China has announced an increase in its defense budget and emphasized unification with Taiwan, dropping the mention “peaceful” from the language.
On March 5, Chinese Premier Li Qiang delivered his first government work report during the Chinese Communist Party’s “Two Sessions,” stating that China’s national defense budget for 2024 will increase by 7.2 percent to 1.6 trillion yuan ($225 billion). He also emphasized the goal of unification with Taiwan but failed to mention it would be by “peaceful” means, which raised concerns about the regime’s increasingly militaristic agenda.
Military Budget Increase During an Economic Downturn
Yao Cheng, a former lieutenant colonel in the Chinese Navy now residing in the United States, stated on the “Pinnacle View” program that the government work report announced the highest military expenditure in China’s history, yet the figure announced by the NPC represents only the operational expenses of the armed forces. In reality, China’s military expenditure is much higher and has two additional expenses.“One of the additional expenses not counted in the budget is providing military assistance to other countries, such as arms support to Iran, North Korea, and Russia,” said Mr. Yao.
The other expense includes China’s paramilitary police force, the People’s Armed Police, with over 1 million members, over 5,000 provincial military districts and military sub-districts, and 8 million reserves, all of which are part of China’s armed forces.
Mr. Yao said, “In theory, these expenses should be included in the military budget, but the armed police and local armed and reserve forces are considered local expenditures and are not included in the national military budget.”
He further explained that a preliminary estimate indicates that these three expenses combined should amount to 5 trillion yuan, equivalent to almost $700 billion. However, China’s expenditures are more cost-effective than those of the United States. For instance, labor is cheaper in China, and materials are less expensive. Building a warship in China costs only 50 to 60 percent of building one in the United States. Therefore, adjusted for purchasing power parity, it can be understood that China’s actual military budget is higher than that of the United States.
Li Jun, a Chinese independent TV producer based in the United States, said on “Pinnacle View” that historically, China’s military expenditure tends to increase when the economy worsens and social instability increases. In the 1950s, China’s military spending accounted for 50 to 60 percent of the regime’s GDP. The figure remained high during the Cultural Revolution. China’s military expenditure was significantly lowered in 1978 when the CCP leader implemented the “reform and opening up” policy to develop the economy.
“At this time of economic instability and rising social grievances, Xi Jinping needs to stabilize military morale,” said Mr. Li. “If he cuts military spending now, the military might think that there won’t be enough money in the future, which could be detrimental for Xi Jinping.”
Potential Regional Conflicts
Mr. Yao said on the show that the absence of mention of peaceful unification with Taiwan in the government report is because the CCP has reached a consensus that peaceful unification is unlikely. Therefore, the only means of reunification is through a military invasion. This led to the CCP’s single-minded militaristic agenda.Regarding the South China Sea, Mr. Yao said that China’s conflict with the Philippines has constraints because China will soon sign the Code of Conduct in the South China Sea (COC) with surrounding countries. In the South China Sea, there are territorial disputes between pretty much all surrounding countries and China. If China conflicts with the Philippines, it will lose credibility for its COC.
US–China Confrontation in the South China Sea
Guo Jun, editor-in-chief of the Hong Kong edition of The Epoch Times, said on “Pinnacle View” that the territorial dispute in the South China Sea will not escalate yet because China’s strategy is to gradually apply pressure, especially to the Philippines. The Philippines has a mutual defense treaty with the United States, and if the situation escalates, it may lead to a U.S. intervention.Ms. Guo said that recent intrusions by the China Coast Guard at the Philippines’s Second Thomas Shoal and Taiwan’s Kinmen Islands are not merely maritime police actions since the China Coast Guard has been under the CCP’s Central Military Commission since 2018. This means that those incidents of confrontation were orchestrated directly by the CCP’s military and are a part of China’s comprehensive strategy in the South China Sea and Taiwan to increase pressure on those countries.
Shi Shan, senior writer and contributor to the Chinese language edition of The Epoch Times, said on the show that the United States is not considering how to deal with China’s coast guard vessels but how to confront China’s entire navy. Therefore, the United States is continuously conducting military exercises in the waters around the Philippines, with allies such as Australia, the UK, Japan, India, and even warships from France and Germany.
“Therefore, this area may become the world’s largest powder keg in the future because future economic growth is also concentrated in Southeast Asia,” said Mr. Shi. “Whoever controls [the South China Sea] is equivalent to controlling the Mediterranean during the Roman Empire. So this area is now crucial.”
