According to the official data published by the National Bureau of Statistics of China (see following figure), the expenditure of the country on National Defence, has been constantly rising over the period 2005-2015. More specifically, since 2005, when some 37.09 Billions of current US $ were invested in the associated directions, the country’s expenditure has more than tripled, to reach some 124.24 Billions of current US $, in 2014. This trend was further reinforced in 2015, when defence budget reached 136.2 billion of current US $. On the other hand, the percentage (%) of the overall National Expenditure allocated for National Defence purposes, has actually dropped from around the 7% figure on average over the period 2005-2009 to some 5.5%, on average, over the period 2010-2014, to 5.17% in 2015.
It must be stressed that particularly for China, the official figures released and those of other sources reporting on defence spending (e.g. the Stockholm International Peace Research Institute (SIPRI)), vary considerably, and often China has been accused of not providing sufficient transparency with regards to its spending in this direction.
Nevertheless, it is commonly acknowledged that China’s defence spending is the 2nd highest worldwide, only behind that of the United States (US). In addition, US defence spending has been falling since 2012, each year, while China’s defence expenditure continued to rise steadily over the same period. As a result, the gap between the 2 countries’ defence expenditure is closing, albeit that it is still very sizable (in 2015, it was estimated that US defence expenditure was still some 3 times greater than that of China for the same year).
On the other hand though, according to SIPRI data, the % of the GDP spent by China on defence has remained quite constant over the last 15 years (2000-2015), and is still considerably below those of the United States, Russia and India, but still about double that of Japan.
According to the Stockholm International Peace Research Institute’s (SIPRI), February 2016 Fact Sheet, “Trends In International Arms Transfers, 2015”, Chinese exports of major arms increased by 88%, between the periods 2006–10 and 2011–15 (see following figure). More specifically, since 2010, China’s revenues from arms exports, have surpassed the cost of respective imports from abroad, while the contrary was the case for at least the previous decade (2000-2009). More specifically, the country’s arms imports decreased by 25% between 2006–10 and 2011–15. While in the early-2000s China was by far the largest importer of arms worldwide, it dropped to 3rd place in the period 2011–15.
Further, most notably, China’s share of global arms exports, rose from 3.6% (2006-10) to 5.9% (2011-2015). All in all, China supplied major arms to 37 countries worldwide, over the period 2011–15, however some 75% of these exports were to countries from Asia and Oceania. In fact, the exports of Chinese arms to countries from these regions, exhibited the largest growth over the period 2011–15, namely being 139% higher than the respective exports over the period 2006–10. Pakistan was the main recipient of Chinese arms exports over the period, accounting for 35%, followed by Bangladesh with 20% and Myanmar with 16%.
Nevertheless, according to SIPRI data, China still remains partly dependent on imports for some key defence items, including large transport aircraft and helicopters (mostly from Russia), and engines for aircraft, vehicles and ships. Characteristically, engines accounted for 30% of China’s arms imports over the period 2011–15. In addition, in 2015 the country signed orders for 4 to 6 air defence systems (S-400 Triumph) and 24 combat aircraft (Sukhoi Su-35 multirole fighter jets) from Russia, indicating that it is not yet self-sufficient as far as such items. In terms of arms suppliers to China, traditionally Russia continued to rank as the primary supplier over the period (2011-2015), with 59%, followed by France with 15% and Ukraine with 14%.
China’s armed forces comprise of the People’s Liberation Army Ground Forces (PLA), consisting of some 1.6 Million troops, the People's Liberation Army Navy (PLAN), with some 235,000 personnel, the People's Liberation Army Air Force (PLAAF) with some 398,000 personnel and the People's Liberation Army Rocket Force (PLARF), with a further 100,000 active staff. Altogether, the sum of the country’s regular forces amount to some 2,333,000 personnel (2015 estimate), and in addition there are the PLA reserves, of some 510,000 members.
In the last couple of decades, notably China has been investing in defence programs and weapons’ acquisitions, with the aim to extend the range of its power projection, as also in operations in ‘critical’ pillars for advanced defence capabilities, such as cybersecurity, satellite communications and space operations, as well as electronic warfare. The PLA, equipped with the latest weapons under production indigenously, will be able to conduct military operations in the Asia-Pacific region, beyond Taiwan, in the South China Sea, the Western Pacific, and the Indian Ocean. Key systems that have been either deployed or are under development with the PLA in this direction include:
- Ballistic missiles (e.g. the silo-based CSS-4, the solid-fuelled, road-mobile CSS-5 (anti-ship) and CSS-10, the extended range CSS-11, etc).
- Anti-ship (e.g. the YJ-18, the YJ-83) and land attack (e.g. CJ-10) cruise missiles.
