Actually 2/3 of the budgets have gone into kickbacks or individual pockets. And much of the weapons really bought are what the Chinese would call "Projects about face" i.e. flashy on the surface, but can't be used when the need comes - it is not what I say, but rather military analysts in Hong Kong like Ma Ting-shing (who's about as insider Chinese military strategy analyst this side of the language barrier as possible).
(Remember the days before the first Sino-Japanese war in 1894: Qing dynasty-era China reputedly had the world's 4th largest navy courtesy of the 1860s to 1880s modernization programme (Yanmu yundong) but it couldn't fight against the Japanese despite in larger numbers and roughly comparable technology).
Chinese history of that era isn't something that I have read all that much about, but if memory serves, this was the China of the Boxer Rebellion and "the sick man of Asia" period: every major power had troops in China. Germany, Russia, Japan, the United States, Britain, we all piled in. I don't think that China is weak enough that we could all simply put troops in there now, though it was certainly just that weak then.