Chinese Military Funding

January 26, 2005: Even in a booming economy, Chinese defense industries stand out, growing 26.8 percent in 2004 (to $20 billion in sales). Chinas military industries, many of them owned by the armed forces, produce everything from assault rifles, to warships, electronics and warplanes. China has been aggressively buying, or stealing, military technology, and upgrading the weapons it builds. Chinese weapons technology has always been way behind what is found in the West. But currently, compared to the United States, Chinese produced weapons are, in some cases, only a decade or two behind, and still closing the gap.

January 11, 2005: The government announced that it will increase money spent on modernizing the navy, air force and missile forces. Chinese efforts to develop their own advanced military technology, and build Chinese designed weapons, is showing results. New ship and submarine designs are entering service. New warplane designs, after many years of trial and error, are also ready for mass production. China appears to be considering shifting money from producing Russian Su-27s under license, to producing Chinese designs. Chinese ballistic missiles, most of them with a range under 1,000 kilometers (just enough to pound Taiwanese targets) are taking advantage of the growing Chinese electronics industry to produce more reliable, accurate and inexpensive guidance systems.

April 24, 2004: China is more than doubling its annual defense spending. Much of the defense spending is not identified as such (things like weapons development, construction and some soldier benefits). But it appears that current annual spending is approaching $70 billion a year. Most of the new money is for upgrading 1960s era weapons and support systems in the navy and air force.