Asia arms race may be overstated

CANBERRA (Reuters) - Asia's arms race may be overstated, with defense spending on the decline as a proportion of economic growth, pointing to an increasing sense of regional security, an Australian defense conference heard on Thursday.

Conventional wisdom that a military build-up and modernization around the Indian and Pacific Oceans reflected increasing security tensions may be misplaced, Australian Strategic Policy Institute analyst Andrew Davies said.

"The one and glaring exception is China," Davies told Reuters after a speech to the conference, saying the priority of military spending was declining as regional economies boomed.

"I think it does tell us something about their thinking and about their level of anxiety being low," he said.

While China's military spend had lifted over the decade from 0.9 percent of GDP to officially more than 1.5 percent, and may be unofficially as high as 5.45 percent, rival Japan had seen spending slip from 1.0 percent to 0.9 percent, ASPI said.

"When you look at what the other north Asian nations are doing, especially Japan, there is no evidence they are reacting to China," Davies said.

"Even India, which has stated aspirations to be a major power, they haven't increased their proportion of spending in GDP terms, although military spending has come up as the economy has come up. In South East Asia the trend is to spend less," he said.

While there was little evidence of an Asia-wide arms race, the region was modernizing its weapons stocks, Davies said, most obviously in China and Southeast Asia.

"Following Singapore's force modernization efforts, Malaysia has also acquired modern combat aircraft, and is in the process of acquiring conventional submarines," Davies said.

Along with China, Australia was one of few countries to dramatically boost defense spending, outlaying more than $20 billion to lift the military's proportion of GDP from 1.8 percent to 2.0 percent, the conference heard.

Australia has committed to a $57 billion modernization, buying new missile destroyers, amphibious carriers, stealth fighter aircraft, missiles, tanks, transport aircraft and attack helicopters, as well as a larger army.

Davies said new weapons systems coming into modernizing Asian economies were often relatively ineffective due to lack of local experience operating and maintaining them.

Malaysia, in particular, had purchased different fighter aircraft from both Russia and the United States, and faced problems integrating them all.

"Obtaining the hardware is almost the easy part. Some Asian countries are beginning to appreciate the need for the command, control and support systems required to get the best from hardware they are acquiring, but many are not," he said.

($1=A$1.04)

(Editing by )