The report varies in the quality of its analysis. Its assessment of Chinese military spending is fairly minimal: “Using 2011 prices and exchange rates, DoD [Department of Defense] estimates China’s total military‐related spending for 2011 ranges between $120 billion and $180 billion.” For context, past reports, from 2010 and 2011, estimated China’s military spending at $150 and $160 billion respectively.
In contrast, back in March, Beijing announced an 11.2% increase in its annual military budget to roughly US$106 billion. While spending comparisons have always been difficult, there is no doubt that the past few decades have seen steady expansion in China’s military spending.
However, China’s spending is still only about a fourth of what the US spends each year on the military. Furthermore, the direct US military budget is less than half of what the US spends on all its national security related spending.
This annual report always walks a tightrope between delineating what it sees as advances in Chinese military modernization while trying to avoid depicting China as a menacing state. For example, the executive summary says with regard to military intentions: