American officials aren’t just concerned about the amount of money the Chinese military is spending. They’re worried about the technology that money is buying. U.S. military hardware remains a generation ahead of any rival’s, but the Chinese have begun to close the gap. Consider China’s progress in building advanced warplanes. Until recently, American officials thought their F-22 and F-35 aircraft were the world’s only fifth-generation fighters (the name given to a class of stealthy fighter jets developed in the past decade, which are equipped with radar-evading features, high-performance engines and avionics, and networked computer systems). Then, on a 2011 trip to China, Secretary of Defense Robert Gates learned otherwise. While Gates met with Hu Jintao, his hosts “coincidentally” revealed the existence of an advanced new fighter, the J-20, by staging the inaugural public flight over the city of Chengdu.

The J-20 is far from China’s only new aircraft. The PLA is also aggressively upgrading its drone fleet. A decade ago, the army had almost no unmanned aerial vehicles (UAVs). At aviation trade shows today, Chinese contractors display scores of drones under development. Among the most notable: the Yilong (Pterodactyl I) and BZK-005, which greatly resemble the U.S. military’s Predator and Global Hawk, respectively. China’s future UAVs may also get a boost from American technology: Iran has reportedly given Chinese scientists access to the RQ-170 advanced spy drone that went down in its territory last year.

Additionally, China is investing heavily in its navy. Today, the U.S. is the only country that can send aircraft carriers loaded with fighter jets to any corner of the globe. The PLA would like to change that.