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By Karen Lema and Manuel Mogato MANILA (Reuters) - The Philippines faces a growing risk of a Paris-style attack by foreign militants, the top contender to win elections next year has warned, but there is no threat of "World War Three" with China over a bitter South China Sea territorial dispute. Rodrigo Duterte, a tough-talking mayor of Davao City in the insurgency-plagued south, has built a reputation for fighting crime. He told Reuters two new army divisions would be formed to tackle security threats if he replaces President Benigno Aquino in the election in May. His views run contrary to Aquino's government, which sees no links between Islamic State militants and five Islamist groups in the southern Philippines - even though police have said the groups had pledged allegiance to extremists in Syria and Iraq. "I said terrorism will grow and grow and grow and it would be a national threat in the coming days, maybe earlier than later," Duterte said in an interview late on Thursday. Known as "the Punisher" for his hardline stance on crime - he has even claimed to have killed petty criminals in Davao City - Duterte said the new army units would not be used against Maoist guerrillas or Muslim rebels. "I will not allow the government to wage war against its own people," he said. Duterte says enhanced security is the only way to build a stable economy. "It is not for the faint-hearted," he said. "If you are a president and you are afraid of criminals, or you are afraid to kill criminals, then you have no business being a president." Duterte's opponents have been silent on his uncompromising approach to crime but human rights groups, including Amnesty International, are alarmed. "No one can take the law into their own hands," said Chito Gascon, head of the government's human rights commission. "KEEP OUR COUNTRY SAFE" Muslim separatists have fought the security forces for 45 years on Mindanao island, of which Davao is the largest city. Duterte, a seven-term mayor, acknowledges the risk of the conflict growing or being exploited by external forces. "If you are from Mindanao, there are explosions here and there and if that happens nationwide, I will not be caught with my pants down," said Duterte. "I will use the military and police ... because I have to keep our country safe, secure, peaceful." The message has struck a chord with voters, about 54 million of whom are eligible to elect a president, vice president and more than 18,000 local government executives and legislators. A Social Weather Stations opinion poll published this month showed Duterte was the top-rated contender for 38 percent of 1,200 respondents, more than twice the number who supported Aquino's anointed successor, former interior minister Manuel Roxas. Duterte, a 70-year-old lawyer, also said he was open to bilateral talks with China to settle their hotly disputed claims in the South China Sea, another move contrary to existing government policy. The Philippines has asked the Permanent Court of Arbitration in The Hague to affirm its right to areas within 200 nautical miles of its coastline and Manila expects a favorable decision by mid-2016. Brunei, Malaysia, Taiwan and Vietnam also all have rival claims with an increasingly muscular China in the South China Sea, which is believed to hold huge deposits of oil and gas. "We will have to talk, we will not go to war because we cannot afford it," he said. "If I cannot get to talk with them because they would not sit down for a multilateral talks, then I would consider just talking to them." (Reporting By Manuel Mogato and Karen Lema; Editing by Paul Tait)