A Budget for Peace
China's defense spending grows at slower rate this year
By Lan Xinzhen  ·  2016-03-21  ·   Source: | NO.12 MARCH 24, 2016

An army brigade marches during a military drill in north China's Inner Mongolia Autonomous Region on June 3, 2015 (XINHUA) 

The defense budget will grow at a rate of 7.6 percent in 2016, the lowest in six years, according to a budget report given to the Fourth Session of the 12th National People's Congress, China's top legislature, on March 5. This year, the budget is 954 billion yuan ($146 billion), compared with last year's budget of 886.9 billion yuan ($136 billion).

China's national defense policy and military reform have recently been in the international media's spotlight as they have maintained a watchful eye on its military expenditures.

Foreign media outlets began predicting China's defense budget for 2016 as early as last October. Some, in light of the situation in the South China Sea, reckoned that expenditures would rise more than 12 percent in 2016.

China's defense policy is defensive in nature, and the country has stuck to the principle of peaceful development.

In essence, China's defense spending has grown in tandem with the projected performance of the economy. China has set its GDP growth target for 2016 at between 6.5 and 7 percent, in contrast to the average annual increase of 7.8 percent observed in 2011-15.

However, China's defense department needs additional funds to meet its various needs. It still lags behind major countries in terms of weaponry, training and payment to its servicemen. The department is in constant need of cash to continue modernizing.

Moreover, China still faces numerous potential threats. In the East China Sea, for example, disputes between China and Japan over the Diaoyu Islands could digress into further conflict. The prominent rise of Japan's right-wing movement has also compelled Chinese troops to enforce vigilance against possible aggression.

In the South China Sea, Chinese armed forces need to demonstrate that it is capable of protecting its territory as U.S. warships and planes have repeatedly intruded on waters and airspace adjacent to China's Nansha Islands.

China also has its hands full under mounting pressure from North Korea's nuclear program, as Beijing works toward detente.

In addition, as China has invested in and is trading with many countries and regions around the world, its armed forces have shouldered an increasing amount of responsibilities in order to secure the country's overseas interests.

Based on those potential threats, China's armed forces need more money to update their equipment, strengthen training and deter invasions.

China is currently pushing forward military reform. It has begun downsizing its army by cutting 300,000 servicemen, of which a large proportion are officers. These people will then be assigned to other posts or demobilized—which would also cost money.

This year, China's defense spending has grown at a rate lower than that in any of the past five years because the country has more pressing needs to meet. For instance, it is bent on lifting the poor people within its borders out of poverty and enabling everyone to share the fruits of the country's development.

China is also accelerating the construction of the Silk Road Economic Belt and the 21st-Century Maritime Silk Road to promote the co-development of the countries lying along the routes. Pushing forward social and economic development and improving people's living standards is much more important to the Chinese Government than increasing its defense spending.

Even so, some people may say that China's defense spending is not transparent, and there might be off-budget expenditures.

That is groundless speculation. In China, any expenditure related to defense, whether it is on personnel, armament or infrastructure, is included in the budget.

Such ideas may stem from differences in other countries' systems. Take, for example, medical insurance premiums for veterans, which are allocated as part of defense spending in China but not in the United States. Also, while the United States has the world's largest arsenal of nuclear weapons, its costs are spread between the budgets of its departments of defense and energy.

China's defense spending is still low in relation to those of other major countries, regardless of how it is measured—either in terms of percentage of total GDP or per-capita level. In particular, the share of its military expenditure in GDP is only around 1.5 percent, the lowest among the UN Security Council's permanent members.

The composition and trend of China's defense spending over time shows that China's armed forces are purely meant for defense, and that China is a peace-loving country.

Copyedited by Bryan Michael Galvan 

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