Sticky issue: Takaichi speaks to the media at her official residence in Tokyo. The Japanese Prime Minister’s remarks about Taiwan are at the heart of escalating tensions between the two Asian giant economies. — Reuters
BEIJING: Amid escalating tensions between China and Japan, fuelled by Tokyo’s remarks regarding China’s Taiwan, experts warn that if the Japanese administration continues down the same path, it is endangering bilateral economic ties that have great significance for both nations.
In response to Japanese Prime Minister Sanae Takaichi’s claim that a Taiwan emergency constitutes a “survival-threatening situation” for Japan, and her refusal to retract the remarks, China has halted Japanese seafood imports, authorities have suspended the release of two Japanese films and major Chinese airlines have cancelled flights to Japan.
Hidetoshi Tashiro, a Japanese economist, said that Takaichi’s remarks could trigger serious fallout, with China already warning its citizens against travel and study in Japan, amid tour cancellations.
Tourism accounts for around 7% of Japan’s overall gross domestic product (GDP), according to the World Travel and Tourism Council.
Meanwhile, statistics from the Japan National Tourism Organisation showed that visitor arrivals from the Chinese mainland and the Hong Kong Special Administrative Region accounted for nearly 30% of the total during the January to October period of this year.
“Even more serious is that companies in both Japan and China may come to share the expectation that bilateral relations will become unstable going forward, which could dampen their willingness to engage in trade and investment between the two countries.
“I hope that the Japanese side will refrain from provocations, what China calls ‘playing with fire’ – and avoid unnecessarily heightening tensions,” said Tashiro.
As Japan’s largest trading partner, China represents a critically important market for a wide range of Japanese industries, including auto parts, precision machinery, consumer goods and chemical products.
The General Administration of Customs said China is Japan’s biggest source of imports. In 2024, the total trade volume between China and Japan reached US$308.3bil, with China’s imports from Japan amounting to US$156.25bil.
As the engines of global growth sputter, Japan’s economy is grappling with a distinct lack of momentum and the persistent threat of stagflation.
Whether it can break free from this trend of sluggishness remains an open question, said Lyu Kejian, vice-president of Chinese Association for Japanese Economic Studies.
“Any significant disruption to trade ties with China would deliver a direct shock to an economy already struggling to find its footing,” Lyu said.
In August, the Japanese government revised down its real economic growth forecast for the current fiscal year from April 2025 to March 2026, from an earlier projection of 1.2% to 0.7% due to downward pressure from US tariff policies and weak consumer spending.
“If not for political noise, there is no reason Japan-China economic and trade relations should not continue to grow,” said Tashiro.
At a time when the United States is falling into isolationism and seeking to undermine the free trade system, the development of free trade and people-to-people exchanges between Japan and China would benefit not only both countries, but also the entire world, he added.
As political waves ripple across the Japanese business community, executives called for Tokyo to maintain rational communication and pragmatic cooperation with Beijing.
Tetsuro Homma, executive vice-president of Panasonic, said that China is not only a consumer market or a manufacturing powerhouse, but also an innovation and engineering hub.
“For Japanese companies, strengthening collaboration with Chinese supply chain partners is crucial.
“It enables us to deliver quality products to global consumers at more competitive prices,” Homma said.
The vast majority of Japanese enterprises maintain long-term confidence in their development prospects in China and remain committed to growing their roots in the Chinese market, he added.
The China International Import Expo held in Shanghai earlier this month saw a total of 329 Japanese companies participating, 1.6 times that of last year’s event, said the China International Import Expo Bureau. — China Daily/ANN
