Japan-China Relations Heat Up During Abe-II

Japan’s foreign policy profile seems to be undergoing a perceptible overhaul after the assumption to office of Liberal Democratic Party leader Abe Shinzo as Prime Minister following his massive electoral victory in the December 16 elections to the Lower House. Apart from the domestic issues such as arresting the surging yen, increase spending on infrastructure and resuscitating the economy, his stance on the diplomatic row with China over ownership of the Senkaku Islands that made some people feel that Japan is weak-kneed contributed to his electoral victory.

China’s military modernization and assertive stance on territorial issues in recent years is a matter of concern that has engaged security analysts in dissecting how to handle the China challenge. China’s relentless rise and its unpredictability are driving the regional powers, including the US, to seek counter strategy either independently or in cooperation with other regional powers. President Barack Obama’s Asian pivot policy may be seen from this consideration as well.

Prime Minister Abe is known to be a hardliner and a nationalist. Japan has the backing of the US, its security alliance partner, in dealing with the China challenge. Abe is not shy in articulating his government’s policy to review Japan’s military strategy whose primary aim is to offset China’s growing military power. With this in view, his government seeks to increase defence spending, which if happens, will be the first time in a decade.

NDPG 2010 and China’s reactions

The new National Defense Program Guidelines adopted in 2010 by the Left-leaning Democratic Party of Japan aimed at addressing to China’s rising military might by building more submarines and other mobile forces capable of defending Japan’s southernmost islands. It was the biggest step yet in a decade-long shift away from cold war-era deployments of heavy tank and artillery units on the northern island of Hokkaido to counter a now-vanished Soviet threat and toward bolstering Japanese forces in the southern islands around Okinawa, where China’s navy has become a growing presence. But the NDPG 2010 called for gradual reductions in defense spending, and in the size of Japan’s military, particularly in the number of tanks and infantry members.

Though the guidelines called for increasing military cooperation with the US and other democracies in the region including South Korea, Australia and India, it did not address requests from Washington for Japan’s Self-Defense Forces to join in three-way drills with the US and South Korea that would be aimed at North Korea. Before Abe, Japan had long resisted American calls to increase its military role in the region because of the constraints of its pacifist postwar Constitution and the bitter memories of devastating defeat in World War II. Though the new guidelines seemed to indicate a willingness to slightly raise Japan’s military profile, it was only in a defensive manner. Now Abe is committed to strengthen Japan’s military to defend the country’s control of over uninhabited islands in the East China Sea claimed by both nations but controlled by Japan. The islands are called the Senkaku in Japanese and Diaoyu in Chinese.

The NDPG guidelines used uncharacteristically strong language to warn of China’s rapidly modernizing military and called it “a matter of concern for the region and the international community.” Indeed, China’s growing naval capabilities have been a particular concern in Japan since Beijing and Tokyo clashed diplomatically way back in 2010 over uninhabited islands claimed by both nations but controlled by Japan.

Beijing criticized the new policy as “irresponsible” and suggested that it was based on a misunderstanding of China’s intentions. “China adheres to the road of peaceful development and pursues a defensive national defense policy,” Jiang Yu, the Foreign Ministry spokeswoman, said in a statement. She added: “We have no intention to be a threat to anyone.”

As per the new policy, Japan will increase the number of submarines to 22 from the current 16 and reduce the number of tanks by a third to about 400. It also called for creating more mobile forces, which could include creating new air and seaborne units that could quickly move to defend remote islands. Besides these changes, the guidelines called for reconsidering Japan’s self-imposed ban on the export of weapons, a step that would make it easier for Japan to join other nations, and particularly the US, in the joint development of expensive new weapons systems.

Japan has already joined the US in developing new anti-missile systems. The guidelines of 2010 for deploying more Patriot interceptor missiles to shoot down ballistic missiles from North Korea, which have been developing missiles and nuclear weapons.

Changes under Abe

Though Abe has not released the details of his intent on the military revisions, his replacement plan entails reversing the DPJ’s cuts and increase defense spending for the first time in 11 years in light of the territorial tensions with China. The LDP wants to raise defence spending in fiscal 2013, which begins in April, to at least ¥4.77 trillion the same as in the initial fiscal 2009 budget the last one it formulated before becoming an opposition party. In fiscal 2012, Japan’s defence expenditure drafted by the DPJ stood at ¥4.71 trillion. This would be the first increase in Japanese military spending since 2002 when its defence spending was budgeted at Yen 4.96 trillion.

