Saturday, September 19, 2009

Different Agendas Drive Western Pacific Budgets



09/24/07 12:51

Print this story

Different Agendas Drive Western Pacific Budgets


TAIPEI — Defense budgets in Asia are on the rise, although the trends vary among the four biggest spenders: China, Japan, South Korea and Taiwan.

“Defense spending is rising moderately among the major nations of the Western Pacific, but the increase is being driven more by prosperity than fear,” said Loren Thompson of the Lexington Institute, Arlington, Va. “As economies have grown, countries are able to invest more heavily in the capabilities needed to protect ports, secure trade routes and strengthen deterrence.”

Countries throughout the region have been improving their armed forces since the 1990s, citing the perception that the United States is less likely to actively try to resolve conflicts and the desire to increase their ability to act in a greater range of international issues.

Overall, Asia appears to be more secure. North Korea is moving to abandon its nuclear weapon program, and while many nations in the region are wary of China’s growing military, Beijing has shown little inclination to threaten its neighbors, except Taiwan.

China appears to be following the path that any nation with a growing economy would be expected to pursue.

Still, Beijing’s increased spending begets more of the same.

“I imagine that the PRC’s [People’s Republic of China’s] robust and apparently successful efforts to improve its armed forces inspire Japan and others to follow suit, but I think the current increases are more than an arms race,” said Thomas Kane, author of the book, “Chinese Grand Strategy and Maritime Power.”

“ I suspect that Japanese policy-makers are concerned that their peace constitution reduced their influence during the recent gulf wars, and I suspect that policy-makers in other countries would prefer not to suffer the same fate as Japan.”


Japan has invested heavily in ballistic missile defense systems, but with recent signs that North Korea is being cooperative on nuclear issues, Tokyo has less to fear. However, the momentum for improving Japan’s defense establishment appears unstoppable.

Numbers have not varied much over the past 10 years. According to figures from the Stockholm International Peace Research Institute (SIPRI), since 1997 Japan’s budget has hovered between $43 billion and $44 billion. Under Japanese law, defense budgets cannot surpass 1 percent of gross domestic product (GDP). However, where Japan is putting its resources has changed.

“Well, defense spending is flat in Japan and has been so for more than a decade,” said Richard Bitzinger, senior fellow at the Institute of Defence and Strategic Studies, S. Rajaratnam School of International Studies, Singapore. “That has forced some hard choices; in particular, the government has been shifting monies away from certain types of procurement — tanks, aircraft — in order to pay for missile defense, which is a high priority, and from building more conventional destroyers in order to build the ‘helicopter destroyers,’ which are basically amphibious assault ships or even potential mini-aircraft carriers.”

Though there are more allocations for missile defense, there is also a subtle shift toward a more indigenous defense industry less dependent on the United States. Japan is building a replacement for the P-3 Orion aircraft with a new P-X aircraft program along with a domestic C-X and F-X aircraft program. Japan’s Navy just launched its first so-called helicopter carrier, which actually resembles a conventional aircraft carrier.

“The waning of the North Korean nuclear threat may slow Japanese efforts to acquire improved defenses, but the Tokyo government seems determined to increase the quality of its military technology,” Thompson said. “This trend is apparent in the purchase of Aegis combat systems suitable for defense against sophisticated ballistic and cruise missiles, and in efforts to become the first foreign buyer of the stealthy F-22 fighter.”

South Korea

South Korea is technically still at war with its neighbor to the north but also sees Japan as a potential adversary.

Seoul spends much less than Tokyo — in 2006, the defense budget was $21.8 billion, less than half of Japan’s $43.7 billion.

The total has hovered between 2.4 percent and 2.8 percent of the GDP: $16.7 billion in 1997; $19 billion, 2004; $20.3 billion, 2005.

Much of the increase has to do not only with Japan, but the gradual disengagement of U.S. military forces from South Korea and a sense that the United States is slowly removing itself from the Asia-Pacific region.

“This is little more than an anecdote, but I recently examined a South Korean naval officer’s doctoral thesis on ROK [Republic of Korea] military policy. He argued strongly that the ROK needs to build up forces that will increase their ability to act independently from the U.S.,” Kane said. “I have heard other ROK officers express similar ideas. Again, I suspect that other Pacific Rim countries have similar needs and are likely to pursue a similar policy.

“If you’re a hawk, you may say all this reflects America’s perceived loss of military capabilities in the region. If you’re a dove, you may say that all this reflects America’s loss of so-called soft power in the region. If you’re tired, you may say that it was probably inevitable anyway. How are you going to keep them down on the farm, after they’ve seen Broadway?”


