Japan revealed its intentions to make substantial changes to its defence policies on the pretext of China’s increasing military might and North Korea’s nuclear weapons. Japan has maritime border with China. Japan’s new national defence policy has acquired importance in the wake of recent rise of tensions between China and Japan when a Chinese trawler hit a Japanese petrol boars near disputed chain coral islands on which both countries have ownership claims.
China has been strengthening its military utilising its trade surplus and foreign currency reserves due to which its neighbours such as India with which it has border disputes, Japan with which it has disputes on ownership over coral islands in South China Sea, and Taiwan on which it has ownership claim have rising concerns. The US is also worried with China’s military build-up as it feels China is threatening the US’ interests in South Asia and East Asia regions. The secretary of state for the US Ms Hillary Clinton expressed openly her concerns that China was ascertaining its domination in the region.
Recently, the US conducted military drill with South Korea in Yellow Sea after North Korea fired artillery shells on a disputed South Korea’s island near maritime border. Though, the US said the military drills were part of regular exercises, its main aim was to issue veiled warning to Chinese military, which has been ascertaining its position in the region. The US accused China for not reigning in North Korea’s behaviour during recent tensions in Korean peninsula. It has 50,000 troops stationed in a Japanese island Okinawa and 28,500 troops in South Korea.
Article first published as Japan Rejects Apology to China, Rift Deepens on Technorati.
The rift developed between the Asian giants China and Japan with Japan taking into custody, a Chinese trawler captain Zhan Qixiong. Even though the captain was released amid growing pressure from China, rift continued to mount between the two countries. However, Japan denied it released the Chinese captain because of pressure from China.
Chinese people are still aware of hard times they faced during Japanese colonial occupation of China and are inclined to protest even a small instance of disrespect. As both the countries have claims on disputed island chain known as Diaoyu in China and Senkaku in Japan, where the trawler collision with Japanese patrolling boats took place, the latest issue expanded beyond releasing the arrested men.
It is now understood whether only the captain was arrested and released or his crew was also involved in the incident. The BBC News reported only a captain’s arrest, but CNN reported three days ago that the captain and his crew were arrested.
Oil rich islands
The dispute on Senkaku islands in East China Sea involves potentially lucrative drilling rights in waters. The territorial dispute also hinges upon the collection of bird excrement by the Japanese and medicinal herbs available on the islands. There is also a dispute whether the islands could really be called so, as they were remains of a dead volcano. If they are not islands, then the international territorial laws will not be applicable.
BBC News | 25 September 2010 | 10:30 GMT
Japan has turned down China’s demand for a formal apology after releasing a Chinese fishing boat captain who was detained for two weeks in Okinawa. Zhan Qixiong was arrested earlier this month after his trawler collided with two Japanese patrol vessels near disputed islands in the East China Sea.
Despite his release, the two countries remain locked in their worst diplomatic row for years. Tensions were further heightened when China detained four Japanese this week. The four who were working for a Japanese construction company were questioned on suspicion of filming in a military zone.
Mr Zhan left Okinawa on Friday evening on a specially chartered plane sent by the government of China. After his release, the Chinese foreign ministry issued a statement reiterating its "strong protest" and what it called its "indisputable" claim to the islands. "The Japanese side must make an apology and compensation for this incident," the statement said.
A Japanese foreign ministry spokesperson described China’s demand as "totally groundless" and said it could not be accepted. Tokyo insisted it had handled the case strictly in accordance with its own laws.
After landing at Fuzhou Airport in Fujian Province, Zhan Qixiong said he was thankful to be free and repeated his claim of innocence. "The Diaoyutai Islands are a part of China. I went there to fish. That’s legal," said the angler. "Those people grabbed me – that was illegal," he said.
Reuters | Sep 19, 2010 | 8:44pm IST
China suspended high-level exchanges with Japan on Sunday and promised tough countermeasures after a Japanese court extended the detention of a Chinese captain whose trawler collided with two Japanese coastguard ships. The spat between Asia’s two largest economies has flared since Japan arrested the captain, accusing him of deliberately striking a patrol ship and obstructing public officers near uninhabited islets in the East China Sea claimed by both sides. "China demands that Japan immediately release the captain without any preconditions," Foreign Ministry spokesman Ma Zhaoxu said in a statement on the ministry’s website (www.mfa.gov.cn), repeating that Beijing viewed the detention as illegal and invalid. "If Japan acts willfully despite advice to the contrary and insists on making one mistake after another, the Chinese side will take strong countermeasures, and all the consequences should be borne by the Japanese side," Ma said.
