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CHINA'S MILITARY EXPENDITURE INCREASES STEADILY

<Kanwa News March 20th 2003> China's openly declared military budget for this year is RMB185.3 billion Yuan/US$22.3863 billion (US$1=RMB8.2774 Yuan), which is RMB15.856 billion Yuan/US$1.9155 billion more than the previous year, an increase rate of 9.6%, more than three times as Russian military budget. In 2002, China's claimed military expenditure was RMB169.444 billion Yuan /US$20.47909 billion. China's deliberate avoidance of a two-digit military budget increase aims at meeting the needs of politically setting off the "China threat argument". This dramatic figure is very suspicious in that it may be a "manipulated decision".

There has been no indication that China will cut its expenses in arms purchase. The largest scale ever water ship construction projects, the import of SU30MKK2 and the production of J10A will all continue this year. In addition, Kanwa also believes that a lower military expenditure growth rate very likely reflects that the construction of such major projects like new generation 093SSN and 094SSBN is completed partly. The servicemen compensation adjustment plan is also at concluding stage. More arms development expenses may be buried in the budget for scientific and technological research. For two consecutive years, China's military expenditure has increased at a high rate of above 17%. In 2001 and 2002, the growth rates were respectively 19% and 17.5%. In particular, the expenditure on arms purchase increased by 27% in 2001 and 15.8% in 2002. China's total expense on arms purchase from 2000 to 2002 was RMB 38.93 billion Yuan, 49.46 billion Yuan and 57.278 billion Yuan, that is, US$4.7033 billion, US$5.9755 billion and US$6.9201 billion respectively (data from China official defense white paper). In other words, by just doing a straightforward calculation, the average spending on arms purchase for each of the four services was US$1.73 billion in the year 2002. This year, the spending may increase by at least US$600 million, making the total expenditure US$7.5 billion.

COMPARISON OF CHINA-TAIWAN MILITARY BUDGET

There has been no indication that the decrease of China's military budget this year is due to the deterioration of fiscal revenue on the part of the Chinese central government, or it can no longer support the arms race with Taiwan. China claimed that in 2001, its military budget only amounted to 7.65% of the national fiscal expenditure, lower than the 8.66% of 1998. In contrast, Taiwan's military budget in 2001 made up to 16.48% of its total fiscal expenditure, and this rate was 17.19% in 2002. Taiwan's military budget in 2002 was TW$261.04 billion/US$9.0372 billion ($1=TW$28.885), in 2001, it was TW$269.8 billon/US$9.34 billion. Due to unhealthy financial situation on the island, Taiwan's military budget tends to decrease by years. In 1993, Taiwan's defense budget once hit TW$271.09 billion/US$9.385 billion. The total budget decreased by 3.7%. This is a striking contrast to China's steady increase in military expenditure in the last few years.

In 2001, China's arms purchase expense was RMB49.460 billion Yuan/US$5.9755 billion, while Taiwan's corresponding figures were TW$62.7 billion/US$2.17 billion. In 2002, China's arms purchase expense was RMB57.278 billion Yuan/US$6.9201 billion. For Taiwan, this figure was TW$55 billion/US$1.904 billion. Due to the stagnated economic situation on the island, Taiwan has demonstrated signs of "exhaustion" in the arms race with the mainland. The US has become discontented with Taiwan's declining aspiration to purchase new weapon systems.

It deserves further close concern whether China's current move of cutting military budget is out of consideration to Taiwan's sharp decrease in military expenditure, or because Beijing believes it needs to restrict its military build-up at a rational level while maintaining a lead in this arms race. <Kanwa>

想不到平可夫比我还懒！！
[em10][em10][em10]CHINA'S MILITARY EXPENDITURE INCREASES STEADILY

<Kanwa News March 20th 2003> China's openly declared military budget for this year is RMB185.3 billion Yuan/US$22.3863 billion (US$1=RMB8.2774 Yuan), which is RMB15.856 billion Yuan/US$1.9155 billion more than the previous year, an increase rate of 9.6%, more than three times as Russian military budget. In 2002, China's claimed military expenditure was RMB169.444 billion Yuan /US$20.47909 billion. China's deliberate avoidance of a two-digit military budget increase aims at meeting the needs of politically setting off the "China threat argument". This dramatic figure is very suspicious in that it may be a "manipulated decision".

There has been no indication that China will cut its expenses in arms purchase. The largest scale ever water ship construction projects, the import of SU30MKK2 and the production of J10A will all continue this year. In addition, Kanwa also believes that a lower military expenditure growth rate very likely reflects that the construction of such major projects like new generation 093SSN and 094SSBN is completed partly. The servicemen compensation adjustment plan is also at concluding stage. More arms development expenses may be buried in the budget for scientific and technological research. For two consecutive years, China's military expenditure has increased at a high rate of above 17%. In 2001 and 2002, the growth rates were respectively 19% and 17.5%. In particular, the expenditure on arms purchase increased by 27% in 2001 and 15.8% in 2002. China's total expense on arms purchase from 2000 to 2002 was RMB 38.93 billion Yuan, 49.46 billion Yuan and 57.278 billion Yuan, that is, US$4.7033 billion, US$5.9755 billion and US$6.9201 billion respectively (data from China official defense white paper). In other words, by just doing a straightforward calculation, the average spending on arms purchase for each of the four services was US$1.73 billion in the year 2002. This year, the spending may increase by at least US$600 million, making the total expenditure US$7.5 billion.

COMPARISON OF CHINA-TAIWAN MILITARY BUDGET

There has been no indication that the decrease of China's military budget this year is due to the deterioration of fiscal revenue on the part of the Chinese central government, or it can no longer support the arms race with Taiwan. China claimed that in 2001, its military budget only amounted to 7.65% of the national fiscal expenditure, lower than the 8.66% of 1998. In contrast, Taiwan's military budget in 2001 made up to 16.48% of its total fiscal expenditure, and this rate was 17.19% in 2002. Taiwan's military budget in 2002 was TW$261.04 billion/US$9.0372 billion ($1=TW$28.885), in 2001, it was TW$269.8 billon/US$9.34 billion. Due to unhealthy financial situation on the island, Taiwan's military budget tends to decrease by years. In 1993, Taiwan's defense budget once hit TW$271.09 billion/US$9.385 billion. The total budget decreased by 3.7%. This is a striking contrast to China's steady increase in military expenditure in the last few years.

In 2001, China's arms purchase expense was RMB49.460 billion Yuan/US$5.9755 billion, while Taiwan's corresponding figures were TW$62.7 billion/US$2.17 billion. In 2002, China's arms purchase expense was RMB57.278 billion Yuan/US$6.9201 billion. For Taiwan, this figure was TW$55 billion/US$1.904 billion. Due to the stagnated economic situation on the island, Taiwan has demonstrated signs of "exhaustion" in the arms race with the mainland. The US has become discontented with Taiwan's declining aspiration to purchase new weapon systems.

It deserves further close concern whether China's current move of cutting military budget is out of consideration to Taiwan's sharp decrease in military expenditure, or because Beijing believes it needs to restrict its military build-up at a rational level while maintaining a lead in this arms race. <Kanwa>

想不到平可夫比我还懒！！
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