Are we on the brink of a regional conflict?

As you’ve probably heard or read in Rich’s post, the heat is building up between China, Japan and, to a lesser extent, Taiwan. The centre of attention is the Senkaku (or Diaoyu in Chinese) islands in the East China Sea. Currently under Japanese control, the islands are claimed by both China and Taiwan and have given rise to tensions in the past, notably in 2010.

The Bone of Contention

On 18 September, the People’s Daily published a rather virulent article threatening Tokyo with harsh commercial sanctions if the Japanese government did not decide against ‘nationalising’ three of these islands, which had been up until now the property of a Japanese family. The nationalisation of the islands was in fact an attempt to prevent the current sinophobic and nationalist governor of Tokyo Shintaro Ishihara from buying them for the town. Paradoxically, the nationalisation, which aimed at calming down things, did exactly the opposite. China is now outraged that its warnings have remained ineffective and forcefully claims that the group of islands is part of its ‘inherent’ territory. A few patrollers of the Chinese Sea Surveillance Agency have been sent to the area. Taiwan sent a few boats of its own yesterday, too.

So why this diplomatic rant for a group of five, uninhabited islands, whose surface total a mere 7 sqm? As mentioned above, a similar crisis happened in October 2010 following a minor naval incident in the area. Beijing then put pressure on Japan by heavily reducing exports of rare earth, which are vital to the Japanese high-tech sector. These three-dimensional crises point to recurring tensions between the two countries who are both trade partners and strategic rivals.

The economic and strategic importance of the archipelago shouldn’t be underestimated. The islands, which are located 200 km to the North-East of Taiwan, hold a key location in case of a regional conflict and control a crucial supply route to the region – in particular to Japan. Moreover, its Exclusive Economic Zone is greatly coveted by both powers, as it abounds in fish resources and, potentially, in oil and gas reserves.

History provides a second backdrop to the crisis. Chinese activists did not put Chinese flags on the main island on the 15th of August by chance – it happened to be the anniversary of Japan’s defeat in 1945. Also, the massive demonstrations that have taken place in various Chinese cities epitomise the underlying historical acrimony.

Finally, this crisis needs to be understood in the wider context of rivalry between the two main powers in Asia. Facing a weakened Japan, China is gaining more and more grounds in the region, including in terms of military power. Under the claim of national ‘vital interests’ China asserts its maritime ambitions, including in the South around the Spratleys and Paracels islands, leading to rising tensions between China and its neigbour countries.

In its Annual White Paper on Defense published on 31 July, Tokyo worries about its neighbour’s maritime ambitions and doubling of its military budget within the last 5 years. If China’s economy, diplomacy and military keep growing at the same rate, the Middle Kingdom will quickly dominate the continent. A scenario which is unthinkable for Japanese officials: this is why the announcement that China put its first aircraft carrier into operation last Tuesday, was quickly followed by Japan’s annoucement that it will increase its submarine fleet to 22 in the short-term future.

Another contributing factor to the crisis is the unstable domestic situation in both countries. In China, the woes of the Bo Xilai family have highlighted the major malfunctions within the Communist Party and have disrupted the smooth transfer of power to a new governing team in autumn. In Japan, the Noda government is in a tight spot and may face early parliamentary elections by the end of the year. Authorities in both countries want to avoid an escalation of the crisis but given the up-coming political dates, a harder diplomatic stance pleases the public. Indeed, while there is a minor nationalist and sinophobic movement in Japan, patriotism in China feeds not only on national economic successes but also on nippophobia, which is instrumented by the authorities seeking legitimacy.

Some argue that this territorial dispute is very likely to have a similar ending as the one in 2010. In other words, that the problem will remain unsolved and that Beijing may implement some commercial sanctions in the near future. They claim that realpolitik will probably take over, after the key political dates, due to the interdependence of both economies. Economic and financial cooperation is bound to continue, albeit in a highly unstable and often conflictual context.

Others wonder whether a regional conflict isn’t looming and point out that the interdependence of European economies didn’t prevent the escalation of conflict in 1914. While it will probably not be the main factor in preventing an open conflict in East Asia now, a war would hardly be in the interest of China nor Japan. Although China is showing its muscles, its naval fleet is still in its infancy and is no match to Japan’s, which also enjoys the support of the United States. While the current balance of power is still in favour of Tokyo, it remains to be seen for how long . It looks like the arms race that Rich envisaged has already started.


3 comments on “Are we on the brink of a regional conflict?

  1. clintonwatson says:

    I wonder if we really are seeing an arms race. Military data from the Stockholm International Peace Research Institute shows that military spending as a percentage of GDP has been steady in both Japan and China. China’s ratio has varied between 2.0 and 2.2 and Japan’s 0.9 and 1.0. The World Bank use this dataset which can be accessed here:

  2. sengad says:

    Hi Clinton, I’m not sure whether the data you mention rebuts the hypothesis of an arms race.
    What it shows is that military expenditures are steady in terms of percentage of GDP. Since the Chinese economy grew by 9.1% in 2011, the value of military expenses has de facto increased significantly. On the other hand, the Japanese economy did have a negative growth rate over the same year due to the earthquake and subsequent tsunami, thus the military expenditures have reduced in real terms. However, determining if there is or isn’t a budding competition in military capabilities would require an analysis of the expenditures themselves, rather than as a percentage of GDP.
    The aircraft-carrier episode seems to point to a budding competition in maritime capabilities, and certainly adds to the current climate of distrust. But as I said in the post, China has a long way to go before its capabilities can match those of Japan and its Western allies.

  3. clintonwatson says:

    Yip, of course Chinese economic growth has been higher than that of Japan over the past few decades. China’s rising military expenditure (in $ terms) is just a reflection of its growing economy, rather than a militarisation. China still spends less than all of the other Permanent Members of the Security Council as a percentage of GDP. Why am I fixated on the GDP ratio indicator? Because it indicates the relative importance of defence amongst all government priorities. I’m not familiar enough with the figures/estimates to know whether China is shifting more resource into its navy.

    There is a lot of talk about China’s push for blue-water naval capabilities (Robert Kaplan has wrote a lot of engaging material on this, for example). Beijing’s “string-of-pearls” strategy, a series of naval bases in the Western Pacific and Indian Oceans, is apparently a central plank of this push. Yet, very little has actually happened in the last decade or so. Gwadar in Pakistan is probably the most advanced port, but even that is managed by a private Singaporean company. The Chinese purchased their aircraft carrier from Ukraine almost 15 years ago and have only just launched it. The carrier might be a new bud for China, but it’s certainly had a very long winter and it’s flowered many times previously in the Black Sea. So…it’s not clear that a Bismarckian China is really looming large or that an arms race has begun. But I do agree that the distrust between Japan and China is finding new lows.

    I just read this article (admittedly published in a right wing newspaper), which supports your view of a looming conflict:

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )


Connecting to %s