China's central government will boost defense spending 12.2 percent this year as President Xi Jinping seeks to create a strong military and the navy extends its reach into neighboring waters.
The defense budget is set to rise to 808.23 billion yuan ($131.6 billion), the Ministry of Finance said in a report today. The percentage increase is greater than that of total government expenditure, which will rise 9.5 percent in 2014, according to the report.
Premier Li Keqiang told the opening session of the National People's Congress in Beijing today that China will continue to enhance border, coastal and air defenses.
"We will comprehensively enhance the revolutionary nature of the Chinese armed forces, further modernize them and upgrade their performance, and continue to raise their deterrence and combat capabilities in the information age," Li said. China will boost research on national defense and the development of new and high technology weapons, he said.
China's military modernization is increasing tension in the region as it challenges the guarantee of security provided by the U.S. for more than a half a century to sea lanes that handle the bulk of world trade. Xi has made a strong military a key priority for a revitalized China and said he wants the nation to be a maritime power.
‘Great Power'
China has also taken an increasingly assertive stance on territorial disputes that have lingered for decades with its neighbors. In November, China declared an air defense identification zone over a swathe of the East China Sea that includes islands disputed with Japan.
"Since China's defense spending is growing more quickly than any other country in the region, it always intensifies concerns about China's intentions as a great power," said Taylor Fravel, a professor at Massachusetts Institute of Technology who studies China's ties with its neighbors. "The presence of active disputes in the maritime domain plus the increasing pace of Chinese naval exercises in the Western Pacific and Indian Ocean further intensifies this concern."
Defense spending rose 10.7 percent to 720 billion yuan in 2013, the report said. China has the second-biggest military budget in the world after the U.S., though its outlay is still around five times less.
Chinese ‘Self-Defense'
A rising budget doesn't change the nation's path toward peaceful development, NPC spokeswoman Fu Ying said yesterday. China needs power to ensure peace, and a few neighboring countries are promoting the "China threat" concept, she said.
"China's military budget has already been increasing by an average of more than 10 percent annually for many years," said Denny Roy, a senior fellow at the Honolulu-based East-West Center whose work focuses on Chinese security issues. "In China's view, the Chinese military is still not large or powerful enough to meet the needs of what the Chinese would call self-defense."
That includes the capability to overturn any move by Taiwan toward independence or to enforce China's claims in the South China Sea, he said.
China contests almost all of the South China Sea, based on historical usage and a nine-dash line that extends hundreds of miles south from Hainan Island, where China has a naval base, to the equatorial waters off the coast of Borneo.
Maritime Escalation
China's neighbors have not sought to match its pace of defense spending, though they are shifting the composition of their forces and procurement toward such items as submarines, Fravel said.
In an escalation of tensions with the Philippines, Chinese ships used water cannons in January to drive Filipino fishermen away from a disputed shoal in the South China Sea, the Philippine military said Feb. 24.
While the U.S. says it does not take sides on territorial disputes it has not supported China's claims under the nine-dash line. The U.S. ambassador to the Philippines Philip Goldberg said last month that "there is no such thing" as the nine-dash line, at a forum in Manila.
China's firmness on territorial matters will stop short of war, said Jian Zhang, a senior lecturer at the University of New South Wales in Canberra who specializes in China security issues. China's priority is still to make sure the external environment is stable, he said.
‘Deterrence Capability'
"I don't think that China has any intention or think that it's realistic to win the arms race with the U.S.," he said. "China's intention is to develop very credible, decent deterrence capability which can in the case of any military conflict deter U.S intervention. That's what they are hoping for."
The central government's budget for domestic security will increase 2.9 percent to 193.4 billion yuan in 2014. No figure was given for China's total spending on internal security, which in previous years was provided in a table at the back of the budget report. China's security spending has been higher than that on national defense since at least 2010.
Some analysts say China's actual defense spending is much higher than the announced figure. It reached $240 billion last year, about twice the officially declared budget, the U.S. Defense Intelligence Agency said last month.
U.S. Defense Secretary Chuck Hagel last month proposed a Pentagon budget for the fiscal 2015 year of $496 billion. That would reduce the Army's forces by 6 percent to fewer than before the attacks of Sept. 11, 2001. The proposed budget would provide $154 billion for weapons purchases and research, $25 billion less than projected a year ago, according to the Defense Department.
The contrasting direction of the budgets prompted a top American procurement official to warn that U.S. military superiority is threatened.
"We've relied on technological superiority for decades now as one of the fundamental things that sets our military apart and I do see that that's not assured given the investments being made by China as well as by other powers," Frank Kendall, under secretary of defense for acquisition, technology and logistics, told reporters in Singapore Feb. 11.
(Bloomberg)
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