China's defence budget to increase by 7 to 8 per cent this year

Military delegates arrive for a session of the Chinese People's Political Consultative Conference (CPPCC) in Beijing, on March 4, 2016. PHOTO: AFP

BEIJING - China's defence budget will increase by 7 to 8 per cent this year, marking a slowing pace compared with last year, a top government official said on Friday (March 4).

Parliament spokeswoman Fu Ying gave the ballpark figure at a news conference, adding that the actual figure would be released on Saturday, when the annual session of the largely rubber-stamp National People's Congress (NPC) opens.

Ms Fu said the defence budget is set based on two considerations: China's military construction needs and its economic conditions.

"President Xi Jinping has said the People's Liberation Army (PLA) will strive to protect our national sovereignty and also maintain world peace. You know we're also embarking on military modernisation efforts this year, so that's a factor too," she said.

Last year, China's defence spending rose 10.1 per cent to 887 billion yuan (S$188 billion), second only to the United States, continuing nearly two-decades of double-digit increases in military budget.

It was the slowest pace in five years, though many believe China's official spending to be understated so as to suppress concerns over its military might.

China's defence spending is closely watched amid its increasingly assertive stance in territorial disputes with regional countries such as the Philippines and Vietnam in the South China Sea and with Japan in the East China Sea.

Last month, Beijing deployed an advanced surface-to-air missile system to a contested island in the resource-rich waters of the South China Sea, drawing international criticism.

President Xi is also attempting to drag the PLA into the modern age to make it a meaner and leaner fighting machine, slashing 300,000 jobs and revamping the Cold War-era command structure.

Sources quoted in a Reuters report last month had said a 30-per-cent spike was being mooted in military circles to assuage the military's unhappiness at sweeping reforms and as worries over the South China Sea and Taiwan weigh on Beijing.

On Thursday, Lieutenant-General Wang Hongguang, former deputy commander of the Nanjing Military Region, said a 20-per-cent increase was needed to cover the retirement pay and lay-off compensation for 300,000 personnel set to lose their jobs amid Chinese military's modernisation efforts.

He told reporters on the sidelines of a political meeting in Beijing that more money was also needed to assert China's territorial claims in the South and East China Seas.

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