Perhaps the biggest news of the last third of 2020 was that Xi Jinping’s often-postponed state visit to Japan will not take place in spring 2021 and may be postponed to September 2022, in commemoration of the 50^th anniversary of the normalization of China-Japan diplomatic relations. Both countries’ economies recovered well from the pandemic, with robust trade between them even as they continued to snipe at each other politically and upgrade their military capabilities. China continued to expand its presence in waters of the East China Sea claimed by Japan.

Politics

With continued inability to agree on the text of the joint communique, each side made efforts to burnish its image with potential partners. Tellingly, Prime Minister Suga Yoshihide’s first overseas trip after taking office took place in October was to emphasize the importance of Japan’s ties to Southeast Asia, and that Japan’s commitment to a rules-based international order makes it a better partner for ASEAN nations than China, given its escalating unilateral actions in the area. China denounced Japan’s sponsorship of a free and open Indo-Pacific (FOIP) and Suga’s trip as a strategy meant to walk in step with the United States and deepen confrontation in the region.

The reporting period started on a diplomatic note, but this did not last. Global Times described China’s commemoration of the 75^th Anniversary of the Victory of the Chinese People’s War of Resistance Against Japanese Aggression on Sept. 3 as low-key, which the paper attributed to improving China-Japan relations. President Xi Jinping did not deliver a speech during the commemoration, and Chinese media did not criticize Japan. It cited unnamed analysts as saying that, given US unilateralism and provocation to regional peace and stability, there was a growing need for China and Japan to strengthen cooperation to maintain regional stability and prosperity. However, on the next day China Daily struck a more truculent note in a report on the opening in Heilongjiang of a major exhibition related to the War of Resistance Against Japanese Aggression that, according to the paper, presented new evidence of Japan’s human experiments and biochemical weapons.

Figure 1 An exhibition at the commemoration of the 75th anniversary of the Victory of the Chinese People’s War of Resistance Against Japanese Aggression. Photo: China Daily

In December, Chen Xi, head of the party’s Organization Department and a Poliburo member, spoke at the seventh national memorial day for the victims of the Nanjing Massacre slaughtered by Japanese troops in 1937, describing it as a painful memory that should not be forgotten or tampered with. However, for the third year in a row, Xi did not attend.

Even before assuming the top job, Suga indicated he would take a tough stance on China. Debating with other contenders for the presidency of the Liberal Democratic Party (LDP)—and therefore the prime ministership—in mid-September  Suga vowed that, if elected, he would stand his ground with Beijing. Chinese specialists on Japan dismissed his and other candidates’ remarks as campaign rhetoric, opining that no leader would abandon the benefits that have been achieved during the past few years, especially those relating to the economy and trade. Although the specialists observed that all candidates took a hardline, they expressed a desire for Japan to mediate between China and the US.

Chinese papers were skeptical, saying that while China would welcome mediation, Japan could not play such a role since it is not an “independent” country but “Washington’s loyal follower which still has huge military presence.” Global Times editorialized that the question of whether Suga’s attitude would be better than Abe’s was “insignificant” as “China should continue to boost its attractiveness to Japan, weaken Japan’s ability to restrict China’s development, and gradually suppress Japan’s idea of taking an opportunistic line toward China amid worsening China-US relations.”

China Daily predicted that Suga would try to further improve relations with China but at the same time take a tough stance against China in defense and security policies. If, for example, he does not admit Japan has a dispute with China over the Diaoyu/Senkaku islands, this “could sour Sino-Japanese ties.” Only two days after Suga’s election as prime minister, one of his major backers, influential LDP heavyweight and China-friendly Nikai Toshihiro, voiced hope that Xi’s state visit would take place soon and that a fifth political document would establish China-Japan intentions for “co-creation to achieve world peace and prosperity led by Japan and China together.” This ran counter to Suga’s stated intention to base Japan’s security on a close relationship with the US.

