BEIJING – China’s defense budget will rise by 8.1 percent in 2018, which is above the economic growth target set at 6.5 percent, according to the government’s annual management report presented Monday by Prime Minister Li Keqiang at the annual plenary session of the National People’s Congress (NPC).
The 2018 defense spending will be 1.11 trillion yuan ($175 billion).
This is the third time since 2013 that the increase in China’s defense budget has grown by less than 10 percent.
Li also noted that the size of the armed forces personnel was been reduced by 300,000 in the last five years as part of the modernization process aiming at modernizing the technological and operational systems of the military.
NPC spokesperson Zhang Yesui said on Sunday that the increase in defense spending would serve as a compensation for lower growth in other years and would be used especially in modernizing the equipment and improving the living conditions of the troops.
Li also announced that China will continue to cut steel and coal production capacity this year as part of the ongoing restructuring process of its heavy industry and the transformation of its economic model.
The cut in steel production capacity will be 30 million tons in 2018, while coal production will reduce by 150 million tons.
According to official figures, China cut its production capacity last year by 50 million tons of steel and 250 million tons of coal.
Since the start of the process, the Asian giant has reduced its steel production capacity by 170 million tons, while the coal production capacity has fallen by 800 million tons.