The Japanese cabinet’s announcement that reserve funds be used to “purchase” three of the five uninhabited islands in the East China Sea (called Senkaku in Japanese and Diaoyu in Chinese)— also claimed by China and Taiwan but controlled by the Japanese government— has led to heightened tensions in the region.
Earlier, Japanese Prime Minister Yoshihiko Noda’s suggestion to nationalize the islands in July 2012 was criticized by both China and Taiwan. Following the Japanese government’s announcement on September 11, that three islands were purchased by the national government from private owners, Taiwan recalled its representative in Tokyo and two China Marine Surveillance patrol vessels reached the waters around the islands. Even as Japan appointed a new ambassador to China and the Director-General of the Asian and Oceania Affairs Bureau at the Japanese Foreign Ministry, arrived in Beijing for urgent talks to “avoid misunderstanding and lack of explanation on the issue,” China’s defence ministry spokesperson issued a statement saying that China reserved “the right to take countermeasures”.
This is not the first time that relations have become strained between China and Japan over the Senkaku/Diaoyu islands. Yet, each incident over the islands seems more explosive than the last. In September 2010, a Chinese fishing boat and a Japanese patrol boat collided in waters near the islands. The crew of the Chinese fishing boat was detained by Japanese forces. After large scale protests across Mainland China and in the face of aggressive diplomatic posturing by the Chinese government, the Japanese government sent back the vessel and 14 fishermen, but detained the captain in order to try him according to Japanese laws. Eventually however, Japan buckled under intense pressure from China and released the Chinese captain. This was seen as a sign of Japanese weakness in the face of an increasingly assertive China.
Since that incident, calls for a harder position vis-à-vis China have only increased in Japan. In August 2012, 14 Chinese activists attempting to reach the islands were detained by the Japanese Coastguard and sent back. Prime Minister Noda had previously told the Japanese parliament that Tokyo cannot rule out the possibility of dispatching Japan's Self-Defense Forces (SDF) if the situation on the islands “gets out of control”. Given that two Chinese patrol vessels are already in the waters around the islands, efforts by Japanese SDFs to access the islands could well become confrontational.
Violent protests across China (in about 10 major cities) over Japanese moves have already engendered pledges to boycott Japanese goods. In recent years, it is reported that Japanese automobile companies have been losing their market share in China even as the automobile market has continued to expand. This is deemed by many to be a direct consequence of the diplomatic stalemate between the two countries over issues pertaining to history and territory. Anti-Japan demonstrations in China may well lead to an unofficial embargo on Japanese goods, and could put additional pressure on the Japanese government.
Even though the Chinese government has thus far advocated sensible and measured expression of nationalist sentiments and condemned violence, there is no guarantee that anti-Japan sentiments will not fireball into anti-Japan riots, as had happened in 2005. This may be a very real possibility given that during the protests in August 2012, demonstrators reportedly displayed banners which bore the following words: “Even if all China becomes a graveyard, we will kill all Japanese.” In a rare show of nationalist temper, protesters reportedly attacked Japanese restaurants and cars of Japanese make, even if they were owned by Chinese nationals.
There is a large economic interest at stake for Japan here. According to the 2012 White Paper on International Economy and Trade released by the Japanese government, bilateral trade between China and Japan was about US$ 345 billion in 2011, with an annual growth of 14.3 per cent. Japanese exports to China constitue around 50 per cent of the trade volume and about 20 per cent of its total exports (the corresponding figure for China is comparatively lower). In this situation, any possible Chinese decision to impose trade sanctions or a large scale boycott of Japanese goods would hurt Japan more than China.
Thus, Japan would be loath to jeopardize its economic relationship with China especially since growth figures for the Japanese economy in the second quarter have been revised down. Japanese gross domestic product grew at an annual rate of 0.7 percent in the three months through June, much less than a preliminary calculation of 1.4 percent. Already saddled with the world’s largest public debt burden, it has been reported that Prime Minister Noda’s government may run out of money as soon as December 2012 if the deadlock over legislation for deficit-financing bonds continues and this may well result in early elections. Unfortunately for Prime Minister Noda, (it looks like) he is damned if he takes a strong stand on the Senkaku issue with China, and damned if he does not.
China is currently in no mood to be conciliatory. Perhaps a pattern may be discerned in its behaviour on maritime disputes. Just as with Philippines, China seems unafraid of exacerbating the tensions and involving its naval forces. Statements from both the People’s Liberation Army (PLA) as well as the Chinese Ministry of Foreign Affairs suggests that ‘on principle’, (read ‘safeguarding China’s territorial sovereignty’), it cannot let Japan’s move go unanswered. Apart from despatching patrol vessels, China has also started providing marine forecasts for the islands and surrounding waters through China Central Television. This is supposedly aimed at “safeguarding China's maritime rights and interests as well as protecting the safety of fishermen, fishing boats and ocean patrol ships in the area.” It is quite clear that China seeks to bolster its claims over the islands by all means. Unlike in the South China Sea however, constructing a garrison in the East China Sea will not be as easy.
In 2010 it was the case of a civilian Chinese fishing boat colliding with a Japanese coast guard vessel; however, the situation has changed now with the presence of two Chinese naval vessels patrolling off the islands today. Any future collision between the Chinese naval forces and the Japanese Coast Guard could lead to direct armed conflict and consequently embroil the US as well.
The US has thus far called for restraint on both sides, emphasized the importance of good relations between the two countries for the global economy and has not taken any categorical position on the territorial issue. Whereas the US has not had to take a definitive stand on the disputes in South China Sea, it may well have to clarify its position on the Senkaku/Diaoyu issue soon. This is essentially because of the special defence relationship the US has with Japan. The disputed islands fall under the administration of Okinawa, which incidentally hosts four American bases and about 10,000 American troops. In 2009, the Japanese Prime Minister had stated that the islands fell within the ambit of the Japan-US security treaty. Subsequent media reports suggested that American officials supported Japanese territorial claims over the islands.
In this context, unwillingness or inability of the US to support its most important ally in the Asia-Pacific would seriously impair its “pivot” formulation and its rebalancing strategy, at least in the eyes of China’s Asian neighbours. China is obviously not unaware of the stakes involved as far as the US is concerned. Yet, it has chosen not to diffuse tensions. It can thus be inferred that China may be assessing the strength of American commitment to the Asia-Pacific. A commentary carried by the People’s Liberation Army (PLA) Daily on September 12 suggests just that. Major General Luo Yuan, a deputy director of the World Military Research Department of the Academy of Military Sciences of the Chinese PLA, writes:
The Japanese government should not anchor its hopes on the “U.S.-Japan Security Treaty”, which can serve at best as a mere “whetstone” on which the Chinese military will convert pressure into power. On the other hand, Japanese people should really think carefully about when the Uncle Sam can be trusted, and when the U.S. has ever truly abandoned its own interests for others?
American inaction on the Senkaku/Diaoyu matter could thus be viewed as a significant concession to China and boost Chinese morale further.
Given that some diplomatic effort has already been made by Japan to address the issue, it remains to be seen how China responds and what, if anything, the US is willing to do.