By Carlton Vann, MBA '08
In recent years, the American media has been captivated by China's meteoric rise, often overshadowing the significant role Japan plays in Asia. However, the relationship between these two Asian giants is far more intricate than the occasional diplomatic spat that makes headlines. Speaking on Wednesday, February 6, 2008, to a crowd of about 35 students and faculty at the Weatherhead East Asian Institute of Columbia University, Professor Claude Meyer of Sciences-Po in Paris delved into the political and economic dynamics between China and Japan, exploring their rivalry for leadership in Asia. The event was cosponsored by the Center on Japanese Economy and Business, the Alliance Program, and the APEC Study Center.
Economic Interdependence and Competition
Professor Meyer began by highlighting the economic interdependence between China and Japan. In the 1990s, as Japan's economy stagnated, China experienced rapid expansion, leading Japanese companies to heavily invest in China. This economic relationship is founded on complementary comparative advantages: Japan possesses crucial technology and capital, while China offers low-cost manpower for manufacturing. Japan now stands as the second-largest source of Foreign Direct Investment in China, trailing only Hong Kong. Interestingly, despite being the two largest economies in Asia, they do not directly compete in export markets due to their production of different goods. However, competition over natural resources, such as Russian oil, has emerged and is expected to intensify.
In contrast to their economic ties, political relations between China and Japan remain strained. Japanese leaders often characterize their relations with China as "economics hot, politics cold." The historical backdrop of World War II significantly influences this tension. While Japanese leaders believe they have made clear apologies for their colonial past, Chinese leaders consider these apologies insincere. The resurgence of this historical antagonism is closely tied to the rise of strong national identities in both countries. In China, rapid economic growth has resulted in significant income disparities and social unrest. To divert attention from these issues, Chinese leaders focus on Japan's actions during WWII, aiming to bolster national cohesion. On the other hand, Japanese political leaders seek to enhance the country's international influence by transitioning into a "normal country" less reliant on its military alliance with the U.S. This shift has led to a rightward political trend in Japan, contributing to deep-seated mistrust of China.
The underlying source of tension between China and Japan lies in their rivalry for leadership in Asia. If China sustains its current economic growth and modernizes its military, it could become unrivaled in Asia in the next quarter-century. However, Japan, having been the dominant country in Asia for much of the twentieth century, is reluctant to relinquish its position to China. For Japan, the challenge is to maintain its economic leadership while expanding its security influence in Asia. Meyer asserts that both countries are vying for power, yet neither can claim definitive economic and political leadership in Asia. This rivalry is likely to be governed by a classic Chinese strategic precept: "Consider your neighbors both as friends and enemies."