China is beginning to export its own weapon designs, including armed drones, worldwide and is reaching "near-parity" with the West in terms of military technology, according to a report on Tuesday.

The International Institute for Strategic Studies said that China's official defence budget of $145 billion (137 billion euros) last year was 1.8 times higher than those of South Korea and Japan combined.

It also accounted for more than a third of Asia's total military spending in 2016, the IISS annual Military Balance report said, adding that spending in Asia grew by five to six percentage points a year between 2012 and 2016.

Total global military spending instead fell by 0.4 percent in real terms in 2016 compared to 2015, largely due to reductions in the Middle East.

"China's military progress highlights that Western dominance in the field of advanced weapons systems can no longer be taken for granted," IISS director John Chipman said at a presentation in London.

"An emerging threat for deployed Western forces is that with China looking to sell more abroad, they may confront more advanced military systems, in more places, and operated by a broader range of adversaries," Chipman said.

The report found that in terms of air power "China appears to be reaching near-parity with the West".

It said one of China's air-to-air missiles had no Western equivalent and that China had introduced a type of short-range missile that "only a handful of leading aerospace nations are able to develop".

It said China was also developing "what could be the world's longest range air-to-air missile".

- Chinese exports to Africa -

The report noted that Chinese military exports to Africa last year "were moving from the sale of Soviet-era designs to the export of systems designed in China".

It said that Chinese-made armed drones had been seen in Nigeria and Saudi Arabia.

The report also noted that European states are "only gradually" increasing their defence spending.

"While Europe was one of the three regions in the world where defence spending rose in 2015-16, European defence spending remains modest as a proportion of the continent's GDP," the study said.

In 2016, IISS found that only two European NATO states -- Greece and Estonia -- met the aim of spending 2.0 percent of their GDP on defence.

This was down from four European states that met the target in 2015 -- Britain, Greece, Estonia and Poland.

Britain dipped to 1.98 percent of GDP, according to IISS calculations, although that figure was immediately disputed by Britain's defence ministry.

But the IISS said it was more important that countries focus on upgrading their military equipment.

"This is made more urgent because of the degree to which Western states have reduced their equipment and personnel numbers since the Cold War," it said.