In its first unclassified report on the subject in six years, the Office of Naval Intelligence depicts a powerful trajectory for China’s maritime forces. Titled “The PLA Navy: New Capabilities and Missions for the 21st Century,” the document and accompanying videos also cover the China Coast Guard—precisely the right approach, since the world’s largest blue water civil maritime fleet serves as “China’s Second Navy” and is on the front lines of island and maritime “rights protection” in the East and South China Seas. This focus on both the PLA Navy (PLAN) and the China Coast Guard is also especially appropriate given their role as the principal institutions charged with furthering regional sovereignty claims. The PLAN is also responsible for safeguarding Chinese interests much farther afield, and is gradually developing power projection capabilities to do so.

Looking towards 2020, the Office of Naval Intelligence sees China’s maritime forces on a trajectory of major improvement through hardware acquisition and accrual of operational proficiency. Chinese shipbuilding capabilities and resources allow both forces to replace old ships with new, far more capable ones. Last year alone, China’s navy laid, launched, or commissioned more than 60 vessels; the report expects a similar figure for 2015. More naval ships emerged from Chinese shipyards than from those of any other country in 2013 and 2014. The Office of Naval Intelligence expects China to lead in naval ship launching in 2015 and 2016 as well.

Chinese naval development remains more a quality improvement swap than a Soviet-style numerical buildup. PLAN ships include 26 destroyers, 52 frigates, 20 corvettes, 85 missile patrol craft, 56 amphibious vessels, 42 mine warfare ships, more than 50 major auxiliaries, and more than 400 minor auxiliaries. Beyond the numbers, though, what is most noteworthy is (1) the increasing number of vessels with multi-mission capabilities and their ability to operate both near to and far from China, and (2) growing numbers of specialized ships. Examples of geographic versatility include four-and-counting Yuzhao-class landing platform docks. They can support South China Sea island seizures and potentially even overseas expeditionary warfare.

In other revelations, the Office of Naval Intelligence explains that China can deploy heretofore publicly-unknown remote-controllable Wonang-class inshore minesweepers. China has four Dongdiao-class intelligence collection ships, which support growing surveillance operations in the Western Pacific. Three cutting-edge Dalao-class submarine rescue ships augment Chinese undersea warfare ability, which is relatively strong in the proximate waters that China cares most about. Likewise relevant to the East and South China Seas: twenty Jiangdao-class patrol corvettes in China’s fleet, with 10-40 additional hulls anticipated. The PLAN is also introducing UAVs. The Camcopter S-100 UAV has already been deployed, with a variety of indigenous systems likely to follow soon.

In the most groundbreaking single piece of information in the report, a U.S. government source has confirmed for the first time that Chinese ships and submarines have deployed the potent new-generation supersonic YJ-18 anti-ship cruise missile. Previously designated the CH-SS-NX-13 by the Department of Defense, it is apparently a copy of the 3M54E Klub (SS-N-27B export variant), with which Russian Kilo-class 636M subs are equipped. Like the Klub, the sea-skimming YJ-18’s high speed and terminal trajectory make it extremely difficult for ships’ air defense to thwart.

While most PLAN growth is primarily qualitative, the China Coast Guard is undergoing both a qualitative and a quantitative buildup. Over last decade, it received 100 new large patrol ships, patrol combatants and other craft, and auxiliary ships. Between the beginning of 2012 and the end of 2015, the report projects, the China Coast Guard will have added more than 30 large patrol ships and more than 20 patrol combatants—an overall hull increase of 25%. No other Coast Guard in the world is remotely close to that rate of growth.

And China already boasts the world’s largest blue water coast guard fleet. Compared to its maritime neighbors, the numbers are grossly in Beijing’s favor. China has more Coast Guard ships than Japan, Vietnam, Indonesia, Malaysia and Philippines combined (China’s smaller neighbors are in another civil maritime category entirely: the minor leagues). While the Japan Coast Guard is extremely competent, it is already behind quantitatively and the gap will likely only grow.

To ensure that these hardware advantages can be translated into overall capabilities gains, however, the PLAN must continue to improve its training, coordination, and jointness. To truly master long-range precision strike weapons that it emphasizes in the hopes of deterring—and if necessary defeating—U.S. intervention, China must maintain awareness over a tremendous swath of ocean and airspace. The China Coast Guard faces less lofty operational objectives, but must continue to consolidate and organize itself effectively, no small task given its swelling ranks and the large number of new ships it needs to integrate.

If Beijing can continue on its present maritime trajectory, its neighbors and the United States are in for substantial challenges. Chinese sources frequently invoke “three million square kilometers of blue territory,” which equate to approximately 90% of the major waters within the First Island Chain (Bohai Gulf, Yellow Sea, East China Sea, and South China Sea). Already, China is engaged in massive island construction in the South China Sea, likely to give its maritime forces a better set of outposts from which to uphold and extend its claims there. There are numerous flashpoints in both the East and South China Seas, with frequent and deliberate vessel collisions during the Sino-Vietnamese Haiyang Shiyou 981 standoff in 2014 particularly worrying. The Office of Naval Intelligence judges that the clash “could easily have escalated into a military conflict.”

China is also becoming more active in distant seas. The report concludes that carriers, ballistic missile submarines and possibly large-deck amphibious ships will transform PLAN operations and further increase its international visibility: “in the next decade, China will complete its transition…to a navy capable of multiple missions around the world.” The question is to what extent Beijing will be able to reconcile a posture that pressures its neighbors in waters close to home, while seeking to protect growing interests and be seen as a global leader further afield.

Andrew S. Erickson is an Associate Professor in the Naval War College’s China Maritime Studies Institute and an Associate in Research at Harvard’s Fairbank Center for Chinese Studies. He blogs at www.andrewerickson.com.