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Feb 11, 2007
Military spending to surge by 18%· US and Japan urge clarity over big recent increases

Officials say money is for better food and training
Tania Branigan in Beijing
The Guardian,
Wednesday March 5 2008

A paramilitary policeman in Hangzhou province. Photograph: Reuters

China's military is to receive another hefty budget increase, with a surge of nearly 18% in funding to beef up its capabilities and smooth the lives of more than 2 million troops.

The increase, announced a day after a Pentagon report criticising China for a "lack of transparency" in security affairs, brought demands from Japan and the US for Beijing to explain recent big increases in defence spending more clearly.

Funding will rise from about 350bn yuan (£25bn) to 418bn yuan, according to the National People's Congress, which begins its annual session today.

Jiang Enzhu said that double-digit increases for much of the last two decades had been moderate, adding: "These increases were of a compensatory nature to make up for the weak defence foundation."

Chinese military spending fell sharply as a proportion of government expenditure and arguably in real terms in the 1980s. Jiang said the extra money would provide better training and meals for more than 2 million soldiers in the People's Liberation Army and cover increased fuel and salary costs. According to one report, he also suggested it would help China prepare for a conflict "under IT-based conditions".

But the Pentagon report suggested China's true defence budget was two to three times the official figure last year - but still well behind the US budget, which has also risen substantially to $623bn (£314bn) for 2008.

The difference in buying power also skews comparisons. The most recent figures from the Stockholm International Peace Research Institute, for 2006, suggest that China lagged behind the US, UK and France in its total spending that year - but in terms of purchasing power was second only to the US, spending the equivalent of $188bn to America's $529bn.

The report expresses concerns about China's increased strategic strike capability and anti-satellite weapon tests and states that "numerous" intrusions into computer networks, including some owned by the US government, seem to have originated in China.

It argues that the People's Liberation Army "is pursuing comprehensive transformation from a mass army designed for protracted wars of attrition on its territory to one capable of fighting and winning short-duration wars along its periphery against hi-tech adversaries".

It added: "The lack of transparency in China's military and security affairs poses risks to stability by increasing the potential for misunderstanding and miscalculation."

But the Chinese foreign ministry attacked the report as unfair, inaccurate and an example of "cold war thinking".

Its spokesman, Qin Gang, added: "We do not seek expansion. The purpose is to safeguard our sovereignty, security and territorial integrity."

He denied Chinese involvement in infiltrating computer networks, saying they too were victims of hackers.

"We hope related countries can work together to tackle this problem. If the US has an accusation to make, it should produce the evidence," he said.

China and the US have shown signs of a rapprochement in recent years despite tensions, last week agreeing to set up a military hotline. But yesterday a state department spokesman said the US and other nations wanted to understand China's motives in raising spending so sharply. Japan's defence ministry also urged China to enhance transparency and address international concerns.

Trefor Moss, Asia Pacific editor at Jane's Defence Weekly, said it was hard to know the true scale and nature of the country's military development, but added: "For a long time China's spending was clearly quite tiny comparatively, and the army was quite basic. They are a long way behind in terms of military hardware but are clawing back some ground.

"Their IT capacity is probably further ahead because they are stronger there and the Pentagon has had a lot of concerns."

The US defence department's report also suggests that China's focus continues to be preparing for developments in its tense dealings with Taiwan, including the possibility of US intervention.

The National People's Congress warned the island would pay a "heavy price" if the public backed the referendum on UN membership, which is being held alongside the presidential election this month.

In numbers
£29bn The amount the defence budget will rise to following the increase. The budget was previously £25bn

2m The number of soldiers in the People's Liberation Army, who will receive better training as a result of the increase

$188bn China's estimated military spending for 2006 in terms of purchasing power. The US spent $529bn in the same year
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