Future flashpoints will drive Japan-China relations

Confrontations are not new in the Japan-China relationship, but their impact only grows. There is little reason to hope for a quick resolution to the current crisis. The last one was long-lasting and started over a drunken fishing trawler captain.

It ended with an awkward handshake between Japanese Prime Minister Abe Shinzo and Chinese President Xi Jinping in 2014. And there is much to fear in that today’s row will escalate even further. 

This crisis pits Tokyo’s security goals against Beijing’s longstanding desire to reclaim full control over Taiwan. Finding an exit from these tensions will, at the very least, take time.  

Diplomatic crises often change the stakes for each, and for the Japanese, the consequences are multifaceted. Japan’s new Prime Minister Takaichi Sanae was the initial focal point. As The Washington Post editorial board aptly noted, she said the “quiet part out loud.” 

Responding to an opposition party lawmaker’s question in the Diet, she acknowledged that China’s use of force against Taiwan could be seen to threaten Japan’s survival. In government speak, that means Tokyo might have to order its Self-Defense Forces to respond with others. 

Diplomatic status

Beijing responded in various ways. The Consul General in Osaka on X claimed that those who stick their neck in the affairs of others could have it chopped off, an indelicate threat given his diplomatic status. 

But the real retort came from Beijing. Chinese tourists and students were warned against travel to Japan, ostensibly for their own safety. Then, Japanese aquatic products were once again banned under the guise of health and safety.

Out in the waters of the East China Sea, the longstanding contest over sovereignty of the Senkaku Islands, as they are called by Japan, or the Diaoyu Islands, as they are known in China, resurfaced. 

Several incidents have been reported in which the Chinese Coast Guard vessels have challenged Japanese fishermen, only to then be confronted by Japan’s Coast Guard. Out of sight, these incidents are reported by each government differently.

But it suffices to say that this is a dance that carries considerable risk. 

A direct challenge between the coast guards of each nation could easily lead to further escalation, including the introduction of military forces. Keeping escalation of this sort at bay is increasingly becoming essential. 

The day-by-day, blow-by-blow escalatory dynamics define a crisis, but they do not always reveal the consequences of it. Diplomats and political leaders are tasked with managing incidents. But the underlying tensions must also be considered. 

Why do Japan and China find themselves in these recurrent crises? Simply put, it is because their interests are in conflict. 

Where once Japan and China could resolve most of their bilateral problems through compromise and innovative policy change, today these two powers find it difficult to find common ground. 

I wrote a book in 2015 about this changing reality and bilateral difficulties have only grown between Tokyo and Beijing. By then, the two neighbors had confronted each other over their sovereignty dispute, sparking the arrests of a fishing trawler captain and his crew in 2010.

Earlier crisis

What followed was demonstrations in both countries, the stoppage of much-needed rare earth shipments to Japan and diplomatic contests in the UN. There was also the purchase of the islands from their private owner by the Japanese government in 2012. 

Not until prime minister Abe traveled to Beijing for the APEC Summit four years after the crisis began, did the real effort at diplomatic healing begin. 

The consequences of that earlier crisis deserve attention as today’s one unfolds. First, the political fallout within Japan was significant. The Senkaku kiki, or crisis, seriously hampered the governing party’s credibility. 

The inexperienced Democratic Party of Japan, or DPJ, was widely perceived as unable to defend Japanese interests and too inept in diplomacy to be trusted with running the country. The party is gone now, too damaged electorally to make a comeback. 

In 2012, the Liberal Democrats swept back into power under Abe’s leadership and went on to eight years of repeated electoral success and a supermajority in the Diet. He is well known for his strategic revamping of Japanese policy in the face of China’s growing military muscle. 

Indeed, it was Abe who reinterpreted the Constitution to allow for the Self-Defense Forces to work with other nations should Japan’s survival be threatened – the very issue under discussion in the Diet when Takaichi made her remarks. 

What some do not know is, he was intent, as was his father, who served as Minister of Foreign Affairs during an earlier crisis over the Senkaku Islands, on ensuring Japanese control over its territory. There was also the need for Tokyo to prepare itself for a test of its defenses.

Second, and not unrelated, the island crisis also changed the way Japanese viewed their security relationship with the United States. For the first time since the US-Japan alliance was revised in 1960, tensions suggested the possibility that Tokyo could find itself on its own. 

