China has expressed its "serious concern" at the decision yesterday by the US to sell a package of sophisticated weapons to Taiwan.
While President Bush deferred a decision on the highly controversial sale of the Aegis naval defence system, Taiwan nonetheless welcomed the arms deal, which includes diesel-powered submarines and Kidd-class destroyers.
The package, Taiwan's biggest from the US in 10 years, was warmly welcomed by the island's leaders. But a Chinese Foreign Affairs spokeswoman said China viewed the arms deal "with serious concern".
"China has consistently opposed the sale of weapons to Taiwan, and resolutely opposed the sale of Kidd-class destroyers, P-3 Orion planes and diesel-powered submarines, and other advanced weapons," she said. "All of these are advanced weapons."
China has maintained its view that submarines are offensive weapons. Since the Netherlands sold two to Taiwan in 1981, it has managed to block all further sales using the threat of diplomatic sanctions and trade retaliation.
Taiwan now has just four submarines, including two Dutch Swaardvis class vessels and two second World War vintage Guppy II craft.
While the Chinese reaction was milder than many had expected, it is thought to be just an opening shot in this round of controversy over US arms sales to Taiwan. The sale of the Aegis naval defence system had been Beijing's biggest concern.
Despite the US's deferral of the Aegis decision, the deal will sharply strengthen Taiwan's ability to defend itself against China's bigger and stronger navy.
The US navy already has the four older Kidd-class destroyers, which are in storage. The transfer of those to Taiwan could begin as early as next year.
Other elements of the package include torpedoes, submarine-launched and surface-launched missiles, minesweeping helicopters and self-propelled artillery, according to a White House official.
Taiwan is anxious to strengthen its defences against Chinese ballistic missiles. US intelligence reports have indicated that China has stationed short-range ballistic missiles in at least two points along the Taiwan Strait between China and Taiwan.
In Taipei, legislators were delighted by the package, which would vastly improve the island's naval defences. It is the biggest package since the early 1990s, when Taiwan bought 150 F-16 fighter jets from the US and 60 Mirage 2000-5 fighters and six Lafayette-class frigates from France.
The most potent threat from China, however, is seen as the batteries of Chinese ballistic missiles pointed at Taiwan from bases in coastal Fujian province. China fears Aegis could become a platform for a missile defence system that could neutralise them.
A US official in Washington said that while it was not selling Aegis to Taiwan now, it was keeping the option open. This was interpreted as a message to China to scale back its missile deployments.
China-US ties were already strained by a tense showdown over the April 1st collision between a US spy plane and a Chinese fighter, as well as an impending visit to the US by a former President of Taiwan, Mr Lee Teng-hui.
Patrick Smyth reports from Washington:
White House sources yesterday insisted that the decision on weaponry for Taiwan was unrelated to the recent spy plane incident and based entirely on Taiwan's needs.
President Bush's decision reflects exactly the recommendation made to him by his National Security team last week when the president was told that the Taiwanese did not yet have the capability to use Aegis effectively.
Whatever the reason, the decision should allow the US to begin to de-escalate the war of words with China which has raged since the spy plane crash. The Chinese have made it clear that they do not approve of any arms sale but viewed the Aegis as particularly destabilising to the regional security balance.
The Bush administration has been under heavy pressure from hawks in the Republican Party to give the Taiwanese all they were seeking.
Senator John Kyl, a Republican from Arizona, applauded the decisions and said that the White House should revisit the decision on Aegis if the Chinese continue to expand their missile threat.