* China-built aircraft carrier seen by 2015
* China military build-up still driven chiefly by Taiwan
* US eyes more steady military-military ties with China
(Adds China comment, paras 2, 10-11)
By Paul Eckert and Phil Stewart
WASHINGTON, May 18 (Reuters) – The Pentagon said on Friday
it believes China spent up to $180 billion on its military
buildup last year, a far higher figure than acknowledged by
Beijing, and it accused “Chinese actors” of being the world’s
biggest perpetrators of economic espionage.
China rejected the report as irresponble, saying the United
States was spreading a “China military threat” theory.
The Pentagon, in its annual report to Congress on China’s
military, flagged sustained investment last year in advanced
missile technologies and cyber warfare capabilities and warned
that Chinese spying threatened America’s economic security.
“Chinese actors are the world’s most active and persistent
perpetrators of economic espionage,” the report said.
“Chinese attempts to collect U.S. technological and economic
information will continue at a high level and will represent a
growing and persistent threat to U.S. economic security.”
David Helvey, acting assistant secretary for defense,
stopped short of saying the Chinese government was behind cyber
intrusions, and instead repeated that they were “from China.”
“As we learn more about them, we have a better understanding
of the nature of the operations and that helps us to say with
greater confidence that some of these are in fact coming from
China,” he told reporters in a briefing on the annual report.
Analysts said espionage and aggressive acquisition of
dual-use technology could accelerate China’s military
modernization.
The United States could be in for a surprise in 2013-15 if
“China successfully exploits it extensive cyber-espionage
efforts and unveils new weapons systems that are on par with
U.S. systems,” said Capital Alpha Partners LLC, a investment
analysis group, in a research note on the Pentagon report.
China expressed its opposition to the report for painting
its military development as a threat, saying it was for
defensive purposes and not aimed at any country or target.
“China is committed to maintaining and promoting the peace,
stability and prosperity in the Asia Pacific region, and even
the world,” Foreign Ministry spokesman Hong Lei said in a
statement. He called on the United States to halt the annual
publication of the reports and do more to promote Sino-U.S.
military relations.
The report was the first by the Pentagon since President
Barack Obama last year launched a policy “pivot” to reinforce
U.S. influence across the Asia-Pacific region, even as planned
belt-tightening shrinks the size of the military in many other
parts of the world.
That pivot has fanned unease in China, with some People’s
Liberation Army officers calling it an effort to fence in their
country and frustrate Beijing’s territorial claims. The Pentagon
report identified China’s rapid development of Anti-Access/Area
Denial weaponry, such as missiles targeting aircraft carriers,
as a potential threat to U.S. movements in Asia.
STEALTH FIGHTER, AIRCRAFT CARRIER
China has advertised its long-term military ambitions with
shows of new hardware, including its first test flight of a
stealth fighter jet in early 2011 and its August launch of a
fledgling aircraft carrier – a refitted former Soviet craft.
The Pentagon noted that some components of China’s first
indigenously produced carrier may already be under construction.
It said that carrier could achieve operational capability after
2015.
“China likely will build multiple aircraft carriers and
associated support ships over the next decade,” it said.
It would be 2018 before China’s stealth fighter would have
“operational capability,” said Helvey, citing the need to field
more aircraft, integrate weapons and conduct training.
China announced in March that 2012 outlays on the PLA wil
reach 670.3 billion yuan for 2012 (about $106 billion), an 11.2
percent increase over 2011. That follows a near-unbroken string
of double-digit rises across two decades.
The Pentagon suggested that China’s 2011 figure was an
underestimate, noting “poor accounting transparency and China’s
still incomplete transition from a command economy.”
“Using 2011 prices and exchange rates, (the U.S. Department
of Defense) estimates China’s total military-related spending
for 2011 ranges between $120 billion and $180 billion,” the
Pentagon said.
“Some of their nuclear forces modernization occurs
off-budget, some of the research and development monies that go
to their defense industry we also think comes from a different
budget … some of the foreign acquisitions comes from a
different account as well,” said Helvey.
In contrast, U.S. lawmakers are now debating a bill seeking
$554 billion in base defense spending for the 2013 fiscal year
beginning in October and $88.5 billion for the Afghan war and
other overseas operations.
Taiwan, the self-ruled island that China claims as a
renegade province to be recovered by force, if required,
“remains the principal focus and driver of much of China’s
military investment,” the report said.
Despite an ongoing improvement in China-Taiwan relations
under Taipei’s Beijing-friendly President Ma Ying-jeou, “China’s
military shows no sign of slowing its efforts to prepare for
Taiwan Strait contingencies,” said Helvey.
The report underscored the Pentagon’s desire for more steady
and continuous military-to-military relations with China, noting
that “this aspect continues to lag behind other aspects of the
broader bilateral relationship.”
But Helvey noted that although China canceled some military
exchanges after the September 2011 U.S. announcement of arms
sales to Taiwan, dialogue continued and the two powers have set
a “robust” schedule for 2012, which has already seen a U.S.
visit by Defense Minister Liang Guanglie.
The 43-page report is posted at
http://www.defense.gov/pubs/pdfs/2012_CMPR_Final.pdf
(Additional reporting by Don Durfee in Beijing; Editing by Ron
Popeski)
