Defense News quotes Brent Scowcroft Center Nonresident Senior Fellow Roger Cliff on China’s defense spending:
Despite the increases, actual spending was less that what China had earlier announced it would spend.
“According to my records, 2013 is the second year in a row in which China’s actual defense spending wound up being significantly less than was announced at the beginning of the year,” said Roger Cliff, senior fellow with the Asia Security Initiative at the Atlantic Council.
“The announced budget in March 2013 was … an increase of 10.7 percent over 2012. Actual expenditure in 2013 was … an increase of only 7.6 percent over 2012.”
The announced increases also never account for inflation, Cliff said. “Inflation in 2013 was expected to be 3.2 percent, official inflation figures for 2013 haven’t been released yet, as far as I know, so the increase in defense spending from 2012 to 2013 was only 4.3 percent in real terms.
“In fact, since 2009, China’s defense budget has grown by an average of only 4.7 percent in real terms,” Cliff said. “And yet, because the increases are always announced in nominal terms, not real terms, and the budgets announced at the beginning of the year have been exceeding the amount actually spent, everyone is still talking about ‘annual double-digit increases in China’s defense spending.’ ”
“One additional bit of information: Inflation in 2014 is expected to be 3.5 percent, so even if defense spending winds up being as high as announced for 2014, that will still only be an 8.4 percent increase over 2013 in real terms,” Cliff said.