U.S. naval power in the Pacific will increase as the Pentagon rebalances American forces toward the Asia-Pacific region, Defense Secretary Leon Panetta said in Singapore while calling on countries to beef up their capacity.

By 2020, the “Navy will re-posture its forces from today’s roughly 50/50 percent split between the Pacific and the Atlantic to about a 60/40 split between those oceans — including six aircraft carriers, a majority of our cruisers, destroyers, Littoral Combat Ships, and submarines,” Panetta said today at the Shangri-La Dialogue.

Panetta is using his first visit to the annual Asian security conference to elaborate on the U.S. military’s revamped global strategy laid out in January. Pentagon officials have billed the approach as an effort to focus more attention on a region where China’s growing economic and military power is causing friction with its neighbors.

Countries in the region must develop their own military capacities as well as create rules to deal with territorial disputes in the South China Sea, Panetta said.

Panetta is trying to show support for allies in the region without encouraging them to be reckless in dealings with China, said Bonnie Glaser, an Asia specialist at the Center for Strategic and International Studies in Washington.

Panetta, more than any other U.S. official, has made it clear “we want the countries in the region to have the capability to defend themselves and not take for granted or rely on the U.S. to come and put out fires when there’s a problem,” Glaser said in an interview in Singapore.

Oil Reserves

Disagreements and clashes in the South China Sea have been building since 2009, according to “Stirring Up the South China Sea,” a report published in April by Brussels-based International Crisis Group.

Oil reserves in the South China Sea may be as much as 213 billion barrels, according to Chinese studies cited in 2008 by the U.S. Energy Information Administration.

In the most recent incident, China and the Philippines have been in a standoff since April over the Scarborough Reef in the South China Sea, which is claimed by both countries.

The U.S. opposes coercion, provocation and the use of force to settle such disputes by either country and has told both China and the Philippines — a U.S. treaty ally — that they must resolve the matter peacefully under international law, Panetta said today.

Geographic Distribution

The United Nations Convention on the Law of the Sea may be the best mechanism to resolve such disputes, according to the Congressional Research Service. The U.S. hasn’t ratified its participation in the convention. Panetta and Secretary of State Hillary Clinton urged the U.S. Senate to do so in testimony last month.

The U.S. will increase the size and scope of military exercises in the region and expand port visits by Navy ships, Panetta said today. In 2011, the U.S. Pacific Command participated in 172 multilateral and bilateral exercises with 24 countries in the region, according to Panetta’s spokesman Carl Woog.

U.S. Navy warships as well as cargo and hospital ships attached to the Pacific Command made approximately 700 port visits during 2011, according to Captain Lydia Robertson, a command spokeswoman.

Panetta didn’t say how forces would be deployed across the Pacific from the U.S. West Coast to Guam, Japan and the Indian Ocean. His 60 percent estimate encompassed all ships to be based in Pacific waters, including three aircraft carriers in San Diego; two in Everett, Washington; and one in Yokosuka, Japan, according to Woog.

New Weapons

“The United States will have a significant forward deployed and rotational presence in the Asia-Pacific region,” Woog said in an e-mail. “We continue to work with partners and allies on a geographically distributed fleet in the theater.”

Panetta told his audience in Singapore that the U.S. is investing in new classes of weapons required to operate in the Asia-Pacific region.

He said that key to the strategy are new weapons such as Lockheed Martin Corp. (LMT)’s F-35 Joint Strike Fighter that’s capable of evading enemy radar; new Virginia-class nuclear-powered submarines built by General Dynamics Corp. (GD), and Huntington Ingalls Industries Inc.; “improved precision weapons;” electronic warfare systems; a new Air Force long-range bomber and refueling tankers.

Sino-U.S. Relations

On a trip that will take Panetta from Singapore to Vietnam and India, his Asian counterparts may press him on how the strategy will affect them and what it will mean for U.S.-China relations.

The region’s leaders, such as Singapore’s Defense Minister Ng Eng Hen, have said a lack of clarity about the U.S. strategy risks creating friction if China sees the moves as an attempt to contain its increasing power.

“I reject that view entirely,” Panetta said today of the prospects for a clash with China. The U.S. refocus is “fully compatible with the development and growth of China,” he said.

China can advance prosperity and security in the region by “respecting the rules-based order” that has worked well for six decades, Panetta said.

During a 30-minute question-and-answer session after his speech, Panetta downplayed concerns that the U.S. shift to the Pacific might raise tensions with China. He emphasized a need to boost cooperation on common security challenges such as piracy and disaster relief while noting the “ups and downs” in relations.

`Not Naive’

“We are not naïve about the relationship and neither is China,” Panetta said. “We both understand the conflicts we have, but we also both understand that there really is no other alternative but for both of us to engage and to improve our communications.”

Indonesian President Susilo Bambang Yudhoyono yesterday called on the U.S. and China to work together for the benefit of countries throughout Asia.

“With their enormous economic potential, it is natural that many countries want to build good relations with both China and the Unites States,” he said in a speech opening the conference last night. “Both the U.S. and China have an obligation not just to themselves, but to the rest of the region to develop peaceful cooperation.”

The Philippines and Vietnam have expressed alarm as China has confronted them over territorial disputes and oil exploration rights in the South China Sea. China’s neighbors reject its map of the sea as a basis for oil and gas development.

Military Exchanges

The Philippines and the U.S. have stepped up military cooperation and exchanges of high-level visits. Panetta and Clinton met with their Filipino counterparts Voltaire Gazmin and Albert del Rosario in Washington last month.

The U.S. is helping the Philippines draft a long-term military modernization plan that calls for the Pentagon to supply coastal patrol vessels and maritime radar as well as assisting the country in obtaining equipment from U.S. allies in the region, according to U.S. officials who spoke with reporters May 3 on condition of anonymity to discuss diplomatic matters.

Army General Martin Dempsey, chairman of the U.S. Joint Chiefs of Staff, will visit the Philippines after attending the security conference in Singapore, Panetta said.

Rotating Troops

The U.S. is moving away from an era of permanent bases it built in Europe after World War II that have proved to be expensive to maintain.

Instead, the Pentagon will seek arrangements for U.S. troops to rotate through the region. Australia already has agreed to host a contingent of Marines at its northern port city of Darwin, and the U.S. is working on “developing the same kind of approach in the Philippines and elsewhere in the region,” Panetta told reporters traveling with him to Singapore.

The U.S. is expanding partnerships with countries including India, Singapore and Indonesia, Panetta said. With current treaty allies such as Japan, the U.S. is stepping up joint military exercises and maritime surveillance missions as well as developing new missile-defense technologies, he said.

As part of the Asia-Pacific strategy the U.S. is trying to determine what combination of military advice, technical assistance and weapons sales will help each country in the region, Panetta told reporters.

Diplomacy, Trade

President Barack Obama’s administration also is pursuing diplomatic and trade measures to strengthen cooperation across the region, Panetta said.

Developing the new classes of weapons and the successful implementation of the Pentagon’s strategy depend on Congress averting budget cuts of about $500 billion over the next 10 years, in addition to the $487 billion in reductions already planned, Panetta told reporters.

The added cuts will take effect in January under a so- called sequestration mechanism, unless Congress and the president agree on an alternative to meet deficit and debt reduction goals.

If additional budget cuts take place, “it’s going to seriously impact our strategy and we may have to throw the strategy out the window,” Panetta said.

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