The current international situation continues to undergo profound and complex changes. Peace and development remain the dominating themes of the times. Although the international situation as a whole tends to be stable, factors of uncertainty, instability and insecurity are on the increase.

The trends toward world multipolarization and economic globalization are deepening amid twists and turns. New changes are occurring in the balance of power among the major international players, with the process of their realignment and the redistribution of their interests accelerated. New and profound readjustments have taken place in the relations among the world's major countries. While cooperating with and seeking support from each other, they are checking on and competing with one another as well. With their overall strength continuing to rise, the developing countries have become important players in promoting a multipolar world and democratized international relations. The United Nations is playing an irreplaceable role in international affairs. Economic globalization and technological advancement have generated new opportunities for development. As a result of accelerated global industrial restructuring, and the continued development of regional economic cooperation, world economy has witnessed new growth, with interdependence among nations deepened and their common interests increased. However, a fair and rational new international political and economic order is yet to be established. Tendencies of hegemonism and unilateralism have gained new ground, as struggles for strategic points, strategic resources and strategic dominance crop up from time to time. The Iraqi War has exerted a far-reaching influence on the international and regional security situations. The imbalance in world economic development has worsened, with the North-South gap continuing to widen, and economic security confronting new challenges.

The military factor plays a greater role in international configuration and national security. Worldwide Revolution in Military Affairs (RMA) is gaining momentum. The forms of war are undergoing changes from mechanization to informationalization. Informationalization has become the key factor in enhancing the warfighting capability of the armed forces. Confrontation between systems has become the principal feature of confrontation on the battlefield. Asymmetrical, non-contiguous and non-linear operations have become important patterns of operations. The world's major countries are making readjustments in their security and military strategies and stepping up transformation of their armed forces by way of developing high-tech weaponry and military equipment and putting forth new military doctrines. As a result, the generation gap in military technology between informationalization on the one hand and mechanization and semi-mechanization on the other is still widening, and military imbalance worldwide has further increased. The role played by military power in safeguarding national security is assuming greater prominence.

Traditional and non-traditional security issues are intertwined with the latter posing a growing threat. Some regional hot spots have cooled down. Security cooperation at the regional level has deepened. The worldwide campaign against terrorism has made progress. International cooperation in the fields of information security, energy security, finance security and environment security has been enhanced. And international efforts to crack down on transnational crimes, prevent epidemic diseases, and reduce the impact of disasters have been intensified. However, world peace remains elusive. Geopolitical, ethnic, religious and other conflicts interact with political and economic contradictions, resulting in frequent outbreak of local wars and armed conflicts. International terrorist forces remain rampant. It seems rather difficult to eliminate completely the root causes of terrorism, making the fight against terrorism a long and demanding task before the international community.

The Asia-Pacific region enjoys basic stability in its security situation. As the world's most dynamic region economically, most nations in the region have made development the centerpiece of their policy. Major country relations continue to improve and grow. Peaceful consultation has become the basic approach to the settlement of disputes. Security dialogue and cooperation of various forms have become more animated. Asia-Pacific Economic Cooperation (APEC) is playing an important role in promoting common development. The institutionalization of the Shanghai Cooperation Organization (SCO) has been basically accomplished. The SCO is incessantly expanding and deepening its cooperation in the political, security, economic, humanitarian and other fields. The SCO is playing a greater role in promoting peace, stability and development in the region. China has established a strategic partnership with the Association of Southeast Asian Nations (ASEAN) dedicated to peace and prosperity in the region, and engaged in comprehensive cooperation that has seen rapid expansion. Cooperation in East Asia, with the ASEAN and China, Japan and the ROK as the main players, keeps expanding, leading to greater economic development and political and security trust in the region. The ASEAN Regional Forum (ARF) as the most important official channel for multilateral security dialogue in the Asia-Pacific region, plays a positive role in promoting security cooperation in the region. The nuclear issue on the Korean Peninsula has been brought onto the track of peaceful settlement through dialogue, and the process of the Six-Party Talks has made progress in the discussion of substantive issues and the institutionalization of the process. Tensions between India and Pakistan have been eased, and the two countries have maintained the momentum of peaceful dialogues.

Meanwhile, complicated security factors in the Asia-Pacific region are on the increase. The United States is realigning and reinforcing its military presence in this region by buttressing military alliances and accelerating deployment of missile defense systems. Japan is stepping up its constitutional overhaul, adjusting its military and security policies and developing the missile defense system for future deployment. It has also markedly increased military activities abroad. The foundation for the Six-Party Talks is not solid enough as uncertain factors linger in the settlement of the nuclear issue on the Korean Peninsula. The threat posed by terrorism, separatism and extremism is still grave. Such transnational crimes as smuggling, piracy, drug trafficking and money laundering are rampant. Many countries are confronted with the formidable task of eliminating poverty, achieving sustainable development and enhancing security in the area of public health.

The situation in the relations between the two sides of the Taiwan Straits is grim. The Taiwan authorities under Chen Shui-bian have recklessly challenged the status quo that both sides of the Straits belong to one and the same China, and markedly escalated the "Taiwan independence" activities designed to split China. Incessantly trumpeting their separatist claim of "one country on each side," they use referendum to engage in the separatist activities aimed at "Taiwan independence," incite hostility among the people on the island toward the mainland, and purchase large amounts of offensive weapons and equipment. They have not given up their attempt at "Taiwan independence" through the formulation of a so-called "new constitution for Taiwan." They are still waiting for the opportune moment to engineer a major "Taiwan independence" incident through the so-called "constitutional reform." The separatist activities of the "Taiwan independence" forces have increasingly become the biggest immediate threat to China's sovereignty and territorial integrity as well as peace and stability on both sides of the Taiwan Straits and the Asia-Pacific region as a whole. The United States has on many occasions reaffirmed adherence to the one China policy, observance of the three joint communiqués and opposition to "Taiwan independence." However, it continues to increase, quantitatively and qualitatively, its arms sales to Taiwan, sending a wrong signal to the Taiwan authorities. The US action does not serve a stable situation across the Taiwan Straits.

China's national security environment in this pluralistic, diversified and interdependent world has on the whole improved, but new challenges keep cropping up. The vicious rise of the "Taiwan independence" forces, the technological gap resulting from RMA, the risks and challenges caused by the development of the trends toward economic globalization, and the prolonged existence of unipolarity vis-a-vis multipolarity - all these will have a major impact on China's security. Nevertheless, China is determined to safeguard its national sovereignty and security, no matter how the international situation may evolve, and what difficulties it may encounter, so as to join hands with the people around the world in advancing the lofty cause of peace and development for mankind.