Japan-China: Soft Power of Panda Diplomacy

On October 25-27, Japanese Prime Minister Shinzo Abe made his first official visit to China in seven years. His previous visit took place in December 2011, after which political contacts between the two countries were frozen. The “nationalization” of the Senkaku Islands by the Japanese government in 2012 led to this chill in bilateral relations. The next time the prime minister of Japan met with the Chinese President Xi Jinping was on the sidelines of the APEC summit in 2014, which marked the beginning of a new surge in bilateral relations. In 2016, the Japanese prime minister visited China to attend the G20 summit, on the sidelines of which he met with the Chinese leader. Chinese Foreign Minister Wang Yi visited Japan last April for the first time in eight years.

Economic relations perked up in recent years as well. In 2017, bilateral trade amounted to about $300 billion, up 10 percent over the previous year. The number of Chinese tourists visiting Japan grew by 15 percent reaching approximately 7.3 million. [1] The economy has been the driving force behind bilateral relations in recent years, whereas the political sphere remained marked by icy estrangement. It is not accidental that the “hot economics, cold politics” formula has always been used to describe China-Japan relations.

In recent years, the countries’ joint approach to global economic problems, in addition to their own economic ties, has also helped bring them closer. Japan and China, which have become global economic leaders primarily on the strength of foreign trade, share positions on the issue of freedom of international trade. Their current opponent - the United States led by President Trump - has set up major non-trade barriers to foreign imports. Although the main thrust of Washington’s trade war is directed against China, Japan was the sacrificial lamb that, along with China, suffered from US duties on steel and aluminum imports. Not without reason, Tokyo is concerned that the Trump administration’s next step will involve a significant increase in tariffs on imported automobiles and auto parts, which account for the bulk of Japanese exports to the United States. In speaking out against the protectionist policies of Washington and in favor of preserving and promoting multilateral international trade systems, geopolitical competitors Japan and China ironically found themselves on the same side of the barricades in their opposition to America.

That said, there is also a systemic factor underlying the rapprochement – an awareness of the other country’s importance to advancing their own national interests. For China, Japan is a critical source of investment and technology, especially amid mounting tensions with the United States. In turn, Japan now more than ever needs stable political relations with its mainland neighbor as slowing growth rates in the Chinese economy unavoidably dampen the prospects for economic growth in Japan.

Under these circumstances, both China and Japan would benefit immensely from even minor, symbolic progress in the political dialogue, which has long been held back by a territorial dispute and divergent approaches to their historical past. The Japanese prime minister’s visit was used as just such an opportunity. It is not accidental that Abe’s visit to Beijing was timed to coincide with the 40th anniversary of the Treaty of Peace and Friendship between China and Japan of August 1978. This fundamental bilateral document, which was signed in the difficult geopolitical circumstances of the Cold War, is relevant today as the parties were able then to identify a compromise formula to deal with the territorial dispute and to downplay points of contention.

Therefore, the emphasis of the visit was on demonstrating progress, however symbolic. For example, a Chinese military orchestra played the Japanese national anthem, which invariably evokes memories of Japan’s expansionist policies during WWII among the Chinese. There was also Tokyo’s official announcement of the end of Official Development Assistance to China ahead of the visit. Over the course of 40 years, Japan provided assistance to China in the amount of approximately $32.4 billion, mostly in the form of low-interest loans. These loans allowed China to radically modernize its economy and laid the groundwork for its economic breakthrough in the 1990s, which propelled the country to the top of the global economic powerhouses. Interestingly, the news that Tokyo would discontinue the ODA was greeted with more than just understanding by the Chinese, who no longer see their country as “developing,” but with recognition that Japan’s assistance was invaluable for the country as it was carrying out the crucial economic reforms that made its future economic successes possible.

The visit also saw hugely important official statements characterizing the current state of bilateral relations. For example, Prime Minister Abe said that his visit to China marked a "historic turning point" in Japan-China relations which can be described as transitioning from competition to cooperation. In turn, Xi Jinping noted that bilateral relations “have returned to normal” and that today China and Japan share “common interests and concerns” on many issues on the international agenda.[2] In turn, Chinese Foreign Ministry spokesperson Lu Kang said at a briefing that Japan is an “important neighbor” for China, and that both sides must confirm that they are cooperation partners and “will not become threats to each other.” [3]

It is also significant that during the October 26 meeting, Abe and Xi practically ignored the most controversial issues in bilateral relations, including the historical past and the territorial dispute. Only once did Xi stress the need to properly address sensitive issues related to WWII and the status of Taiwan. Instead, the participants focused on overcoming contradictions and fostering cooperation.

