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China Slows Defense Spending Despite Threat of New Cold War With U.S.

China's defense expenditure is set to grow at its slowest rate for three decades as Beijing grapples with the coronavirus crisis, despite growing tensions with the U.S. that some observers have likened to a new Cold War.

Chinese leaders released the country's national budget Friday as they met for the annual National People's Congress in Beijing. Military spending will still increase by 6.6 percent on 2019, at a figure of more than 1.2 trillion yuan ($178 billion).

Though still a significant rise, it marks the slowest increase in three decades. Beijing has poured enormous sums into transforming its mammoth, low-tech Cold War-era forces into a modern high-tech military capable of a range of operations—including force projection.

The investment has seen China become the second-biggest military spender in the world, though its budget is still less than half that of the U.S.

But with the coronavirus economic crisis biting, Beijing is being forced to reconsider its spending plans. Still, Premier Li Keqiang said Friday that the armed forces would not suffer from the slowed spending increase.

"We will deepen reforms in national defense and the military, increase our logistic and equipment support capacity, and promote innovative development of defense-related science and technology," Li told NPC delegates.

"We will improve the system of national defense mobilisation and ensure that the unity between the military and the government and between the military and the people remains rock solid," he said.

China's economy shrank by 6.8 percent in the first quarter of 2020 compared with the first quarter of 2019, as the country struggled with the impact of the coronavirus pandemic. The government did not set a 2020 growth target in Li's work report, presented on Friday as the NPC opened.

Tensions between Washington and Beijing have risen to new highs amid the coronavirus pandemic. President Donald Trump initially praised China's response to the COVID-19 outbreak in the central Chinese city of Wuhan and said he was working closely with President Xi Jinping to address the crisis. But Trump has since turned his ire on Beijing.

Chinese officials are accused of concealing vital information about the outbreak while pressuring the World Health Organization to downplay the severity of the crisis.

China is also accused of driving a disinformation campaign to absolve itself of blame while maligning the response of foreign nations, and underreporting its number of infections and deaths.

Chinese officials—including Xi—are resisting calls for an international probe into the origins of the virus. Trump and Secretary of State Mike Pompeo have alleged—without providing evidence—that the virus actually escaped from the Wuhan Institute of Virology.

Most experts and officials have said the most likely origin point was a wildlife market in Wuhan, where the virus is believed to have jumped from bats to humans, possibly via an intermediary animal like a pangolin.

Trump has hinted at repercussions for China, and earlier this month threatened to "cut off" relations with Beijing. Meanwhile, existing flashpoints remain in the South China Sea and Taiwan.

This week, Beijing threatened to take action over a proposed U.S. arms sale to Taiwan, which China considers part of the country. It has vowed to retake by either diplomatic or military means.

The pandemic has added a new layer of complexity to these existing issues. An internal report by China's Ministry of State Security recently warned that Beijing faces a rising tide of international hostility over the pandemic, comparable to the global reaction to the 1989 Tiananmen Square massacre.

The report, detailed by Reuters, said that these fresh tensions could push China into an armed confrontation with the U.S.

China, coronavirus, military, spending, defense, investment, US
This file photo shows Chinese soldiers ride atop tanks during a parade to celebrate the 70th Anniversary of the founding of the People's Republic of China at Tiananmen Square on October 1, 2019 in Beijing, China. Kevin Frayer/Getty Images/Getty
China Slows Defense Spending Despite Threat of New Cold War With U.S. | World