China raises 2016 defence spending by 7.6 percent: budget

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Beijing (AFP)

China will raise its defence spending by 7.6 percent this year, a budget report to the country's Communist-controlled parliament showed on Saturday.

It was the "lowest defence budget increase in six years", the official news agency Xinhua said, adding it came "in the wake of rising economic headwinds and last year's massive drawdown of service people".

At a giant military parade in Beijing last September to commemorate the 70th anniversary of Japan's World War II defeat, Xi announced the PLA would be reduced by 300,000 personnel, as China seeks to craft a more efficient and effective People's Liberation Army (PLA).

The PLA is the world's largest standing military but China's total declared spending of 954 billion ($146 billion) remains far below that of the US.

The increase -- more conservative than the double-digit rises of past years -- comes as Beijing increases its military heft and asserts its territorial claims in the South China Sea, raising tensions with its neighbours and with Washington.

It unveiled a revamped military structure at the start of the year, establishing a new army general command and a Rocket Force to oversee its strategic missiles.

In 2015, the budget was increased by 10.1 percent.