The above is the United States Annual Report to Congress dated 15 May 2017. It updates information on China's thoroughly-streamlined military command structures and capabilities to engage hostile forces in a wide range of theaters and environments.These include silo-based and mobile nuclear intercontinental ballistic missiles, strategic submarines, 4th and fifth generation bombers, anti-satellite, cyber and space warfare, anti-access/area denial (A2/AD) abilities, military features in the South China Sea, and military bases further afield such as Djibouti. It reflects China's much-boosted strategic nuclear deterrence as well as capabilities to fight short-duration, high-intensity regional conflicts at greater distances.
The Report perceives China's military objectives as to "perpetuate the rule of the Communist Party of China, maintain domestic stability, sustain economic growth and development, defend national sovereignty and territorial integrity, secure China’s status as a great power and, ultimately, reacquire regional preeminence; and safeguard China’s interests abroad". They necessitate power projection capabilities to safeguard national core interests such as Taiwan, and others consistent with the "China Dream" of national renaissance.
The Report notes that China's official military budget grew at an average of 8.5% annually from 2007-2016. In March 2016, China announced a 7% inflation-adjusted increase to $144.3 billion, continuing more than two decades of annual defense spending increases and sustaining its position as the second largest military spender in the world after the United States (about one-seventh of the latter in nominal terms but three-quarters in purchasing power terms). It expects that China has the ability to support defense spending growth for the foreseeable future.
Clearly China is fast catching up with the United States militarily both in terms of quality, sophistication, integration and flexibility. Nevertheless, while China continues to pose an increasing challenge to American military dominance, such challenge is largely limited to a number of scenarios and is largely confined to the Asia Pacific as China is still far behind in global reach and efficiency.
The Report doesn't sound overtly alarmed about China's military intentions which seem concomitant with China's dramatic economic rise. While warning caution and vigilance, it also highlights a range of ongoing peaceful military-to-military cooperation and exchanges between China and the United States as well as a host of other countries. There is no undue paranoia or fear in the Report of China usurping America's global dominance or leadership.