The never-ending process of normalizing China-Japan ties by FUNABASHI Yoichi

“API Geoeconomic Briefing” is a weekly analysis of significant geopolitical and geoeconomic developments that precede the post-pandemic world. The briefing is written by experts at Asia Pacific Initiative (API) and includes an assessment of burgeoning trends in international politics and economics and the possible impact on Japan’s national interests and strategic response. (Editor-in-chief: Dr. HOSOYA Yuichi, Research Director, API; Professor, Faculty of Law, Keio University; Visiting Fellow, Downing College, University of Cambridge)

This article was posted to the Japan Times on July 5, 2022:

API Geoeconomic Briefing


July 5, 2022

The never-ending process of normalizing China-Japan ties

Chairman, Global Council, International House of Japan
Founder, Asia Pacific Initiative





In the past half-century since Japan normalized diplomatic ties with China, their bilateral relationship has gone through tremendous changes.

In 1972, Japan’s gross domestic product was about three times that of China, but today, the size of the Japanese economy is one-third of the Chinese economy. Also in 1972, the amount of trade with China was 2% of Japan’s total trade value, but now it has increased to nearly a quarter.

And it’s not just about the economy and trade. Japan’s defense spending was 2.4 times that of China as of 1989, but currently Beijing’s defense spending has expanded to 5.4 times that of Tokyo.

The two countries are at odds over the territorial rights of the Japan-administered, China-claimed Senkaku Islands. And along with the tensions across the Taiwan Strait, China is posing a fundamental challenge to Japan’s maritime national security and its alliance with the United States.

When the two countries normalized diplomatic ties, there were hopes that it would bring China into the global community, help its economic takeoff and make its people wealthier, leading to stabilization and development of bilateral relations.

But today, China under President Xi Jinping’s administration that conducts “wolf warrior diplomacy” — or coercive diplomacy — is regarded as having betrayed all such expectations.

A recent survey showed that more than 90% of the Japanese people said they don’t have a positive impression of China, while 66% of Chinese people expressed the same feeling toward Japan.

The harboring of deep-rooted negative views following the normalization initiative five decades ago — what does it mean?

In short, shocking global geopolitical events in the past 50 years have changed the context of China-Japan relations, bringing new challenges to both countries.

There were three epoch-making watersheds — the Tiananmen Square crackdown and the collapse of the Soviet Union; the 2008 global financial crisis and the territorial dispute over the Senkaku Islands; and the COVID-19 pandemic and the war in Ukraine.

The 1989 Tiananmen Square crackdown on pro-democracy protests shook the presupposition in the 1972 Japan-China joint communique that stated, “In spite of the differences in their social systems existing between the two countries, the two countries should, and can, establish relations of peace and friendship.”

As the world became increasingly globalized, it became difficult for democratic countries to tolerate China’s handling of issues related to universal values and principles as domestic affairs.

While Japan, along with other Group of Seven countries, imposed sanctions on China, Beijing responded by weaponizing historical issues against Japan.

Moreover, the collapse of the Soviet Union in 1991 reduced Japan’s strategic value for China. Beijing, which had accepted — although not welcomed — the U.S.-Japan alliance until then, began to look upon it with hostility.

Next came the 2008-2010 global financial crisis and the territorial dispute between Japan and China over the Senkaku Islands.

Beijing pursued an anti-access/area denial (A2AD) military doctrine, designed to deny an adversary’s forces from advancing within the first island chain — a defensive line drawn by China off its east coast that includes Okinawa Prefecture, Taiwan and the Philippines — in order to have command of the seas and the air in the East and South China seas, which would be necessary for an invasion of Taiwan.

A “mutually beneficial relationship based on common strategic interests,” which Japan and China resolved to promote when Chinese President Hu Jintao visited Japan in May 2008, has decayed.

And in September 2010, China effectively banned exports of rare earths to Japan following Tokyo’s arrest of the captain of a Chinese fishing boat that collided with Japanese coast guard vessels near the Senkaku Islands.

This was when the principle of separating politics from economy, which had been maintained between the two countries at least as an official stance, fell apart.

The most recent developments are the COVID-19 pandemic that started in 2020 and the war in Ukraine.

Japan realized that it was heavily dependent on China not only for raw materials to produce pharmaceuticals but also for needles necessary for vaccinations.

As China makes geoeconomic advances to gain supremacy in market control, cutting-edge technology and sphere of influence, Japan is taking a “China-plus-one” approach of avoiding investing only in China as well as reshoring businesses.

Despite the efforts, however, Japan’s investments in China are continuing to increase. China-bound exports accounted for 34% of Japan’s GDP in 2020 — compared with 32% for Taiwan, 30% for Indonesia and 27% for the Philippines.

Japan’s dependence on China is only rising, leading to higher geoeconomic vulnerability.

Regarding the war in Ukraine, Japan has been imposing sanctions on Russia, with Prime Minister Fumio Kishida saying, “Ukraine (today) may be East Asia tomorrow.”

Japan’s responses are also beginning to take on the characteristics of building deterrence against China by making Russia fail in its military invasion of Ukraine and pay the price, thus raising the hurdles for Beijing’s possible military invasion of Taiwan.

Japan is already feeling the strong pressure of the China-Russia bloc.

Amid significant changes in the environment surrounding China-Japan relations, one thing that has consistently remained unchanged is the significant presence of the United States.