China’s defense spending has been the focus of debate for several years, with China observers in Washington complaining about a lack of transparency. This debate has overshadowed what many believe are more serious Chinese threats and developments in long-range ballistic missiles and its aggressive warship and fighter aircraft development programs.

China’s defense budget, at two-digit growth, moves forward in a tsunami-like juggernaut, and few expect it to slow soon. According to SIPRI numbers, China’s budget grew from $44.3 billion in 2005 to $49.5 billion in 2006, averaging about 2 percent of GDP over the past 10 years. These numbers are challenged by a variety of Western intelligence organizations and think tanks. China’s lack of transparency makes true numbers difficult to determine.

Arthur Ding, a Taiwan-based cross-Strait military affairs specialist and research fellow at the National Chengchi University’s Institute of International Relations, said China’s military budget likely will continue to rise by two-digit figures in the next several years as long as its economy can grow by about 8 percent annually.

China’s military modernization will continue to influence regional issues, and nearby countries, including Taiwan, will have to boost their defenses accordingly, he said.

“However, due to lack of detailed breakdown of China’s military budget released every March at the National People’s Congress, it is difficult to know exactly how much is allocated to defense industries. Nevertheless, it is safe to say that enormous amounts will be spent on key defense industries,” Ding said.

“The priority for allocation should be those directly related to RMA [revolution in military affairs] programs or information warfare programs. Specifically speaking, it should include space industry (satellites of various functions and anti-satellite capability), C4ISR systems, EW systems and IW systems.”

Ding argues there is no doubt that these programs are designed to block the United States from intervening in the Taiwan Strait, citing the U.S. Defense Department report, “Military Power of the People’s Republic of China,” which describes them as providing China with anti-access capability.


Political wrangling has prevented Taiwan from taking advantage of the 2001 Bush administration offer of eight diesel submarines, 12 P-3 Orion anti-submarine aircraft and Patriot PAC-3 air-defense missile batteries. Washington government officials accused Taiwan of ignoring its defense needs and relying too much on the U.S. pledge to defend Taiwan in a conflict with China.

However, all of that changed in June with the passage of a budget for the P-3s, a token budget for 66 F-16s, money for a feasibility study on submarines and upgrades for the Patriot PAC-2 Plus missile batteries. This budget and new initiative has reinvigorated the Taiwan military and quieted Taiwan’s critics in Washington.

“Taiwan has reversed its declining defense spending. That negative trend had raised a question in the United States of Taiwan’s commitment to its self-defense, despite the PLA buildup across the Taiwan Strait. The United States has applauded Taiwan’s latest increase in defense spending,” said Shirley Kan, a specialist in Asian security affairs at the Washington-based Congressional Research Service (CRS).

“However, questions remain about whether there are political imperatives behind the increases; about whether Taiwan has a coherent defense strategy in the absence of a consensus about national security; and about allocations in the defense budget, including among expensive hardware, personnel, training, munitions, domestic weapons programs, gifts, etc.”

Kan pointed out in a recently released CRS report for Congress on Sept. 13, “Taiwan: Major U.S. Arms Sales Since 1990,” that the budget has increased significantly. Taiwan’s 2005 defense budget was about $8 billion. Taiwan’s final 2006 defense budget was about $7.8 billion, a reduction of $200 million from the previous year.

But in August 2006, Taiwan’s Executive Yuan (Cabinet) approved a proposed 2007 defense budget of $9.8 billion, an increase of $2 billion. However, a proposal to buy F-16 fighters made up $488 million of this increase, and the Bush administration has not decided whether to consider Taiwan’s request for new fighters. The final 2007 defense budget approved by the Legislative Yuan totaled $9.2 billion.

Regarding the 2008 defense budget, the Defense Ministry requested and the Executive Yuan approved in August a budget of $10.6 billion, an increase of 15 percent. However, that amount includes funds for at least two uncertain requests: the first of three annual payments for the submarine design phase and the second year’s budget for new F-16 fighters.

There are those who fear that Taiwan’s renewed military procurement enthusiasm is too little, too late.

“Taiwan’s efforts to modernize military forces continue to be impeded by its tense relationship with the mainland and the determination of other nations to stay on good terms with Beijing,” Thompson said. “Despite impressive growth in recent years, Taiwan risks being overwhelmed by the expanding global influence of the People’s Republic, which will discourage most nations from selling Taiwan the latest military technology.”