2019-2020 Defense Budget of China, Indonesia, Malaysia, Singapore, Philippines, Vietnam and Thailand

Defense Budget of China 2019-2020

  • China on Tuesday set its 2019 defense spending at 7.5 percent higher than a year ago — or 1.19 trillion yuan ($177.61 billion).
  • That’s lower than the 8.1 percent growth in 2018 and far below double-digit increases of previous years — though analysts have long questioned how accurately the budget reflects actual spending.
  • But slower growth in defense spending doesn’t mean ongoing military tensions with the U.S. have ceased, warned Timothy Heath, senior international defense researcher at U.S. think tank Rand Corporation.

People’s Congress, Beijing announced a 7.5 percentage increase in its projected defence spending over last year. It will spend $177.54 billion on sustaining, growing, and modernising its military. The United States, a little more than a year after acknowledging it was in an era of great-power competition again, announced a $750 billion defence budget.

Headlines have zeroed on the relative decrease in spending growth on defence. After all, in 2018, China’s defence budget growth stood at 8.1 per cent. Percentages can be misleading, however. China’s military modernisation objectives remain as ambitious as ever. It continues to plan for multiple contingencies and allocate resources as necessary.

Commensurate with its rapid economic growth and growing global ambitions, China has pursued a large-scale modernisation – and more recently reorganisation – of its military. Under President Xi Jinping, the People’s Liberation Army has diversified away from its historical focus as a land-based force towards the seas.

Defense Budget of Indonesia 2019-2020

We link to economic growth of about 7 percent … so by 2019, the national defense budget can increase to around $20 billion per annum,” Luhut said, as reported by Reuters on Wednesday.

Muradi, a defense and military analyst at Padjadjaran University in Bandung, West Java, agreed with the country’s plan to set such an impressive target for its defense and security sector, saying that “our defense sector is already 10 years behind neighboring countries such as Singapore and Malaysia.”

According to Muradi, Indonesia’s defense sector spending — which includes the purchase of primary weaponry defense systems, the cost of security monitoring and also stipends for military personnel — should make up at least 2 percent of the country’s GDP to be considered adequate.

This year, Indonesia has allocated Rp 83 trillion ($6.6 billion), which represents 0.8 percent of the total state budget, Defense Minister Ryamizard Ryacudu said early last month.

Malaysian Defense Budget 2019-2020

Malaysian government announced on 3 November a 2019 defence budget of MYR13.91 billion (USD3.3 billion), a year-on-year decline of 10%.

The reduction means defence expenditure will decline to its lowest level as a share of the government budget since the 1980s. Spending will also fall to 0.9% of GDP having stood at 1.4% as recently as 2016, and has been cut by around 21% in nominal terms over the same four-year period.

The new budget represents the latest in a series of military spending cuts in the country, as successive governments have pursued a process of fiscal consolidation aimed at eliminating the country’s budget deficit – which will stand at 3.4% of GDP in 2019 – and reducing sovereign debts.

Defense Budget of Singapore 2019-2020

Singapore has announced a 2019 defence budget of SGD15.47 billion (USD11.4 billion), an increase of 4.8% over the revised military expenditure for 2018. The new budget amounts to 19% of total government expenditure for 2019 and about 3.3% of national GDP.

Budgetary documents published on 18 February show that SGD14.96 billion of the 2019 budget, or 96.7%, will be for operating expenses while the remaining SGD504.2 million, or 3.3%, is for development expenditure. The allocation for operations is an increase of 5.1% against 2018 while the 2019 development expenditure is a 3.8% decrease.

The operating expenditure includes payments towards the acquisition and maintenance of military equipment as well as the salaries of military personnel.

Defense Budget of Thailand 2019-2020

June 7, the Thai government announced the defense budget figures for the 2019 fiscal year, with the budget set for just over 227 billion Thai baht (just over $7 billion), as well as a reported additional $3 billion for security spending for a range of internal threats. Though the headlines suggested that this was indicative of a large increase, the hike is significant but still largely consistent in many ways with what we have seen over the past few years.

At the most basic level, the amount itself certainly represents another consecutive round of significant increase in defense spending under the junta government. It is a 4.2 percent rise over defense spending figures from 2018, coming after an increase during the previous year of around 5 percent. The 2017 defense budget prior to that had seen a much more modest increase of around 2 percent.

But the significant increase still puts figures at around the same levels in terms of government spending and percentage of GDP, which is still much lower than where defense planners would like those figures to be. The budget is about 7.6 percent of government spending and 1.4 percent of GDP, which generally tracks with similar figures in previous years on both counts.

Defense Budget of the Philippines 2019-2020

The Philippine government has allocated and spent billions on the enhancement of the country’s defense capability over the years. The Duterte administration will sustain this commitment by allocating P188.2 billion to the defense sector for 2019” in order to maintain and expand the country’s defense capabilities against foreign and domestic threats.

The revised AFP modernization program, and adjusted compensation and rice subsidy for Military and Uniformed Personnel were also discussed by the budget secretary.    

Defense Budget of Vietnam 2019-2020

Vietnamese Government allocated US$5.1 billion towards military expenditure in 2019, of which 32.5% is earmarked for the procurement of defense equipment. The country’s military modernization efforts are focused on preventing China from taking hold of disputed territory in the South China Sea. Over the forecast period, the country is expected to procure fighter and multi-role aircraft, armored vehicles, naval vessels, patrol ships, maritime patrol aircraft, and surveillance equipment. The country’s defense expenditure is projected to increase from US$5.5 billion in 2020 to US$7.9 billion by 2024.

As assessed by BusinessWire, between 2015 and 2019, Vietnam cumulatively spent US$7.2 billion on defense equipment, while US$15 billion was assigned for revenue expenditure. Over the forecast period, Vietnam’s capital expenditure is expected to grow at a CAGR of 9.43% and revenue expenditure is expected to register a growth of 9.44%. Vietnam’s slow population growth is projected to increase per capita defense expenditure from US$53.7 in 2019 to US$79.3 by 2024.

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