China's military spending increases by 7.5%

March 5, 2010

China's military spending will increase by 7.5% for 2010, the first single-digit increase since 1989, a spokesman for the Chinese parliament, Li Zhaoxing, said.

Mr. Li said that China would spend 532.1 billion yuan ($77.9 billion) on the country's military over the course of 2010, an increase of about 36.9 billion yuan ($5.4 billion) over 2009's spending. Regardless of the increase, China still spends significantly less on its military as a proportion of its gross domestic product (GDP) than other countries around the world. China spends about 1.4% of its GDP on the military, while the United States spends about 4% of its GDP on the military. The US, which accounts for 48% of the world's military spending, has frequently encouraged China to be more transparent about its military spending, a challenge which China said it was meeting.

At a press conference, Mr. Li said that the increase was in response to various security threats to China, although the nature of the threats were not specified. He did, however, say that, "The only purpose of China's limited military strength is to safeguard China's sovereignty and territorial integrity." He also said that the government has limited military spending to the best of its ability, and had tried to ensure a balance between the military and other needs.

According to US military analysis and official Chinese reports, China has been steadily increasing military spending since the late 1980s, when the country began a program of improving its entire armed forces, including developing and producing weapons and equipment. The US Pentagon issued a report in 2009, saying that military spending had increased by an average of 12.9% annually since 1996. Based on this, analysts say that the earlier large spending increases could explain the slower increase for 2010. China in the past few years has seen dramatic spending increases in other sectors, especially costs related to the global financial crisis, and these sectors have complained about the amount of military spending. As one analyst, David Shambaugh from George Washington University, put it, "There have been complaints from some other sectors that it has been distorting expenditures. Maybe some of those arguments have come home to roost."