China's military firms struggle as corruption purge bites

Revenues at China’s giant military firms fell last year as corruption purges slowed arms contracts and procurement, according to a study released on Monday by a leading conflict think tank.

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The Chinese declines contrast with strong revenue growth globally for big arms and military-services companies, fueled by wars in Ukraine and Gaza, and global and regional tensions, the research by the Stockholm International Peace Research Institute (SIPRI) found.

“A host of corruption allegations in Chinese arms procurement led to major arms contracts being postponed or cancelled in 2024,” said Nan Tian, director of SIPRI’s Military Expenditure and Arms Production Program.

“This deepens uncertainty around the status of China’s military modernization efforts and when new capabilities will materialize.”

CHINA’S REVENUES DOWN 10%, JAPAN’S UP 40%

The People’s Liberation Army (PLA) was one of the main targets of a broader corruption crackdown ordered by President Xi Jinping in 2012, reaching the upper levels of the military in 2023 when its Rocket Force was targeted.