TAIPEI, Nov 29 (Reuters) - For more than two decades, Taiwan
tried to buy a fleet of modern conventional submarines to fend
off an existential threat invasion by China. There were no
The United States, Taiwan's main ally, has a nuclear-powered
fleet and hadn't built diesel-powered subs in decades. Other
nations balked, fearful of angering Beijing.
Now, as China under President Xi Jinping steps up its
military intimidation of Taiwan, an array of foreign
submarine-technology vendors, with the approval of their
governments, are aiding a secretive program to build subs in
Taiwan. Taipei has stealthily sourced technology, components and
talent from at least seven nations to help it build an
underwater fleet with the potential to exact a heavy toll on any
Chinese attack, a Reuters investigation has found.
Taipei's chief foreign weapons supplier, the United States,
has provided key technology, including combat-system components
and sonars. But assistance is coming from far beyond America.
Defense companies from the United Kingdom, which like
America operates a fleet of nuclear-powered ballistic missile
and attack submarines, have provided crucial support.
A veteran of Britain's Royal Navy submarine fleet, retired
Commodore Ian McGhie, was a key figure in the drive to recruit
submarine expertise, according to a person familiar with his
role. McGhie helped a Gibraltar-based company hire engineers
including former Royal Navy sailors, the person said.
Britain also has approved multiple export licences in the
past three years for UK companies to supply submarine
components, technology or software to Taiwan, according to
information from the Department for International Trade obtained
via a Freedom of Information request. The value of submarine
technologies approved for export from the UK to Taiwan has grown
exponentially in recent years, government data analyzed by
Taipei also succeeded in hiring engineers, technicians and
former naval officers from at least five other countries:
Australia, South Korea, India, Spain and Canada. Based at a
shipyard in the port city of Kaohsiung, the experts have advised
the Taiwanese navy and state-backed shipbuilder CSBC Corporation
Taiwan, the company building the new submarines.
Taiwan scoured the globe for this submarine engineering
expertise, Rupert Hammond-Chambers, the president of the
US-Taiwan Business Council, told Reuters.
"It's a jigsaw," Hammond-Chambers said. Taiwan had to search
the international market for technology and components it was
unable to source domestically. So, he said, it "cut down the pie
to smaller pieces" to figure out which work required foreign
assistance, such as help in completing the design of the
The Taiwanese project, which officially began in 2017, is
formally known as the Indigenous Defense Submarine program. It
is codenamed Hai Chang, which means "Sea Prosperity" in Chinese.
Shipbuilder CSBC began construction last year and is aiming to
deliver the first of the planned eight vessels by 2025,
according to government statements. The value of the project is
estimated at up to $16 billion, according to the London-based
International Institute for Strategic Studies.
Informed about the findings of this article, a spokesperson
for China's foreign ministry said the Taiwanese "authorities are
colluding with external forces" on the program. The countries
concerned, the spokesperson said in a written statement, should
refrain from participating in the submarine effort, "stop
military ties with Taiwan and stop supporting the 'Taiwan
independence' secessionist forces."
These countries are "playing with fire, and those who play
with fire will get burned themselves," the spokesperson said.
Taiwan's defense ministry said the new submarines are
crucial for "the national defense forces' asymmetric warfare," a
reference to waging war against a superior military foe. It
added that various challenges facing the program have been
"eliminated" and it is being "implemented according to plan."
CSBC declined to comment.
FEAR OF REPRISAL
Some details of the sub project, including the involvement
of a small number of foreign engineers and some tenders for
equipment and expertise, have been previously reported by
Reuters and others. This report provides the most detailed
account yet of the program and the extent of foreign assistance
Taiwan is receiving. It is based on reporting in 11 countries
and interviews with more than 80 people, including current and
former officials, diplomats, former submariners and defense
industry sources. Reporters also analyzed corporate filings and
thousands of social media postings.
Two people in Taiwan with direct knowledge of the program
said project leaders devised a low-profile strategy to limit
Beijing's ability to pressure foreign governments and companies
not to work with Taipei. The Taiwanese team approached foreign
companies directly, rather than first requesting approval from
national governments, the two people said. With orders in hand,
the foreign companies then applied for export permits from their
Export approvals have now been secured for all the key
components, according to the two people and public statements by
Taiwan officials. Many of these parts are related to the combat
system, the two people said.
Still, fear of reprisal from Beijing has scuttled some
transfers. A German company that provided vital equipment
suddenly terminated a deal last year, according to the two
people. They declined to name the firm or the technology
involved. Managers from the supplier later disclosed to Taiwan
that the sale was blocked by its parent company, which has
extensive business interests in China.
