Wen Jiabao reduces Chinese growth but keeps military spending high to "win local wars"
Beijing (AsiaNews) - The Assembly of the National People's Congress (NPC) began today with Premier Wen Jiabao's directives for the current year: a reduction in economic growth forecasts to 7.5%; attention to the "land rights" of farmers, a justification for the 11.2%, increase in military spending to "win local wars".
China's NPC which gathers parliament together once a year never results in any big surprises: the approximately 3 thousand delegates vote and approve on whatever the Party's Politburo has studied and drawn up. Nor was there anything new in Wen Jiabao's speech. Although the cuts to growth forecasts were expected: in these decades, the GDP grew by at least 10% per year, yet this in itself has created a great imbalance. The reduction this year (last year it was 9.2, in 2010 was 10.4) is aimed at stabilizing the economy and reducing the weight of state industries, reducing inflation and defusing a possible bubble in the financial and real estate markets.
Beijing has also been forced to reduce the growth of GDP: the world economy is in recession and there is declining investment and foreign demand.
Thus Wen Jiabao - also on the advice of the IMF and World Bank - has confirmed that China needs to aim at increasing domestic consumption. But to do this, he has to reign in inflation, raising wages, improving the lives of farmers.
Wen stressed that the government will support domestic consumption, it will increase spending on social services and increase the wages of low and medium income groups. A growth of 7.5% is the lowest rate since 1990.
The premier also touched on the issue of land rights of farmers, which has become a hot topic in recent years, since farmers are being cheated and dispossessed of their lands and homes, to make room for industrial speculation and plants. According to the Academy of Social Sciences in Beijing at least 60% of so-called "mass incidents" (ie social uprisings, at least 180 thousand a year) are due to land issues. "Farmers' rights to the land they contract to work on...are property rights conferred by law, and these rights must not be violated by anyone," he said.
Wen also an 11, 2% increase in military spending: "We will enhance the armed forces' capacity to accomplish a wide range of military tasks, the most important of which is to win local wars under information-age conditions".
Analysts wonder if these "local wars" are the riots Xinjiang and Tibet, or military expansion in the South China Sea. In recent years, China has often clashed with Vietnam and the Philippines for the control of the Spratly Islands and with Japan for control of the Diaoyu Islands (or Senkaku).
According to the research group IHS, by 2015 the budget for the People's Liberation Army will be doubled compared to 2010 and will reach the considerable figure of 1500 billion yuan (about 178 billion euros). For this year the figure is 670 billion yuan (about 80.6 billion yuan).
The military escalation is already worrying China's neighbors. Yesterday, the secretary of the Japanese government, Osamu Fujimura, said that Japan is "carefully watching " China's military spending and looking for greater transparency.
Many analysts say that in reality China's military budget is really twice that stated: research, development and acquisition of military assets abroad are not included in the budget presented at the PNC.
In recent years, Beijing has launched its own satellite technology and digital war, while investing in the modernization of its fleet: in August, it launched its first aircraft carrier.
For more on the NPC see also: 29/02/2012 China's National People's Congress and its billionaire Communists to meet shortly
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