Japan’s decision has "seriously damaged Sino-Japan bilateral exchanges,” Chinese state television added, reading out a separate response from the Foreign Ministry. China has suspended ministerial and provincial-level bilateral exchanges with Japan, halted talks on increasing flights between the two countries and postponed a meeting about coal with Japan, the report said. Xinhua news agency added that Chinese vice Foreign Minister Wang Guangya had made "solemn representations" to the Japanese ambassador, Uichiro Niwa, and expressed "strong indignation" over the captain’s detention. Japan’s Kyodo news agency reported that the trawler captain’s detention,
Reuters | Sep 14, 2010 | 4:36pm IST
The yen hit a 15-year high versus the dollar on Tuesday after Japan’s Prime Minister Naoto Kan won a ruling party leadership vote, while concerns about a shaky recovery knocked global stocks off a 4-month peak. The euro fell against the dollar while euro zone bond prices gained as a sharp fall in German investor morale suggested the recovery in Europe’s largest economy is poised to lose momentum. In Japan, Kan’s victory over party heavyweight Ichiro Ozawa, who had made more strident calls to curb the yen’s rise, raised speculation that Japanese authorities would not intervene imminently. The yen firmed to 83.07 per dollar, its strongest since mid-1995.
European shares were steady while U.S. equity futures pointed to a slightly lower opening on Wall Street on nervousness that U.S. retail sales data at 1230 GMT could give another bleak picture of the U.S. economy. These concerns helped push the MSCI world equity index down 0.1 percent to 297.93. Earlier, the index had hit a four-month peak of 298.50 as stocks benefited from a wave of more optimistic sentiment generated by solid Chinese data and relief at new Basel III banking rules. "Trading in global equity markets is dominated by short-term views. Equity strength is fraught with dangers as investors are very fearful about what is around the corner," said Maurice Pomery, managing director at consultants Strategic Alpha. Investors’ search for safe-haven assets also set gold on track for its biggest one-day rise this month, while the dollar fell below parity versus the Swiss franc for the first time since December last year.
Reuters | Thu Sep 9, 2010 | 9:11pm IST
Stocks and the euro rose on Thursday after stronger-than-expected U.S. data on labor conditions and trade activity, raising hopes the tepid economic recovery would accelerate. The yen edged near to a 15-year high against the dollar as investors bet Japanese authorities are not yet ready to curb the currency’s strength. Crude prices rose and bonds fell. New claims for unemployment insurance fell more than expected last week to their lowest level in two months and the U.S. trade deficit narrowed more than forecast in July as exports shot to their highest level since August 2008, painting a rosier picture for economic growth.
"The news flow has been positive over the last few days compared to what was through most of August," said John Toohey, vice president of equity investments at USAA in San Antonio, Texas. "You put that together with the fact sentiment among investors had turned more bearish than it has been since early 2009, you are ripe for a rally." Fears of a double-dip recession have kept investors at bay and the stock market in a tight trading range for several months. The Dow Jones industrial average added 61.91 points, or 0.60 percent, to 10,448.92. The Standard & Poor’s 500 Index rose 9.49 points, or 0.86 percent, to 1,108.36. The Nasdaq Composite Index gained 17.27 points, or 0.77 percent, to 2,246.14. Japan’s Finance Minister Yoshihiko Noda said the ministry was conducting simulations on forex intervention, though the Japanese currency hardly budged as the perception remains that Tokyo is unlikely to intervene until the U.S. currency falls near 80 yen. Noda’s comments were also undermined as Bank of Japan Governor Masaaki Shirakawa said he did not talk about currencies and monetary policy at a government meeting.
Despite strong growth figures recorded in the Europe, Germany in particular, and the United States economic growth in both regions will remain at slow pace as per the IMF chief economist Olivier Blanchard. His remarks were published on Monday in a French newspaper Le Figaro, Reuters reported. He reiterated that the euro zone governments should deliver credible plans so as to reduce their budget deficits for medium terms. Instead of stipulating target dates only the contents of the plans would reassure financial markets about the financial health he remarked. “Whether it is 2013 or 2014 is not important,” he said.
Impact on Asia
A slowdown in the US would have automatic impact on growth in the short term Mr. Blanchard was quoted as saying. He might be referring to the dependent on exports to the US of the major players of Asia China, Japan and India. Exports from the three countries are majorly destined to the US and hence the impact. China recently concentrated on developing domestic market to relieve itself from depending on exports to the US. Japan market is already saturated and the haunting deflation for Japan is preventing it to shift priorities in trade it seems. Decreasing prices prevent consumers to come to shops as they expect the prices may further slip. That is making hard for Japan to increase consumer spending.