Weapons of Mass Destruction (WMD)

DATE=10/16/00

TYPE=CORRESPONDENT REPORT

TITLE=CHINA-DEFENSE (L)

NUMBER=2-267989

BYLINE=KIRK TROY

DATELINE=BEIJING

CONTENT=

VOICED AT=

INTRO: China says it will increase its military spending to forestall independence moves by Taiwan and to respond to what is sees as foreign interference and power politics. Kirk Troy reports from Beijing that China's cabinet has issued a report assessing its defense needs and says the increased military spending is primarily peaceful.

TEXT: China's cabinet issued a so-called - white paper - saying it will increase military spending 12-percent. In the lengthy policy paper, the cabinet says it is being forced enhance it capabilities to defend its sovereignty.

China considers Taiwan the biggest threat to its sovereignty and repeated it will use force if Taiwan either moves to declare independence or delays talks on reunification with the Chinese mainland.

Taiwan's new president, Chen Shui-bian, has repeatedly offered to negotiate, but Beijing is refusing the offer until Taiwan accepts that it is a part of China.

/// OPT /// The island has operated in a de facto independent fashion since the Chinese civil war ended more than 50-years ago. /// END OPT ///

The Chinese report calls relations with Taiwan grim, and complicated by the interference of outside nations. The Chinese cabinet criticized U-S arms sales to Taiwan, saying peaceful reunification between China and Taiwan is imperiled by what it called - hegemony and power politics - a thinly veiled reference to the United States.

China insists its move to beef up the military is being forced upon it and that it is a peace-loving nation. It notes that its defense expenditures are just a fraction of what the United States, and its Asia ally Japan, spend each year.

Analysts however dispute official Chinese defense figures as low, saying they fail to reflect research and development, foreign purchases, and spending by other parts of the government.

China has recently been purchasing more advanced weaponry from Russia and began streamlining its forces into a more modern, hi-tech military. Editorials in state-run media say the upgrade is a reaction to a proposed U-S anti-missile defense system in Asia. (SIGNED)

NEB/HK/KT/JO/RAE