“China will boost defense spending 10.7 percent this year as the government modernizes its military arsenal and adopts a more assertive stance in territorial disputes with its neighbors.
Military spending is set to rise this year to 740.6 billion yuan ($119 billion) from 669.1 billion yuan, the Ministry of Finance said in a report. China has the second-biggest military budget in the world after the U.S., which spent nearly six times more on defense than China last year and is now cutting those outlays.
Defense spending as a percentage of gross domestic product remained unchanged in 2012 from a year earlier at 1.3 percent as the country upgrades its fleet of fighter jets, ships and missiles. The Communist Party says its modernization doesn’t pose a threat, while Japan and other nations in the region argue China has become more hostile in disputes over territory in the resource-rich waters of the East and South China seas.
“The increase is consistent with their long-term modernization plans,” said Taylor Fravel, a professor at the Massachusetts Institute of Technology who studies China’s relations with its neighbors. “Any time you see a double-digit increase in defense spending, especially when nobody else in the region is growing their budget at those rates, it generates anxiety and concern.”
