China on Wednesday accused the United States of sowing discord between China and its neighbours after the Pentagon said Beijing is using espionage to fuel its military modernisation, branding Washington the "real hacking empire".
The latest salvo came a day after China's foreign ministry dismissed as groundless a Pentagon report which accused China for the first time of trying to break into U.S. defense computer networks.
The Pentagon also cited progress in Beijing's effort to develop advanced-technology stealth aircraft and build an aircraft carrier fleet to project power further offshore.