An official briefed on the matter said: “This goes far beyond China’s national defence needs and creates risks for all sides.”
They said Beijing was testing the responses of regional capitals with the “unprecedented” deployment.
A Reuters report on Thursday found more than 100 naval and coastguard ships had been deployed.
Karen Kuo, Taiwan’s presidential spokesman, said on Saturday the Chinese naval build-up “indeed poses a threat and impact to the Indo-Pacific and the whole region”.
Adding that security forces had been ordered to maintain full situational awareness, Kuo said: “We also especially call on China to live up to its responsibilities as a major power and to exercise restraint in its actions.”
The current operations exceed China’s mass naval deployment in December last year, which prompted Taiwan to raise its alert level, sources told Reuters.
Beijing, which claims Taiwan as part of China’s territory, has piled military pressure on the self-governing island in recent years, deploying warships and fighter jets to simulate a future blockade and an invasion.
In Tokyo, Defence Minister Shinjiro Koizumi said Japan was watching the Chinese military movements “with great attention”.
Without commenting on the specific deployment, he said Japan was deeply concerned with how “China has been expanding and stepping up its military activities in the areas surrounding Japan”.
Beijing’s foreign ministry spokesman Lin Jian sought to downplay the build-up, saying the navy was adhering to international law.
“There is no need for any party to overreact, over-interpret, or engage in baseless speculation,” he said.
The rise in activity comes after a diplomatic crisis between China and Japan after Japan’s Prime Minister Sanae Takaichi said last month that if China invaded Taiwan, it could trigger a military response from Tokyo.
Beijing has also been angered by an announcement by Taiwanese President Lai Ching-te that an extra US$40 billion ($69b) would be spent on defence to counter China.
China began dispatching a higher-than-usual number of ships to the region after November 14, when it summoned Japan’s ambassador to protest Takaichi’s comments on Taiwan.
Alongside increased air activity, several of the ships have carried out mock attacks on foreign ships. They have also practised access-denial operations aimed at preventing outside forces from sending reinforcements in the event of a conflict, sources said.
There are also reports Beijing has begun to wage an intellectual campaign questioning Japan’s authority over Okinawa, its southernmost prefecture, near Taiwan. Analysts suggest the strategy, in its early stages, is a response to Beijing’s perceived threat from Japan over Taiwan.
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