To minimize such setbacks, the Taiwan team secured access to
two or three sources of many important technologies in the event
one of the suppliers pulled out, the two people said.
Taiwan's success in securing expertise and technology
reflects the West's mounting concern over China's expanding
military might and the pressure Beijing is exerting on the
island, foreign diplomats say. In September, Britain and the
United States struck a deal with Australia to help Canberra
build nuclear-powered subs as America and its allies respond to
China's military build-up. Two weeks later, Britain sent a
warship through the Taiwan Strait for the first time since 2008.
The submarine aid is a breakthrough for isolated Taipei,
which doesn't have official diplomatic recognition from the
nations that approved export permits for the project. "Taiwan
isn't really that lonely," said one of the people in Taiwan with
knowledge of the program. "Given all the export permits we
managed to get, we know that many countries are helping."
Asked about British help on the project, a UK government
spokesperson said that Britain's "longstanding policy on Taiwan
has not changed: we have no diplomatic relations with Taiwan but
a strong, unofficial relationship, based on dynamic commercial,
educational and cultural ties."
"The United States will continue to make available to Taiwan
the defense articles and services necessary to enable Taiwan to
maintain a sufficient self-defense capability," a U.S.
Department of State spokesperson said in response to questions
about the program. "Doing so increases stability both across the
Taiwan Strait and within the region."
Beijing insists Taiwan is part of China and has called
repeatedly for peaceful unification, but refuses to rule out
using force to bring the island under its control. President
Tsai Ing-wen says Taiwan is an independent country called the
Republic of China, its official name, and has vowed to defend
its freedom and democracy. As Chinese shipyards churn out the
warships that would be required for an invasion, a fleet of
modern submarines would significantly boost Taiwan's firepower.
China has 58 submarines, six of them nuclear-powered
ballistic missile vessels, according to the Pentagon. Taiwan's
navy deploys just four subs. Two are World War Two vintage:
U.S.-made Guppy-class submarines, in service with Taiwan since
1974, that are only fit for training. The other two are more
modern: Sea Dragon-class submarines built in the Netherlands and
commissioned in 1987.
The eight new submarines, plus the Sea Dragons, would pose a
deadly threat to an invasion fleet, say veteran Western,
Japanese and Taiwanese submariners. Armed with powerful
torpedoes and anti-ship missiles, these vessels could attack the
convoys of troop transports and warships that China's military,
the People's Liberation Army (PLA), would need for any landing
The two people in Taiwan with direct knowledge of the sub
program said the vessels would also be deployed in the deeper
waters east of the island. That would help keep open ports along
Taiwan's eastern coastline, which is furthest from China, for
resupplies in a conflict.
The subs would also exploit a weakness of the PLA navy,
which analysts say still lags America and its allies in advanced
anti-submarine warfare capability. The presence of subs off the
Chinese coast would force China to maintain continuous
anti-submarine operations. "A torpedo's firepower is much
greater than missiles or guns," said Vice Admiral Tatsuhiko
Takashima, who retired last year as commander of the Japan
Maritime Self-Defense Force's submarine fleet.
Not everyone believes the submarine program is what Taiwan
needs. Some strategists say Taipei should be investing primarily
in smaller, cheaper but lethal weapons, such as mobile
anti-aircraft and anti-ship missiles. If camouflaged and
deployed in cities and mountains, these weapons could pound a
PLA invasion force before it reached Taiwan.
Former Taiwan military chief Lee Hsi-ming outlined this
doctrine before his retirement in 2019. Lee said the island
needed to preserve the ability to strike back at an invader in
the likely event of the loss of major conventional hardware such
as fighter jets.
Back in 2001, the United States agreed to supply Taiwan with
conventionally powered submarines as part of a bigger arms
package. But it had been decades since American shipyards built
these vessels, and so Washington was unable to deliver. The U.S.
submarine fleet is exclusively nuclear-powered.
Taiwan's efforts to obtain submarines elsewhere sank as
other nations feared offending China. Beijing downgraded
diplomatic relations with the Dutch after the Netherlands sold
Taiwan the Sea Dragons in the 1980s. To restore ties, the Dutch
foreign ministry told Reuters, the Netherlands signed an
agreement with China in 1984 stating it "would not approve any
new exports of military goods to Taiwan." That pact remains in
A turning point for the program was the election in 2016 of
President Tsai, whose ruling Democratic Progressive Party
champions creating a more robust military deterrent against the
PLA. A ruling party research group had been studying the issue,
and Tsai was determined to build new subs even before taking
office, said four people with knowledge of the project.
At an important 2015 meeting, a retired submarine commander,
Yang Yi, briefed Tsai on the importance of submarines, three of
the people said. Reuters was unable to contact Yang. Other top
navy officers, including the island's former military chief,
Admiral Huang Shu-kuang, strongly supported the project.
