China's Double-Digit Defense Growth
What It Means for a Peaceful Rise
China has done it again. In early March, it released its defense budget for 2015, and as in almost every year for over almost two decades, it increased its military expenditure by double-digit percentages. This year, the Chinese defense budget will rise by 10.1 percent, to roughly $145 billion. And it seems likely that the trend will continue, much to the concern of Washington and regional capitals.
Already, China is the second-biggest military spender in the world, having surpassed the United Kingdom in 2008. China’s new budget for the People’s Liberation Army (PLA) is more than three times those of other big spenders such as France, Japan, and the United Kingdom, and nearly four times that of its rising Asian rival, India. It is also the only country besides the United States to have a triple-digit defense budget (in billions of U.S. dollars).
This level of spending is all the more remarkable given where China started. In 1997, Chinese military expenditures totaled only about $10 billion, roughly on par with Taiwan and significantly less than that of Japan and South Korea. Beginning that year, however, China’s defense budget began to rise. There were two economic factors that made this growth possible. First, the country’s economy soared; in 1997, defense spending made up less than two percent of GDP, which remains roughly the same share today, at least according to Beijing. Second, low inflation rates over the past two decades have meant that real growth in defense spending has nearly matched nominal growth;
Log in or register for free to continue reading.
Registered users get access to one free article every month. Subscribers get access to the entire archive.
Or subscribe and save 55%!
- Full website and iPad access
- Magazine issues
- New! Books from the Foreign Affairs Anthology Series