2020 will mark the first time in decades that China has not set growth targets for its economy. Last year, Beijing targeted growth in the range of 6% to 6.5%. GDP grew 6.1%, the slowest pace in almost 30 years.
Then came the coronavirus pandemic and weeks of economic shutdown in much of China. GDP shrank 6.8% in the first quarter, the first contraction reported by Beijing since 1976.
When the economy contracts, external pressure is increasing.
The US military is increasing challenges to Beijing’s claims in the South China Sea, including
Back-to-back naval navigation freedom training in April and
B-1 bomber flight, which is the heaviest in the US Air Force inventory, is from Guam and the US mainland.
And when the spending figures for 2020 were announced last Friday, Beijing’s priorities were immediately clear.
The military’s share of pain – the increase in its budget is the lowest in decades – but the PLA’s pain is small compared to the blows given to other areas of the Chinese government.
For example, the budget fell 13.3% for general public services, down 11.8% for foreign affairs, down 7.5% for education and 9.1% for science and technology.
“The proposed budget shows Beijing feels insecure and under siege,” said Timothy Heath, senior researcher at the RAND Corp think tank. in Washington.
“The strong increase in spending reflects strong anxiety about deepening tensions with China’s main competitors, the United States, as well as fading hopes for a peaceful union with Taiwan,” Heath said.
“Beijing also has many reasons for increasing defense and security spending to manage this escalating problem
domestic chaos in Hong Kong, in the western provinces, or throughout the country due to soaring unemployment and slackening growth due to the effects of the Covid-19 pandemic. “
Wu Qian, a spokesman for the Chinese Ministry of Defense, said Beijing’s defense budget is appropriate for now.
“It can be said that the world is not peaceful,” Qian said on the sidelines of the National People’s Congress this week.
“China’s internal security and foreign interests also face some real threats …
“It is reasonable and necessary that Chinese defense spending increases moderately and steadily,” Wu said.
Compare with US
Beijing also touted an increase in the military budget as the smallest in several years, and said the overall amount was a fraction of the money spent by some foreign militaries.
In fact, Zhang Yesui, spokesman for the third session of the 13th National People’s Congress, said at a press conference last week that “China’s total defense spending in 2019 is only a quarter of the world’s largest defense expenditure.
The biggest defense expenditure is the United States, according to the International Institute for Strategic Studies (IISS).
IISS figures were released in February shows the US spent $ 686 billion on defense in 2019 compared to $ 181 billion by China, number 2 in the IISS world ranking.
But subsequent studies by analysts
at IISS and the Washington-based Heritage Foundation say the gap between the US and Chinese military budgets may be as small as 13%.
And when you look at the progress that the Chinese military has made since Xi became President in 2013, the huge gap between the Chinese and American military budgets defies credibility:
– Only in recent years, China has implemented it
the first aircraft carrier to be built domestically, Shandong;
– made it
J-20 stealth fighter – seen as a challenge for US F-22 and F-35 fighters – ready for combat;
– Increase it
a ballistic missile submarine fleet, both with new ships and better missiles in it;
– open it
first foreign military base in the African country of Djibouti;
– and
building a series of islands in the South China Sea that US Admiral Philip Davidson, the main US commander in Indo-Pacifc, called the “Great Wall of SAM,” or a series of surface-to-air missile bases could make the sky over a very hostile area for any enemy air force.
Lack of transparency
All this costs a lot of money, but in the case of Beijing it is often difficult to see where it came from, analysts said.
“Defense budget data available from Beijing … experiences three different problems: lack of transparency, known and unreliable negligence,” writes Frederico Bartels, a Heritage Foundation researcher, in
an April paper was released in The Strategist, website of the Australian Strategic Policy Institute.
Bartels came up with a 13% difference between the US and Chinese defense budgets after analyzing everything from currency rates to labor costs across China.
He told CNN any defense figures coming out of China must be treated with skepticism because Beijing did not specify specifically where the money was flowing or based on what budget might be allocated.
Bartels gave an example of a new aircraft carrier built in the US versus China.
In the US, the government will declare the price paid to independent contractors to build aircraft carriers. But in China, state-run companies will build warships and only be responsible to Beijing.
Money for new aircraft carriers can be transferred to the company under one of many accounts, not necessarily related to warships.
In the end, outside observers really don’t know what the price of this ship is.
“That’s the kind of game they can play with state-owned companies,” Bartels said.
Police and coast guard troops
Inheritance researchers and IISS analysis also show that other parts of China’s defense formation, such as the growing coast guard, do not see at least a portion of their expenses included in the military budget.
According to the IISS study, the budget for the People’s Armed Police (PAP), which is assigned to law enforcement, border defense and internal security, actually decreases when a large coast guard fleet is under PAP control in 2018.
“This will show that (Chinese Coast Guard) expenditure remains a cost related to extra-budget defense and must be added to China’s total defense spending figures,” said the IISS study.
Meanwhile, the China Power Project at the Center for Strategic and International Studies shows this annual expenditure figures published by China’s Ministry of Finance and Defense off as much as $ 3 billion.
To enter that number in hardware terms, about three
Sophisticated Beijing Type 55 Wreckers, key linchpin in the country’s naval buildup.
The buildup has become part of Xi Jinping’s military modernization that aims to make the PLA at least equal to the United States military in Asia.
And with the progress made since Xi came to power in 2013 – and especially since he reorganized the Central Military Commission aiming for corruption in 2017 – clearly Beijing will not agree to weakening the PLA.
Bartels said the budget sent a strong message from Xi to the PLA that “we really appreciate what the People’s Liberation Army is doing, and we want to be able to protect them even in less positive economic times.”
Steven Jiang and Laura He from CNN contributed to this report.
