China's Army Budget Growth Within Rational Range

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Last updated at: (Beijing Time) Thursday, August 01, 2002

China's Army Budget Growth Within Rational Range

China's increased defence budget for this year should not be used as an excuse to spread the fallacy of the so-called "China threat," said Chinese military experts.

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China's increased defence budget for this year should not be used as an excuse to spread the fallacy of the so-called "China threat," said Chinese military experts.

The inflated claim that China's defence budget is as high as US$65 billion, more than three times the official Chinese government figure, is groundless, said Luo Yuan, a specialist with the Academy of Military Science of the People's Liberation Army (PLA).

Luo was refering to the figure given in the Pentagon's report on Chinese military power.

Minister of Finance Xiang Huaicheng announced earlier this year an increase of 17.6 per cent, or 25.2 billion yuan (US$3.04 billion), in the central defence budget for 2002, which brought the State defence budget to around 166.2 billion yuan (US$20 billion).

The country's military spending is also relatively low in terms of both gross and per capita expenditure, in comparison with the defence budgets of some developed countries or even some developing countries neighboring China, said Luo.

For example, US military spending for 2002 is estimated at US$379.3 billion, an increase of US$48 billion over the figure for the previous year, he said, adding China's national defence budget for 2002 is less than half of the US increase for the year.

According to official sources, in the past few years, China's national defence budget as a percentage of its GDP has been under 1.5 per cent.

The average annual figures from 1996 to 1999 are, respectively, 1.06 per cent, 1.09 per cent, 1.20 per cent and 1.27 per cent. The expert indicated that in the first two years of the 10th Five-Year Plan (2001-05), the average figure was about 1.49 per cent and 1.64 per cent.

Xia Jiren, an expert at the PLA Institute of Military Economics, said that the introduction of high technology in military forces, such as the upgrading of weaponry and equipment, necessitates increases in defence spending.

The military equipment designed and developed in China during 1960s and 1970s clearly had to be replaced, said Luo.

Furthermore, Yuan Zu, a Beijing-based military expert, said most of the increased budget will go to support the 2.5 million army personnel and the basic operations of the army.

Part of the budget will be spent on raising the salaries of officers, non-commissioned officers and office staff on the regular payroll, subsidies for compulsory service personnel and pensions for retired service personnel, Yuan said.

China's decision to attract more professionals has also contributed to the rise in military spending.

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