China's 2017 defense budget rise held below double digits

China's defense budget will rise about 7 percent this year, the spokeswoman for China's parliament said on Saturday, its slowest pace since 2010 and the second year in a row it will not log a double-digit percentage increase.

The actual number for defense spending will be released on Sunday, when China's largely rubber stamp parliament begins its annual session.

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Last year, with China's economy slowing, the defense budget recorded its lowest increase in six years, 7.6 percent, the first single-digit rise since 2010, following a nearly unbroken two-decade run of double-digit budget increases.

China's annual economic growth target is expected to be lowered to around 6.5 percent from last year's 6.5-7 percent when Premier Li Keqiang gives his work report to parliament. Parliament spokeswoman Fu Ying said defense spending would account for about 1.3 percent of GDP, the same level as the past few years.

Barry Huang | CNBC

China's military build-up has rattled nerves around the region, particularly because China has taken an increasingly assertive stance in its territorial disputes in the East and South China Seas. Fu dismissed these concerns, saying China had never harmed anyone.

"Look at the past decade or so, there have been so many conflicts, even wars, around the world resulting in serious, large numbers of casualties and loss of property, so many refugees destitute and homeless. Which one has China caused?" she said. The defense budget figure for last year, 954.35 billion yuan ($138.4 billion), likely understates its investment, according to diplomats, though the number is closely watched around the region and in Washington for clues to China's intentions.

Barry Huang | CNBC

A 7 percent rise for this year based on last year's budget would bring the figure to 1.02 trillion yuan, still only a quarter or so of the U.S. defense budget. The White House proposed a 10 percent increase in military spending to $603 billion, which comes as the United States has wound down major wars in Iraq and Afghanistan and remains the world's strongest military power.