"China's desire to secure access to the markets, commodities, and energy supplies needed to sustain domestic economic growth significantly influences its foreign engagement," retired admiral Dennis Blair told Congress.

The priority of Chinese diplomacy is to remain on friendly terms with other major powers, especially the United States given the primacy of US demand to China's own economic growth, he said.

"But Beijing is also seeking to build its global image and influence in order to advance its broader interests and to resist what it perceives as external challenges to those interests or to China's security and territorial integrity."

Blair, the new director of national intelligence under President Barack Obama, was presenting the US intelligence community's annual "risk assessment" to a Senate select committee.

He noted that under President Ma Ying-jeou of the nationalist Kuomintang party, Taiwan has resumed dialogue with China after a nine-year hiatus, and there is cautious optimism "for a period of less confrontational relations."

But Beijing's communist leadership sees eventual reunification with Taiwan to mend the rival Chinas' 60-year-old split as "vital to regime legitimacy," the US official stressed.

"Preparations for a possible Taiwan conflict continue to drive the modernization goals of the People's Liberation Army and the Chinese defense-industrial complex," Blair said.

"At the same time, we judge that China over the past several years has begun a substantially new phase in its military development by beginning to articulate roles and missions for the PLA that go well beyond China's immediate territorial interests."

Blair cited China's development of a blue-water navy that can range far afield from East Asia, highlighting its decision in December to start anti-piracy patrols in the lawless waters off Somalia.

Chinese infantry troops were also extending their international presence through a higher peacekeeping profile, and may take on combat missions beyond their current role in logistical support for the United Nations.

Blair said China's space programs, including anti-satellite weapons, "also rank among the country's highest military priorities."

Of most immediate concern to far-flung US forces in the western Pacific and Asia is China's refinement of ballistic and cruise missile capabilities, while its nuclear weapons capability will increase over the coming decade.

"China also is developing conventionally armed short- and medium-range ballistic missiles with terminally guided maneuverable warheads that could be used to attack US naval forces and airbases," Blair said.

"In addition, counter-command, control, and sensor systems, to include communications satellite jammers, are among Beijing's highest military priorities."

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