Contemporary relations remained hindered by the two countries’ fraught pasts. Abe Shinzo tweeted in mid-September that he had visited Yasukuni Shrine after resigning to report his resignation to the souls of the war dead. This was Abe’s first visit to the shrine since 2013, although China regularly objected to the offerings Abe sent at regular intervals while he was prime minister. Global Times reported that the visit was “blasted” on social media, showed that Japan’s rightwing politicians had yet to reflect on their country’s war crimes even as they try to be friendly with China, and would set a bad example for Suga. Suga did not attend the shrine’s autumn festival, but did send a ritual offering, which Global Times, in a separate protest article, referred to as a “potted plant.” Noting that Suga had not sent such offerings while serving as chief Cabinet secretary, the paper interpreted his gesture as indicating that he would adhere to the Abe administration’s policies on the shrine and that he was trying to win support from the Japanese right and “some public opinion.”

Some complications concerned the more recent past. Disclosing hitherto unknown details of the secret negotiations involving a Chinese fishing boat ramming two Japanese Coast Guard vessels a decade ago, Nikkei commented in early September that China’s unwillingness to compromise meant that “Japan once again faces the question of whether it is ready to tackle big issues regarding its powerful neighbor—and at what cost.” In mid-November, Japanese diplomatic sources revealed that plans in 2016 for a freedom of navigation operation in the South China Sea in response to Chinese pressure on the Diaoyu/Senkakus was called off because then-Prime Minister Abe feared it would jeopardize a visit by Xi that he had been hoping for.

Suga and Xi held their first telephone call on Sept. 25, with no mention of Xi’s long-postponed state visit to Japan. Xinhua reported that Xi told Suga he is ready to join hands with him to promote new development in the two countries’ relationship and that China supported Japan in hosting the Olympic games. Tellingly, the call took place only after Suga had spoken with President Trump and, separately, with Indian Prime Minister Narendra Modi. Suga and Modi agreed to elevate their special strategic and global partnership and stepped up cooperation in security and economic efforts in support of a “free and open Indo-Pacific,” with the US and Australia, code language for opposition to Chinese assertiveness in the area. Nikkei editorialized that Suga first seek the understanding of the Japanese people before trying to improve relations with China. Japanese concerns over such issues as the PRC’s encroachments in the East China and South China seas and its repressive actions in Xinjiang and Hong Kong must, said the paper, be frankly conveyed to China.

As September ended, a Nikkei correspondent interpreted Renmin Ribao’s prominent coverage of Xi’s phone call with Angolan President Joao Lourenco vis-à-vis RMRB’s treatment of his call with Suga as a message to Japan that it will not receive preferential treatment from the PRC. Reciprocally, he noted, Xi was number seven on Suga’s call list. The correspondent also took note of a video that showed a kindergarten-aged girl wearing a military uniform shooting Japanese army soldiers with a toy gun. The video ended with the girl, having disposed of the Japanese soldiers, triumphantly bearing the Chinese flag and being saluted by dozens of other children as martial music played in the background.

Speaking at a meeting of the Quad with Australia, India, and the US the following week, Suga indicated that he would follow Abe’s strong commitment to a Free and Open Indo-Pacific (FOIP) to counter China’s growing assertiveness. The Chinese government announced the creation of a 3D museum including archives and maps that reiterates Beijing claim to the disputed Diaoyu/Senkaku islands, with the Japanese government immediately lodging a protest through diplomatic channels.

A Pew poll in October showed a rise in unfavorable views of China in 14 countries including Japan, where 52% of respondents said their views were “very unfavorable” and 34% “somewhat unfavorable,” 1 percentage point higher than last year. Other countries’ views were also unfavorable, with those of nine states reaching their highest points since polling began a decade ago.

A Global Times opinion piece described the new generation of Japanese politicians as focused on cooperation with the US, Europe, and the Indo-Pacific strategy, with containment a core concern. China must be vigilant on where they will take Japan’s future policies, it argued. Suga visited Vietnam, which currently chairs the 10-member ASEAN, and Indonesia, ASEAN’s largest economy, to discuss ways to enhance security ties while not explicitly asking that they push back against China. During his visit to Hanoi, Suga, though never mentioning China by name, said that Japan would cooperate with ASEAN nations to establish the rule of law in waters in the region. He and Vietnamese Prime Minister Nguyen Xuan Phuc reached an agreement in principle on defining conditions for Japanese defense equipment and national security technology to be exported to Vietnam.

