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Thursday, Feb. 7, 2008

CHINA SYMPOSIUM

Growing weight of China's economy begins to tip the balance in East Asia


Staff writer

Most forecasts point to China's economy becoming several times larger than Japan's in coming decades. What does this mean for Japan and the United States in Asia?

News photo
Takashi Shiraishi
News photo
Robert Madsen

"If we want to maintain our political, economic and diplomatic leverage in the region, both the U.S. and Japan have to come up with some effective ways of dealing with China's rise," Robert Madsen, a senior fellow at the MIT Center for International Studies, told the Jan. 23 symposium.

Madsen noted that European powers faced a similar challenge when they were confronted with the rise of the U.S. and Germany from the late 19th century.

Britain responded by working closely with the U.S. and in exchange Britain got more power in Europe, even though its own economic power diminished, he said. France, after fighting a series of wars with Germany until 1945, opted for a new strategy of creating institutional relationships with its neighbors to secure voting power in international bodies, he noted.

Madsen described Japan's postwar strategy as playing Britain's role, with its security alliance with the U.S.

Today, with its pursuit of greater economic integration in East Asia, Japan appears to be trying to move closer to the French model, but the timing of this shift is not ideal for Japan, he said.

When France pursued what would later become the European Union in the late 1940s, its power gap with Germany was huge because Germany had just been defeated in the war, he said. "The equivalent time for Japan would have been 15 or 20 years ago, when Japan was much more powerful relative to China," he added.

Germany right after WWII also was ready to work with France because it was afraid of being isolated, but China today sees no reason to bolster Japan's power, he said.

Takashi Shiraishi, a professor and vice president of the National Graduate Institute for Policy Studies, agreed that a radical change in Asia's balance of power will be inevitable.

Signs of the change are already emerging, he said. In 1995, eight of the 10 members of the Association of Southeast Asian Nations had more trade with Japan than with China. In 2005, there were only two such ASEAN members.

A challenge for China's neighbors, including Japan, he said, is to ensure that today's order in East Asia will not undergo a disruptive, revolutionary change but a steady evolution into a new one. And a key to such stability is to deepen the economic integration and cooperation among the countries involved, he added.

Japan's basic strategy toward the challenge has been — as Prime Minister Yasuo Fukuda puts it — a "resonance" of its alliance with the U.S. and its Asian diplomacy, Shiraishi noted.

A solid alliance with the U.S. increases "predictability of the future change" in Japan's position in Asia, the professor said. And by pursuing greater regional cooperation under the cause of building an "East Asian economic community" — which may not necessarily result in creating such a community itself — Japan can deepen its economic interdependence with the rest of Asia, including China, he said.

"Such a close economic interdependence will work to prevent any moves to fundamentally change the status quo in the region," Shiraishi said. "I think this has been Japan's basic strategy since the 1980s, and it will probably not change in the future."



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