Up until that point, most Japanese thought that they would be involved in a conflict as a result of a US-led operation, most likely on the Korean peninsula. Few imagined the use of force against Japan by neighbors.

But China’s growing maritime power, the continued legacy of Japanese imperial ambitions, and the World War II invasion seemed a combustible mix in that Senkaku crisis. 

Aid packages

Ensuring American support should another incident erupt became a priority of diplomats and defense planners alike. 

Finally, the economic ties that had underpinned Tokyo’s relations with Beijing since 1978 had fundamentally altered. Economic interdependence had long been seen by government and private sector interests in Japan as commercially and politically stabilizing. 

From the provision of massive aid packages in the first two decades of the relationship to more strategic investments in China’s massive economic transformation, Japanese interests were well served by this relationship, even as moments of political tension flared. 

Yet a now affluent China can claim leverage over these very same interests, and Japan is far more vulnerable to decision-making in Beijing. 

For some time now, Japanese companies have lowered their profile in the world’s second-largest economy, diversified their investments, and aligned with their government’s new interests in security measures to limit exposure to this threat. 

The use of economic retaliation was central to the Senkaku crisis, and it is even more conspicuously the tool of choice for Beijing today. Lessening Japan’s exposure to it is now part and parcel of private sector deliberations, as well as government policymaking. 

Still, when this current episode of crisis ends, it will have ripple effects that go far beyond the policymaking of the moment. 

To be sure, avoiding any steps that could lead to the use of force by either country is paramount, and to date, while Chinese Coast Guard ships flirt with confrontation near the Senkakus, neither government seems inclined to escalate in that direction. 

But politically Japan’s prime minister is getting more credit than her DPJ predecessors for her handling of the situation. According to a Nikkei/TV Tokyo poll, her approval rating remains high at 75%, and 55% of those polled think her remarks in the Diet were appropriate. 

Ambiguity has characterized Japan’s formal statements on Taiwan in the past, but increasingly, more Japanese seem to believe that their security policy needs greater clarity.

Strategic review

Strategically, the Takaichi Cabinet had already decided to review its National Security Strategy and defense plan in 2026, and this crisis will undoubtedly provide fodder for ongoing efforts to strengthen Japan’s ability to manage crises and, if necessary, threats. 

Already, economic security measures are being put in place that will affect Chinese investment in land and real estate in Japan, and this will likely accelerate. 

Japan is likely to continue to invest more of its GDP in defense, and next year’s strategic review should reveal how fast – and in what ways – Tokyo wants to increase its hard power. 

Finally, Japan’s diminishing appetite for economic interdependence with China is likely to drop further. Investments in the country are likely to be affected. Diversification of markets for seafood and other aquatic products will continue.

So too will efforts to shore up supply chains to make them less vulnerable to Chinese government decision-making. 

Already, Tokyo has concluded an agreement with Washington to cooperate globally on the supply of rare earths and critical minerals. Japan has other economic partners with which it will likely find greater common ground in the Indo-Pacific and Europe. 

The risks of this Japan-China confrontation should not be underestimated. It is not simply another spat. The United States will need to ensure this crisis does not escalate and will want to help find a way out of the current tensions. 

The phone call placed by Chinese President Xi to US President Donald Trump demonstrated how complex American involvement could be in this current crisis. 

Yet an eye on the long game is what is needed. Standing with an ally in crisis earns greater opportunity for future cooperation. Ignoring that ally could have future consequences. 

Power contest

A crisis, or worse yet, a conflict across the Taiwan Strait portends a major power contest of a magnitude Northeast Asia has not seen. Deterring such a conflict will require a close and confident Tokyo-Washington alliance. 

The risk of further confrontations may become a more regular feature of Japan-China relations as Beijing seeks to shape Japanese preferences over Taiwan. 

Without a doubt, this crisis will shape Japanese attitudes in the future, while the US, too, will need to consider not only the crisis of the moment but those to come.

Sheila A Smith is a John E Merow Senior Fellow for Asia Pacific Studies at the Council on Foreign Relations.

This edited article was published by the Council on Foreign Relations under a Creative Commons license. Read the original here.

The views and opinions expressed in this article are those of the author and do not necessarily reflect the official policy of China Factor.