China says defense budget to rise by about 7 percent in 2017

The announcement comes after US President Donald Trump announced a 10% rise in defence spending. Photo / AP
The announcement comes after US President Donald Trump announced a 10% rise in defence spending. Photo / AP

China will raise its defense budget by about 7 percent this year, a government spokeswoman said Saturday, continuing a trend of lowered growth amid a slowing economy despite regional tensions over the South China Sea and other issues.

Total defense spending would account for about 1.3 percent of projected gross domestic project in 2017, said Fu Ying, spokeswoman for the legislature. She was speaking at a news conference on the eve of the opening of the body's annual session.

The precise figure will be provided by Premier Li Keqiang in his address to the National People's Congress on Sunday morning.

Fu reiterated China's contention that its military was purely for defense and constituted a force for stability in Asia.

"We advocate dialogue for peaceful resolutions, while at the same time, we need to possess the ability to defend our sovereignty and interests," Fu said.

"The strengthening of Chinese capabilities benefits the preservation of peace and security in this region, and not the opposite."

Depending on the final figure, this year's budget could mark the third consecutive year of declines in defense spending growth rates, even while some outside observers say those figures don't account for all military spending. The budget grew by 7.6 percent last year and 10.1 percent in 2015.

That trend reflects "the new normal, an acknowledgement that Chinese growth is plateauing as a whole," said Alexander Neill, a senior fellow for Asia-Pacific security for the International Institute for Strategic Studies based in Singapore.

While the slowing economy may preclude a spending spree similar to past years, when growth rose by double-digit percentages each year, there's no doubt China will continue to add high-tech weaponry according to its long-term strategy, Neill said.

Seeking a more streamlined fighting force, China plans to complete the cutting of 300,000 military personnel by the end of the year, shifting the emphasis away from the land forces and toward the navy, air and rocket units.

Still, the increase of about 67 billion yuan ($9.7 billion) would push the total defense budget past the 1 trillion yuan ($145 billion) mark for the first time. The percentage increases do not track in U.S. dollar figures because of variations in the exchange rate.

China's defense budget is expected to rise to $233 billion by 2020, almost twice what it was in 2010 and four times what Britain spends, according to a study released in December by IHS Jane's. By 2025, China would outspend all other states in the Asia-Pacific combined, the consultancy predicted.

The defense budget has for years been the world's second largest, although it still lags far behind the U.S. President Donald Trump has asked for a 10 percent increase in U.S. defense spending this year, adding $54 million to the budget that topped $600 billion last year.

China points out that, as a developing country with a population of 1.37 billion, its defense spending per capita is a fraction of those of other nations. Fu also said the percentage of GDP China spends on defense is below the 2 percent the U.S. calls on NATO allies to spend.

The relatively modest spending increase reflects both China's steady, if not spectacular economic growth, and a security outlook that has changed little in recent years, said Tang Yonghong of the Institute of Taiwan Studies at Xiamen University in southeastern China.

"China's defense budget is formulated on the basis of its own needs and the domestic economic situation. Beijing isn't much concerned about the reaction from the international community," he said.

China has been spending heavily on technologies, allowing it to project power far from shore, including aircraft carriers, long-range bombers and its first overseas military base located in the East Africa nation of Djibouti.

Along with defending China's frontiers, the self-governing island of Taiwan remains a military priority for the 2.3 million-member People's Liberation Army, the world's largest standing military. Beijing has never renounced its vow to use force to take control of the island it considers its own territory, and tensions have risen since the election last year of independence-leaning Taiwanese President Tsai Ing-wen.

Beijing has also come under criticism for militarizing man-made islands in the South China Sea, which China claims virtually in its entirety.

Fu turned those accusations back on the U.S., saying the strategically vital waterway through which about $5 trillion in trade passes each year was basically calm.

"As to how to the situation develops in future, that depends on U.S. intentions. American actions in the South China Sea have a definite significance in terms of which way the winds blow," she said.

- AP

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