Minister of National Defense Lee Jye said yesterday he is ready to make a 23 percent price cut to win legislative support for passing a US$18 billion arms purchase bill.

Taiwan is planning to buy six Pac-3 anti-missile systems, eight conventional submarines and a fleet of submarine-hunting P-3C aircraft from the United States.

The opposition alliance, which has a majority of two at the 225-seat Legislative Yuan, demanded a 50 percent cut in the quoted price, refusing to deliberate on a special budget bill for the purchase.

Lee told the press at an MND Chinese New Year party the price quoted in the local currency for the purchase last year was NT$610.8 billion, which at that time was equivalent to US$18 billion.

The local currency appreciated upward against the greenback over the year. It was NT$33 against the dollar in 2004. The New Taiwan dollar finished at 31.332 to the dollar yesterday.

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That alone slashed the price by NT$20.8 billion to NT$590 billion, Lee pointed out

Should the Legislative Yuan drop demands that the submarines be built in Taiwan, Lee went on, the price would be further lowered to only NT$480 billion.

Li Wen-chung, a senior Democratic Progressive Party lawmaker, urged Lee to submit a new purchase bill with a NT$480 billion price tag.

"Don't send us a NT$590 billion bill," Li said.

He said the NT$480 billion bill, which still falls far short of the opposition-demanded 50 percent cut, must be passed in the current Legislative Yuan session.

Washington is getting impatient, Li said. "The Americans, dissatisfied that we did not enact the purchase bill at our last session, are threatening to cancel the sale of the eight submarines if we do not act now," he claimed.

Taipei urgently needs the advanced weaponry in the face of a sustained arms buildup by Beijing. China has close to 600 ballistic missiles targeting Taiwan.

If the arms are purchased as scheduled, the defense minister said, they will help keep peace and stability in the Taiwan Strait for years to come.

Opponents complain Taiwan cannot afford the spending and the weapons may not be delivered in time to defend the island against a possible invasion from China.

They have demanded a solid U.S. assurance of assistance in exchange for that large defense spending.

Lee did not venture a direct response but thanked the United States for declaring together with Japan that peace across the Taiwan Strait is their mutual security concern.

"That may be so meant (it is tantamount to an offer of the solid American assurance of help in time of emergency)," Lee said.