China Announces 7.2% Increase in Defence Spending Amid Growing Geopolitical Tensions
In a significant move on Wednesday, China confirmed it would raise its defence spending by 7.2% for 2025, mirroring last year’s increase.
The announcement comes as Beijing accelerates the modernisation of its armed forces, eyeing a more assertive role in the face of intensifying competition with the United States.
China, now with the world’s second-largest military budget, is determined to expand its military capabilities, although it remains far behind the U.S., which maintains the globe’s largest defence budget. However, despite the spending gap, China’s People’s Liberation Army (PLA) boasts more personnel than its American counterpart, adding to the growing concern in Washington and neighbouring nations.
This year’s 1.78 trillion yuan ($245.7 billion) defence budget represents a substantial allocation of resources, although it remains less than one-third of the U.S. military budget. For context, China’s defence spending last year amounted to only 1.6% of its GDP, a relatively modest figure when compared to other global powers like Russia and the United States, according to Stockholm International Peace Research Institute.
Still, Beijing’s growing military expenditure has raised alarms globally, particularly in the United States and among its allies in Asia, such as Japan. Tensions between China and Japan continue to escalate, especially over territorial disputes in the East China Sea. Additionally, China’s increasingly aggressive stance in the South China Sea, where it claims nearly the entire region despite international legal challenges, continues to heighten regional instability.
Another key concern stemming from this defence budget increase is Taiwan, which remains at the heart of Beijing’s geopolitical ambitions. China views the self-ruled island as a breakaway province and has repeatedly warned of the potential use of force to assert control.
During the National People’s Congress in Beijing, Premier Li Qiang reiterated the country’s firm stance, vowing to oppose any separatist efforts aimed at Taiwan’s independence while promoting “peaceful development” in cross-Strait relations. While China describes its military posture as “defensive”, its broad territorial claims and assertive actions in disputed regions have drawn skepticism, with concerns that they could trigger a broader regional conflict.
According to Chin-Hao Huang, Associate Professor at the National University of Singapore, the budget hike is a reflection of “growing uncertainties in both China’s external environment and its domestic security priorities.” The increase in military funding, Huang noted, highlights the necessity for China to maintain a ready and technologically advanced military force capable of responding to any global or regional challenges.
As geopolitical tensions escalate, experts like Niklas Swanstrom, Director at the Institute for Security and Development Policy, argue that China cannot afford to reduce its military spending. With rising friction between China and the U.S., coupled with European nations considering substantial hikes to their own military budgets, Beijing’s defence expansion is unlikely to slow down.
As the world watches the shifting dynamics in global military power, this latest defence budget increase signals China’s ongoing commitment to positioning itself as a formidable player on the world stage. With growing strategic competition in the Asia-Pacific and beyond, Beijing’s military expansion could shape the future of global security.
