Defense News
03/04/09
China Increases Defense Budget
By Wendell Minnick
TAIPEI, Taiwan - China will increase its defense budget for 2009 to $70.2 billion, up 14.9 percent from 2008, said Li Zhaoxing, 11th National People's Congress spokesperson said on March 4.
"Defense spending accounts for 6.3 percent of the country's total fiscal expenditure in 2009, slightly down from the level of previous years," Li said in the state-run China Daily.
"The budget rise follows a 17.6 percent increase in 2008 compared with the previous year. The increased budget will also be spent on the purchase of equipment and construction of facilities to enhance the ability of the military force to defend the country in the age of information," Li said.
Li said disaster relief and anti-terrorism operations would be enhanced, as well as rebuilding programs for military facilities destroyed during an 8.0 magnitude earthquake in Sichuan province in May.
China and the U.S. just concluded its first Defense Policy Coordination Talks since Beijing severed military ties in October after Washington approved a $6.5 billion arms sale to Taiwan.
"U.S. arms sales to Taiwan remain the main stumbling block, but the Chinese also continue to call for a change in the 2000 NDAA [National Defense Authorization Act] legislation that places limits on U.S.-China mil-mil exchanges," Bonnie Glaser, Washington-based Strategic and International Studies. "It is unlikely that U.S. policy in either area will be altered in the near future. This is likely to have an influence on the mil-mil relationship, but exchanges are not likely to remain frozen."
The NDAA 2000 restricts military exchanges with China's military that pose a national security risk. Restrictions include information exchanges on force projection operations, nuclear operations, complex joint combat operations and logistical operations, chemical and biological defense, surveillance and reconnaissance operations, military space operations, arms sales or military-related technology transfers, release of classified and access to a "Department of Defense laboratory."
During the two-day meetings in Beijing, the U.S. asked for more transparency in China's defense budget and programs. However, Li said China had no "hidden military expenditure."
"Well, it is consistent with past Chinese spending, but it is amazing that Beijing is continuing a trend of double-digit increases that extends back, without a break, for more than a decade," said Richard Bitzinger, Institute of Defence and Strategic Studies, S. Rajaratnam School of International Studies, Singapore.
"It is also noteworthy that, amid a global economic downturn, Beijing has decided to make defense spending recession-proof. It may be true that off-budgetary spending add considerably to this figure, but even the official number is very significant, as it means that China now clearly outspends every other country in the world, save the United States," said Bitzinger.
When China released its 2008 defense budget numbers last year, U.S. sources said China's defense budget was actually between $97 billion to $139 billion. Excluded figures were believed to be expenses for strategic forces, foreign acquisitions and secret build programs.
There have been unconfirmed reports China has begun an aircraft carrier build program. Andrei Chang, China military analyst, Kanwa Defense Center, said China is now quietly constructing an aircraft carrier in modules at separate port facilities.
