In June 2007 the Stockholm Peace Research Institute of Sweden claimed in a published report that China's military spending had overtaken that of Russia by a very large margin. U.S. defense officials have expressed concern over the lack of transparency in China's military budget and the purpose behind some of its weapons acquisitions.

In light of these concerns, chances are very slim that the European Union will lift its arms embargo on China this year; in fact, the embargo may remain in effect for a long time to come.

At the Paris Air Show and other major European exhibitions of military equipment, major arms manufacturers from Germany and France have shown little interest in the Chinese market; they are not pressuring the EU to lift the embargo on China.

French and Italian arms manufacturers learned their lessons through brief attempts at cooperation with China in the 1980s. Not only did these efforts yield little profit, but the companies found their technologies had been stolen and replicated by the Chinese.

The United States and Japan are behind a plan to strategically isolate China, which has been very successful so far. Both Tokyo and Washington believe that the scale, pace and strategic intent of China's arms expansion in recent years are far beyond its needs for a future conflict in the Taiwan Strait. They see China posing an immense challenge, over a much broader area, against the United States, Japan, NATO and even India. China's latest moves to construct an aircraft carrier and build new nuclear-powered submarines are specific examples of this challenge.

Why is NATO planning to locate ballistic missile defense bases in Poland and the Czech Republic? The United States managed to convince NATO that China's intercontinental ballistic missiles may pose a threat to NATO members' territory. These facilities would not only be directed at Russia, according to multiple military sources within NATO countries.

On several occasions, the United States has replaced China with North Korea as the potential target of missiles from Eastern European bases. But why should Europe and NATO be on guard against non-existent intercontinental ballistic missiles from North Korea? In fact, the bases are related to the fact that NATO views China as a potential threat and an unstable factor that directly influences its security.

Generally speaking, the strategic friction between China and NATO is related to the following factors: First, China's military is expanding at a pace unmatched by any other country in the world, and China's strategic arsenals, including its ICBMs and SLBMs, can easily reach the territories of all NATO member countries. China is one of the few major countries that have the capability to pose a direct military threat to NATO members, and yet China's military expansion is nontransparent and restricted by no international treaties.

Second, China's construction of an aircraft carrier and other large-tonnage surface battleships suggests that China will directly challenge the interests of NATO countries in the Pacific Ocean and in the Indian Ocean as well. This includes the interests of the United States and Canada.

Thirdly, China's rising military, political and economic prowess in central Asia and Afghanistan is also in conflict with NATO's frontline strategies in the region. Several reports published in the United States have claimed that 90 percent of the weapons used by insurgents in Iraq and Afghanistan are from China. Moreover, China has close political, military and diplomatic ties with those countries that are considered "rogue nations" by the United States and NATO, for instance, Iran and Syria.

In particular, Iran's ballistic missiles are considered the most practical and direct threat to NATO territories, giving NATO an excuse to develop its own ballistic missile defense program and for the United States to deploy anti-ballistic missile systems in Eastern Europe. In fact, China has been the key source of Iran's arms over the years.

Lastly, Chinese intelligence agents are also a threat to the interests of NATO countries. NATO has the world's most cutting-edge technologies, and Chinese spies have been quite active in all NATO countries and even in Russia. A top official from the Canadian Security Intelligence Service openly acknowledged recently that the agency devoted more than half its personnel and material resources to dealing with these Chinese operatives.

How does China look at NATO's reassessment of its China policy? An internal Chinese document on the country's diplomatic relations talks about its policies on the European Union and NATO. A fundamental focus of the arguments in the document is that China should take advantage of NATO's "internal contradictions" and attempt to divide the alliance.

A large section of this document is devoted to a discussion of EU and NATO members' concerns about U.S. "unilateralism," claiming that the disappearance of a common adversary has led to the rise of internal differences. The document says that since the end of the Cold War, NATO's role as the hub of European and U.S. security has weakened, and Europe and the United States now have fewer common political objectives as a result.

The course of development in international affairs has meant that, due to their respective democratic political systems, changes of governments in the United States and within NATO member countries has also meant adjustments in their foreign policies. Nonetheless, because of their shared values, race and close cultural heritage, the United States and Europe still have some common goals, particularly in the fight against terrorism, preventing the rise of "rogue nations" in specific regions and guarding against the threats of Russia and China. The consensus of the United States and Europe on the issue of Iran's nuclear program is a best representation of such common strategic interests.

The Chinese document also claims that the European populace has generally lost confidence in the United States, and that relationships between the leaders of Germany, France and the United States have cooled. The author of the document believes that there is no close coordination between Europe and the United States on the Balkan and Afghanistan issues, nor have they formulated common policies on Russia and China.

The document concludes that China should actively strive to strengthen China-Europe economic and trade relations. China should not only continue its efforts to strengthen its strategic partnership with France, but should also reinforce its ties with Germany and Eastern European countries.

"Countries such as France and Germany do not like the United States to dictate what they should do. The United States has always tried to use NATO to interfere in affairs around the world, which is in fact to use NATO to serve the interests of the United States. Without France and Germany, Europe could have become a handy tool of the United States long ago," reads the Chinese analysis.

The document recommends that China reinforce its relations with the European Union to minimize the impact of the U.S. strategic squeeze upon China, and to win solid support from the European Union in a wide range of areas including the Taiwan issue, technology transfers and the lifting of the arms embargo. China's strategy of using Germany and France to create divisions between the United States and Europe has been a frequent topic of discussion in articles published by the Chinese media.

(Andrei Chang is editor in chief of Kanwa Defense Review Monthly, registered in Toronto.)

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