So, in 2017, with tension mounting in the Taiwan Strait, the
defense ministry signed a memorandum of understanding with CSBC
to officially begin the program to build a submarine of Taiwan's
Former military chief Huang, now senior adviser on the
National Security Council, gave updates to lawmakers on the
project that were treated with extreme secrecy. Lawmakers had to
sign a confidentiality agreement, said a person who attended the
briefings. In some of the meetings, held over the past few
years, navy officers brought in a model of the submarine in a
cardboard box before it was revealed to the lawmakers. The model
looked different each time, the person said, as the designs
In a meeting late last year, the navy presented
documentation of export permits issued by foreign governments
for lawmakers to review. The names of the companies were coded,
and lawmakers had to consult a manual to see which firms were
assisting in the program, the person said. Each time a lawmaker
used the manual, their name and the page numbers they viewed
Obstacles remain. Building a submarine from scratch is
expensive and technically challenging. Taiwan has also had to
contend with the refusal of established conventional submarine
builders to provide a design or other assistance.
The Netherlands, for instance, has agreed to maintain the
two existing Sea Dragons. But the country is not engaged in
Taiwan's new sub. Asked why, the Dutch foreign ministry said
that under the 1984 agreement with Beijing, the government
wouldn't approve any new export permits for military equipment
to the island.
Tokyo, one of America's closest allies, has also been
reticent to get involved. Japan operates one of the world's most
advanced conventional submarine fleets. The idea of helping
Taiwan was informally discussed in Japan but was dropped out of
concern over how China might react, according to two senior
defense ministry sources in Tokyo.
One reason for Japan's hesitancy is fear of the economic
consequences of offending Beijing, said retired Vice Admiral
Yoji Koda, a former fleet commander of the Japanese Maritime
Self-Defense Force. Japanese companies that would stand to lose
business in China for helping Taiwan are a powerful lobby, Koda
Japan's defense ministry declined to comment.
To keep its suppliers on board, Taiwan has proceeded
quietly. Some hints of the international support have trickled
In November last year, CSBC's chairman, Cheng Wen-lon,
confirmed that foreigners had worked alongside the shipbuilder's
in-house staff to draft the blueprints. "Our staff drew the
blueprint by themselves, of course, with assistance from foreign
technical personnel, but we did the main body ourselves," he
said in response to questions from Taiwanese lawmakers. Cheng
told legislators he was not allowed to reveal where the foreign
technical assistance was coming from, however.
A little-known company that was incorporated in the British
Overseas Territory of Gibraltar in 2013 provided a key talent
pipeline. The company, Gavron Limited, headed by two Israelis,
won a contract to provide technical advice to CSBC. The contract
was for about T$600 million ($20 million), according to a 2018
defense ministry press release. Corporate filings list the two
directors of Gavron as Gil Yossef Cooper and Arie Beizer.
Beyond the news that it secured a contract and has recruited
some engineers for the project, little has been disclosed about
Gavron's role. A Gavron manager told Reuters he couldn't answer
questions without first getting permission from the client. The
manager declined to make Cooper and Beizer available for
On its website, Gavron says it offers "decades of experience
from consultants such as nuclear submariners ... as well as
others with niche technical skills." The company also says that
"many" of its consultants were career submariners in the British
This included McGhie, the former senior Royal Navy
submariner who recruited engineers to work on the Taiwan
project. A 2017 job ad for a submarine engineer for Gavron in
Taiwan was posted on an online European job platform. It listed
McGhie as the contact person.
Work would include "pressure hull and major bulkhead design
review," the ad said. Both are crucial elements: The pressure
hull, made of specialized steel, is the structure that keeps the
submarine watertight when it submerges. It must withstand
enormous forces. The bulkheads are interior structures that
divide the submarine into sections to reinforce the pressure
hull and allow flooded compartments to be sealed in an
Contacted by Reuters for comment, McGhie said he would need
to seek permission from Gavron to talk about the project because
of the sensitivity of the client and his own contractual
obligations. He didn't specifically mention Taiwan. In a
follow-up email, McGhie said there were "some inconsistencies
and minor inaccuracies" in this account of his and Gavron's
role, but he did not elaborate. In his LinkedIn profile, he says
he assisted a Gibraltar company in securing "a multi-million
pound, complex technical service to a Client in the heavy
industry sector in the Far East."
McGhie was the commander of British forces in Gibraltar
until 2016, according to a UK government web page. His LinkedIn
profile notes that he spent 32 years in the military and was
part of a team that "devised, negotiated and delivered" the UK's
first National Cyber Security Programme, a £650 million project,
while he was at the Office of Cyber Security in Britain's
A JAPANESE FOLKTALE
Reuters found at least 12 foreign engineers who said in
interviews or on social media that they had worked on the
submarine program or worked for Gavron in Taiwan.