Amid growing concerns over a rising China, the Abe administration plans to spend $2.1 billion on its military over the next few months as a part of a huge stimulus package. The cash is in addition to the regular military spending for 2012-13 and is separate from a boosted budget request that the LDP is seeking. Of the 180.5 billion yen that the defence ministry is seeking as a stimulus package, some of the cash will be used to buy PAC-3 surface-to-air anti-ballistic missile systems and modernise four F-15 fighter jets. Out of 180.5 billion yen, the defence ministry also plans to use 60.5 billion yen to prepare for the changing security environment surrounding Japan. The defence ministry also plans to purchase three SH-60K patrol helicopters and to add a battery for an intermediate-range ballistic missile system. The request for funds has to be approved by the finance ministry before being officially included in the stimulus that the government is set to announce.

In the recent past, the security environment in the region has considerably deteriorated. Japan is involved in a territorial tussle with China over a group of uninhabited islands in the East China Sea. Beijing has sent vessels to the area dozens of times and late last year (2012) dispatched a plane. Nerves in Tokyo were also rattled by an unpredictable North Korea, which sent a rocket over Japan’s southern islands in December 2012 in what it insisted was a satellite launch. Tokyo and its allies said the launch was a covert ballistic missile test. Therefore, Japan feels it compelling to update its equipment as the security environment surrounding Japan is becoming harsher as North Korea has test-launched missiles twice in the last year and tensions with China continue. Under usual precedent, 70-80 per cent of a defence order must be spent with domestic firms, although this is not a legal requirement. This is set to undergo a major overhaul.

The new spending plan, proposed by the LDP, would seek to increase the number of ground troops, strengthen air and sea defenses around the disputed islands, and buy new early-warning aircraft to guard against Chinese intrusions near the islands and its attempt to step up airborne and maritime surveillance, as well as missile launchings by North Korea. In addition to the plan to increase spending, Defense Minister Itsunori Onodera said Abe’s government will review the long-term basic defense program that was adopted along with a midterm defense buildup program in 2010 by the previous DPJ administration.

Abe is also keen on revising the war-renouncing Article 9 of the Constitution and asserted exercising Japan’s right to collective self-defense. This has raised concerns among Chinese officials. During his first term when Abe visited Beijing, both the countries adopted the concept of “mutually beneficial strategic relations”, thereby opening a new chapter in Japan-China relations after bilateral ties had frozen due to his predecessor Junichiro Koizumi’s repeated visits to Yasukuni Shrine, where the souls of the Japanese war dead and Class-A war criminals are enshrined. That bonhomie is not going to be repeated during Abe’s present term because the security environment has drastically changed.

The world has taken note of the fact that the dispute between Japan and China over the sovereignty issue involving the Senkaku Islands in the East China Sea has caused bilateral ties to plummet. China is repeatedly violating Japanese territorial waters and airspace around the islands. It is but logical that Japan enhances its ability to protect its territorial waters and airspace in the area. While acknowledging the grave danger emanating from China, the Japan Times observed in an editorial that the Abe administration “must make strenuous diplomatic efforts to find opportunities to talk quietly with China in an effort to put bilateral relations back on a normal path”. Given China’s unyielding attitude, this appears to be wishful thinking.

After the LDP’s overwhelming victory in the December 16 election, Abe said that since the Japan-China relations are extremely important, he would like to make efforts to return bilateral ties to the “initial point of mutually beneficial strategic relations.” One only hopes that he takes concrete steps in this direction. In the election campaign, the LDP proposed stationing public servants on the Senkaku Islands. Fortunately, the Abe administration has put off implementing this election promise, which would have further damaged bilateral ties.

In the interest of peace and stability in the region, if Abe strives to deepen dialogue with China and make efforts to forge strong personal ties with Chinese leader Xi Jinping, that would be welcome but at the same time, Japan is expected to strive to counter voices in the international community that are attempting to undermine the legitimacy of Japan’s possession of the Senkaku Islands. Japan’s ultimate goal should be to turn the seas around the islands into an area that produces mutual benefits for both Japan and China through fishing and the exploitation of underground natural resources.

US commitment remains strong

The LDP’s ambitious plan also includes financing for a feasibility study on acquiring Osprey aircraft, American vertical-takeoff transport planes, which can fly farther and faster than Japan’s current helicopters, allowing its troops to more easily reach the disputed islands. With the world’s sixth-largest military budget spending of 4.65 trillion yen, or $53.3 billion, on defense, Japan has one of the largest and most advanced militaries in Asia, though it has kept a low profile to avoid stirring bitter memories of its early-20th-century empire building. Abe’s nationalistic stance is aimed at raising Japan’s military profile in the region and arresting Japan’s declining influence, besides helping its ally, the US, to counter China’s rising military prowess.

