2016 Report to Congress of the U.S.-China Economic and Security Review Commission, One Hundred Fourteenth Congress, Second Session, 16 November 2016.
The U.S.-China Economic and Security Review Commission has just released the 2016 Annual Report to Congress. This year’s report covers Chinese overcapacity, investment in the United States, state-owned enterprise reform, China’s military buildup, espionage threats to the United States, and China’s relationship with the world (including a special focus on Hong Kong, Taiwan, South Asia, and North Korea), among other topics. Additionally, this year’s report has a new chapter on China’s response to the United States’ Rebalance to Asia. The congressionally-mandated report features 20 recommendations for lawmakers.
Several trends in addition to economic performance will likely factor into China’s defense budget planning going forward. Craig Caffrey, principal analyst for defense budgets at IHS Jane’s, assesses that China’s military reforms ‘‘will reduce pressure on the defense budget in the longer term.’’123 On the other hand, studies have observed that the cost of ships and weapons generally tends to increase faster than inflation (even in the absence of a large-scale, high-technology military modernization effort such as China’s), eventually requiring continuous spending increases to avoid force reductions.124 Andrew S. Erickson, professor of strategy at the Naval War College, noted in testimony to the Commission in 2014 that a buildup of aircraft carriers and other large vessels—which China now appears to be pursuing under a doctrinal shift toward ‘‘far seas’’ protection*125—could be detrimental to its budget for this reason.126 China’s ability to rely on large numbers of low-paid recruits will also continue to diminish as labor costs rise;127 the September 2015 decision to cut 300,000 troops128 is notable for this reason. However, the longstanding assessment that China’s defense spending increases appear sustainable in the near term, reiterated by DOD in 2016,129 should be expected to hold. …
Nonmilitary assets could also contribute to China’s logistics capabilities in expeditionary operations. For example, the PLA Navy has relied on Chinese state-owned shipping companies to resupply antipiracy task forces in the Gulf of Aden. According to Chinese security experts Andrew S. Erickson and Austin Strange, China Ocean Shipping (Group) Company, or COSCO, has used its extensive network of regional contacts to facilitate relations between the PLA Navy and local replenishment services suppliers in countries near the Gulf of Aden.*89 …
LINKS TO FULL TEXT OF SELECTED SOURCES CITED:
Conor M. Kennedy and Andrew S. Erickson, “From Frontier to Frontline: Tanmen Maritime Militia’s Leading Role—Part 2,” Center for International Maritime Security (CIMSEC), 17 May 2016.
Andrew S. Erickson and Conor M. Kennedy, “China’s Fishing Militia Is a Military Force in All but Name,” War Is Boring (Blog), 9 July 2016.
Reprint of Andrew S. Erickson and Conor M. Kennedy, “Countering China’s Third Sea Force: Unmask Maritime Militia before They’re Used Again,” The National Interest, 6 July 2016.
Andrew S. Erickson and Adam P. Liff, “China’s Military Spending Swells Again Despite Domestic Headwinds,” China Real Time Report (中国实时报), Wall Street Journal, 5 March 2015.
Adam P. Liff and Andrew S. Erickson, “Demystifying China’s Defence Spending: Less Mysterious in the Aggregate,” The China Quarterly 216 (December 2013): 805-30.
Andrew S. Erickson, “China Announces 7.6% Budget Increase to $146.67 Billion (954.35 Billion Yuan): Comprehensive Context and Analysis,” China Analysis from Original Sources 以第一手资料研究中国, 4 March 2016.
“‘Rich Nation, Strong Army’? Resource Inputs for PLA Modernization,” Testimony before the U.S.-China Economic and Security Review Commission, Panel II: “Inputs to China’s Military Modernization,” “China’s Military Modernization and its Implications for the United States” hearing, Washington, DC, 30 January 2014.
Andrew S. Erickson, A Statement before the U.S.-China Economic and Security Review Commission, Panel III: “China’s Political and Security Challenges in the Middle East,” “China and the Middle East” hearing, Washington, DC, 6 June 2013.
Gabriel B. Collins and Andrew S. Erickson, “Djibouti Likely to Become China’s First Indian Ocean Outpost,” China SignPost™ (洞察中国) 91 (11 July 2015).
Andrew S. Erickson and Austin M. Strange, Six Years at Sea… and Counting: Gulf of Aden Anti-Piracy and China’s Maritime Commons Presence (Washington, DC: Jamestown Foundation, 2015).
Andrew S. Erickson and Austin Strange, “China’s Global Maritime Presence: Hard and Soft Dimensions of PLAN Antipiracy Operations,” Jamestown China Brief 15.9 (1 May 2015).
Andrew S. Erickson and Austin Strange, “Learning by Doing: PLAN Operational Innovations in the Gulf of Aden,” Jamestown China Brief 13.21 (24 October 2013).
Andrew S. Erickson and Conor M. Kennedy, “China’s Maritime Militia,” CNA Corporation, 7 March 2016.
Alexander Sullivan and Andrew S. Erickson, “The Big Story Behind China’s New Military Strategy,” The Diplomat, 5 June 2015.
Andrew S. Erickson and Michael S. Chase, “China’s Strategic Rocket Force: Sharpening the Sword (Part 1 of 2),” Jamestown China Brief 14.13 (3 July 2014).
Andrew S. Erickson and Justin D. Mikolay, “Guam and American Security in the Pacific,” in Carnes Lord and Andrew S. Erickson, eds., Rebalancing U.S. Forces: Basing and Forward Presence in the Asia-Pacific (Annapolis, MD: Naval Institute Press, 2014), 14-35.