04 March 2013

China’s Military Budget Bump: What it Means

Andrew S. Erickson, “China’s Military Budget Bump: What it Means,” China Real Time Report (中国实时报), Wall Street Journal, 5 March 2013.

China revealed its latest official defense budget on Tuesday, projecting a 10.7% increase in funding that would bring the People’s Liberation Army budget to 720.2 billion yuan ($114.3 billion). The increase is neither surprising nor sudden, but it is nevertheless significant.

This year’s increase to the military budget is similar to the 11.2% increase in 2012. As Princeton’s Adam Liff and I document in a forthcoming article for The China Quarterly (pdf preview), those growth rates are significantly less impressive when inflation is factored in. Yet even the PLA budget’s inflation-adjusted growth rate is the envy of Western militaries.

Western military budgets are typically either stagnating or declining absolutely. The major exception is Japan, whose defense budget will rise in 2013, for the first time in 11 years, at a modest rate of 0.8%. For the U.S. and many of its traditional allies, military money is relatively tight. The U.S. defense budget, $656.2 billion in 2012, is set to fall to just over $600 billion in 2013, according to IHS Jane’s.

This year’s PLA budget increase has important implications for China’s military development, for its place in East Asia and the world, and for its neighbors and the United States. The key dynamics are important, but should not be confused or conflated.

No matter how China’s goals expand or its defense spending rises in the future, its military will be hard-pressed to assume a global role on a par with that of the U.S. military. China’s eclectic “counter-intervention” approaches, which can support devastating attacks close to its shores, do not translate effectively into long-distance power projection. Difficult reforms and major funding increases would be needed to realize such a transformation, and Beijing’s interests remain far from requiring this.

That said, the PLA already boasts potent capabilities vis-à-vis its outstanding island and maritime claims. The U.S. enjoys by far the world’s largest defense budget, but its military is dispersed worldwide, engaged in various ambitious global missions. China’s defense spending remains a distant second in size, but is concentrated primarily around China’s mainland, border regions and maritime periphery. It is how it might be used there that causes concern.

Ironically, the very “might makes right” approach that that Chinese official statements and media attribute constantly to the U.S. is manifested clearly in Beijing’s own dealings with its less-powerful neighbors. China’s unwillingness to limit itself to peaceful means in this regard poses significant challenges to its neighbors’ security and America’s regional position. China’s approach also undermines the accepted norms related to freedom of navigation, surveying and resource access that sustain today’s international system.

Fortunately, beyond contested areas off its shores, China shares considerable common interests with the U.S. and other nations, offering great prospects for mutually-beneficial cooperation. Indeed, the international community should encourage China to play a robust, constructive role, and acknowledge its status as a great power in proportion to the global “public goods” that it provides. This might be termed the “Spiderman Doctrine”: “With great power comes great responsibility.”

Yet to ensure that China acts responsibly in the Asia-Pacific — now the world’s most economically- and strategically-dynamic region—the U.S. must maintain strong military capabilities, alliances and partnerships to deter any Chinese efforts to use force, or the threat of force, to alter the regional status quo. Preserving the peace will not sustain itself automatically: It requires strategic focus, and funding.

The bottom line from an American strategic perspective: As Washington stumbles into sequestration, U.S. policy-makers will have to decide quickly how important it is to sustain the Asia-Pacific peace and prosperity that their predecessors expended so much blood and treasure to establish.

For further details, including relevant official Chinese media statements, see: Andrew S. Erickson, “China’s 2013 Military Budget to Rise 10.7% to US $114.3 Billion–What it Means, and Why it Matters,” China Analysis from Original Sources (以第一手资料研究中国), 4 March 2013.