A PRAGMATIC PARTNERSHIP

Warming ties bring opportunity for cooperation between China and Japan

TThe author is a researcher with the China Institutes of Contemporary International Relations he relations between Asian neighbors China and Japan have got back on track with the exchange of visits by Chinese Premier Li Keqiang and Japanese Prime Minister Shinzo Abe in the same calendar year. As the world’s second and third largest economy respectively, the warming of ties between China and Japan is not only good news for their two peoples but also for the world economy, especially against the backdrop of the prevailing trade protectionism.

Warming ties

Since China overtook Japan to become the world’s second largest economy in 2010, its stature has been growing in the global economic structure. In 2014, China’s total economic output exceeded $10 trillion for the first time, taking it even closer to the center of the world stage. There are three economies today that have a GDP of more than $10 trillion—the United States, the European Union, and China. This is the reason economists think a three-pole economic system is emerging while Japan has fallen behind.

China shares the first place with the U.S. vis-à-vis the total import and export trade volume while its exports are 1.4 times that of the U.S. today, Chinese border ports are the busiest hubs of visitors, capital, goods and information or data.

In the past seven years, the heads of major countries led delegations to China, building landmark trade and economic relations and promoting the expansion and upgrading of industrial chains. Due to frozen China-japan political relations, Japan failed to catch up with the other countries in cooperating with China, and the division of labor and trade and economic relations between the two lagged behind the world average. Abe’s visit was a journey to gloss over the gap.

With trade protectionism, populism and anti-globalization prevailing under U.S. President Donald Trump’s administration, trade frictions have brought great pressure to China-u.s. and Japan-u.s. economic ties. China-japan relations, therefore, need to be more stable to withstand the potential risk. The leaders of both countries are actively undertaking responsibilities for the development of their nations and also for regional stability and prosperity. They chose to restart normal exchanges and return to the right track.

In fact, as early as in November 2014, the leaders took the initiative to create conditions for multilateral meetings and during the Asia- Pacific Economic Cooperation Summit in Beijing, reached a four-point agreement on improving bilateral relations. Since then, both countries have been promoting non-governmental exchanges.

In his meeting with a Japanese nongovernmental delegation in Beijing on May 23, 2015, Chinese President Xi Jinping emphasized that “the China-japan friendship is rooted in the people, and the future of the bilateral relationship is in the hand of the people of the two countries. The more obstacles we face in bilateral relations, the more we need to strengthen people-to-people exchanges, creating conditions to improve the bilateral relationship.” He also said the two countries should “manage historical issues, and prevent new issues from emerging” to overcome the “stumbling blocks.”

This set the tone for the development of China-japan relations in the new era.

This year, Premier Li Keqiang visited Japan in May to attend the seventh meeting of the leaders of China, Japan and South Korea, an important opportunity to strengthen the normalization of bilateral relations. It was followed by Xi meeting Abe in Vladivostok in September on the sidelines of the Eastern Economic Forum during which the Chinese president told Abe the Belt and Road Initiative can be a new platform for the two countries to deepen cooperation.

Abe’s official visit to China and the signing of more than 50 cooperation agreements during the visit have shown the people of both countries the fruits a strategic and mutually beneficial relationship can bear.

Wider cooperation

Abe’s visit, coming in the wake of the fourth industrial revolution, shows adaptation to the requirements of a fast changing world. It provides an opportunity for the two countries’ manufacturing industries to upgrade their capacities. Each era has its leading technologies and industries. Take the 1990s for example. The information technology (IT) revolution in the United States’ Silicon Valley ushered in a golden decade for the U.S. economy and propelled the rest of the world into the IT era. In this new era, people can learn from that revolution.

In the IT and Internet era, technologies are changing the mode of manufacturing and promoting industrial upgrading and progress. As globalization deepens, crossborder capital movements have become much more frequent, technological innovations are becoming popular worldwide, and industrial and product standards are becoming internationalized. The Internet of Things has enabled cross-border integration of manufacturing industries, which will accelerate the globalization of production. Enterprises from all countries are integrated and interdependent, resulting in crossborder division of labor and large-scale intra-