"Taiwan ... has allowed its defense spending to decline in real terms over the past decade, creating an increased urgency for the Taiwan authorities to make the necessary investments to maintain the island's self-defense capabilities," stated the Pentagon's latest annual report on Chinese military power, released to Congress Friday.

Beijing wants to see Taiwan reunified with China; Taiwan is committed to maintaining its independence. Long-term U.S. policy has been to help Taiwan militarily resist "any effort by Beijing to resort to force or coercion to dictate the terms of Taiwan's future status," according to the report.

Part of that policy is the possibility of the U.S. military coming to Taiwan's defense if it is threatened or attacked by China. It also includes making sophisticated weapons and defensive systems available to Taiwan.

But Taiwan has not taken advantage of offers made in 2001 to sell it the Patriot PAC-3 air defense system, the P-3C Orion anti-submarine aircraft, and diesel electric submarines.

"In the six years since the offer was made, China has continued to make significant advances, some unexpected, in the capability these systems are designed to protect against," the report states. "Although Beijing professes peaceful resolution as its preferred outcome ...(China's) ongoing deployment of short-range ballistic missiles, enhanced amphibious warfare capabilities, and modern, long-range anti-air systems ... (opposite Taiwan) are reminders of Beijing's refusal to renounce the use of force."