This week sees the continuation of increased tension between China and Japan over a set of islands in the East China Sea. To learn more about what might be driving these tensions and how a peaceful resolution can be reached, we speak to James Manicom, a CIGI research fellow and expert in maritime security and international relations in East Asia.

CIGI: Is it arguable that this conflict is being fuelled, or might even be prolonged, by either country’s own domestic politics?

James Manicom: I think that’s absolutely the case. This series of events was brought about by Tokyo Governor Ishihara Shintaro’s efforts to buy the disputed Senkaku/Diaoyu Islands so they could be administered by the Tokyo government. This placed considerable pressure on Japanese Prime Minister Noda Yoshihiko to do the same. To have allowed Ishihara to buy them would have left the Noda government vulnerable to criticisms from Japan’s small, but vocal, conservatives for being soft on China. More importantly, to have allowed Ishihara to buy the islands would have opened the door to more tension with China, as Ishihara would be a much less considerate landlord than the central government. So, Noda really had little choice but to nationalize the islands. The only winner, so far, is the seller of the islands, who walked away with $26 million (USD).

It remains to be seen what impact this crisis with have on the upcoming election in Japan. Although the opposition Liberal Democratic Party candidates are busy trying to outdo one another on anti-China rhetoric, one often hears from Japanese interlocutors that the average Japanese citizen doesn’t care about the islands. As in other countries, Japanese people don’t vote on foreign policy issues. At the same time, one gets the sense that the Japanese are collectively a little sick of being pushed around by China. I think that in the Japanese bureaucracy, a sense has emerged that Japan should stand up to China when it can.

In China, the crisis takes place against the backdrop of a Communist Party leadership transition that has already had its share of problems stemming from the Bo Xilai scandal, with the arrest of his wife Gu Kailai for murder and the trial of his deputy, Wang Lijun. A considerable amount of anti-Japanese sentiment already exists on the part of the average Chinese citizen, and these views are inflamed during times of crisis. There is speculation that the outgoing Chinese leadership is weak and vulnerable to accusations of weakness by hard-liners and rising political stars. The interesting dimension is that it’s unclear just how genuine these protests in China are. It seems that protests in Beijing are well-controlled by the government; people are being told where to protest and what they can and cannot do. In contrast, those occurring in smaller Chinese cities are spiralling out of control, which has led to considerable destruction of property.

CIGI: Some say this crisis will take, and perhaps already is taking, an obvious toll on diplomatic and economic (trade) relations between the two countries. What prospects do we have for this crisis to resolve itself peacefully? Can we expect the situation to get worse before it gets better?

Manicom: We’ve seen a number of ties between the two countries severed. Tourism is down, Chinese competitors have withdrawn from a badminton tournament and cultural exchanges have been postponed. Sino-Japanese trade relations are pretty robust, but we have seen the trade relationship take a beating in the past due to tensions over the islands. Stock markets are down, Japanese businesses in China are boarded up and there are widespread calls by Chinese nationalists for a boycott of Japanese goods. The real question is whether Japan or other countries that have heavily invested in China — such as South Korea — will begin to think twice about China as a destination for manufacturing.

I think that September 18 marked a low point from the Chinese nationalist perspective. Most people have gone back to work, and the really hard core protestors, have been shut down by police. From a government perspective though, whether and how things will calm down remains to be seen. China continues to send its coast guard ships to the islands and these are met by their Japanese counterparts. I think the odds of miscalculation under these circumstances are low. The real wild card is the rumour of a flotilla of fishing boats being sent to the islands to fish; civilians are not as restrained as government officials. Furthermore, Japanese officials have warned that the arrival of numerous Chinese fishing boats near the islands would take the crisis to “a new stage.” At the same time, the two countries will celebrate 40 years of diplomatic ties in November and this could be an important pretext for leaders in both countries to try to settle things down.

In terms of resolving the issue of the disputed sovereignty over the islands, I’m profoundly sceptical that there will ever be a formal resolution to the issue; the domestic costs of compromise are just too high. I’m pretty confident, however, that Chinese and Japanese leaders will once again find ways to signal each other and to cooperate behind the scenes in order to keep the issue from seriously upsetting bilateral relations. They have done it before and are capable of doing it again. Over the longer term, the relationship could be improved if governments in both countries did a better job of reminding their citizens how unimportant the disputed islands are and just how important China and Japan are for each other’s economic well-being.

CIGI: What stakes or obligations does the international community have in this conflict, and what role, if any, can the international community play in a peaceful resolution?

Manicom: The international community has a significant interest in the management of these tensions. The main concern is the possibility of an accident between a civilian and a government vessel near the islands that might cause the crisis to spiral out of control. These kinds of crises can escalate quickly, particularly as there is no hotline communication mechanism between China and Japan, despite efforts to create one. The escalation of hostilities could get ugly very quickly, as both countries have well-armed navies.

I am hard-pressed to think of what role, if any, the international community has in bringing about a peaceful resolution to the dispute. Anything beyond a statement expressing interest in its peaceful resolution could be interpreted by one side or the other as taking sides. This is basically a bilateral issue, in which the most concerned third party is the United States. That said, other countries — particularly those with territorial disputes with either Japan or China — are likely watching these events closely.

Over the longer term, the relationship could be improved if governments in both countries did a better job of reminding their citizens how unimportant the disputed islands are and just how important China and Japan are for each other’s economic well-being
The opinions expressed in this article/multimedia are those of the author(s) and do not necessarily reflect the views of CIGI or its Board of Directors.