Concerns Over Defence

March 2007 | Risk Summary

China is to boost spending on defence by 17.8% this year, its biggest increase in ten years, following a 14.7% rise in 2006. The announcement has raised concerns about the potential for escalating tensions in the region, particularly with Taiwan also hiking its defence spending on the back of the perceived increased threat from the mainland. The US has long been concerned over the lack of transparency in China's defence budget, with Vice President Dick Cheney commenting in a recent visit that China's anti-satellite missile test in January and its military build up was 'not consistent with Beijing's stated goal

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