Why Japan-China Spat Hurts Both (Page 2 of 4)

And Japan? Japanese officials argue that, since the UNCLOS doesn’t directly address what should happen in a situation like the one in the East China Sea, the two countries should divide their claims along a median line between them. In this case, a median line gives each country a roughly equal amount of territory, but it places the Senkaku Islands, which are thought to contain vast energy resources, on the Japanese side. China has therefore rejected this division. Nonetheless, Japan currently possesses the islands, having incorporated them into its territory in 1895.

The issue has been complicated by the fact that in 1992, China adopted legislation that authorized the use of force to enforce Chinese claims to the islands. Tokyo quickly protested the law which, if enforced, could lead to a Sino-Japanese military confrontation. In 1996, Japanese nationalists later travelled to one of the islands and erected an aluminium lighthouse. This prompted condemnation from both China and Taiwan (which also claims what it calls the Diaoyutai islands based on the fact that, before China’s establishment, Beijing had charged Taiwan’s provincial government with administering the island).

In August 2003, the Chinese Offshore Oil Corporation and Chinese Petroleum Corporation partnered with the Union Oil Company of California and the Royal Dutch/Shell Group to explore the extent of the energy resources in the vicinity of the disputed island of Chunxiao. In April 2005, the Japanese government lifted a ban prohibiting Japanese energy companies from exploring areas of the East China Sea and on July 14 of that year, Teikoku, a Japanese energy company, was granted the right to explore an area located 43 nautical miles into the Chinese EEZ.

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The tit-for-tat continued in 2006, when revised Japanese textbooks reaffirmed the country’s claims. Later that year, a group of Hong Kong residents sailed to the islands to affirm China’s claims. After the Japanese turned them away, China protested that the Japanese response infringed on Chinese sovereignty. China, for its part, sent some ships to the island group to conduct research in 2007.

Tensions continued in 2008, when the Chinese Navy cruised through the area to affirm ownership, while last year, then Japanese Prime Minister Taro Aso asserted that the islands were covered under the US-Japan Security Pact, prompting a complaint from the Chinese Foreign Ministry.

The problem for both countries is that as long as they remain unable to resolve this dispute—either through a negotiated division or through joint development projects—both miss out on the rich natural resources, as private energy firms are reluctant to attempt to exploit them.

For a while, it looked like the countries might be able to suspend their sovereignty dispute in order to mutually benefit from exploiting the undersea riches. But the bilateral negotiations that began in 2004 have neither reconciled their conflicting sovereignty and territorial claims nor established an agreed mechanism for joint exploitation of the energy reserves. So far, at least, Chinese-Japanese energy collaboration remains primarily confined to uncontroversial areas such as cooperative conservation and environmental programmes.

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