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Japan's new prime minister says he wants a stable relationship with China. But as the US escalates its offensive against China on all fronts, Tokyo may find it harder to walk its fine line

By NewsChina Updated Dec.1

Days after becoming Japan’s longest-serving prime minister, Shinzo Abe unexpectedly resigned in August over a chronic health condition. On September 16, he was succeeded by Yoshihide Suga, who was Chief Cabinet Secretary since 2012, one of Abe’s most trusted aides.  

Following an unprecedented period of political stability in Japan’s top leadership in post-WWII history, the power change leaves many questions about the country’s direction. One major policy under close watch is the world’s third-largest economy’s position in the escalating tension between China and the US.  

Abe’s Legacy
Its relations with the US and China have been critical for Japan. While the US is Japan’s military ally, security guarantor and its second-largest trade partner, China is Japan’s largest trade partner and a close neighbor. When Abe took office in 2012, the Sino-Japanese relationship was at its lowest point in years, following Tokyo’s decision to nationalize the disputed Diaoyu/Senkaku Islands. In 2013, Abe’s visit to the Yasukuni Shrine where some Japanese war criminals are interred further strained China-Japan relations. 

But Abe eventually stabilized Japan’s relationship with China. Under his iconic Abenomics policy, Abe boosted economic ties and expanded tourism exchanges with China, making Japan the most visited destination for Chinese tourists in 2019.  

Abe also made a keynote trip to Beijing in October 2018, the first in seven years, which succeeded in breaking the diplomatic ice between the two countries.  

In the meantime, Abe strengthened Japan’s security ties with the US. During the Obama administration, Abe managed to convince Washington to extend its security guarantee to cover the disputed Diaoyu/Senkaku islands. Abe also proposed the so-called “security diamond,” which Washington eventually adopted as its Indo-Pacific strategy.  

Under the administration of US President Donald Trump, Abe faced mounting pressure from Washington. Not only has Trump lambasted the US-Japan trade relationship as unfair and pulled out from the Trans-Pacific Partnership free trade bloc, Washington also demanded that Japan quadruple its financial contribution to the cost of stationing American troops in the country.  

Nevertheless, Abe emerged as one of the few Asian leaders to have established personal ties with Trump in the past few years. By the end of 2019, he had golfed with Trump three times, visited his Mar-a-Lago club twice and nominated Trump for the Nobel Peace Prize.  

Against the backdrop of increasing economic and political pressure the Trump administration put on China, Japan followed the US and banned China’s tech giant Huawei from involvement in its 5G infrastructure and offered financial incentives for Japanese firms to relocate from the Chinese mainland to Japan or Southeast Asia.  

In the meantime, Abe maintained its political reengagement with China. In the two meetings between Abe and Chinese President Xi Jinping in June and December 2019 in Osaka and Beijing, the two leaders agreed to usher the bilateral relationship into a “new era.” 

Abe also invited Xi for a State visit to Japan in April 2020, which would have been the first visit made by a Chinese leader since 2008, were it not for the Covid-19 pandemic. The visit has been postponed indefinitely. 

Policy Continuity
Most analysts believe that Suga will stick to Abe’s balancing policy between the US and China amid rising tension between the world’s two largest economies. Upon assuming office on September 16, Suga said his top priority is to overcome the Covid-19 crisis, and he will continue the Abe-era policy, including Abenomics.  

Regarding Japan’s foreign policy, Suga acknowledged that “the situation surrounding Japan is becoming more difficult,” and said that he will strengthen Tokyo’s alliance with the US, while seeking to establish stable relationships with China and Russia.  

Suga also said that he would continue to pursue objectives including the “free and open” Indo-Pacific policy. The issue was also highlighted in his talk with Trump on September 20. According to the White House, Trump said that the US is “ready to continue pursuing the vision of a free and open Indo-Pacific that he and former Prime Minister Shinzo Abe forged.” 

In the past months, Washington has actively pushed its Indo-Pacific strategy into a NATO-like military alliance between the US, Japan, India and Australia, known as “the Quad.” In the latest annual gathering of foreign ministers of the Quad held in Japan on October 6, US Secretary of State Mike Pompeo called for the group to establish a “true security framework” to counter China’s “exploitation, corruption and coercion.”  

But Suga is not ready to go that far. In contrast to Pompeo’s confrontational rhetoric against China, Suga did not directly mention China and said that the pandemic shows “exactly why right now is the time that we must further deepen coordination with as many countries as possible that share our vision.” 

In a televised debate on September 12 against his contenders within Japan’s ruling Liberal Democratic Party (LDP), Defense Minister Shigeru Ishiba and former Foreign Minister Fumio Kishida, Suga explicitly opposed Ishiba’s call to create an Asian version of NATO, warning that “an Asian NATO would risk dividing the region between allies and enemies.” 

