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Part 3: Economics overrides
anti-Japan sentiment

By Macabe Keliher

Part 1: The dragon seizes market share
Part 2: Replacing US in Asian export market

BEIJING - The anniversary of the 1937 Nanjing Massacre last December was surprisingly subtle and subdued. In contrast to years past, when reports and exhibitions of atrocities and Japanese cruelty characterized the remembrance, recent ceremonies emphasized peace and harmony. A local children's troupe sang peace songs together with a Japanese choir, and a "Nanjing Peace Declaration" was read, calling on "the world's peace-loving people to rise to protect peace and resist war".

Japan has not been completely forgiven, to be sure, and harsh words about never forgetting history, and inflated death tolls, still circulate. (The 65th anniversary was observed on December 13. Many estimates place the death toll around 250,000-300,000.) Yet the fiery anti-Japanese sentiment has now taken a back seat to the practical ideals of partnership and Asian integration, or, as the latest issue of the influential journal Strategy and Management calls it, "new thinking on Japan" for a "foreign-relations revolution".

In an effort to drop the victim mentality and assume the role of a rising nation with world-power status, China is engineering a complete reversal of its attitude toward Japan, aiming to cement a relationship necessary to assume its leadership role in Asia. Where ever-increasing demands for Japanese apologies and talk about the "hurt feelings of the Chinese people" once permeated Beijing-Tokyo relations, "We are now trying to look beyond the past. The model is France and Germany in the post-World War II world," says a high-ranking official in Beijing's Ministry of Foreign Affairs, who asked not to be named.

In the past six months, relations between Beijing and Tokyo have reached their warmest temperatures in modern history. Day-to-day contacts between governments at levels throughout the various bureaucracies are routine. Beijing has begun to allow Japanese citizens to visit China without applying for visas. When Chinese President Hu Jintao and Japanese Prime Minister Junichiro Koizumi met last May at the Group of Eight conference of industrialized nations in France, it was the first time a Chinese leader had not publicly demanded an apology for Japan's war crimes against China.

What followed instead was an announcement on further cooperation and a strengthening of relations when leaders met at the summit of the Association of Southeast Asian Nations (ASEAN) last October on the Indonesian island of Bali. Furthermore, criticism of Koizumi's annual visits to Tokyo's Yakasuni War Shrine, the last in January, has been kept to a minimum, as has criticism of Japan's recent deployment of troops to Iraq - events that previously would have sparked domestic outcry and international criticism from China. The government here even attempted to change the name of the Nanjing Massacre Memorial Museum to the Nanjing International Peace Center, but it had to back down in the face of violent public protests. Still, efforts are under way to reshape public opinion, but it will take years to undo years of China's shrill anti-Japanese propaganda.

While such real changes are being orchestrated by the central government, academics and influential think-tank figures here have been pushing the ideological envelop for closer ties with Tokyo over the past few years. Debates began in the late 1990s as economic relations strengthened and discussions arose about making China a "big country" (daguo). Opinion pieces and editorials were published, with titles such as "Sino-Japan relations ought to have a grander vision". These officially sanctioned pronouncements culminated in the influential Strategy and Management journal running a series in late 2003 about how to improve relations with Japan. The journal of the government policy think-tank China Institute of Contemporary International Relations, Contemporary International Relations, devoted the entire November 2003 issue to "The Future for Sino-Japanese Relations"; its pages were filled with sympathetic explanations of Koizumi's shrine visits honoring the war dead, and calls for closer and stronger ties.

Japan as Number 1
The official line, of course, is still to hold Japan accountable. "Politically Sino-Japan relations are at a low ebb," began one interview with a Foreign Ministry official. "The Japanese prime minister insists on visiting the war shrine and this hurts the feelings of the Chinese people." Among those memorialized at the shrine are known war criminals.

But press a little and economics takes over.

"China normalized relations with Japan in the 1970s, and when Japan apologized over some of those emotional facts ... it is the correct understanding of history," the official continued when asked about discussions on improving relations. "Now Japan is most important economically; it has become the largest investor in China, and China's diplomatic strategy is to advance a peaceful regional environment to facilitate domestic growth. It is natural to bring out two countries closer together. We must be forward-looking."

Japan has become a linchpin in China's economy. By of the end of 2002, the Japanese had pumped in US$36.34 billion in foreign direct investment, or 8.11 percent of China's total utilized FDI, making Japan China's largest foreign investor, according to the Chinese Ministry of Commerce. And by investing in high-tech industries the Japanese also bring with them all the requirements to upgrade China's economy in value-added manufacturing and management. In 2002, Chinese products became Japan's largest imports for the first time, accounting for 18.3 percent of Japan's total imports, surpassing United States' products, which were 17.1 percent of total imports. And China became one of Japan's largest export markets, second only to the US. That was the same year two-way trade between the China and Japan first exceeded $100 billion, reaching $101.9 billion in 2002, and $120 billion in the first 11 months of 2003.

