This year marks the anniversary of 40 years of diplomatic peace and economic trade between two former Second World War adversaries, Japan and China. September is not shaping up as a shining demonstration of this peace.
The Senkaku Islands, also known as the Diaoyu, Tiaoyutai or Pinnacle Islands, are located slightly above the Tropic of Cancer and about 200 nautical miles east of the Chinese mainland. These islands comprise seven square kilometres in the East China Sea and are approximately 0.008 per cent the size of the area of the city of Calgary.
The relevancy of these islands to the public consciousness is not immediately clear but surprisingly these small islands have become the centre of an enormous trade dispute between two of the largest economies on earth.
Historically, ownership of these islands has been contested between Japan and China. Japan formally claimed these islands at the end of the 19th century. Senkaku remained under Japanese control until all Japanese territory was taken over by the United States following Japan’s surrender at the end of the Second World War. The islands were returned to Japanese control in 1972 and in that same year the Taiwanese and Chinese governments also claimed ownership of the islands. They have been privately owned and rented ever since, existing in a sort of geopolitical grey area.
On September 10, the Japanese government announced plans to “purchase” the Diaoyu Islands from the previous owner — the Kurihara family — in an attempt to nationalize the islands. Predictably, this move triggered outrage from the Taiwanese and Chinese governments who claimed the move was infringing on their national sovereignty. The reaction has prompted anti-Japanese demonstrations throughout China with protesters calling for a boycott of Japanese goods. Toyota, Honda and Nissan have halted production at some of their plants in China while Panasonic has suffered damage to some of their stores in China. Consequently, shares in Japanese companies have been steadily sliding in the past few weeks and there has been less global demand for Asian imports in the wake of the European debt crisis.
Outside their perceived domestic borders, the Chinese government does not normally take on an antagonistic role in international affairs. Through their desire to stay out of any nation’s domestic policy in favour of business — as their support for the government in Sudan has demonstrated in the past — China has a less-than-stellar reputation in the international humanitarian community. However, one issue that the Chinese government is exceedingly sensitive to is perceived infringements on its sovereignty, especially from Japan. Just as in another country located south of the 49th parallel, the political right-wing government in China is exceptionally nationalistic and is a crucial part of the political landscape. Even something as seemingly insignificant as a group of deserted islands can have worrying economic and political ramifications.
Though it was over 80 years ago, the Chinese demonstrated they have not forgotten about the Japanese expansion into northeast China in 1931. On September 19, Chinese vice president Xi Jinping was quick to raise the spectre of 20 century Japanese expansionism and even cautioned the world to not let Japan forget about the outcomes of the “world anti-fascist war.” The Chinese premier condemned the planned Japanese purchase and on September 10 stated, “The Diaoyu Islands are an inalienable part of China’s territory and the Chinese government and its people will absolutely make no concession on issues concerning its sovereignty and territorial integrity.” This kind of heated rhetoric is causing a great deal of concern internationally, but not necessarily out of fear of any sort of military conflict. The Chinese domestic market is the largest of any one nation in the world and the sort of isolationist sentiment being expressed in the streets of China has the capability to spread to other nations. With the fragile global economy, this little spat over a few islands in the East China Sea becomes more and more concerning.
China is demonstrating that business comes first, except when sovereignty is threatened. In 2011, Chinese exports to Japan totalled $148.3 billion and Japanese exports to China totalled $194.6 billion and still China is willing to risk damaging this relationship. From a Japanese perspective, the risks seem to outweigh any sort of reward, and the Western reaction to Japan’s plans to purchase the islands is essentially an eye-roll. The question remains, why would Japan want to pick at this scab?