PRC Arms Bazaar Reveals Significant Growth in Weapons Programs

Xi Jinping
Xi Jinping / AP
December 10, 2014

Zhuhai, Guangdong Province—The People’s Republic of China showed off its growing military aircraft programs at Air Show China, a platform traditionally used to entice commercial aerospace firms to do business with China. 

When it was first held 18 years ago, Air Show China was intended to show the western world the capabilities of the People’s Republic of China’s (PRC) aerospace industry. Boeing, Airbus, and other major commercial aerospace firms were supposed to see the potential benefits of placing production contracts and other local industrial cooperative projects with China’s aircraft enterprises.

The space now allocated to China’s commercial aerospace sector at the event has been compressed into one section of one pavilion. The other exhibition space is now overflowing with military exhibitors. Even a number of the foreign firms present (particularly the companies from Russia) are only there to participate in the PRC’s military aircraft programs.

The overall public perception is that international air shows take place in order for those attending to be wowed by the aerobatic maneuvers of different fighter aircraft. But despite the "fast movers" tearing up the skies during the flight program, these events wherever they are held—Le Bourget, Singapore, Dubai, Farnborough—are largely about commercial aerospace.

The ratio of commercial business to military projects at these expos is about the same as the sales numbers for major U.S. firms like Boeing: the billions in orders break down to about 85 or more percent sales of commercial airliners and 15 percent or less fighter aircraft. "We would not have the economies of scale necessary to design and build military aircraft if we were not building 777s and 787s," is how more than one Boeing executive has described the dynamics of America’s aerospace sector.

But at Air Show China this ratio is reversed. Despite all of the market surveys about how the PRC represents the single largest growth market for commercial air travel, the biennial event at Zhuhai has become one of the world’s biggest arms bazaars rather than a place for announcing billions in airliner purchases.

The pavilions at this show display constantly expanding numbers of surface-to-air, surface-to-surface, anti-ship missiles, cruise missiles, and laser-guided bombs. These products are there at the behest of the China Aerospace Science Industrial Corporation (CASIC), Northern Industries of China (NORINCO), and Poly Technologies—state-owned military industrial conglomerates that do not even build aircraft.

A close look at the weapon systems on display reveals that it is not unusual to see two, three, or more PRC firms building what is essentially the same weapon system to address the same requirement. This may indicate that the People’s Liberation Army (PLA) engages more than one enterprise to put forth competing designs and then picks one as the winner in a similar manner to the U.S. military inviting Lockheed Martin and Raytheon bid for the same government contract.

The losing firm in the United States does not then put the weapon system not selected for military use into production anyway. However, there are indications that this happens on a regular basis with PRC industry. Some of this hardware can be sold off to export customers, but the degree of duplication in analogous weapons systems production far exceeds the ability of the PRC’s defense exporters to find places to sell them to.

Another issue is "how much of the kit being shown at Zhuhai is actually battle-ready," a western intelligence analyst told the Washington Free Beacon. There has been considerable publicity surrounding this past summer’s arrest of General Xu Caihou, a former deputy commander of the PLA and vice chairman of the powerful Central Military Commission (CMC), for being involved in numerous corrupt activities, including "selling" promotions within the upper ranks. Less-discussed are the charges that Xu was accepting bribes from PRC defense industrial firms in order to accept the delivery of weapon systems that may or may not actually perform as advertised.

The degree to which Beijing keeps expanding the number and type of weapons it builds for its own use and exports abroad ought to have some in Washington re-examining the relationship with Beijing, said a former Pentagon official.

"They continue to arm states like Iran that have promised to use those weapons against U.S. forces in the Mid-East. They have also volunteered to be Moscow’s banker now that U.S. and [European Union] sanctions have cut many of the avenues to borrow money from abroad. The PRC—to no small degree—are making it possible for Russia’s [President] Putin to continue his invasion of Ukraine."

Published under: China