China Is Among the World Leaders in ‘Secret’ Military Spending, Report Says

Chinese guards in Tiananmen Square.

Flickr image via Peter Mackey

AA Font size + Print

Chinese guards in Tiananmen Square.

And 'additional, off-the-books spending' could be as high as 50% of China’s official defense expenditure.

China is responsible for 30% of the world’s secretive defense spending, reports Transparency International (TI), a Berlin-based anti-corruption NGO. Secretive spending, defined by TI as “military expenditure where no meaningful details are released either to the public or parliament,” is leading to corruption at home and mistrust in the Asia-Pacific region that could destabilize the area, the organization says.

“No information is available on acquisition planning, and only broad details are disclosed on actual and planned purchases,” TI wrote about China’s defense spending in its Asia-Pacific Government Defense Anti-Corruption Index, adding: “The Chinese public would gain more knowledge about their nation’s defense capabilities through reading foreign press reporting.”

Furthermore, “additional, off-the-books spending” could be as high as 50% of China’s official defense expenditure—or $65 billion, based on China’s declared defense budget last year (paywall)—making it extremely difficult to form an accurate assessment of what China’s military is spending its money on.

TI’s ranking of defense establishments, by least to most corruptible.(Transparency International)

China is one of 11 countries in Asia that TI says has a “high,” “very high,” or “critical” risk of corruption in its ranking of defense “establishments.” Myanmar and Cambodia score the worst.

China’s military expenditure now accounts for 12% of the world’s total, according to the TI report.

As China’s GDP has grown, so has its spending on weapons and military, though it is far outpaced by the US. The below data is from the Stockholm International Peace Research Institute, which has to rely on its own estimates to parse China’s actual military spending:

Meanwhile, China’s military budget as a share of its GDP remains remarkably flat from year to year:

Part of the reason China’s defense spending is so muddy is that the People’s Liberation Army has long been able to generate impressive side revenues by establishing corporations or by commercializing the vast amounts of land entrusted to it.

Close [ x ] More from DefenseOne
 
 

Thank you for subscribing to newsletters from DefenseOne.com.
We think these reports might interest you:

  • Software-Defined Networking

    So many demands are being placed on federal information technology networks, which must handle vast amounts of data, accommodate voice and video, and cope with a multitude of highly connected devices while keeping government information secure from cyber threats. This issue brief discusses the state of SDN in the federal government and the path forward.

    Download
  • Military Readiness: Ensuring Readiness with Analytic Insight

    To determine military readiness, decision makers in defense organizations must develop an understanding of complex inter-relationships among readiness variables. For example, how will an anticipated change in a readiness input really impact readiness at the unit level and, equally important, how will it impact readiness outside of the unit? Learn how to form a more sophisticated and accurate understanding of readiness and make decisions in a timely and cost-effective manner.

    Download
  • Cyber Risk Report: Cybercrime Trends from 2016

    In our first half 2016 cyber trends report, SurfWatch Labs threat intelligence analysts noted one key theme – the interconnected nature of cybercrime – and the second half of the year saw organizations continuing to struggle with that reality. The number of potential cyber threats, the pool of already compromised information, and the ease of finding increasingly sophisticated cybercriminal tools continued to snowball throughout the year.

    Download
  • A New Security Architecture for Federal Networks

    Federal government networks are under constant attack, and the number of those attacks is increasing. This issue brief discusses today's threats and a new model for the future.

    Download
  • Information Operations: Retaking the High Ground

    Today's threats are fluent in rapidly evolving areas of the Internet, especially social media. Learn how military organizations can secure an advantage in this developing arena.

    Download

When you download a report, your information may be shared with the underwriters of that document.