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China: The Growing Red Dragon

Dated: 8 Mar 2013
Posted by Dominic Murphy
Category: International

2013.03.07 China with Flag

China is an ever growing military giant.  Its available manpower ranks first in the world with 749M active military personnel and 618M fit-for-service and now China also has very formidable land capabilities that rival the U.S.  While their Air-Force is sub-par, their Navy also looks to rival the United States (less Air-Craft Carriers) in total combat ships.

Their defense budget in 2012 was $106.4B up 11% from 2011, but only about a sixth of the United States even though it has quadrupled in the last 10 years.  In March, China announced that it would be raising its defense spending by 10.7% to 720 Billion Yuan ($115.8B).  With conflicts in the South/East China Sea currently taking place this number is sure to scare China’s surrounding neighbors and the government targeting a 7.5% GDP growth rate, defense spending seems to outpace the overall growth of the nation.  Nevertheless, when you factor in inflation the numbers seem significantly less and China’s defense spending eventually falls into line with the GDP.


While the United States budget is much larger, it has more of a global presence to take care of.  China tends to focus its military spending on its mainland and maritime periphery.  That is cause for concern for its neighboring states.  Not to mention the fact that there is widespread concern that China is finding ways to hide its actual spending.  The cost of weaponry and high-tech systems from Russia don’t even show up in its defense budget as well as China’s indigenous weapons research and development program are funded by the Ministry of Science and Technology.

Although China is not likely to release any real statement of their current spending, they are trying to show a sort of transparency by announcing their total number of military exercises for the year.  In February Beijing announced that it would conduct 40 military drills in 2013 to improve its combat capabilities and prepare its soldiers for war.  This is the first time that China has ever announced the amount of exercises it would carry out.  The Ministry of Defense’s bureau of press affairs was quoted saying “As a responsible power, we released related information to demonstrate policies, strengthen trust, and enhance transparency”.  But with escalating tensions in the South and East China Sea, many observers feel that their real motive is to project its power and flex muscle.

With the territorial disputes mounting, this would seem like a terrible time for the United States to fall into a deadlock via sequestration.  Indeed, the Obama administration has to place this area as a top priority as Taiwan is militarily backed by the United States.  Both have a great deal to lose if an “unintended incident” occurs as both economies are heavily intertwined.  The United States recently sent its first LCS ship (out of 4) to dock in Singapore.  While this action may be reason to keep an eye on China’s submarines, you can bet it is also a way of making sure an “unintended incident” doesn’t happen.

With China’s defense spending steadily increasing year over year and with a projected pace to outspend the United States by 2035, we have to assume that their quality of military capabilities is also increasing.  Funding large research programs to modernize its military must be a top priority to not only protect the mainland but to project power to their neighboring countries. In the follow up blog post to this segment I will outline what military upgrades could look like within the next few years.  While transparency into actually spending isn’t clear, there are indeed many upgrades and improvements that all modernized militaries are employing.


2013 CES Highlights

Dated: 11 Feb 2013
Posted by Cameron Mehin
Category: Innovation Adoption, International, New Markets, Technology


                       The 2013 Consumer Electronic Show gave us a look into the future with an outstanding display of new innovations and technology in areas ranging from vehicles and telepresence to cell phones and televisions.

While there were hundreds of wonderful gadgets, widgets and solutions to everyday problems, we had to limit ourselves to only highlighting what we felt were the best of the best.

Some of the areas we highlighted this year:

  • Human-Machine Interface
  • 3D Printing
  • Connected Home
  • Robotics
  • Healthcare and Health Monitoring
  • Virtual Reality

Click Here for VMI’s 2013 CES Best of the Best

Have a different take on an innovation, or want to share your opinion? Email or us comment below, we look forward to hearing from you!