WEBVTT - Tony Capaccio on Taiwan (Audio)

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<v Speaker 1>Now Taiwan could soon receive a package of one hundred

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<v Speaker 1>Patriot missiles from the US. The cost approximately eight hundred

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<v Speaker 1>two million dollars for those let's get closer to the show.

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<v Speaker 1>We we're joined by Tony Cappaccio, who is a Bloomberg

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<v Speaker 1>Pentagon reporter. Tony, thanks so much. So this is fascinating

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<v Speaker 1>because this is brand new hardware hardware. But but the

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<v Speaker 1>deal is morphed out of a twenty ten sales so

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<v Speaker 1>it's classified as as not really a new deal. What

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<v Speaker 1>what's the significance of all of this. That's a very

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<v Speaker 1>interesting way to put it. Morphed out of That's a

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<v Speaker 1>very interesting accurate way to say it. Yeah, this is

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<v Speaker 1>one way I think they can get away with saying

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<v Speaker 1>we don't have any new sales planned. But the hardware

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<v Speaker 1>is pretty interesting. The Taiwan has the Pack three and

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<v Speaker 1>they's earlier Pack two Patriots. These are what they call

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<v Speaker 1>hit to kill, with very sophisticated sensors that could they

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<v Speaker 1>hit the missile versus they explode next to one. So

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<v Speaker 1>this new version, it would be up to Taiwan to

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<v Speaker 1>put in a a sales order for what they call

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<v Speaker 1>this is a clubsy name, but it's called the Mission

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<v Speaker 1>Missile Segment Enhancements. Basically, it's the best Patriot missile the

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<v Speaker 1>US has. It can fire farther, it's fins making more maneuverable,

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<v Speaker 1>and it's just got a more powerful motor. So the

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<v Speaker 1>issue here is selling them on these missiles along with

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<v Speaker 1>test equipment and very importantly modifications to their current launcher

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<v Speaker 1>kits launchers basically and then upgraded software. This package of

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<v Speaker 1>two million dollars, it's a possible sale. I don't need

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<v Speaker 1>to say this would fall under the threshold of the

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<v Speaker 1>ten year old contract that had a maximum order of

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<v Speaker 1>two point eight one billion dollars. If it was over

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<v Speaker 1>that threshold, they'd have to say this was a new sale.

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<v Speaker 1>My understanding is that this the thail and he's a

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<v Speaker 1>couple of years ago, has signaled a budgeteer of budget

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<v Speaker 1>interest in doing this, and I gotta think this is

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<v Speaker 1>gonna move pretty fast after Congress approves it within thirty days.

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<v Speaker 1>That yeah, and Tony, the the the geopolitical dynamic of this,

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<v Speaker 1>because you have in and I went back and actually

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<v Speaker 1>read your story of of that China had reacted very

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<v Speaker 1>strongly and and what canceled partnerships with the US, So,

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<v Speaker 1>I mean, and things are very tense now, so it's

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<v Speaker 1>not out of the roma possibility they will be a

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<v Speaker 1>very strong reaction to this as well. There could be. Yeah,

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<v Speaker 1>I think the cuteness here is that it's not really

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<v Speaker 1>a new sale the Biden administration can say, but a

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<v Speaker 1>modification under an umbrella contract or more morphing. As you said,

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<v Speaker 1>I gotta think so that they are going to react

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<v Speaker 1>because this is a new, more powerful missile that can

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<v Speaker 1>fire longer and farther excuse me longer and maneuver better.

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<v Speaker 1>So so they're they're they're gonna be so So how

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<v Speaker 1>I mean, what now? What is the partnership between the

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<v Speaker 1>US and China militarily? What what could be hurt by this?

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<v Speaker 1>What's the gamble? I'm thinking it's not so much hurting

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<v Speaker 1>our relationships with China as them taking more provocative short

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<v Speaker 1>term actions like maybe additional missiles launchings or area intrusive

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<v Speaker 1>aerial demonstrations like they did when Speaker Pelosi visited Taiwan,

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<v Speaker 1>or you know what this made There may be nothing, Okay,

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<v Speaker 1>So what are we talking about here in the United States?

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<v Speaker 1>Does this have to be funded or can this can

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<v Speaker 1>this you said, move move quickly? Does this? Does Congress

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<v Speaker 1>get involved? How does it work? Congresses? They were when

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<v Speaker 1>what they call the informal stage, notification stage, and they

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<v Speaker 1>have thirty days to formally approve it. It's basically a

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<v Speaker 1>pocket veto. If they don't object, it goes through, and

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<v Speaker 1>then it's in Taiwan's ballpark to come up with a

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<v Speaker 1>funding request, I mean a sales request to the State Department.

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<v Speaker 1>Were not giving me things for free, but the process

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<v Speaker 1>is in motion. Got it all right, Tony? Thank you

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<v Speaker 1>for explaining that the process is a little bit complicated. Uh,

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<v Speaker 1>Tony cappacrio kindagon, of course, out of Bloomberg