The U.S. is the most important factor in Japan’s relationship with China, and Beijing has been the most important factor in Tokyo’s relationship with Washington.

Prime Minister Kakuei Tanaka’s visit to Beijing in September 1972 was triggered by U.S. President Richard Nixon’s visit to China in February of the same year.

Japan acted in concert with the U.S. in imposing sanctions on China following the Tiananmen Square crackdown, then shifting back to engagement policy and supporting Beijing’s bid to join the World Trade Organization.

But in the 2010s, the China policies of Japan and the U.S. started showing discrepancies.

The gaps include the vision of the East Asian Community advocated by the administration of the Democratic Party of Japan, the territorial dispute over the Senkaku Islands, Prime Minister Shinzo Abe’s visit to Yasukuni Shrine and China seeking a “new type of great power relations” with the U.S.

Japan should stay alert to pitfalls which can be called the “Japan-U.S.-China trap.” Stabilizing and maintaining trilateral relations has been the most difficult issue for Japan’s diplomacy both since and prior to World War II.

A variety of hidden dynamics could make trilateral ties a zero-sum relationship: sphere of influence; ethnicity; ideology; nuclear weapons; the permanent five members of the United Nations Security Council; a “cap in the bottle” theory — meaning the risk of Japan’s militarism rising again in the absence of a cap to suppress it; a power vacuum in a region lacking an identifiable power; a Group of Two forming between the U.S. and China; human rights; the “remnants of the Cold War”; and so on.

The most fearful U.S.-China-Japan trap in the coming era is Japan losing its diplomatic options amid U.S.-China confrontations.

In order to stabilize China-Japan relations, Tokyo must constantly communicate with Washington and closely coordinate policies.

In strengthening U.S.-Japan ties, Tokyo should direct particular attention to maintaining a stable relationship with Beijing.

It is necessary for Japan to pursue a more independent role both in power and international order.

Regarding power balance, it is essential to continue deepening Japan’s alliance with the U.S. and boosting deterrence against China.

In doing so, Japan should also consolidate its own deterrence capabilities and become more responsible for defending itself.

The U.S. is likely to adopt a more selective engagement policy from now on in its relations with the rest of the world. Alliances will lean toward sharing of responsibilities and collaborative work.

The U.S.-Japan alliance will have to go beyond interoperability and become more interdependent.

At the same time, to stabilize relations with Beijing, Tokyo should step up its economic security so that it can implement deterrence and resilience against its neighbor’s economic coercion.

It is important to increase Japan’s productivity and international competitiveness.

Chinese strategic theorist Yan Xuetong said, “It is not only true that China changed the status quo by getting strong, but also America and Japan changed the status quo by getting weaker.”

Yan argued that if China is to be called a revisionist camp, Japan and the U.S. should also be regarded as revisionists.

To defeat sophistry by such realpolitik in China, Japan’s persistent growth and innovation are indispensable.

In managing relations with China, we have to note that the principle of separating politics from economy cannot be used even as an expedient, considering Beijing’s military-civil fusion strategy and its National Intelligence Law.

In order to prevent Beijing from exploiting the asymmetric political systems of China and Japan and stepping up its influence operations, it is necessary to adopt the principle of reciprocity of opportunities, rights and duties in maintaining the bilateral relationship.

In a broader international order, Japan needs to play the role of becoming a stable and active power to reconstruct international order in the Asia-Pacific.

How should we confront the geopolitics in Eurasia driven by the China-Russia bloc? Japan’s role is certain to grow even bigger in creating an environment for international order and rule-making.

In building order and creating rules, it is important for Japan to cooperate with China where it can.

During Abe’s administration, Tokyo opened the way to cooperation with China in third countries’ markets by showing the intention to embrace its Belt and Road initiative under the condition that the projects are open, transparent, economically viable and fiscally sound for debtor countries, which Beijing agreed to include in its principles.

In conducting diplomacy with Beijing, Japan needs to focus more on the principles of international law, rather than on universal values such as human rights, and be smart enough to make use of common factors while being aware of differences in stance, rather than trying to come to a final settlement based on justice.

In the past half a century, the governments of Japan and China have defined their relationship through four documents — the 1972 joint communique, the 1978 peace and friendship treaty, the 1998 joint declaration and the 2008 joint statement.

Today, however, the most compelling wisdom for China-Japan relations is demonstrated in the four-point consensus on improving the ties issued in November 2014.

The statement, which helped the two countries escape the worst in their relationship stalemated by the territorial dispute over the Senkaku Islands, said: “Both sides recognized that they had different views as to the emergence of tense situations in recent years in the waters of the East China Sea, including those around the Senkaku Islands, and shared the view that, through dialogue and consultation, they would prevent the deterioration of the situation, establish a crisis management mechanism and avert the rise of unforeseen circumstances.”

Amid the worsening geopolitical environment, Japan and China, which have worked for 50 years to normalize their ties, look as if they are being pulled back to the starting point of normalization, lacking domestic support for better relations.

Normalization should probably be understood as a never-ending process backed by self-control and some sense of resignation — the idea of managing conditions rather than solving problems, which is the essence of competitive coexistence.


Disclaimer: The views expressed in this API Geoeconomic Briefing do not necessarily reflect those of the API, the Institute of Geoeconomics (IOG) or any other organizations to which the author belongs.