In Indonesia, Suga emphasized Japan’s commitment to the Free and Open Indo-Pacific, also endorsing the Jakarta-initiated ASEAN Outlook on the Indo-Pacific. Suga and Prime Minister Joko Widodo will work toward holding a second “two-plus-two” foreign and defense ministerial talks, Indonesia being the only ASEAN member to have such a channel. The two prime ministers also agreed to achieve a defense equipment and technology transfer agreement. As in Suga’s trip to Hanoi, the impetus for this, Chinese expansionism, was not mentioned. Xinhua described Suga’s visits to Vietnam and Indonesia as an attempt to bring ASEAN into the Indo-Pacific framework being pushed by the US and Japan.

Yomiuri editorialized that, in light of large-scale acquisitions in Hokkaido and other areas in Japan by Chinese and Chinese-related companies, the government should move quickly on legislation to monitor the sale of land around SDF bases and on remote border islands. The government should also consider identifying vital plots of land and directly buying them up, as well as encouraging repopulation of remote border islands to discourage illegal entry from abroad.

US information security company Crowdstrike revealed in October that Japanese research institutions developing coronavirus vaccines have been hit by cyberattacks, apparently from China. In November, Mitsubishi Electric, which plays a major role in supporting Japan’s national security and infrastructure, was again the target of a sophisticated cyberattack. After last year’s attack, likely orchestrated by a Chinese group, Mitsubishi implemented new cybersecurity measures.

Osaka police in October announced the arrest of a former employee of a major chemical firm for disclosing information to China on the manufacturing process of conductive particles used in smartphone touch panels. At the beginning of the next month, Tokyo’s Metropolitan Police Department announced that it will separate its China and North Korea operations in what seems a belated response to China’s 2017 requirement for its citizens to cooperate with the government’s espionage activities and repeated intrusions off the Senkaku/Diaoyutai islands. Japanese police have repeatedly uncovered leaks of data believed to have been perpetrated by China-based hackers and others.

Global Times in October responded favorably to Suga’s first policy speech to the Diet since his inauguration, interpreting his statement in support of a stable China-Japan relationship as indicative of a “mild” attitude. However, rhetoric and moves conducive to positive developments do not represent the whole picture of the Suga administration’s China policy.

For instance, in November, Jiefang Junbao, China’s leading military newspaper, cautioned Japan against allowing relations to deteriorate again due to “external factors.” Taking note of President-elect Biden’s commitment to applying Article 5 of the Japan-US Security Treaty to the Diaoyu/Senkaku islands, Biden’s interference in the disputed islands, and “other issues,” JFJB predicted that China-Japan ties “will probably fall into a dilemma again.”

Nikkei reported that repeated Chinese incursions into the Diaoyu/Senkaku area was the key topic of the 20-minute November meeting between Suga and visiting Chinese Foreign Minister Wang Yi. Wang replied that the islands should not stand in the way of advancing bilateral relations and that the two countries should work together on economic recovery and the pandemic. Suga raised concerns about the situation in Hong Kong and asked China to end import restrictions on Japanese food, including beef. The two sides affirmed cooperation on the Summer Olympic and Paralympic games in Tokyo and the 2022 Winter Olympics in Beijing. They did not discuss a new date for Xi Jinping’s often-postponed state visit to Japan.

Figure 2 Wang Yi meets Japanese Prime Minister Suga. Photo: Nikkei

Wang’s late November discussion with Japanese Foreign Minister Motegi Toshimitsu resulted in an agreement to establish a fast-lane travel corridor for essential personal exchanges by the end of November to facilitate the resumption of business activities. According to China Daily, they also discussed establishing a consultation mechanism on climate change policies, and opening a direct telephone line under the air and maritime contact mechanism to manage risks and enhance mutual trust.

Asahi, noting that Wang’s hardline stance on the Senkakus and other issues angered LDP lawmakers and that there is little enthusiasm for an early visit to Japan by Xi, predicted that it will not take place until 2022, perhaps on the 50^th anniversary of the normalization of China-Japan diplomatic relations. The invitation was originally extended in June 2019.

