Analysis
The myth of China’s military might
Beijing's defence budget doesn't tell the whole story
BY EDWARD LUTTWAK
Professor Edward Luttwak is a strategist and historian known for his works on grand strategy, geoeconomics, military history, and international relations.
ELuttwak
March 7, 2023
The day after Li Keqiang, China’s departing Prime Minister and the last of Beijing’s moderates, called for more market liberalisation to reach this year’s 5% growth target, Xi Jinping responded by announcing a muscle-flexing 7.2% increase in China’s defence spending. That is certainly consistent with Xi’s truculent stance (he replied to Nancy Pelosi’s recent Taiwan visit with a series of ballistic missile launches), and with his official promise to the Communist Party that China will become the world’s dominant power by 2049. But what do those percentages actually mean?
The declared total of China’s newly increased defence budget at 1.56 trillion yuan amounts to $230 billion, according to the current exchange rate. If that were the case, it would mean that China is falling further behind the United States, whose own fiscal 2023 defence spending is increasing to $797 billion (and actually more, since that figure does not include its funding for military construction or the added help to Ukraine).
China’s own figure is also generally assumed by experts to be greatly understated — not by fiddling the numbers one by one, but rather by wholesale exclusions, such as the attribution of research-and-development spending to civilian budgets. Even if a commando team of elite forensic accountants were sent into action to uncover China’s actual defence spending, with another team dispatched to determine what’s missing from the US budget, we would still only have a very loose indication of how much actual military strength China and the United States hope to add.
https://unherd.com/2023/03/the-myth-of-chinas-military-might/