Taiwanese President Lai Ching-te vowed to defend Taiwan’s sovereignty in his New Year’s address, days after China concluded large-scale live-fire military drills around the island. Lai said democracies worldwide had condemned Beijing’s actions for undermining peace and stability in the Taiwan Strait. The drills followed China’s anger over a planned $11 billion U.S. arms sale to Taiwan and remarks by Japan’s new leader suggesting possible intervention in a conflict. Taiwan has announced a $40 billion defence budget and pledged to raise military spending to 5% of GDP as China reiterates threats of annexation.