- Nuclear submarines (Types 093 and 094).
- Modern surface ships (e.g. the Type 056 Jiangdao-class corvette, the Type 052D Luyang II class guided missile destroyer, the Type 071 Yuzhao-class amphibious transport docks, the Type 054A Jiangkai II frigates).
- An aircraft carrier (the Liaoning, Type 001).
The PLA’s Naval force is expected to be further strengthened with the construction on the new Type 081-class landing helicopter assault ship, as well as several aircraft carriers (Type 001A), over the next years.
In terms of aerial assets, China is developing advanced 4th and 5th generation aircraft (e.g. the Shenyang J-16, the Chengdu J-20 and the Shenyang J-31, the first introduced in 2013, and the 2nd and 3rd expected to be introduced in 2018/19), which incorporate stealth/low-observable technology, carbon fibre and other specialty materials, and has introduced recently (July 2016) its first indigenously produced heavy-lift military transport aircraft (the Xian Y-20). As far as UAVs, China is investing heavily in such systems, as is the trend in all advanced countries, with over a dozen reported programmes underway. In this direction, AVIC (Aviation Industry Corporation of China) holds an annual competition (the “AVIC Cup—International UAV Innovation Grand Prix”) for new UAV concepts, since 2012. Participants typically include some of China’s leading engineering schools. On the other hand, the indigenous Sky Hawk-1 (SH-1) stealth multirole long-range tactical UAV (developed by China Aerospace Science and Industry Corporation (CASIC)), first demonstrated in 2010, is now in service with the PLA. Further, AVIC has developed the Pterodactyl 1, a Medium-Altitude Long-Endurance (MALE) UAV, comparable to the US RQ-1 Predator, in addition to a number of other advanced UAV concepts, including a vertical take-off platform. The Pterodactyl 1 is also in service with the PLA and has already achieved reported exports sales to Saudi Arabia, the UAE, Egypt, Nigeria and Kazakhstan.
In general it is noted that China’s defence investments in recent times, prioritize missile and space programs, followed by the development of naval assets and aircraft, and, lastly, land force materiel. China is developing and producing increasingly advanced military systems, through a combination of investments in accessing foreign designs, as well as through reverse engineering, combined with strategically planned indigenous systems development. In parallel, the local defence industry is drastically improving upon the quality and reliability of the produced systems, while at the same time increasing overall production capacity.
More specifically, in January 2006, the country adopted a 15-year plan (for the period 2006-2020), titled the “Medium- and Long-Term Program for Science and Technology Development”, which was aimed at transforming China into an “innovation-oriented society by 2020” and a “world leader in science and technology (S&T) by 2050”. This plan outlines China’s science and technology focus areas in terms of “basic research”, “leading-edge technologies”, “key fields and priority subjects” and “major special projects”, many of which have an impact on defence, as follows:
- Basic Research: The 5 areas with military extensions identified in the associated plan as “major strategic needs”, requiring ‘active’ government involvement and funding, were:
- Material design and preparation
- Manufacturing in extreme environmental conditions
- Aeronautic and astronautic mechanics
- Information technology development
- Nanotechnology research
- Leading-edge Technologies: Such technologies identified in the 15-year plan as ‘priority’ for rapid development, include:
- Information Technology: As far as intelligent sensing, ad-hoc networks and virtual reality.
- New Materials: Smart materials and structures, high-temperature superconduction and highly efficient energy material.
- Advanced Manufacturing: Extreme manufacturing and ‘intelligent’ service robots.
- Advanced Energy Technologies: Hydrogen energy and fuel cell technologies, alternative fuels and advanced vehicle technologies.
- Marine Technologies: 3-D maritime environment monitoring, fast, multi-parameter ocean floor survey and deep-sea operations’ technology.
- Laser and Aerospace Technologies: Chemical and solid-state laser technology, as weapon systems to be integrated on ground-based and/or airborne platforms.
- Key Fields and Priority Subjects: Industries and technology groups which could lead to technological breakthroughs, remove technical obstacles and improve international competitiveness, were identified. As a consequence, the indigenous defence industry is pursuing advanced manufacturing, information-based and defence technologies (e.g. radar, space capabilities, secure C4ISR, smart materials and low-observable technologies).
- Major Special Projects: 16 ‘fundamental’ such directions in which the country needs to focus its efforts for the further development of its current capabilities were identified. These included items such as: core electronic components, high-end universal chips and operating system software, very large-scale integrated circuit manufacturing, next-generation broadband wireless mobile communications, high-grade numerically controlled machine tools, large passenger aircraft, high resolution earth observation systems, manned space flights, and the moon probe.