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China to boost defense spending by 7%, slowest pace since 2021

by Evelyn Cheng
March 5, 2026
in Markets
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China’s liquid-fueled intercontinental strategic nuclear missiles DongFeng-5C, which have a worldwide strike vary, move by means of Tian’anmen Sq. in the course of the V-Day army parade on September 3, 2025 in Beijing, China.

China Information Service | China Information Service | Getty Photos

BEIJING — China plans to extend its protection spending by 7% this yr, the slowest rise in its annual army expenditure since 2021, based on a finances plan by the Ministry of Finance launched Thursday.

The proposal comes as battle within the Center East escalates and tensions over Taiwan persist, amid a broader rise in international geopolitical fault strains.

For the final three years, China has budgeted a 7.2% annual improve in protection spending. Beijing had elevated spending by 7.1% in 2022 and 6.8% in 2021, based on official knowledge.

In response to a authorities work report launched Thursday, Beijing will speed up the event of superior fight capabilities and pursue the “high-quality” modernization of its nationwide protection and armed forces.

The working report additionally highlighted China’s first domestically constructed plane provider, the Fujian, which was commissioned in November 2025. A few of China’s newest weapon methods, together with long-range missiles, had been displayed throughout a army parade in September.

Beijing additionally stated it will “resolutely battle in opposition to separatist forces aimed toward ‘Taiwan independence,’ and oppose exterior interference.”

China is ready to kick off its 8-day Nationwide Individuals’s Congress on Thursday, an annual parliamentary assembly that formally approves the finances and improvement targets for the yr.

Final yr, China proposed a nationwide protection finances of 1.78 trillion yuan ($244.99 billion on the time). Nonetheless, analysts consider the official figures are understated and exclude vital “off-budget” objects.

In response to the U.S. Division of Protection’s 2025 report back to Congress on China’s army, Beijing spent between $304 billion and $377 billion on protection in 2024 — about 32% to 63% increased than its formally introduced finances of $231 billion.

Beijing accounted for almost 44% of Asia’s protection spending in 2025, up from 39% in 2017, based on the Worldwide Institute for Strategic Research.

China can also be second to the U.S. when it comes to army spending.

The U.S. budgeted $849.77 billion for protection in the course of the 2025 fiscal yr. However estimates from non-profit USAFacts point out the U.S. ended up spending about $919.2 billion throughout that point, up 2% from the prior yr and accounting for 13% of the federal finances.



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