Nikkei observed that active recruitment by the Chinese government has increased the trend of Japanese scientists taking jobs in China due to higher salaries and better research opportunities. This has aroused fears of a technology outflow, as well as a brain drain.

In mid-December, in his first press conference since being appointed ambassador to Beijing, Tarumi Hideo, despite being a member of the “China School” of the Japanese foreign ministry and having ties to notably pro-China LDP secretary-general Nikai Yoshihide, called China’s stance on the disputed Diaoyu/Senkaku Islands “completely unacceptable.” Tarumi also expressed doubt on China’s suitability to join the Comprehensive and Progressive Agreement on Trans-Pacific Partnership (CPTPP)  since the PRC did not meet the criteria of high levels of market access and rules and “it would be out of the question to bend the rules and insert exceptions.” On the matter of Xi’s postponed state visit to Tokyo, the ambassador said the two sides were not at the stage of discussing concrete details and “looked forward to building relations that are fair, stable, and constructive.”

China Daily, noting that the Chinese Center for Disease Control and Prevention has been working with Japan’s National Institute of Infectious Diseases, in mid-December suggested that collaboration be expanded to prevent future outbreaks and emerging infectious diseases.

Economics

The economies of both countries rebounded well from the coronavirus. Japan reported a 22.9% expansion in Q3, after a 29.2% contraction in Q2, and China’s economy grew by 4.9% year-on-year in Q3. Japan is now officially out of recession and, on the last trading day of 2020, the Nikkei 225 index hit a 30-year high. The PRC will be the world’s only major economy to grow this year, albeit by a modest 2%.

There was also renewed friction over Chinese encroachment on Japanese fishing areas. According to a Yomiuri report, the Japanese government has asked Beijing to suspend its illegal operations on Chinese fishing vessels in and around the Yamato Bank area, which is part of Japan’s EEZ. As of Nov. 2, the Japanese Coast Guard had issued warnings to 102 such boats, depleting aquatic resources and preventing Japanese fishing boats from entering the area.

Reports that Japanese casual wear retailer Uniqlo now has more directly managed shops in China, 767, than in Japan, 764 (though its franchise stores are more numerous in the home country) is evidence of the linkage of the two economies. Uniqlo enjoys a more upscale brand image in China than in Japan, meaning that its consumers buy higher-priced items and hence enhance the chain’s profits. Sensitive to the risks inherent in uncertain bilateral relations, Uniqlo does not use its Japanese-language logo in China, although it does elsewhere in the world. Miki House, purveyor of upscale children’s apparel, is targeting affluent customers in Asia as the Japanese birthrate continues to decline, with 80% of new shops that have been opened outside Japan since 2019.

Japan, Australia, and India have agreed to diversify supply chains away from China, a major trading partner for all three. Japan has already begun supply chain cooperation discussions with the Association of Southeast Asian Nations (ASEAN) and will seek ways to combine the two initiatives. An Indian expert interviewed by Nikkei, though approving the concept, believes that it will have limited impact.

Taking note of Xi’s plans for future development of the PRC’s economy, center-left Asahi editorialized that China is aiming for self-imposed isolation. Objecting to Beijing’s forcing foreign companies operating in China to transfer their technologies and punishing countries by imposing trade restrictions on them, the paper reminded Chinese leaders that their country’s affluence depends on the international community’s expectations for, and trust in, the openness of China’s economy.

Linkages between the two countries continue to expand, however, regardless of the disputes. In mid-November, after years of hesitation, Japan signed the Regional Comprehensive Economic Partnership (RCEP) pact, marking Japan’s first free trade agreement with both China and South Korea. Although conceding that the rules are relatively lax, the agreement’s supporters expressed hope that the standards could possibly to raised to a higher level later. Tariffs are to be eliminated on 86% of industrial goods exported from Japan to China.

Japanese exports to China rose 3.8% in November, weaker than the 10% rise in October, even as exports as a whole declined by 4% from a year earlier. That same month am air freight route was launched linking Changsha, in central China, with Osaka. Japan expressed interest in opening a consulate in Wuhan, a core transportation hub and key auto production center, where a growing number of its companies have been setting up plants and offices. Japan and China in December signed a memorandum of understanding to create one of the world’s largest methane production facilities in northern China. The methane will be produced from hydrogen and carbon dioxide emitted from industrial production in a Shaanxi redevelopment zone, reducing greenhouse gas emissions. During this reporting period the major Japanese bookseller Tsutaya two of a planned 100 stores in China, which is experiencing a boom in bookstores.