Instead, Suga argued that Japan should maintain high-level engagement with China to address disputes between the two countries.  

On September 25, in his first talk as prime minister with Xi over the phone, Suga said stable relations between Japan and China are “extremely important,” and agreed with Xi to cooperate closely at a high level to boost bilateral ties.  

According to Professor Xing Yuqing, director of Asian Economic Policy at the National Graduate Institute for Policy Studies of Japan, as Abe’s long-term ally and aide, Suga’s landslide victory in the LDP’s leadership election suggests there is a consensus among the ruling LDP to maintain Abe-era policies.  

As interim prime minister, Suga assumed Abe’s tenure and will need to call a general election before September 2021. It remains unclear when Suga will call the election. Polls suggest that more than two-thirds of the Japanese public support Suga’s cabinet and it is widely expected that Suga will win a new and full term.  

“Suga has the potential to become a strong leader like Abe,” Xing told NewsChina, “It is very likely that Japan will enter a ‘Suga-era,’” he added.  

Fumiko Sasaki, a specialist in Asian studies at Columbia University, told NewsChina that it is in Japan’s interest to have a strong leader at a difficult time given the global pandemic and the US-China rivalry. “Without strong leadership, Japan’s foreign policy can easily swing between the pro-US and pro-China factions, and the country won’t be able to adopt a stable and cohesive foreign policy,” Sasaki said.  

Not Plain Sailing 
Not all analysts believe that the bilateral relationship between China and Japan will be as stable as desired. Yang Bojiang, an expert on Japanese studies from the China Academy of Social Sciences, argued that while Suga will not change Japan’s fundamental policy toward China, based on his past policy record Suga could adopt a more proactive policy in boosting economic ties with China, but will have a tougher stance on political issues.  

During Abe’s tenure, Suga was a major supporter of Abe’s policy to attract Chinese tourists, despite strong opposition from security agencies. But Suga is known to support a tougher policy regarding the territorial disputes with China.  

According to Japanese officials, Suga expressed concern over the disputed islands in the East China Sea and the newly enacted national security law in Hong Kong in his talk with Xi. Suga also told reporters that he did not discuss plans regarding Xi’s postponed state visit to Japan.  

Ignoring Suga’s comments that no doubt irked Beijing, China’s State-run English media outlet China Global Television Network (CGTN) reported that Suga pledged that Japan will work with China to ensure the signing of the Regional Comprehensive Economic Partnership agreement (RCEP) within the year, speed up the negotiation of a Japan-China-South Korea free trade area and maintain the stability of the regional industrial and supply chain. 

The report led to some optimism among Chinese experts regarding economic ties between the two countries. But given Washington’s Indo-Pacific agenda, Japan’s eventual stance on the RCEP may be uncertain.  

First announced at the ASEAN summit in 2012, the RCEP would include all 10 ASEAN countries and China, Japan, South Korea, Australia and New Zealand to make the world’s largest trade bloc. But in late November 2019 when India pulled out from the initiative, it dealt a serious blow to the negotiation process. In response, Japan’s Deputy Minister for Economy, Trade and Industry Hideki Makihara told Bloomberg that Japan would not sign the RCEP without India. 
Eventually, all the remaining 15 nations have largely completed negotiations on the text of the agreement and the group announced “significant progress” in August, with the deal said to be ready to sign in November 2020.  

However, as the US stepped up its efforts to forge an economic and military alliance against China in the region, the fate of the RCEP, a trade deal considered as being led by China, could still be in jeopardy.  

In an article published on Project Syndicate, Minxin Pei, professor of government at Claremont McKenna College, argued that the biggest challenge Japan faces is that Tokyo will find it increasingly harder to continue its geopolitical balancing act between the US and China.  

Pei said that Japan will face pressure from Washington to tighten restrictions on key technologies that it supplies to China. With more than US$38 billion in direct investment and nearly 14,000 firms operating in China, Japan would find it “practically difficult, economically ruinous and diplomatically costly” to comply with the requests of the US, Pei said.  

So far, Washington’s technology bans on Chinese firms have led to a surge in sales in Japan’s semiconductor sector. According to data released by the Semiconductor Equipment Association of Japan (SEAJ), between April and August, monthly sales of Japan-based semiconductor firms experienced an average 20 percent increase year-on-year, to a large extent driven by increasing demand from China. But as Washington continues to tighten the screw, Japan’s semiconductor sector could soon feel the squeeze.  

On the security front, Pei said that in the next few years, Tokyo could face increasing pressure from the Pentagon to deploy medium-range US missiles on Japanese soil, something that could trigger a crisis between China and Japan. “These troubles illustrate once again the plight of a country squeezed between two dueling geopolitical giants - and the scale of the diplomatic challenge facing Japan’s new prime minister,” Pei said.