The one-day meeting in a Virginia suburb is a regular annual event to examine Taipei's arms requirements for the forthcoming year. This time though, it coincides with China's naval and military exercises designed to intimidate the island ahead of its presidential elections this weekend - and for all its criticism of the Peking tactics, the Clinton administration is believed to be opposed to new arms deliveries to Taiwan on the grounds they would make an already fraught situation even more so.
Even as the talks began here, the usually soft-mannered Defence Secretary, William Perry, used a speech to members of Congress to warn Peking that the US had "the best damn navy in the world", and that the two aircraft- carrier battle groups which Washington has dispatched to the area were proof that for all China's build-up of its armed forces, "the strongest military power in the Western Pacific is the United States".
In fact, despite the use of live ammunition in the exercises, and the latest verbal salvo from Peking denouncing Washington's "brazen" and unwarranted "interference in Chinese internal affairs" in the waters around Taiwan, officials here are fairly confident that China does not plan to invade. Once the elections are out of the way the forces which have been deployed are expected, in Mr Perry's words, to "return to barracks". The US Secretary of State, Warren Christopher, will meet the Chinese Foreign Minister, Qian Qichen, in the Hague next month.
But Washington knows it is treading a fine line, one that could be fatally overstepped with one miscalculation. Hence the reluctance to commit to a new package of arms sales to Taiwan, which is about to start taking delivery of 150 F-16 fighters in a $5.8bn (pounds 3.8bn) deal bitterly opposed by China when President Bush gave his approval in 1992.
This year, according to the Washington Times, Taiwan is seeking six German-designed diesel submarines that would be built in US yards and cost some $4bn, as well as P-3 anti-submarine and reconnaissance planes, anti-ship missiles and Stinger anti-aircraft missiles. Taken together, the weapons would considerably improve the island's ability to resist any naval blockade by China.
But despite protests in Congress that the US should be standing up more resolutely for a democratic ally being bullied by a totalitarian neighbour, caution continues to be the administration's watchword. Speaking in Singapore yesterday, Peter Tarnoff, Secretary of Political Affairs and third-ranking official at the State Department, said deliveries of the F-16s would not be speeded up because of the crisis. "No imminent threat exists," Mr Tarnoff insisted, "but we are concerned about a possible miscalculation."
The new tension can only exacerbate the long running dispute over China's alleged pirating of US patents and software technology.
It also means that 1996 could be the year when, after several near-misses, the anti-China forces on Capitol Hill succeed in revoking Peking's most favoured nation (MFN) trade status. The administration supports another 12-month extension when MFN comes up for renewal in June, "but it is going to be a difficult issue in Congress", Robert Rubin, the Treasury Secretary, warned in a speech to US businessmen in Hong Kong yesterday.