China will increase its defence budget 7.2% this year

Military delegates march ahead of the opening session of the National People's Congress (NPC) at the Great Hall of the People in Beijing, China, Wednesday, March 5, 2025. (AP Photo/Andy Wong)

TAIPEI, Taiwan — China said Wednesday it will increase its defence budget 7.2 per cent this year, as it continues its campaign to build a larger, more modern military to assert its territorial claims and challenge the U.S. defence lead in Asia.

China’s military spending remains the second largest behind the U.S. and it already has the world’s largest navy.

The budget, which adds up to about US$245 billion, was announced at the National People’s Congress, the annual meeting of China’s legislature. The Pentagon and many experts say China’s total spending on defence may be 40 per cent higher or more because of items included under other budgets.

The boost is the same percentage as last year, far below the double-digit percentage increases of previous years and reflecting an overall slowdown in the economy. The nation’s leaders have set a target of around five per cent growth for this year.

Tensions with the U.S., Taiwan, Japan and neighbours who have overlapping claims to the crucial South China Sea are seen as driving spending on increasingly high-tech military technologies. Those include stealth fighters, the country’s three — soon to be four — aircraft carriers, and a broad expansion of its nuclear arsenal.

China generally ascribes the budget increases to exercises and maintenance and improving the lives of its 2 million service members.

China reiterates opposition to Taiwan’s independence

The People’s Liberation Army — the military branch of the ruling Communist Party— has build bases on artificial islands in the South China Sea but its main objective is asserting Chinese control over Taiwan, a self-governing democracy Beijing claims as its own territory that has close ties to the U.S.

China deployed a smaller contingent of five planes and seven ships near Taiwan on Wednesday, just days after sending dozens of aircraft. Such missions are intended to demoralize and wear down Taiwan’s defences, which have been bolstered by upgraded U.S. F-16s, tanks and missiles, along with domestically developed armaments.

In his comments at the Congress, Premier Li Qiang told the nearly 3,000 party loyalists that China still preferred a peaceful solution to the Taiwan issue, but “resolutely opposes” those pushing for Taiwan’s formal independence and their foreign supporters.

“We will firmly advance the cause of China’s reunification and work with our fellow Chinese in Taiwan to realize the glorious cause of the rejuvenation of the Chinese nation,” Li said.

Taiwan’s defence minister this week said the island is planning to boost military spending in the face of the “rapidly changing international situation and the escalating threats from adversaries.”

Feeling the economic crunch

Faced with slower growth, China will likely prioritize key strategic goals over social and economic reforms, said Antonia Hmaidi, a senior analyst with the Mercator Institute for China Studies.

“Those resources are more important to the CCP’s goals of advancing a techno-industrial agenda and modernizing the military,” Hmaidi said, using an acronym for the governing Chinese Communist Party.

Chinese President Xi Jinping, who oversees the armed forces, has attempted to force through major reforms and removed senior military leaders including two former defence ministers and the head of the missile corps.

Whether that will reduce the armed forces' influence remains unclear though, and the official Xinhua News Agency ran an item after Wednesday’s announcement praising the government for keeping defence spending at below 1.5 per cent of GDP for the last decade and criticizing the U.S. for not cutting its spending.

“China’s development strengthens the world’s forces for peace, and the country will never seek hegemony or engage in expansionism no matter what stage of development it reaches,” Xinhua said, using standard Chinese terms defining its stance as purely defensive in nature.

In its 2004 report on military and security developments involving China, the U.S. Defence Department portrayed China’s ever-growing ambitions, saying the “PLA concepts and capabilities focus on projecting power far from China’s shores.”

The navy’s movement from offshore defence to open seas protection and the air force’s interest in becoming a strategic force “reflect the PLA’s interest in conducting operations beyond (China) and its immediate periphery,” the department said.

Article written by Christopher Bodeen, The Associated Press