China’s plans to target economic growth of about 5 per cent this year should prompt some scepticism. Uncertainty from a property sector crisis and weak consumer spending make it difficult to be optimistic.
But one thing is certain. Few things — not even a budget deficit of 3 per cent of gross domestic product — will stand in the way of Beijing increasing defence spending. Many stand to benefit.
Beijing’s military budget will increase 7.2 per cent, in line with last year’s rise despite a slowing economy and making China the second largest spender after the US globally. This military budget of Rmb1.67tn ($232bn) has more than doubled over the past decade under Chinese leader Xi Jinping. US lawmakers and experts have argued that the actual military expenditures are far higher than official figures, thanks to classified expenditures that are not included.