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Taiwan is planning to upgrade its F-16 fighter jets as well as purchase new subs, fast attack craft and surface-to-air missiles as it tries to counter what it warns is a growing military threat from China.

But Taiwan is also facing economic issues. It has announced a $11.4 billion U.S. budget, which is a one per cent increase from last year, the Associated Press news service reports.

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The country’s Defence Minister Feng Shih-kuan told lawmakers that Taiwan is also focusing on inexpensive but effective “asymmetric warfare” techniques to combat threats in the air and seas from China. Taiwan would also seek more surface-to-air missiles and a revitalized Navy deploying domestically made submarines and fast-attack craft, according to the Associated Press.