Despite local opposition to US air base in Okinawa, the US is committed to protect Japan in view of the perceived threat from China and North Korea. Indeed, the US military sent the first batch of a sophisticated but accident-plagued new aircraft to an air base on Okinawa going forward with its planned deployment. The US dispatched the first six of the MV-22 Osprey aircraft at Marine Corps Air Station Futenma in October 2012. Another six of the ungainly-looking aircraft were to arrive soon at the base, in the center of the crowded city of Ginowan. The US is counting on the deployment to serve as part of the Obama administration’s plan to increase the American military presence in the region and offset the growing strength of China and a nuclear-armed North Korea.

The Osprey’s tilting rotors allow it to take off like a helicopter but fly like a fixed-wing aircraft and flies four times as far as the Vietnam-era helicopters. This puts the more than 15,000 Marines on Okinawa within reach of potential hot spots like Taiwan and a group of disputed islands of Senkaku/Diaoyu in the East China Sea. From Japan’s side, it has backed the deployment, apparently to deter China’s recently assertive claims to those islands, which Japan controls. Though both Washington and Tokyo are facing an unusually strong pushback from many of the 1.4 million residents on Okinawa, the Chinese threat would not dissuade both Japan and the US from strengthening their cooperative venture.

Impact of the tensions on the Asian economies

In 2010 when a dispute between Japan and China escalated over eight uninhabited islands, the economic fallout was not severe. This time, the spat is only contributing to the prolonging the recession that Japan has been experiencing. Chinese consumers staged a boycott of Japanese products over the territorial issue. Sales of Japanese autos in China have fallen. Chinese factories started to favour South Korean component suppliers. The US displaced China as Japan’s largest export market. These are worrying to Asian economies. The spat’s cost to Japan has been huge as Japan’s dependence on China as an export market is high. Nationalism around the issue has resulted in lower demand for Japanese products in China and even Chinese firms are now sourcing products from Korean suppliers. Even as China’s confidence in asserting its territorial claims has grown, trade between the two has tripled since 2000 to more than $300 billion but the commercial cost of failing to resolve the dispute keeps rising. The latest flare-up came after property developer Kunioki Kurihara sold three of the islands to the Japanese government for 2.05 billion yen ($23 million) in September 2012. The new Chinese leader Xi Jinping has called it as “a farce.”

The drop in sales of Japanese products to China had its inevitable impact on Japan’s growth and this contributed to prolong the recession. The standoff over the islands contributed to declines in Japan’s shipments for six months upto November 2012. As a result, Japan’s industrial output fell 0.7 per cent in November 2012 to the lowest level since the aftermath of the 2011 earthquake.

It may be recalled that when then-Japanese Prime Minister Koizumi Junichiro visited Yasukuni shrine in 2005, Chinese people and politicians protested. Yet trade between the two rose more than 12 per cent that year. But the events of 2010 took an ugly turn and the economic effects began to bite the Japanese economy more than the Chinese economy. When a Chinese fishing boat and a Japanese Coast Guard vessel collided in contested waters, things got worse. China stopped granting export licenses to Japan for rare earth metals, necessary for automobile and electronics industries. The licenses were resumed about a week later after Japan released the detained captain of the vessel.

But the row that occurred in 2012 had the most debilitating effect. After the Japanese government bought the three islands, angry Chinese boycotted Japanese products and smashed Japanese shops in China. This was also a demonstration of the Chinese push to its claims to sovereignty until Beijing gets what it wants. The islands offer the prospect of rich fishing grounds, potential oil reserves and a strategic military outpost in the sea between China, Japan and Taiwan. That has overshadowed economic ties for the Chinese with Japan. Japan has intellectual property, brands and capital, while China has people, markets and purchasing power. This bottom line cannot be overlooked.

The latest spat began in April 2012 when then-Tokyo Governor Ishihara Shintaro said he planned to use public money to purchase Kurihara’s islands. Ishihara, 80, is a longstanding critic of China, so the national government stepped in to buy the islands instead, in a failed attempt to defuse Chinese anger. The damage was, however, already done. China’s official Xinhua news agency on December 2, 2012 criticized the US Senate’s approval of an amendment to show the islands fall under a US-Japan defence treaty. China called it a “disturbing message” to the world and accused the Senate of seeking an escalation of tensions between China and Japan. It transpires that the spat has changed the landscape of China-Japan relations and as a territory dispute, it is prone to spirals of escalation. Abe’s return to power has further stoked the conflict. China was quick to criticize when the LDP in its manifesto proposed to strengthen the nation’s military and planned to station officials on the islands. This prompted an editorial in the China Daily newspaper on November 26, 2012 that described the manifesto as “dangerous.”

