has not) supported Taiwanese independence, in part because it supports China’s narrative of a incumbent separatist regime in Taipei. However, the U.S. is likely to support Taiwanese agendas in matters of bilateral action: economic aid, military aid, and weapons procurement.

Sources: The Defense Post, Kyodo News, The Select Committee on the CCP, The Korea Herald, SCMP

End Brief

That concludes this edition of Pacific Weekly.

Thank you for subscribing and I will see you tomorrow.

Nick