For the first time, China and Russia will hold joint military exercises from Aug. 18-25 on the Jiaodong peninsula in the PRC’s Shandong province and the Yellow Sea, involving 10,000 troops and an array of modern military technology. Should their neighbors in the Asia-Pacific be alarmed? Yes and no. On the one hand the Peace Mission 2005 exercises attest to a potential challenge by China and Russia to a U.S.-dominated security order in Asia. Yet the exercises also reveal differences in Sino-Russian political goals that will limit future strategic cooperation.