In other areas, Japan appeared skeptical of Chinese growth or even sought to head it off. Reacting to a Xi Jinping announcement in November that China would consider joining the CPTPP, a Yomiuri editorial expressed doubt that the PRC would submit to its rules and urged member nations to build a consensus to abide by them. In December, meeting at a trilateral forum, Japan and the US pledged to provide financial assistance to Vietnam for the construction of LNG-fired power plants as part of a plan to offset Chinese influence. Shortly thereafter, in what Nikkei described as an effort to offset Africa’s China tilt, Foreign Minister Motegi visited Tunisia, Mozambique, South Africa, and Mauritius. The last three are located at the easternmost point of a free and open Indo-Pacific. Motegi emphasized Tokyo’s more transparent business environment as making it a more attractive business partner than China.

Defense

As China announced its newest advances in military capabilities, Japan continued to push the limits of interpretation of Article 5 of its constitution foreswearing the use of force except in self-defense in response to an increasingly aggressive China. It has also made efforts to solidify relations with the Quad countries. No satisfactory solution has been found on how to replace the canceled Aegis Ashore missile defense system. Various measures are being considered to shore up defense of the remote islands, including repopulation and stationing troops there.

The Japanese government continued to wrestle with the costs and feasibility questions of a replacement for its canceled Aegis Ashore system. The Japanese defense industry is advocating deploying a missile-defense system on a floating platform that will use the radar and other equipment from the abandoned land-based Aegis Ashore project. The floating platform option could be equipped with components of the Aegis Ashore system, allowing Japan to avoid the penalties for breaking its contract with the US. However, there are concerns over whether the transplanted system can provide seamless around-the-clock protection against ballistic missiles, as well as weather conditions. Additionally, the burden of maintaining equipment at sea could make it difficult to keep the system operational at all times.

Figure 3 Examples of floating platform plan. Source: Asahi

According to a private sector study commissioned by the defense ministry, the costs of building two additional Aegis-class ships and their equipment will be about ¥500 billion (about $5 billion), vis-à-vis the ¥400 billion cost of Aegis Ashore. An internal Japanese defense ministry document indicated that the alternative to the Aegis Ashore system will cost 1.5 times as much. Compounding the ministry’s problems, staffing the two additional MSDF destroyers needed for the alternative will be challenging due to shortfalls in recruiting personnel. Even if equipped with the Aegis Ashore land-based equipment, the ships could not easily be moved to the East China Sea where China is making increasing inroads. Renmin Ribao cited Japanese opposition parties’ objection to building two ships equipped with Aegis missile interceptors as being unconstitutional. It also took note of Japanese Defense Minister Kishi Nobuo’s announcement that Japan plans to develop standoff missiles that could be launched at targets from outside the range of enemy missiles.

Speaking at a Washington think tank in September, Kono Taro explained that although as foreign minister he referred to China as a grave concern, as defense minister, he must say that China is a security threat to Japan. In September Yomiuri reported that, due to China’s continued provocations in areas surrounding Japan despite the pandemic, Japanese Ground Self-Defense units conducted large scale drills in Nagasaki prefecture and Hokkaido to prepare for the defense of remote islands. A record number of 17,000 personnel participated in the Hokkaido exercises. Also in September, India and Japan signed a pact for the reciprocal provision of supplies and services between their armed forces, seen as strengthening Quad—with Australia and the US—efforts to contain China’s influence in the Indo-Pacific. Reviewing the fifth anniversary of the enactment of a set of new security laws in the middle of that month, Yomiuri assessed that they had strengthened the US-Japan alliance against China’s maritime push and North Korea’s nuclear and missile development programs. In November, the paper noted that the Japanese government’s unwillingness to use the word “threat” when discussing China for fear of provoking the PRC has proved ineffective as a deterrent and advised Tokyo to maintain relations with Beijing “while augmenting a military buildup that is firm enough not to give China the smallest opening to pounce upon.”

