China has cut this year’s growth target for its slowing economy to 6.5 to 7 per cent and promised to press ahead with painful reforms aimed at boosting productivity and incomes.
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Xi is seeking to drag the People’s Liberation Army into the modern age, cutting 300,000 jobs and revamping its Cold War-era command structure.
Besides the strategic rivalry with the US, China is entangled in a maritime dispute in the South China Sea with Vietnam, Malaysia, the Philippines, Brunei, Taiwan and Japan, and its long-running border dispute with India has not been resolved either. Growth in 2015 declined to a 25-year low of 6.9 percent and is forecast to drift lower this year.
In 2016, Beijing will aim for an economic growth rate between 6.5-7 percent, as Reuters previously reported, with a consumer inflation target of around 3 percent and money supply expansion of around 13 percent, according to a series of draft reports distributed Saturday before the parliament opened.
China provides no breakdown of its defense budget and Pentagon and global arms bodies estimate actual military spending may be anywhere from 40 to 50 percent more because the official budget doesn’t include the costs of high-tech weapons imports, research and development, and other programs. China has the biggest population of Internet users and investors are pouring billions of dollars into developing online and smartphone-based ventures for food delivery, movie ticketing, travel and other services.
China’s construction projects in the South China Sea islands and reefs are necessary for providing public services and strengthening China’s capacities for safeguarding regional peace.
“The official numbers … on the Chinese defense budget are pure fiction”.
The defence budget had been widely expected in military and diplomatic circles to log another double-digit increase. But the draft goal of running a fiscal deficit equivalent to 3 percent of GDP, while marking a rise from the previous year’s target of 2.3 percent, still disappointed some who had hoped for a number closer to 4.
This is only a quarter of what the US spends on its military. It is also strengthening military presence in the Asia Pacific region with its allies. Planes and naval vessels to counter China’s growing capabilities top the Japanese military’s shopping list.
Fu said on Thursday that China had the right to build islands in the Spratly chain of the South China Sea to properly defend its territory.
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The premier’s work report was released as the same time as the 2016 budget, the 2016-2020 Five-Year Plan and a report from the National Development and Reform Commission, the country’s economy planner. “It’s quite a shrewd move, really”.
