China has embarked on a major reform of its armed forces at a time when it is stepping up its maritime military presence, as exemplified by its recent deployment of surface-to-air missiles and radar on one of the disputed Paracel Islands in the South China Sea. China says that it will maintain its “defensive national defense policy.” But these moves are certain to raise suspicions among its regional neighbors as well as the United States. Beijing needs to explain in plain terms how these moves can be compatible with what it claims to be “defensive” defense policy. It also needs to make its defense spending more transparent by presenting its weapons procurement programs in concrete terms. A lack of clear explanations on the part of China will only raise tensions with other nations.

In late November, President Xi Jinping, who also heads the Communist Party’s Central Military Commission, announced a plan to carry out major shake-up of the People’s Liberation Army, the fourth major reform of the military since 1985, with the aim of turning it into a more effective fighting force.

Under the reform, the PLA’s four general headquarters — the General Staff Department and three other general departments responsible for political inspection, logistical support and weapons procurement — which used to be highly powerful organizations within the PLA, have been disbanded and reorganized into 15 units. All these units have been placed under direct control of the Central Military Commission, enabling the body to perform overall management of the PLA.

China has also established three new organizations — the Army Leading Organ, which will be the national-level headquarters, the Rocket Force to command the PLA’s strategic nuclear missile force, and the Strategic Support Force to take charge of cyber warfare, space security and online espionage.

The reform envisages firmly establishing a joint operational command structure by 2020. By eradicating the conventional structure in which the army played a leading role, the operations of the army, the navy, the air force and the strategic rocket force would be controlled in a unified way, so that the PLA could be turned into a nimble and capable military force. The plan also calls for cutting the number of troops by 300,000 although it has not yet been made known where the cuts will be made.

China also has reorganized its seven military regions into five “combat zones” — the East, West, South, North and Middle combat zones — in an effort to make it easier to carry out integrated operations involving the army, navy and air force. It is believed that the East combat zone will include the East China Sea, where Beijing lays claim to Japan’s Senkaku Islands, and the South combat zone will include the South China Sea, where tension is rising between China, on one hand, and Southeast Asian countries and the U.S. on the other. Following the establishment of an air defense identification zone in 2013 over the East China Sea, China is expected to set up a similar zone over the South China Sea in the future.

China’s military shake-up is being carried out because its military structure has become inappropriate for China’s current security posture. During the Cold War, China had to have solid border defense against the Soviet Union, for which ground forces played a key role. But today’s China, bent on shoring up its naval presence, needs a military structure conducive to improving the capabilities of the navy and the air force.

Another purpose of the military reform is to ensure the armed forces’ loyalty to the Chinese Communist Party and to make them more accountable to the party leadership. The military, which enjoys special privileges, has been a hotbed of corruption. Since the military had vested interests in the seven military regions and the four general headquarters, their abolishment comes as no surprise. Since the 15 units newly created under the Central Military Commission include the Discipline Inspection Commission, the Politics and Legal Affairs Commission and the Audit Office, the new setup will help Xi with his efforts to fight corruption at higher levels of the PLA and reinforces his grip over the military.

Although the military reform may make sense from a domestic political perspective, China needs to be conscious of how its move will be viewed by other countries. According to the latest report by the International Institute for Strategic Studies in London, China’s defense spending is the world’s second-largest following the U.S. and accounts for about 41 percent of the total military spending in Asia, including Oceania. It chalked up an 11 percent increase in 2015 from the previous year, much larger than the region’s average increase of slightly less than 3 percent, although China told the current session of the National People’s Congress that its defense spending for 2016 will rise about 7 to 8 percent from 2015. One estimate holds that China’s defense spending in real terms is 1.4 times the publicly announced figure. Beijing needs to explain in clear terms what military purposes it plans to achieve with its defense spending and military reform — in the same manner that other countries need to clarify their defense policies.

Mutual understanding between China and other countries on defense matters is crucial to avoiding an arms race that would only serve to destabilize the region. Given the huge size of its armed forces and defense spending, China needs to be transparent about its defense policy.

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