economics

June 22, 2010

Sayonara, America?

Filed under: Uncategorized — ktetaichinh @ 7:30 pm
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Prime Minister Hatoyama’s resignation at the beginning of June highlights Japan’s dilemma. It wants an eastern equivalent of the EU to guarantee stability and trade. But who will join, and will the US accept Japan’s exit from a co-dependency guaranteed by treaty since the end of the second world war?
http://mondediplo.com/2010/06/04japan
The big prize is China, whose huge market guarantees Japan’s future. After more than a decade of crisis, the Japanese economy is still geared to exports, although these are in freefall. Asia, which seems to have coped better with the financial storm, has replaced the West and China has replaced the US as Japan’s main trading partners. In 2009 nearly a quarter of Japan’s exports went to China, while 16% went to the US and 12% to Europe.

But trade has not been enough to soften attitudes. China and Japan share cultural roots (including their writing systems, Confucianism and Buddhism), which should encourage cooperation, but the past is also charged with conflict. In ancient times, the emperors of China regarded Japan as a nation of “dwarves”, barely worthy of paying China tribute. In the early 20th century, the Japanese pursued their colonial conquests brutally, from the occupation of Manchuria to the Nanking massacre. The Japanese are the only nation to have been nuclear-bombed, but, unlike the Germans, not all have learned from the consequences of aggression. Even today, the museum attached to the Yasukuni Shrine justifies the Pacific war as a “defensive war”.

The tensions have subsided. In Taiwan – an issue on which Beijing and Tokyo differ – the election of Ma Yingjeou, who, unlike his more pro-independence predecessor, favours cooperation with China, has allowed the resumption of less adversarial relations. In Japan, the end of the Koizumi administration signalled a return to normal relations. Hatoyama suggested to President Hu Jintao that the East China Sea should be transformed into a “sea of fraternity” (6), an allusion to the territorial dispute regarding the Senkaku/Diaoyu islands (7). On a visit to Tokyo in December 2009, China’s vice president, Xi Jinping, was able to bypass normal protocol and gain an audience with Emperor Akihito. The influential DPJ figure Ichiro Ozawa led a 600-strong delegation to China last December.

Professor Ryosei Kokubun of Keio University, Tokyo, feels considerable progress has been made, although he warns against taking a simplistic view. There is no Sino-Japanese alliance seeking to drive the US out of Asia, he says; it is a three-way relationship (US-China-Japan). Relations had their ups and downs during the 20th century: a US-Chinese alliance against Japan during the second world war was succeeded by a US-Japanese alliance against China, at least “until the 1970s, when all three saw the Soviet Union as the enemy”. America’s U-turn over China took Japan by surprise. The Japanese still talk of the “Nixon Shock”, referring to President Richard Nixon’s 1972 visit to and recognition of China, which the US had until then shunned. They had the same kind of shock in 1998: “President Clinton stayed in China for more than a week, without coming to Tokyo,” said Kokubun. “People started to worry about America bypassing Japan and feared that a new strategic partnership would be formed at Japan’s expense.”

The return of a Democrat to the White House revived their fears. Officially, everyone applauded Barack Obama’s speech on nuclear disarmament, “which we have wanted for a long time,” said an MOFA official. But they also noticed the length of the US president’s visit to China, compared to his brief stopover in Tokyo last November.
Arc of freedom

Japan’s new administration is keen to avoid the establishment of a one-to-one relationship between Washington and Beijing, from which it would be excluded. Hence the rapprochement with China and a determination to earn political credibility in the region. It is true that the concept of the East Asian Community does not belong exclusively to Japan (it first emerged after the Asian financial crisis of the 1990s, when it was opposed by the US and China), but Hatoyama revived the long term idea of a common (Asian) currency, to mark Asia’s new role in world affairs. His resignation is unlikely to change Japan’s desire to free itself from the International Monetary Fund and the burden of the dollar. An embryonic Asian monetary fund, in which South Korea is participating, is already in place. Even so, the Asian leadership contest has yet to be decided.

China seized the diplomatic initiative by signing a free trade agreement with the 10 Asean countries (8), which came into force on 1 January 2010. While trying to catch up, Japan has turned to India, Australia and New Zealand to form an “arc of freedom and prosperity”, in opposition to China’s authoritarianism. The Japanese government is keen to woo India, which it sees as the perfect counterweight to China. Japan and India signed a strategic partnership agreement in October 2008 and are planning joint military manoeuvres. This privileged relationship is promising but as yet marginal: India accounts for less than 1% of Japan’s trade.

Some members of the Japanese administration have greater hopes of a Japano-Korean axis, similar to the Franco-German axis in Europe. An expert on Asian relations at the MOFA admitted, “We speak the same economic language as China, but we still have great differences over the rest. In southeast Asia, there are only two countries that have both a market economy and democracy: Korea and Japan. They could be an engine of regional cooperation.” However, China may be scary, but Japan does not inspire confidence.

Historical disputes remain an obstacle to a new alliance. In spite of three years working together on a 2,200-page report published this March, a commission of South Korean and Japanese historians was unable to agree on key issues such as Japan’s imposition of forced labour and recruitment of “comfort women” (the euphemism for those forced to work in Japanese military brothels) during the second world war. “It will require patience,” admitted the MOFA expert. “Political and trade negotiations are already much easier. Now that it has joined the developed nations, Korea is more confident. And Hatoyama’s people are ready to take a calmer look at history.” But a trilateral alliance between Japan, China and South Korea has quietly come into being. Brought together by economic issues, they have been meeting on the fringes of Asean summits since 1999. In December 2008, they met independently for the first time. “The East Asian Community concept is taking shape at last,” remarked Kokubun.

But judging from their different approaches to North Korea, it will be a long march. So far, China has favoured pressure and negotiation, South Korea has taken a firm stance and Japan has refused to talk to North Korea. North Korea’s missile launches across Japanese airspace and its nuclear ambitions worry Japan, even if privately nobody really believes it is a serious threat.

Another source of friction that prevents Japan from repositioning itself strategically is Russia. Things have not moved on from the second world war. Russia and Japan have yet to sign a peace treaty, owing to their dispute over the Kurile Islands, which Japan refers to as the Northern Territories. Keen to secure energy resources over which Japan is in competition with China, Hatoyama was negotiating.

Sixty years after its defeat in the Pacific and 20 years after the collapse of the Soviet empire, Japan is still looking for a way into the post-cold war era. Hatoyama tried to secure greater autonomy from the US and was pushing for a new kind of regional cooperation, possibly with China. But he was hesitant to take the plunge and, lacking an innovative strategic vision and with very little support from his own party, he resigned. Does this mean that Japan has once again missed an opportunity to draw a line under the cold war? It is too soon to draw such a conclusion.

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