China’s Official Military Budget to Grow by 17.6% in 2008

Red flag to abull defense market As was the case in the communist Soviet Union, China’s official military budget and real military budget are not the same thing. Many items are hidden under other ministries, or simply not reported truthfully in the absence of accountable government. Official figures are given, however, and for the last 2 decades those figures have shown uninterrupted double-digit increases. Hot on the heels of the Pentagon’s release of its Congressionally-mandated “Military Power of the People’s Republic of China 2008” [PDF] report, Chinese “People’s Congress” spokesman Mr. Jiang Enzhu announced an 17.6% increase in China’s 2008 military budget, to 417.77 billion yuan ($58.81 billion). The increase follows a 17.8% increase in 2007, and a 14.7% increase in 2006. 1996-2007(click to view full) The real math, of course, lies in compound interest; over 20 years, an increase averaging 10% per year would grow a budget to 6.7 times its original size; at 12.5% per year, the figure is 10.5 times, and at 14% per year the budget would be 16.4 times its original size. Military modernization programs appear to be accelerating in step, including reports that China’s navy has already announced plans to build its first aircraft […]