These recruits a mix of young and veteran submarine
experts had experience working on advanced submarine programs.
These included the S-80 built by Spanish state-owned shipbuilder
Navantia and Britain's nuclear-powered Astute-class attack subs
built by BAE Systems, according to the recruits' social media
In a 2017 article posted on his university's website, Juan
Herrero Valero, a Spanish naval architect, said he started
working that year for a British company in Kaohsiung on the
Taiwan program. He said he was recruited for the project after
being approached via LinkedIn. "I was really surprised because
I'm very young," the engineer said in the article. He noted that
he was in Taiwan working with far more experienced engineers.
"But the consulting team has trusted me." He declined to speak
Last month, the United States disclosed with little fanfare
that it would approve the sale of key technology for the
project. The word came in a State Department letter to Congress
dated Jan. 5, which was posted in October in the Federal
Register, the official publication of U.S. government notices.
Washington was prepared to license transfers of technical data
and services to Taiwan, Italy and the UK valued at $50 million
or more to support Taiwan's submarine project, the letter said.
The technology would "support the integration, installation,
operation, training, testing, maintenance, and repair of
systems" supporting the program, the letter said.
Washington has kept a lid on most details, however,
including which U.S. companies are involved. According to two
sources in Taiwan, Lockheed Martin Corp is providing the subs'
combat system, which integrates and displays sonar and other
sensor data to allow commanders to engage targets. Raytheon
Technologies Corp is supplying the sonars, the sources said.
In 2018, Lockheed posted a recruitment advertisement on
JobSearcher.com, an online job site, for a deputy program
manager for work on Taiwan's existing Sea Dragon submarines and
the design phase of the new indigenous sub program. Candidates
must have "foreign language skills in Mandarin Chinese," the
posting said. Earlier this year, Lockheed advertised on another
online jobs site for a combat systems engineer for work on the
Sea Dragon and the new sub.
Lockheed and Raytheon declined to comment for this story.
The aid to Taiwan is in line with longstanding U.S. policy.
Since Washington switched diplomatic recognition from Taipei to
Beijing in 1979, U.S. administrations have been required by law
to provide Taiwan with the means to defend itself.
British companies also are playing a key role. In response
to a freedom of information request, the UK's Department for
International Trade disclosed that 28 "applicants," or corporate
entities, had been granted licenses in the past three years to
export submarine components, technology or software to Taiwan.
The department didn't specifically mention the submarine
The list included QinetiQ Ltd, a high-tech defense company.
Three people with knowledge of the matter confirmed QinetiQ was
involved in Taiwan's program. One said the company provided
advice on underwater safety management. QinetiQ declined to
A Canadian subsidiary of Britain's BMT Group Ltd has also
been involved. BMT is a contractor for the UK nuclear submarine
fleet. BMT Canada Ltd, the subsidiary, was hired to provide
consulting and engineering advice, said four people with
knowledge of the deal. This included reviewing plans drawn up by
CSBC, said one of the people.
BMT Group declined to comment. Global Affairs Canada had no
comment on BMT Canada's involvement. "Canada does not maintain
military-to-military or defense relations with Taiwan," the
foreign ministry said in a statement.
The value of submarine technologies and equipment approved
for export from the UK to Taiwan has grown dramatically, a
Reuters analysis of government data shows.
Between 2011 and 2017, Britain approved export licenses for
the sale of at least £323,549 ($432,000) worth of sub equipment
to Taiwan. That jumped to at least £158 million ($211 million)
between 2018 and March this year. The equipment included test
models and software. The UK data did not specify if the exports
were for the new sub program.
As Taiwan pushes to complete the first vessel by 2025, the
two people with knowledge of the program said their main
concerns are delays to the import of equipment because of
COVID-19 and possible pressure on suppliers by China.
For now, the multinational effort is holding. A person in
Taipei with knowledge of the project likened it to the Japanese
folktale Momotaro, in which a lone boy gets help from a group of
unlikely allies a dog, a monkey and a pheasant to defeat a
"We all gathered together to defeat the demon," the person
(Reporting by Mari Saito, Yimou Lee, Ju-min Park, Tim Kelly,
Andrew MacAskill, Sarah Wu and David Lague. Additional reporting
by Ben Blanchard, Anthony Deutsch, Devjyot Ghoshal, Emily Chan,
Kazuhiko Tamaki, Nobuhiro Kubo, Mike Stone, Lefteris Papadimas
and Michele Kambas. Edited by Peter Hirschberg.)