The territorial dispute reached a crescendo when on December 13, 2012 Japan sent eight F-15 fighter jets after a small Chinese propeller plane that flew over the disputed islands. According to Japan, this was the first Chinese intrusion into its airspace since 1958. Abe has ordered the defence minister Onodera to continue dispatching fighter jets to “keep a close watch” over the waters off the islands in case of an emergency. Crisis mitigation mechanisms need to be urgently reinstated and communication increased between Beijing and Tokyo to stem the escalation. Both the countries must act now to prevent a worsening territorial dispute from ending in armed conflict.

Projections for 2013

The year 2013 is likely to see a more independent Japan under Abe and Japan steps up its military role in Asia. As the spat with China continues, Japan’s assertive prime minister is not likely to take shelter under the US protective umbrella but to deal by itself with US backing. Therefore, removing obstacles that confine Japan’s military expansion is a key ambition of the Abe government, which is heading towards its goal “step by step”. The government’s decision to increase defence spending to at least 4.77 trillion ($54.3 billion) may be seen in this light.

Abe also wants to loosen the constraints of Japan’s post-war pacifist Constitution and has vowed to take a tougher line against China over a territorial dispute in the East China Sea. His real focus will be increasing Japan’s security. His government’s twin aims would be to fix the economy and to improve self-defence. One can expect, therefore, a bigger role for the military and increased defence spending in the next budget during the Abe administration.

Though Chinese aggression over Japan’s control of the disputed islands has escalated tentions, the prospect of a military conflict in the region is still unlikely. This however will not prevent a revision in Japan’s Constitution that upgrades Japan’s Self Defense Force to a fully operating military from allowing Japan to take on a bigger military role in Asia. The political atmosphere in Japan seems to be conducive for re-writing of the constitution and there seems to be sufficient movement towards that objective. The notion, which would have once alarmed Japan’s neighbours scarred by memories of World War II, appears to be gaining favour with some Asian countries, which fear China’s growing military role in the South China Sea. For example, the Philippine’s foreign minister told the Financial Times in December 2012 that his country would strongly support a rearmed Japan as a counterweight to growing military assertiveness by China.

Abe’s task to achieve his objective is going to be bumpy, however. Re-writing of Japan’s constitution is unlikely to be easy and would meet with opposition from Japan’s upper house of the Diet, which would also have to approve any change. For the present, Abe is likely to concentrate to win a majority in the upper house when elections are to take place in July 2013 before any precipitous actions are taken. That will help him in smooth law making. Japan is also likely to be encouraged by the US to assume a greater military role to see that China’s power in the region is counter-balanced. In the broader defence partnership that Japan and the US are exploring, the SDF will be deployed overseas as needed. The US under Obama believes that Japan should play its part in the region and not just rely on the US.

Commensurate with increased military spending and a possible change in the Constitution, Japan is expected to make increased efforts to improve ties with Asia neighbours. In August 2012, Tokyo also experienced a diplomatic deadlock with Seoul after President Lee Myung-bak, the outgoing president, visited the disputed islands, which Seoul calls Dokdo and Tokyo calls Takeshima. Abe lost no time in sending his emissary to South Korea as a conciliatory gesture with a view to improve relations and to have talks with the newly-elected President Park Geun-hye, despite Japan’s disputes over the Takeshima/Dokdo island issue. The tricky part is to connect to the anti-China stance in Southeast Asia and Abe will need to work hard to build ties. Japan is also looking to sell defence supplies to some of its allies, especially those in Southeast Asia. Also, despite his recent rhetoric, he is expected to make some efforts to make amends with China. China angered a number of its neighbours recently by issuing passports that showed disputed territories across the South China Seas as belonging to China.

There are some skeptics who hold the view that it is China which should be fearful of Japan and not the other way as Japan has more modern and hi-tech military hardwares than it. These skeptics argue that Japan has the full backing of the US and a few bases at China’s doorsteps, equipped with the world’s most advanced weaponry as compared to China with military strength well behind Japan, France or UK, Russia or the US. They argue that Japan’s fear of China threat is only an alibi to build-up its military strength to relive its past big power glory to lord over its Asian neighbours. They say that Japan finds the time opportune as the US is faced with budgetary constraints at the moment and therefore conservatives in Japan see as an opportunity to realize the country’s nationalistic dreams. However, such views are jaundiced and ignore the present foreign policy doctrine of China and the message it has sent to the world by its outlandish claims over other countries’ territories. That China is a real threat to the region and the world is the message that should go loud and clear.

So far as India is concerned, India is going to have a prominent place in Japan’s foreign policy doctrine under Abe-II administration. The China challenge that is driving India, Japan and the US to a common platform will assume robustness. The security/defence cooperation will be complemented by the economic complementarities, a welcome prospect for the peace and stability in Asia.

By Rajaram Panda