China’s Military Spending: Soft Rise or Hard Threat?

Abstract

Interpreting China's military expenditure has been a complicated issue with important regional implications. This article will first look at the various estimates of China's military budget and the discrepancies in the numbers as well as the geopolitical rationale driving Chinese military planning. Although China publishes its official defense budget and provides justifications for increases in its military spending, most observers remain skeptical of the accuracy of the official figures and wary of the military modernization efforts. This skepticism has shaped the responses of other Asia-Pacific nations toward China's military modernization. Ultimately, even if the Chinese leadership views the military buildup as a natural part of the country's ascension to great power status, the uncertainties surrounding its military expenditures actually undermine the contention that China's will be peaceful. Key words: East Asian security, China, military spending, arms race Introduction The rapid growth of China's economy and its increasingly vigorous diplomatic engagement with regional and international institutions have given to much discussion of China's peace- ful rise to great-power status.1 At the same time, the Pentagon has identified China as the only potential hegemon on the horizon that stands a chance of challenging the unipolar power of the United States. These two views of China-as a largely benign global partner or as a military superpower-to-be-rely on different understandings of a critical factor: the Chinese military budget. According to the Chinese government, the country's rising military budget reflects general economic growth, is devoted to non-threatening expenditures like better pay for soldiers, and remains only a small percentage of what the United States spends every year on the military. Critics, however, argue that China vastly underreports its military expenditures and that the country is acquiring new power-projection capabilities that change the regional balance of power. Determining which of these pictures of China's military spending is correct is not an easy task. In recent years, the Chinese government has published its official annual defense budget figures and provided justifications for the announced increases in military spending as part of its efforts to alleviate the fears outsiders might have about a rapidly rising China. But these published figures, since they don't match the estimates of outside observers, raise more questions than they answer. Why has there been a large discrepancy between China's official defense budget and other estimates? What are China's ultimate geopolitical goals and rationales behind its military planning? How have other nations in the Asia-Pacific region responded to the more robust Chinese military spending? Finally, what implications do the uncertainties in China's military have for its own national goals? A clear picture of China's military spending is essential for an understanding of the country's unfolding conception of itself, for any analysis of Northeast Asian regional politics, and, ultimately, the future trajectory of global geopolitics. How China resolves the seeming contradiction between its insistence on a peaceful to great power status and its considerable annual military budget increases will have an enormous impact on the shape of international institutions and the ends of multilateral action. Estimates of China's Military Expenditure The Official Chinese Case Calculating China's exact military expenditures is complicated by the Chinese government's relative lack of transparency. Although the Chinese government announces its military budget publicly, usually through the published annual report of the Ministry of Defense, its figures are vastly different from the estimates of outside analysts. Nor is there consensus among outside observers on the exact amount of Chinese military spending. …