A columnist for the Japan Times argued at the end of September that Japan had spent too long on the defensive, and must frustrate China’s strategy of incrementally altering the status quo without incurring substantive costs. If provocative actions such as chasing Japanese fishing vessels inside Japanese territorial waters persist, the Japanese Coast Guard should selectively act against some intruding Chinese ships.

Concerned about Chinese purchases of water sources and tracts of land — particularly those on remote islands and near Self-Defense Forces bases–  the Japanese government said in October that it will establish a law to more closely monitor them. At present, it has no authority to collect personal information about owners and changing names on property registration documents is voluntary. The new law will enable the government to investigate for national security reasons. Earmarked in the Japanese government’s 2021 budget request is 6.2 billion yen to promote “workations,” combining work with vacation on its remote islands as a way to preserve the nation’s territory while also promoting tourism. The appropriation will partially subsidize the creation of satellite offices for companies, Wi-Fi development, the construction of new work space for hotel guests, and charter flight operation.

In October, three MSDF vessels anti-submarine drills in the South China Sea. The Japanese defense ministry gave no details on the geographical location of the drills, but noted that the three vessels would stop in Vietnam, which contests part of the South China Sea with the PRC, “to replenish supplies.” Global Times commented that China was firmly opposed to such activities and would continue to defend its sovereignty and development interests. Two of the Chinese vessels approached a Japanese fishing boat.

Also in October, Chief Cabinet Secretary Kato Katsunobu “strictly protested” the entry of Chinese Coast Guard ships into disputed East China Sea waters for three days and their refusal to leave despite repeated warnings, with the Chinese foreign ministry replying that “it is China’s inherent right to carry out law enforcement patrol in the waters of the Diaoyu Islands, and the Japanese side should respect this.” Two of the Chinese vessels approached a Japanese fishing boat.

Center-right Yomiuri Shimbun speculated that China’s recent intrusions into the area around the disputed Diaoyu/Senkaku Islands was related to Japanese participation in the Quad nations that oppose Chinese expansionism. The article noted that the Standing Committee of China’s National People’s Congress had begun deliberations on the specific duties of the coast guard which could lead to an increase in provocative actions in the disputed waters in cooperation with the Chinese navy.

A commentator for Japan Times characterized China’s recent intrusions into Japanese territorial waters—a record 111 consecutive days from April to August 2020 plus two Chinese coast guard vessels spending a record 57 hours and 39 minutes while engaging a Japanese fishing boat—as both a test for the new prime minister and a continuation of its policy of normalizing its presence in the area. Responding to the intrusion of an unusually large number of Chinese fishing boats into Japan’s Exclusive Economic Zone, the Japanese Fisheries Agency requested that the Japanese boats avoid those areas, to the annoyance of the impacted fishermen.

In a tightening of relations among Japan, India, the US, and Australia to counter Chinese pressure, Australia rejoined the annual Malabar exercises, having withdrawn in 2007 after pressure from China. In November, as India, US, Japan, and Australia began these, their largest naval exercises in more than a decade, Beijing complained of a “cold war mentality” and Japanese Chief Cabinet Secretary Kato termed the presence of Chinese ships in the contiguous zone off the Senkaku/Diaoyu islands for the 283^rd day this year “an extremely serious matter.”

During a visit to Hanoi, Suga, though never mentioning China by name, said that Japan would cooperate with ASEAN nations to establish the rule of law in waters in the region. He and Vietnamese counterpart Nguyen Xuan Phuc reached an agreement in principle on defining conditions for Japanese defense equipment and national security technology to be exported to Vietnam. In Indonesia, Suga emphasized Japan’s commitment to the Free and Open Indo-Pacific, also endorsing the Jakarta-initiated ASEAN Outlook on the Indo-Pacific. Suga and Prime Minister Joko Widodo agreed to work toward holding a second “two-plus-two” foreign and defense ministerial talks, Indonesia being the only ASEAN member to have such a channel. The two prime ministers also agreed to achieve a defense equipment and technology transfer agreement. As in Suga’s trip to Hanoi, the impetus for this, Chinese expansionism, was not mentioned.