The discussion of the situation on the Korean Peninsula was also telling. Japan spoke in favor of joining efforts to assist the settlement process. Shinzo Abe stated that both countries share responsibility for ensuring peace and stability in the region and reiterated his intention to cooperate closely in order to denuclearize the Korean Peninsula. This determination to reduce tensions also came in the form of an agreement reached during the visit to establish a hot line in order to prevent contingencies at sea and in the air in the East China Sea, where the Senkaku Islands are located. One of the signed agreements concerns expanded cooperation in conducting search and rescue operations in the border waters of the East China Sea. Another concerns reciprocal port calls by the warships of both partner countries.

In all, roughly a dozen intergovernmental documents on cooperation in politics, innovation, finance, sports, human exchanges, and more were signed during the visit. [4] About 1,000 Japanese businessmen accompanied Abe to China where they concluded about 500 agreements and contracts worth $2.6 billion. At the insistence of Japan, China agreed to consider lifting restrictions on Japanese food imports imposed in the wake of the Fukushima disaster. The sides announced the early resumption of the talks on jointly developing gas fields off the shelf of the East China Sea. A swap agreement for mutual currency support in volatile financial markets of up to $30 billion was also signed.

The most important results of the visit include a number of agreements on cooperation in implementing infrastructure projects in third countries. Cooperation in this area is mostly due to Beijing, which needs partners to implement its New Silk Road initiative. Even though Japan has refrained from officially joining the Chinese initiative, it went ahead and signed an agreement for about 50 joint infrastructure projects in third countries. A forum on cooperation in the markets of third countries was held during the visit. Such cooperation is based on maximizing the natural competitive advantages of the parties such as the relative low cost of Chinese companies’ services and the high-tech power of their Japanese partners. In fact, infrastructure is becoming the most pragmatic avenue for Japan to pursue its policy of “engagement” with China. China, which is looking for ways to maximize the return on its capital invested in foreign markets, can benefit greatly from Japan’s 50 years of experience. So, cooperation in this area has become for both sides not only an important policy tool to stimulate their respective economies, but also a way to hedge geopolitical risks associated with increased global rivalry between China and the United States and increased uncertainty in relations between the United States and Japan.

Also notable is a number of agreements aimed at improving the public image of the partner countries, badly damaged during the political chill. They include an agreement to declare 2019 a year of exchanges between the youth of Japan and China signed by Abe and Li Keqiang. Some 30,000 young people from both countries are expected to participate in such exchanges over the next five years. China has already announced a list of several invitation programs for the Japanese youth. [5] Another example is the arrangement under which China will lease pandas to Japanese zoos. “Panda diplomacy” is deeply resonant as the transfer of pandas in 1972 to a Japanese zoo became the symbol of normalizing relations between the two countries. In 2012, panda diplomacy was frozen, so the popular additions to the Sendai and Kobe zoos are expected to help China build up its soft power.

The parties have also reached the conclusion that it is necessary to expand the political dialogue. They decided to resume the regular practice of talks at the working level (including the level of deputy prime ministers) on a wide range of international issues, including disarmament, non-proliferation of weapons of mass destruction, international law, and the growth area in the Mekong River basin in Southeast Asia, and more. In accordance with the memorandum signed between Abe and Li Keqiang, annual consultations will now be held at the level of foreign ministers. [6] Abe invited Xi to visit Japan next year. If accepted, it will be the first official visit by the Chinese president to Japan since 2008.

An agreement to speed up talks on a free trade area between China, Japan and the Republic of Korea came as a significant result of the visit. Japan and China have thus demonstrated their determination to act as guarantors of economic integration in Northeast Asia and, more importantly, to support the global free trade system and to oppose protectionism.

[1] http://www.globaltimes.cn/content/1124428.shtml

[2] https://www.japantimes.co.jp/news/2018/10/26/national/politics-diplomacy/shinzo-abe-li-keqiang-agree...

[3] http://www.asahi.com/ajw/articles/AJ201810250009.html

[4] http://www.globaltimes.cn/content/1124834.shtml

[5] http://www.asahi.com/ajw/articles/AJ201810260033.html

[6] http://www.asahi.com/ajw/articles/AJ201810260033.html

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