China is competing in a great Asian arms race because it has no other choice

Beijing’s continued militarization is a forced response to US pressure. But can it keep its cool?

During the two sessions of the National People’s Congress (NPC) over the weekend, China announced that its military budget would increase by 7.2% year on year. The news made headlines around the world. 

The Chinese premier’s work report, submitted to the NPC, says the country’s military “should intensify military training and preparedness across the board,” and points to escalating “external attempts to suppress and contain China.” The country’s state media reacted conservatively, stressing that the defense spending increase is in keeping with the “single-digit” growth pattern of recent years (7.1% in 2022, 6.8% in 2021, 6.6% in 2020).

Western media took a much different angle, with many outlets making obligatory mention of warnings from analysts and officials that China’s real military spending could be much higher than the announced budget. For example the Guardian cited the US Department of Defense as claiming it could be up to two times higher. These outlets do mention that China’s defense budget is still dwarfed by that of the US ($224B versus $772B), before moving on to talk about the size of China’s navy and infantry, its “militarization” of the South China Sea and, of course, repeating the warnings emanating from Washington DC that “China may invade Taiwan” soon.

Such warnings from the US come coupled with a string of deliberate provocations such as official visits to Taiwan, flyovers, and ‘freedom of navigation’ operations. The US itself has made it a priority to militarize the region and to encircle China. None of these points can be found in Western media reports on Beijing’s defense spending – even though they are directly responsible for continued growth in China’s military budget.

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Owing to the US attempt to contain China, the Asia-Pacific is now locked in a growing arms race and military competition, and Beijing has no choice but to participate. Washington has initiated a militarization of the region, under the label of its “Indo-Pacific” strategy, with the focus on suppressing the rise of China. To do this, the US has created minilateral blocs targeting China, one being the Quad (Australia, India, Japan, US) and the other being AUKUS with Britain. Additionally, the US has dramatically increased its deployment of military assets in the region, has pushed the Philippines to increase access to its bases, and has also deliberately pushed the Taiwan issue and walked back from its existing commitments to China in order to escalate regional tensions.

The US has actively encouraged and pushed for the arming of its regional allies too, the most notable example being Japan’s pledge to double its military spending and to buy hundreds of cruise missiles from the US. This militarization has been complementary to the parallel expansion of sanctions and embargoes aimed at crushing China’s rise in high-end technologies, which the US sees as directly contributing to its military capabilities. In this sense, the technological and military aspects of China-US competition are intrinsically linked, all in the name of American supremacy over the region.

So facing this growing military encirclement and competition, how does China respond? The answer is that it continues to develop and strengthen its military, with the optimism that it can keep up with the United States in the long term. The US military budget continues to be over three times the size of China’s, which is also sobering for those calling Beijing a “threat.” However, this does not mean that China is incapable, as its resources are concentrated in one region around itself, while the US is aiming for worldwide domination. When it comes to raw numbers, for example, China already has a larger navy than the United States and greater shipbuilding capacity.

2023 will be a year of significantly increased tensions. It hasn’t started well, with the US kicking up a storm over an alleged Chinese spy balloon, continuing provocations around Taiwan and reviving the Covid-19 lab leak theory. But will China bite? It seems unlikely. 

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One of the primary goals of this US-led effort is precisely to provoke Beijing so that Washington might be able to induce instability and therefore increase its geopolitical clout over other countries, breaking up positive regional integration. That is why China needs to be careful.

With Beijing recognizing it is facing US encirclement, it has to defend its critical national interests, but in conjunction, it also needs to play a diplomatic game to reassure other countries simultaneously. China does not want ties with India to deteriorate further, or to create anxiety for ASEAN claimants in the South China Sea, such as Vietnam, Malaysia, Indonesia or the Philippines. 

It also wants to avoid Europe becoming more militarily involved against China, which would represent a great success for the US. China strives to be firm but also calm and cautious. There is a lot to lose in facing a hostile US, but sitting idly by is not an option. A military competition has begun, and it isn’t going away. Beijing must be strong but also avoid “rocking the boat” too much.