Global Times, reacting to a Kyodo dispatch that Japan’s Defense Ministry is mulling the construction of what would be the MSDF’s largest destroyer in response to China’s growing activities in the East China Sea and North Korean missile threats, termed it an excuse to break through the limits of Japan’s peace constitution by hyping threats from neighboring countries.

Also in November, in a move with grave implications for the waters and islands disputed between the PRC and Japan, China’s National People’s Congress posted draft legislation that empowers the country’s coast guard to investigate and seize foreign ships venturing into territorial waters claimed by China, and to use weapons under certain conditions. Any construction work done without prior Chinese authorization would have those structures removed by the coast guard. On the following day, pointedly accompanying its article with a photograph of a China Maritime Surveillance ship patrolling around the Senkaku/Diaoyu islands, Global Times accused foreign media of “stirring up trouble” and averring that every country has the right to carry out waters and airspace under its jurisdiction, including the use of force.

In November, the Japanese Coast Guard was revealed to be test-flying the US-made SeaGuardian drone, which is able to patrol a wider part of the Pacific and allow the coast guard to concentrate more personnel and equipment in waters near the Diaoyu/Senkaku islands. Yomiuri reported that the Japanese government will replace over 1,000 of its drones “aimed from a national security standpoint at effectively eliminating Chinese-made units currently in use.” The new drones will be equipped with higher security functions. It was also revealed in November that, as part of its efforts to deter Chinese activities in and near its remote islands, the uninhabited island of Mageshima will become an SDF base in addition to serving for field carrier landing practice for US carrier-borne aircraft.

During this reporting period it was also revealed that Japan’s Defense Ministry, alarmed at a report that crucial defense subcontractors were going out of business, commissioned a consultancy to help them apply for tax incentives and subsidies. The goal is to ensure that existing technologies that are crucial parts of the supply chain do not disappear. Unlike China, Japan has no nationally operated weapons factories: all the SDF’s equipment is produced and supplied by private-sector companies.

Japanese Defense Minister Kishi Nobuo and Chinese counterpart Wei Fenghe in mid-December held their first discussion, via telephone, since Kishi took office in September. Kishi expressed concerns about Chinese ships encroaching on waters around the disputed islands. The two also discussed setting up a communications mechanism to prevent the escalation of air and maritime encounters, a topic long under discussion. No hotline has been installed. Elsewhere that same month, Kishi described to a domestic audience the security environment around the southwestern islands as , and said that Japan would develop new standoff weapons: anti-ship missiles that can target warships at greater distances around the chain, including near the Diaoyu/Senkaku Islands. This first major defense policy decision under the Suga administration would expand Japan’s anti-access area denial (A2AD) strategy to stop foreign forces from operating freely in waters close to its home territory.

Global Times in December reprinted Reuters’ report on the 1.1% increase in Japan’s fiscal year 2021 budget while omitting the phrases “to counter China’s growing military power,” against potential foes “including neighboring China.” China plans to raise its military spending 6.6% this year, the smallest increase in three decades” and to strike distant land targets “in China, North Korea, and other parts of Asia.” Reacting to the 1.1% increase, leading Chinese military newspaper Jiefang Junbao criticized Japan for “chanting” its defense-only principle while introducing military equipment that would practically refute this principle. This, the paper said, is bound to increase instability factors in the region and even incur a regional arms race.

In response to increasing Chinese incursions, Japan will assign 22 coast guard ships of 1,000 tons or larger to the East China Sea chain by 2023. Twelve currently patrol the Diaoyu/Senkaku area, while three others are stationed there for other purposes, such as watching for illegal operations by North Korean fishing boats. The conservative Sankei Shimbun daily disclosed that research and development is being conducted on a new type of weapon akin to domestic Tomahawks. If deployed on the Nansei Islands, they could reach Pyongyang and Beijing. However, since doing so might cause North Korea and China to attack Japan, Sankei opined that such concerns might discourage the project.

Global Times, although a frequent critic of what it sees as creeping Japanese militarism, predicted at the end of the year that China’s third aircraft carrier, carrier-based stealth fighter jets, and a newly developed frigate with integrated propulsion system will be among the new weapons debuting in 2021 and that “there is no doubt that China will continue to develop new, world-class weapons for years to come.”

