‘Historic turning point’ in Chinese-Japanese Relations Amid U.S. Protectionism

Chinese Premier Li Keqiang speaking in London in 2014.

At the end of Japanese Prime Minister Shinzo Abe’s three-day visit to China on October 26, Japan and China announced the signing of “more than 50 deals and agreements.”

“From competition to co-existence, Japan and China bilateral relations have entered a new phase. Hand in hand with Premier Li, I would like to advance our ties forward,” stated Abe.

China and Japan have committed to various regional cooperation pacts. Among the most noteworthy is a $30 billion currency swap deal to be enacted in 2021 and a move toward “establishing a yuan clearing bank.”

Additionally, Chinese Premier Li Keqiang mentioned that a consensus had been reached in regards to the Regional Comprehensive Economic Partnership (RCEP) and on a China-Japan-Korea trade zone.

This increased diplomatic cooperation follows an “increasingly uncertain U.S. relationship” for both countries. “Tit-for-tat tariffs” between China and the U.S. have also indirectly hurt Japanese exports of electronic parts to China. In response to this hostile trade environment, Hidetoshi Tashiro, chief economist at Sigma Capital Ltd., claimed that China and Japan could “enhance financial cooperation in third-party markets” like in Central Asia.

Reports indicate that both sides will soon announce the commencement of “30 joint infrastructure projects.” Some have analyzed this development as a sign of China’s increased willingness to draw financial partners into their Belt and Road initiative.  

Abe’s recent meeting with Chinese Premier Li Keqiang is the first of its kind in 11 years. It follows the first official visit of a Chinese leader to Japan in seven years in May.

A poll found that out of the 1,548 Chinese surveyed in 10 major Chinese cities, 23 percent said China’s relationship with the United States is the most important, down from 28 percent last year; the rate of those who selected Japan rose from 12 to 18 percent. Also, 42 percent of respondents conveyed that they had a favorable or relatively favorable impression of Japan, up from 31.5 percent last year; those who reported unfavorable or relatively unfavorable impressions decreased from 67 percent to 56 percent.