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Saturday, December 30, 2006

China’s military spending to reach $36bn

China’s defence spending is expected to reach Rmb283.8bn ($36.4bn) this year, up nearly 15 per cent from last year, according to rarely released government data that are likely to heighten concerns over Beijing’s military build-up.

The boost in funds, which many experts argue greatly underestimates actual military expenditures, is aimed at modernising the 2.3m-strong People’s Liberation Army (PLA) into a nimbler, more technologically-advanced entity, said a white paper released by the government yesterday.

President Hu Jintao, who also leads the Central Military Commission, this week said there was particular emphasis on developing a powerful navy that can respond “at any time” to safeguard national sovereignty.

The rise of China’s military, expanding in tandem with its red-hot economy, is likely to trigger greater concern in the US and Taiwan, which Beijing considers a renegade province.

China’s military modernisation is at the same time a worrying trend for Japan because of lingering historical tensions over Japan’s wartime past. Beijing is wary of a strong US-Japan military alliance and Tokyo’s efforts to reorganise its military which it views has been hamstrung by its postwar pacifist constitution.

China’s white paper, significant since the government rarely publishes specific details about its armed forces, estimates that defence spending over the past 15 years has grown on average 15.4 per cent annually. Last year, spending grew 12 per cent from the previous year to Rmb247.5bn.

Official military spending reached Rmb247.5bn last year, up from Rmb220bn in 2004. In the past, the Pentagon has said China’s real military spending could be as much as three times the stated amount.

However, Beijing defended the size of its military budget by arguing that spending remained modest compared with that of developed economies such as the UK, France, Japan and especially the US. The Chinese government said military spending accounted for 1.4 per cent of projected gross domestic product in 2006 and 6.2 per cent of US military expenditures.

“China pursues a national defence policy which is purely defensive in nature,” said the paper, the fifth of its kind since 1998. “China will not engage in any arms race or pose a military threat to any other country.”

Although the white paper says China’s general security situation is good, it says Taiwan remains a serious threat to regional stability and the task of opposing independence-minded “splittist forces” on the island is now “complex and grim”.

It also says “the issues of border complexities and sensitive historical problems” still weigh on its security assessment, while North Korea’s missile and nuclear bomb tests have made security of the Korean peninsula and northeast Asia “more complicated and severe”.

China has in the past fought brief border wars with India, Vietnam and the former Soviet Union, and is still entangled in territorial disputes with Japan over gas fields in the East China Sea. It is also disputing the ownership of islets in the South China Sea with Vietnam, Taiwan, Malaysia, Brunei and the Philippines.

The paper says the increased funds have gone into investment in new weapons, personnel training, international cooperation projects, and military salaries and accommodation.

It says the military will rely on home-grown research and the ability to “acquire, digest and apply’’ overseas technology to develop new weapons, without specifying which kinds of weapons it wishes to develop.

financial times
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