As the year closed, Yomiuri, citing unnamed sources familiar with China-Russia relations, stated that the two states had agreed to aim missiles at Japan or other US allies in Asia if the United States deployed missiles in those nations. German defense minister Annegret Kramp-Karrenbauer, responding to reports that the frigate Hamburg would be dispatched to the Indo-Pacific out of concern for a rising China, confirmed that deployment routes, dates, port visits, and potential participation in military exercises were being discussed, adding that Germany’s engagement in the region is not directed against anything or anyone but rather about working for stability and prosperity in a rules-based order.

Culture

The annual Japan-China opinion poll conducted by Japanese nonprofit think tank Genron NPO found that 89.7% of Japanese respondents have an unfavorable or somewhat unfavorable impression of China, up 5 percentage points from last year. More respondents cited China’s behavior in the international arena and its military buildup as reasons.

Chinese authorities canceled the anti-Japanese war-themed drama series Leiting Zhanjiang (Lightning General) because of its “excessive entertainment factor.” Soldiers of the party’s famed 8^th Route Army were portrayed as sleeping in a luxurious villa and having carefully styled hair.

Prickly Sino-Japanese relations and pandemic notwithstanding, 8^th century cultural treasures loaned to a Shanghai museum was returned to the Toshodaiji temple which had lent them, enabling the performance of a rite that the temple had performed annually for eight centuries without fail.

Xi’s failure to visit the Daming Temple during his November visit to Yangzhou was seen as a subtle snub to Japan. The temple, associated with Tang dynasty-era monk Ganjin (Chinese: Jianzhen) is seen as a symbol of historical ties between Japan and China.

Taiwan

In September China expressed concern with Suga’s appointment of Kishi Nobuo, a known friend of Taiwan, as defense minister, with PRC foreign ministry spokesperson expressing China’s hope that “the Japanese side will abide by the “one China” principle and refrain from any form of official exchanges with the Taiwan region.” Kishi, who is former prime minister Abe’s younger brother and grandson of former hardline prime minister Kishi Nobusuke, chairs a cross-party group of Diet members that seeks to promote exchanges with Taiwan; in 2015, he served as guide for then-opposition leader and now president Tsai Ing-wen during a trip to Japan.

Earlier in 2020, former Prime Minister Mori Yoshiro attended the funeral of former Taiwan President Lee Teng-hui. He evaded answering questions about Taiwan and Japan developing security cooperation in the face of China’s military intimidation, but said that Prime Minister Suga had called him to express the hope of talking with President Tsai “if there were an opportunity.” Taipei Times observed on Sept. 20 that the interpreter did not translate that into Chinese. Nonetheless, both Taiwanese and Japanese officials declared that there were no plans for a conversation.

In October Taiwan’s Legislative Yuan’s friendship association for the East Asian region officially invited former Prime Minister Abe to give a speech to the LY. It noted that Abe had made it possible for former President Lee to address the Diet. The association’s president, citing the strong friendship between the two countries, hoped that in the future high-level government officials would be able to visit one another.

Near the end of the year, Japanese press agency Jiji reported that five young Taiwanese members of the Fukushima Zenshin-dan visited the tsunami-nuclear meltdown area of Fukushima, sponsored by the Taiwan Society of Tokyo. The group, which is working to dispel negative rumors about radiation levels in Fukushima, will hold an event in Taipei to report about progress in the area’s reconstruction.

In late December, Japanese State Minister of Defense Nakayama Yasuhide urged US president-elect Biden to “be strong” in supporting Taiwan in the face of an aggressive China and quickly announce a policy on Taiwan so that Japan could prepare its response in accordance with it.

Conclusions: Implications for the Future

The economies of both China and Japan rebounded well from the pandemic, suggesting a strong start to 2021, with their trade relations with each other an important part of the recovery. These should provide a mitigating effect on enduring political and territorial disputes where no resolution seems likely. Xi’s long-awaited state visit to Tokyo will depend on whether the two sides can agree on the text of the communiqué that the Chinese side has made plain is a precondition for the visit.