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04 Mar 05. China’s military has been modernising rapidly China has announced an increase of more than 12% in its defence budget, to be approved by a session of its parliament that opens on Saturday. The rise comes as parliament is set to debate a so called “anti-secession law”, aimed at curbing any bid by Taiwan for formal independence. China always says it would oppose independence, by force if necessary. The increase also comes amid mounting concern in the United States about China’s military modernisation. China’s armed forces have not fought a war since 1979, when they were humiliated by the Vietnamese, and Friday’s announcement is just the latest in a series of regular cash infusions to try to upgrade and modernise. Jiang Enzhu, a spokesman for China’s parliament, played down the significance of the rise, which will take official military spending to 247.7 bn yuan ($29.9bn) He said much of the money was needed to boost soldiers’ pay and cover the social costs of cutting 200,000 personnel. He added that China’s defence spending was far lower than that of other major powers. He did not name names, but it is with Washington that China’s military modernisation is becoming a growing issue. Many hawkish voices on China in the US administration believe that Beijing’s figures may understate the real level of military spending. They are concerned about the impact of Europe’s moves towards lifting an arms embargo on China and they are closely watching a new anti-secession law set to be passed by the Chinese parliament – the National People’s Congress. That will underpin Beijing’s drive for peaceful reunification with Taiwan and set out a red line against moves by the island towards formal independence. (Source: BBC)

28 Feb 05. In a last-ditch effort to halt the European Union’s move toward ending its arms embargo to China, the United States may negotiate with the entire 25-country bloc, a change from its preferred tactic of seeking agreements with individual states. But there is a stumbling block that is further stoking U.S. fears about technology transfers to China, say officials on both sides of the Atlantic: The EU cannot impose security rules on its member states. Case in point? The EU’s arms-export code of conduct. The seven-year-old code asks members to notify each other upon granting an export license. The code was updated recently to require more frequent and detailed reporting. But the code remains a far cry from enforceable law. If U.S. officials cannot persuade or force the EU to keep its ban, they want at least to negotiate new trade agreements to keep sensitive systems out of Chinese hands. But there is no effective international arms export mechanism to replace the Cold War-era, now-defunct Coordinating Committee on Multilateral Export Controls. So Washington faces a dilemma: Should it negotiate binding bilateral accords with Europe’s six biggest arms-exporting countries and hope ignored EU countries won’t step in to fill the gap, or should it attempt to hammer out something with the EU, whose political importance is on the rise? (Source: BROOKS TIGNER, BRUSSELS, Defense News)

28 Feb 05. The United States is considering purchasing military equipment from Taiwan, as the Pentagon seeks to reduce costs by diversifying its sources of arms supplies, it was reported Feb. 28. A group organized by the Comparative Testing Office of the U.S. Department of Defense is scheduled to arrive in Taipei Saturday to evaluate the island’s capability of supplying the equipment, the United Daily News said. The trip will come as the United States seeks to increase its procurement of military equipment from Asia Pacific, where the manufacturing cost is only one-third to one-fifth of that in the United States, it said. The group, comprised of five military officers and a civilian official, is expected to meet Taiwanese defense and economic officials and high-tech firms in a five-day visit, the daily said, citing local

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