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Asia's 2012 military spending to pip Europe's

London: Asian military spending will top that of Europe in 2012 for the first time in centuries, a global defence survey said on Wednesday, pointing to high regional economic growth and an increasingly ambitious China.

The London-based International Institute for Strategic Studies said U.S. military spending was also falling with withdrawal from Iraq and Afghanistan - although Washington's $739 billion budget still dwarfs that of other nations.

With the Pentagon explicitly refocusing its strategic attention on Asia, the annual Military Balance report said it was clear that a major historical shift was underway.

Paramilitary recruits march during a training session in China. Reuters

With China's military spending - an estimated $89 billion in 2011 - roughly doubling every five years, other growing Asian states were also funnelling money into their military programmes, the report said. That brought conflict risks.

"There's no doubt we are seeing a major shift," John Chipman, IISS director-general John Chipman told Reuters on the sidelines of the report's launch.

"What we see in Asia is just about every kind of strategic challenge - from 19th century style territorial disputes to economic rivalry and potential new nuclear weapons states ... We need to manage that."

Diplomatic effort and confidence-building measures were necessary to stop disputes between a variety of Asian powers in the South China Sea and elsewhere - together with other regional and economic rivalries - from escalating, he said.

The United States has said it will move additional military resources to Asia, including marines to Australia and combat vessels to Singapore.

Beijing has condemned such plans, accusing Washington of being unnecessarily belligerent. Australia, Indonesia, Vietnam, Singapore, Thailand, India and other nations in the region are also increasing their forces, particularly naval craft.

MIDDLE EAST FOCUS ALREADY DECLINING?

In the short term, Chipman said it was important not to overstate Beijing's capability or ambitions. Despite considerable investment, he said, China still lacked a working aircraft carrier although it continues to conduct trials with a former Soviet carrier. In contrast, the United States had 11 powerful super carriers, although some are always in refit.

China continues to maintain many more personnel, about 2.3 million compared to 1.6 million by the United States. But even if current trends were to continue, IISS says it would take about 20 years for Beijing to match Washington's current military spend.

Beset by economic crisis and with few immediate security threats, however, Europe's military clout is seen declining.

Defence spending for European members of NATO had dropped below that of Asia, even if Australia and New Zealand were stripped from the Asian figure.

Last year's Libya conflict, the IISS said, showed what could be done with a small number of sophisticated military assets. But it also highlighted serious shortcomings in Europe's defence capabilities - such as surveillance, air-to-air refuelling and munition stocks - that had to be filled by the United States.

"It's clear that Europe is now focusing much more on the 21st century rather than the 19th century style of managing conflict - more institutions, more diplomacy, more multilateral engagement, less pure focus on military power," Chipman said.

Despite the current focus on Iran and worries of conflict over its nuclear programme, Chipman said Western military interest in the region also already seemed to be on the wane.

"The countries that have been close to the United States - Israel, Saudi Arabia, United Arab Emirates - are already worrying that the United States is losing its vocation for the region," he said, pointing to rising local defence budgets. "But for now the U.S. focus cannot just be on Asia because of the importance of the Middle East."

Reuters