China says defense budget to rise 11.2% in 2012

BEIJING – China’s defence budget will rise 11.2 percent in 2012 to 670.27 billion yuan ($106.41 billion), a government spokesman said Sunday, amid growing concerns about Beijing’s military build-up.

The figure was contained in a budgetary report submitted to the National People’s Congress, the parliament’s spokesman Li Zhaoxing told a press conference on the eve of the opening of the forum’s annual session.

The number marks a slowdown from 2011 when defense spending rose by 12.7 percent but it is still likely to fuel persistent concerns over China’s growing assertiveness in the Asia-Pacific region.

“We have a large country and a long coastline but our defense spending is relatively low compared with other major countries,” Li told reporters.

China has been increasing its military spending by double digits for most of the past decade as its economy, now the world’s second largest, grew at a blistering pace.

Analysts believe actual spending is much higher than the official figure.

The People’s Liberation Army – the world’s largest with an estimated 2.3 million troops – is hugely secretive about its defense programs, but insists the modernization of its army is purely defensive in nature.

The rapid military build-up has nevertheless set alarm bells ringing across Asia and in Washington, which announced in January a defense strategy focused on countering China’s rising power.