Given the unprecedented amount of trade between the countries, Zhao Jinping, director of the Department for Foreign Economic Studies at the Development Research Center of the State Council, has been advocating a free-trade bloc comprising China, Japan and South Korea - something unthinkable just five years ago. "It would not take much time to complete the process of East Asian economic integration," he said.

Precedents for China's about-face
Furthermore, Japan is China's largest financial donor, "more than all other governments combined", according to Feng Zhaokuei at the Nanjing Institute for International Relations. Feng says Japan accounts for more than 60 percent of China's official development assistance (ODA) received. About 25 percent of the funding for all of China's infrastructure projects between 1994 and 1998 - including roads, railways, telecom systems and harbors - came from Japan, says Feng.

This was a big factor in 1997 when then president Jiang Zemin became the first Chinese head of state to visit Japan. Instead of giving thanks for the cash, however, he demanded apologies for Japan's World War II crimes. He got none and Japan began to talk about cutting off ODA to China.

The real pieces are almost impossible to link together, but the puzzle picture can be inferred. It was about this time that Beijing began to think about how to get beyond the apology. "Beijing came to the understanding that if it wanted to be a leader in Asia, then it must bring in Japan. It needs to make Japan feel part of the region, and cannot afford to continue to isolate it," said one European diplomat in Beijing, asking not to be identified. Op-eds and think-tank publications began to discuss China's regional and global role, fitting Japan into a larger economic and security picture. "We need a new thinking towards Japan. We need to be practical and think from national security, not our emotions," said Feng.

Sino-Japanese security cooperation
One of the most important arguments now circulating for bettering Sino-Japanese ties is the need for security cooperation. Given its recent economic and political developments in the region, Beijing now finds itself in a position of advocating regional stability and economic prosperity - as opposed to exporting revolution, as it did in the past. Promoting stability and economic expansion are seen as crucial for China to assume a leadership role in Asia.

Calls to drop the victim mentality and adopt the role of a responsible power are carried one step further in the security debate: "The two neighbors should make common efforts, with a view to establish strategic relations of historical significance, to strengthen exchanges and mutual understanding, seek common interests, expand cooperation, reduce contention and explore a road for peaceful co-existence and joint development," said Sun Cheng, research professor at the China Institute of International Relations, a Foreign Ministry think-tank.

Such developments are part of China's long-term strategy, says Zhou Guigen of the Nanjing Institute of International Relations. China's "highest strategy is to realize the greatness of the Chinese people", he wrote in the last issue of Strategy and Management. This involves three things: becoming a fully developed country in the 21st century, securing peace and stability along the borders and in the region, and completing the assignment of unification (meaning Taiwan). "The US is the country most capable to hinder China in its rise," he said. "We need to take care of those countries with essential diplomatic relations with the US. This policy points to a diplomatic revolution in our relations with Japan as most necessary."

Be that as it may, the Chinese people are having a hard time catching on. The government has invested 50 years in nurturing anti-Japanese sentiment and is now finding it hard to get them to embrace a land and people they were taught to hate. The name change for the Nanjing Massacre Memorial Museum, for instance, was protested so furiously by residents that the government had to shelve the idea. Recent anti-Japanese protests in Xi'an over a mocking skit, and in Hainan over a Japanese-funded prostitute orgy, are reminders of simmering public resentment the government must be wary of (see The Xi'an incident: No love affair, November 21, 2003). "The government still must pay attention to public opinion," said the Foreign Ministry official who spoke both of China's hurt feelings and the need to advance Sino-Japanese relations.

Perhaps, but Beijing has done a fairly good job of ignoring public attitudes so far, and given the forward momentum of political and economic Sino-Japanese relations, it looks as though public opinion will have to change as well.

As an editorial in the International Herald Leader put it: "The correct way to shape people's emotions is to use party cooperation to facilitate a breakthrough in Sino-Japan relations."

While this correspondent was riding in a taxi in Shenzhen, one of China's special economic zones, recently with a Taiwanese colleague, the driver gave the thumbs-up sign. "Taiwanese are good, they come invest a lot of money here. But if you were Japanese I would kill you!" He said it a bit too cheerily. But the Japanese invest more, no? "Yes, but the Japanese dropped a bomb in my village and killed my neighbor."

Macabe Keliher is an independent historian and journalist, and a regular contributor to Asia Times Online. His website is

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Feb 12, 2004

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