Sends Its Army Money, and a Signal to the U.S.
York Times, March 13 20001,
By CRAIG S. SMITH
SHANGHAI -- China announced its biggest military
budget increase in 20 years last week, making generals from
Washington to Tokyo sit up. Certainly the 17.7 percent jump
to $17.2 billion this year is intended to send the message
that China is serious about modernizing its 2.5-million-man
armed forces in order to give the United States pause if
it thinks of operating unchallenged in Asia. But military
analysts say the focus for now remains a limited one: Taiwan.
Shen Dingli, a Chinese military
expert at Shanghai's Fudan University, described the logic
in a way that parallels what Western experts say: "We're
increasing our military capability in order to ensure that
Taiwan doesn't declare independence. But what China is adding
to its arsenal is far from what's necessary to challenge
the United States in the Asia-Pacific."
That said, China's increased
spending signals a basic shift in how the country perceives
itself in the world, a perception that began changing in
1996 after Taiwan's first democratic presidential elections.
For more than a decade before
that, China had let its military drift, following Deng Xiaoping's
assessment that 20 years of peace would allow the country
to pursue economic development unharassed. As a result,
the People's Liberation Army suffered years of shrinking
budgets in real terms. Even the 10 to 12 percent increases
of the early to mid 1990's were cut by inflation.
Then came Taiwan's elections,
an indication that the island was moving farther from Beijing's
grasp. China fired missiles into the sea off Taiwan's coast
to warn the island's government against moves toward outright
independence. The United States responded by sending an
aircraft carrier through the Taiwan Strait. That infuriated
Beijing and humiliated the People's Liberation Army, highlighting
its lack of options.
Anxiety over the state of the
military increased when Japan passed revised guidelines
for defense cooperation with the United States in 1997 and
decided to join the United States in co-research of a theater
missile defense system that could potentially be used to
protect Taiwan. Then President Lee Teng-hui of Taiwan characterized
the island as a state equal to China in 1999, and Taiwan
elected the independence-minded Chen Shui- bian as Mr. Lee's
After that came the North Atlantic
Treaty Organization's bombing campaign in Kosovo, which
posed the question in China: "Will the U.S. use its
unbridled power to someday intervene in Taiwan, Tibet or
NATO's errant bombing of China's
embassy in Belgrade only punctuated those concerns, allowing
the army to open a debate over the continued validity of
Deng Xiaoping's analysis.
Domestic politics, meanwhile,
converged to lend the army support. Growing corruption in
the military, which had become increasingly involved in
commercial pursuits to supplement its meager budget, had
raised alarm, and President Jiang Zemin forced it to divest
all of its businesses beginning in 1998. He promised to
make up the lost revenue through budget increases later
The debate dominated the discussion
at 1999's annual summer leadership conference at the northern
seaside resort of Beidaihe, where the decision to increase
military spending was made. A White Paper on China's military
a year later reflected the new assessment:
"In view of the fact that
hegemonism and power politics still exist and are further
developing, and in particular, the basis for the country's
peaceful reunification is seriously imperiled, China will
have to enhance its capability to defend its sovereignty
and security by military means."
For those who had followed
this chain of events, the increased budget came as no surprise.
The question now is where China will spend the money.
Much of it is expected to finance
training exercises, maintenance and force restructuring.
There are plans to cut the army's size, but even that will
be expensive because demobilized soldiers must be relocated
and retrained. China is also expected to spend more on its
missile modernization program, thanks to American missile
Most of the spending, according
to Mr. Shen and others, is intended to enhance the country's
ability to intimidate Taiwan. "For Taiwan, to deter
separatists, we need third-generation fighters, missiles
and precision-guided weaponry, amphibious landing equipment,
electronic warfare equipment, all of which can be domestically
manufactured," said Mr. Shen.
Because China lacks a huge
high-tech arms industry, developing new weapons is slow
and expensive. "Although R. & D. spending will
eventually produce something, given the inefficiencies of
the Chinese system this might be one of the least threatening
areas for them to spend defense dollars," said Phil
Saunders, director of the East Asia Nonproliferation Program
at the Monterey Institute of International Studies.
Even then, the money will be
thinly spread. In announcing the budget increase, Finance
Minister Xiang said much of it would go to boost officer's
salaries. Some, too, is earmarked as compensation for revenue
lost when the military gave up its businesses.
OF course, the announced budget
is only part of China's military spending. Some analysts
put the total at double or even quadruple the budgeted amount,
including money used to buy arms abroad, which are paid
for from a separate, undisclosed hard-currency fund. But
even at a multiple of three, China's defense spending is
far outdistanced by that of the United States.
"If the concern is that
China will challenge U.S. interests, that is a long, long
way off," said Evan Medeiros, a senior research associate
at the Monterey Institute's nonproliferation program. "But
if the concern is that they will make the U.S. more cautious
in their operations in the Asia-Pacific region, that's more
David Finkelstein, deputy director
of CNA Corp.'s Center for Strategic Studies, put it another
way: "They want to be the regional hegemon, so that
no Asian- Pacific nation can make serious decisions without
taking China into account."