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The military budget of the People's Republic of China in US$ billions.

The military budget of the People's Republic of China (PRC) is the portion of the overall budget of China that is allocated for the funding of the military of the People's Republic of China. This military budget finances employee salaries and training costs, the maintenance of equipment and facilities, support of new or ongoing operations, and development and procurement of new weapons, equipment, and vehicles. Every March, as part of its annual state budget, China release a single overall figure for national military expenditures.[1]

The Chinese government's published 2010 military budget is US$77.95 billion,[2] the second largest in the world and up 7.5 percent from 2009 (US$70.3 billion).[3] This figure would mean that for 2010, China's military expenditure as a percentage of GDP would be 1.4%.[4]

Various studies

While the People's Republic of China officially states to have a lower defense budget than the other world powers, unofficial estimates place the total amount of spending higher than the government claims. However, unofficial calculations about the military spending of the People's Republic of China tends to differ between organizations.

In 2009, the US Department of Defense's annual report to Congress on China's military strength offered several estimates of actual 2008 Chinese military spending. In terms of the prevailing exchange rate, Pentagon estimates range between US$105 and US$150 billion,[5] the second highest in the world after the US.

The last year that many international institutes provided estimates of Chinese military spending, in comparable terms, was 2003. In terms of the prevailing exchange rate, SIPRI, RAND, the CIA and the DIA estimated the budget at between US$30 and US$65 billion. In terms of purchasing power parity, or the relative purchasing strength of the expenditure, the SIPRI estimate is as high as US$140 billion.[6] The Chinese government's published budget at that time was less than US$25 billion.

A RAND Corporation study states that People's Republic of China's defense spending is higher than the official number but lower than United States Department of Defense estimates. The defense spending of the People's Republic of China is estimated to be between 2.3-2.8% of China's GDP. This is 40-70% higher than official figures, but substantially lower than previous outside estimates. Chinese military spending nevertheless doubled between 1997 and 2003, nearly reaching the level of the United Kingdom and Japan, and it continued to grow with an annual rate of greater than 10% during 2003-2005.[2] If the RAND study is correct, China could be the second highest spender by percentage of GDP, among the countries in the below tables; as well, it would surpass Japan and Russia in absolute terms.

A SIPRI study also comes to the conclusion that the military spending of the People's Republic of China is higher than the official budget, but its estimate is lower than that of the RAND study.

Comparison with other countries

Absolute expenditures in USD for 2004-2007
Country/Region Official budget DIA SIPRI RAND DoD
United States $419.3 billion $475.3 billion $475.3 billion $419.3 billion
United Kingdom $58.6 billion $47.4 billion $47.4 billion
Japan $45.8 billion $45.8 billion $42.4 billion
People's Republic of China (PRC) $29.9 billion $90–130 billion $30.7 billion $42.0-51.0 billion $63.0 billion
Russia $14.5 billion $70.0 billion $19.4 billion $70.0 billion
Republic of China (Taiwan) $7.6 billion $7.7 billion
Relative expenditures as percentage of GDP
Country/Region Official budget SIPRI RAND DoD
United States 3.6% 4.0% 3.6%
Russia 2.8% 4.3% 12%
United Kingdom 2.7% 2.2%
Republic of China (Taiwan) 2.6% 2.2%
People's Republic of China (PRC) 1.4% 1.8% 1.9-2.4% 1.2%
Japan 1.0% 1.0%
  • Data: Official: 2005; SIPRI: 2005 (overall) 2004 (% of GDP); RAND: 2004; DoD: 2005, except the data for the U.S. which is a 2006 estimate.
  • Note that this data have been adapted to the revision of China's 2004 GDP. This revision increased China's GDP number with 16.8% (or 283 billion USD). These figures were issued by the Chinese National Bureau of Statistics following a survey that aimed to gather more accurate data. Service industries accounted for 93% of the revision.[7]
  • 2007 military budget is 350.92bn yuan, only an increase of 4.1 yuan per capita.
  • Due to differences between the countries' budget systems, China categorizes "the budget of The 2nd Artillery Corps" as "the budget of Space Development Rockets", and Missile development is included in the Air Science Budget. As a result, China and Russia's Military budgets do not correspond to those of other countries, but actual military expenditure can be estimated by military equipment inventory. DIA re-estimated China's real Military Expenditure for 2007, and Pentagon reported to Congress that it will be between 80Bil to 130Bil USD, at the same level as Japan+UK+France Lampsum amount.

Real Volume Comparison

  • The following table exposes the effects of Purchasing Power Parity by comparing the equipment that each country can afford with its budget. The data, except for the "troops" category, shows only relatively modern and on use material each military owns, it excludes stocks and obsolete hardware.
Type PRC Russia Japan US ROC N. Korea S. Korea
Combat aircraft 2,200 2,200 400->260 4,601 400 ~300 300
Tanks 8,000 21,000 900->600 ~7,000 900 3,000 2,000
Submarines 60 60 16 72 2 24 8
Tank/Transportation 420 200(Pac50) 30 900(Pac450) - - 10
Troops (in thousands) 1600 400 165 650 220 1100 660

See also


External links

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