China’s Economic Slowdown Raises Concerns Over Nationalism and Military Power

Published: September 7, 2023

As China grapples with a prolonged economic slowdown, concerns are mounting over the potential consequences, including the possibility of the Chinese Communist Party (CCP) shifting its focus towards nationalism and military strength as a means of maintaining its grip on power. Some experts even fear that the CCP may resort to foreign interventions to divert attention from domestic issues. Recent data suggests that the CCP made a strategic decision years ago to use military force or the threat thereof as a tool for consolidating its power.

Economic Deceleration and Missed Opportunities

China’s economic growth has been decelerating for over a decade, presenting ample opportunity for responsible management and a transition towards sustainable consumption-led growth, as advocated by many Western policymakers and economists. However, the CCP has failed to embrace this advice, potentially due to the structural changes it would entail, which could weaken the party’s hold on power. Instead, the CCP has responded to an economic slowdown by channeling considerable resources into its military, the People’s Liberation Army (PLA).

What is particularly concerning is Beijing’s attempt to downplay the magnitude of this military investment.  Chinese officials out annual defense expenditure figures over the past ten years while pledging a commitment to a “peaceful rise,” suggesting that defense spending was proportional to the country’s total economy (GDP), implying a slight rise in the PLA budget in line with broader economic gains.

Questions About Budget Figures

However, skepticism has surrounded these claims, with questions arising about how China could sustain such an extensive military buildup with the reported budget figures. Independent studies show that, at least since 2015, investment in the PLA has grown far more quickly than the overall economy. These findings challenge the notion that the PLA budget increases were in line with China’s official GDP.

The COVID-19 pandemic briefly disrupted this trend in 2020 as Chinese shipyards shifted their focus from constructing PLA Navy vessels to building commercial ships. Nevertheless, military spending appears to have resumed its upward trajectory, outpacing GDP growth once again. China has witnessed a resurgence in shipbuilding activities, a substantial nuclear expansion by the PLA Rocket Force, increased procurement of advanced aircraft by the PLA Air Force, and a record number of military satellites in orbit, even surpassing the United States. All this is happening against the backdrop of an economic crisis exacerbated by President Xi Jinping’s stringent zero-COVID policy.

A Calculated Strategy Amid Economic Turmoil

Amid this economic turmoil, Beijing’s commitment to doubling down on defense spending and adopting a more confrontational “wolf warrior” diplomacy is part of a calculated strategy. With credible military capabilities, Beijing aims to assert its dominance globally, securing vital resources, market access, technology, and capital by any means necessary.

A prime example of this strategy can be seen in the South China Sea, where China has sought to expand its territorial claims. Beijing’s aggressive moves in building and militarizing islands in the region have raised tensions significantly. In addition to having symbolic and defensive importance, these measures give control over vital maritime lanes that are necessary for the transportation of energy from the Middle East and access to international markets. They also enable China to exercise its rights to regional fisheries and natural resources under the sea.

President Xi’s “Dialectic of War and Peace”

To domestic audiences, President Xi has described his strategy, known as the “dialectic of conflict and peace,” stressing that only those who are able to fight effectively discourage war. With the help of this plan and the expansion of the PLA, China will be able to push its interests overseas without worrying about opposition.


Addressing China’s increasing military assertiveness and potential threats to regional stability requires a multifaceted approach:

1. Engagement: Diplomatic channels should be open for dialogue and negotiations with China to reduce tensions in areas like the South China Sea.

2. Transparency: Encourage China to provide more transparent data on its military spending and intentions to foster trust and stability in the region.

3. Alliances: Strengthening alliances and partnerships with regional actors can help deter aggressive behavior.

4. Conflict Resolution: Promote peaceful conflict resolution mechanisms to address territorial disputes and prevent military escalation.

5. Economic Cooperation: Maintain and expand economic cooperation to ensure that prosperity remains a priority for the Chinese government, reducing the reliance on military strength as a basis for legitimacy.

6. International Oversight: Establish international mechanisms for oversight of military activities in contested regions to prevent conflicts and misunderstandings.

While these solutions may not guarantee a complete resolution to the challenges posed by China’s military expansion, they can contribute to regional stability and reduce the risk of conflict in the long term. It is essential for the international community to address these concerns proactively to ensure a peaceful and prosperous future for all parties involved.

Yuval Noah Harari

Yuval Noah Harari is an accomplished author with a Bachelor of Arts in Journalism. His passion for storytelling and commitment to journalistic excellence have been the driving forces behind his successful writing career. With a keen eye for detail and a deep understanding of the art of storytelling, Yuval has consistently delivered compelling narratives that captivate readers from all walks of life.