The U.S. and China are squaring off over deployment of an anti-missile system in South Korea, the latest source of tension between the world's two biggest economies as they vie for influence in Asia.

The U.S. is considering placing a THAAD ballistic missile defense system in South Korea to counter improved North Korean weapon technology. A group of lawmakers from the ruling Saenuri Party has also begun lobbying for South Korea to purchase the Lockheed Martin Corp. missile system directly. China fears the U.S. could use THAAD to target its missiles and has called on South Korea to reject deployment.

"How can we fight with a knife when North Korea is brandishing a gun?" Won Yoo-chul, a lawmaker who heads the ruling party's policy-setting committee, said in an interview Friday. "North Korea's nuclear and missile threat is advancing by the day and China's response over THAAD is excessive."