CHINA’S ANNUAL parliament will approve an increase in the country’s spending on defence of 7.5 per cent this year, a smaller margin than expected and the first time in more than two decades the jump has been less than double digits.
China has repeatedly promised that its breathtaking economic advances would be a “peaceful rise”, but there are concerns about the country’s military build-up and some analysts are wondering about the aims of the military expansion and believe the official increase is twice what Beijing claims. The decision to raise spending by only 7.5 per cent can be seen as an effort to address these concerns.
The Beijing government generally releases the figures about the defence budget as delegates gather for the National People’s Congress, which begins today after two days of meetings of the consultative assembly.
China says it is merely bringing its military up to speed and its spending on its armed forces is well shy of that of other countries, especially the United States.
“China is committed to peaceful development and a military posture that is defensive in nature,” National People’s Congress spokesman Li Zhaoxing told a news conference that was carried on national television.
Mr Li said the spending increase would be used to enhance China’s ability “to meet various threats”, which probably refers to the Taiwanese issue, more specifically to the way the US is selling weapons to the self-ruled island, much to Beijing’s ire.
He pointed out that China’s 532 billion yuan (€57 billion) defence budget worked out at 1.4 per cent of gross domestic product (GDP), which compares with the US defence spend of over four per cent of GDP and Britain, France and Russia’s defence budget of over two per cent each.
The People’s Liberation Army is the largest standing army in the world, with 2.3 million soldiers, 800,000 reservists and a People’s Armed Police of 1.5 million. President Hu Jintao has called for greater efforts to modernise the armed forces.
The Chinese say they want a “Revolution in Military Affairs with Chinese Characteristics” to give them an army to reflect their growing economic importance in the region.
The focus of China’s military development is on Taiwan, which mainland China has said it would attack if the self-ruled island, which Beijing views as a renegade province, formally declares independence.
The expansion of China’s navy includes a growing submarine fleet and new ships suitable for the open seas, which has prompted US fears that its military could alter the balance of power in Asia.
A third of spending goes to salaries and improving living conditions for soldiers, with the rest divided between replacing equipment and military research and development.
Deputies to China’s top legislature and members of its top advisory body are also taking aim at the huge profits of China’s real estate developers.
Some say the country’s property bubble may be about to pop. Developers in China earned profits of at least one trillion yuan (€110 billion) in 2009, Chen Wanzhi, a deputy to the NPC, told local media.
Property prices rose strongly in China towards the end of the year last year after falling in the early half of the year, and rich lists for last year show that real estate developers made up the lion’s share of China’s wealthiest elite.
The gap in China between rich and poor is growing, and there is a lot of resentment about the prices that some real estate is fetching.
Mr Chen appealed to China’s housing industry to focus less on windfall profits and more on providing affordable housing.