TENSIONS are running high after the United States accused China of deploying surface-to-air missiles on a disputed island in the South China Sea.
The US State Department spokesman John Kirby said satellite imagery suggested "very recent" placement of missiles on Woody Island that went against China's pledge not to militarise the area.
The island, in the Paracel island chain, is in the South China Sea, which sees more than $5trillion in global trade passes every year.
China claims most of the South China Sea, but Vietnam, Malaysia, Brunei, the Philippines and Taiwan have rival claims.
Since reports of missiles emerged, China’s top diplomat, State Councillor Yang Jiechi, said that China had "challenged" the deployment report but had neither denied nor admitted the missiles were there.
Mr Kirby said: "The Chinese have said one thing, and yet appear to be doing another.
"We see no indication that this militarisation effort has stopped.
“It's doing nothing to make the situation there more stable and more secure.
“In fact, it's having quite the opposite effect."
China hit back through its state-run Global Times news portal, which said the US had “ulterior motives in hyping up China’s deployment of missile defence systems on an island in the South China Sea”.
Citing China’s strong economy as a motive, it added: “The hyping by certain western media is a pure repeat of the ‘China threat’ theory.”
On Wednesday, US Secretary of State John Kerry said the United States would have "very serious" talks with China about militarisation of the South China Sea.
China has offered little specific response to the missile deployment reports, but said it had a legitimate right to military facilities on territory it views as its own.
Australian Foreign Minister Julie Bishop, the first senior Western official to visit China since the reports appeared, said she raised the issue of the South China Sea's militarisation in talks in Beijing on Thursday.
She said: "Until such time as we have a clear picture of it, of course it's a matter of concern.
Ms Bishop referred to comments by Chinese President Xi Jinping in Washington last year that China did not intend to militarise islands in the South China Sea.
She added: "We certainly hold China to that and that's been reiterated to me."