Trouble for Tokyo: Japan’s Foreign Policy Challenges

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Trouble for Tokyo: Japan’s Foreign Policy Challenges

Faced with a rising China, Russia’s ‘pivot’ to Asia, and challenges with North and South Korea, Japan may need to reboot its Foreign Policy.

Officials in Tokyo have known for some time that Japan’s regional foreign policy needs to be revamped. The economic crisis has brought Japan’s export giants to their knees and forced the country’s economy to look at different ways of conducting business. Moreover, the nuclear crisis in Fukushima last spring further intensified Japan’s already acute energy security dilemmas. The dynamic security environment in Northeast Asia has not helped Japan’s footing either. Tokyo sees itself virtually surrounded by geopolitical challenges on all sides, including territorial disputes with China, South Korea and Russia and the consistent challenges it faces from an unpredictable regime in Pyongyang.

But all is not doom and gloom. Japan surely faces tough choices in how it conducts its foreign policy, but so do other states in the region. China needs to balance its regional ambitions with the strategic reality that primacy will not be voluntarily relinquished by Washington, Tokyo, Moscow or Seoul. South Korea also charts an uncertain course. Despite weathering the economic crisis better than Japan, South Korea is still vulnerable to the financial risks brought on by high household debt and the enhanced competition it faces since signing a series of free trade agreements. On the security front, Seoul continues to stare down a volatile cadre of military leaders in Pyongyang that have arguably accumulated even more power since Kim Jong-il’s death. Similarly, Russia, despite its “Pacific moment” this year at the Vladivostok APEC Summit, will need to considerably recalibrate its approach to the region if it wants to sufficiently benefit from its claims as an Asian superpower.

It is not too late for a proactive Japanese foreign policy in Asia. Tokyo needs to leverage the capital that it has already accrued amongst states in the region to regain some of its lost prestige.

One of the most obvious ways Japan can do this is through making the tough decisions that earmark its entry into the Trans Pacific Partnership (TPP). This is a move championed by industrial heavyweights such as Toyota, Toshiba and Mitsubishi, but fiercely opposed by lobbyists representing Japanese farmers who fear – with good reason – that the TPP will effectively eliminate their competitive advantage at home by ending exorbitant tariffs on agricultural imports. It may be political suicide for Prime Minister Yoshihiko Noda to completely abandon the farmers – especially considering it was their area that was most affected by the tsunami and earthquake last year. This caveat notwithstanding, it is imperative that Noda impress upon the agricultural block – which makes up merely 1.4% of Japan’s GDP  – that the country’s economic survival is at stake.

The TPP is not an economic vaccine though. Japan’s economic engagement with Asia needs to complement this with a focus on expanding its footprint with bilateral trade agreements. Tokyo has taken a proactive approach in this area in recent years, inking Economic Partnership Agreements with India, Singapore, Malaysia, Thailand, Indonesia, Vietnam, Brunei and the Philippines. Japan must now speed-up the pace of current EPA negotiations with regional heavyweights South Korea and Australia. It remains imperative that Tokyo not lose sight of the strategic importance of the former in light of recent sparring over the disputed Dokdo/Takeshima islets.

Japan’s presence in the region’s key multilateral institutions such as the Asia Pacific Economic Cooperation (APEC), the Association of Southeast Asian Nations (ASEAN) and the East Asia Summit (EAS) is another vehicle that should continue to drive Tokyo’s foreign policy. Japan has a perfect opportunity to articulate its role during Indonesia’s hosting of APEC next year which would allow leaders in Tokyo to leverage APEC’s temporary congruence with ASEAN and the EAS – which are also housed in Jakarta.

While Japan’s economic challenges in a dynamic Asia-Pacific are considerable, there are also significant political hurdles that its leaders can address through enhanced regional diplomacy. It has been a tough year for Japan’s security establishment, which has been ill-prepared to adequately manage its territorial disputes with China, South Korea and Russia. China has reemerged as the dominant strategic power among states in Northeast Asia. Beijing’s primacy in the region, while still at least a decade away, has only been challenged thus far by the United States. The situation is a bit more nuanced with regard to Russia and South Korea. Both countries have advanced considerably over the past decade but still suffer from a lack of strategic depth in Asia. Russia realizes that the continent is changing and it leaders know must react quickly or risk being left out. Seoul on the other hand has a security policy – focused on North Korea – which limits it ability to free up resources for a stronger economic push into Asia.

Despite these formidable challenges, both Russia and South Korea have seized the opening provided by an assertive Chinese foreign policy to pressure Japan with unprecedented measures on their territorial disputes. Essentially, both states have exploited Chinese actions for their benefit and are engaged in tacit “free riding” on the heels of Beijing. Why are Russia and South Korea taking this approach? It seems that Seoul and Moscow have made a calculated gamble that Japan will buckle or – at the very least – make concessions as a result of the overwhelming pressure from its neighbors. Good relations with Japan are too important to South Korea and Russia for them to confront Tokyo directly. As a result, both states have opted to shield their provocations under the scope of Chinese policy and the dynamic power architecture in Northeast Asia.

Aside from these disputes, leaders in Japan have been plagued for years by its toxic relationship with North Korea. There have been slight indications lately that a thaw might be palatable to both sides. Any talk of détente though would have to start with confidence building measures around the long simmering issue of  the outstanding Japanese nationals abducted by North Korea nearly thirty years ago. Of course, Pyongyang and Tokyo being at loggerheads is not a new development. Relations between Japan and North Korea have been tense for decades. Aside from the abduction row, Tokyo also condemns the North for its belligerent missile tests over Japanese territory and Pyongyang’s nuclear weapons program. As a result, Tokyo has maintained a tough set of unilateral sanctions to complement the existing UN Security Council penalties on Pyongyang that have been in place since the North’s first nuclear test in 2006. These sanctions, which were renewed earlier this year, have effectively cut off all bilateral trade between the countries. On the other hand, North Korea has issues with Japan lingering from its colonization of the Korean peninsula before and during World War II. Tokyo continues to be a dart board for the North’s hardliners who accuse it of being a mere outpost of Washington.  The North also takes a hard stance against Japan’s territorial claim to Takeshima/Dokdo and recently insisted that the issue was “directly related to (Korean) national dignity” and that there could be “no concession or compromise” with Tokyo.

Japan needs to take a strategic approach to these geopolitical challenges. It appears that this route is already being tested with North Korea, as a traditionally risk-adverse foreign ministry in Tokyo makes a calculated gamble that Pyongyang might be ready for serious talks. The spillover effects of positive strides with North Korea – even if mere window-dressing – should not be discounted. South Korea, China and Moscow – all of which have a stake in Pyongyang’s future – would realize that Japan is not just providing lip-service on North Korea. This could potentially erode China’s tacit support of the North’s quest to isolate Japan from a meaningful seat at the table when/if the moribund Six Party Talks resume. There have also been indications that Japan and Russia are exploring ways to resolve their outstanding territorial dispute.

It would be an exaggeration to frame Japan’s regional foreign policy as an impending crisis. Japan has spent decades building its prestige through soft power relationships among ASEAN states, Central Asia (via the Central Asia plus Japan Dialogue) and South Asia (through the South Asian Association for Regional Cooperation). As others have noted, Japan’s relations with India have been expanding in recent years as both states – leery of China – take the next step to a potential strategic partnership. However, as the Asian states continue to contort their foreign policies, Tokyo will need to bank on more than goodwill and trade. This means getting serious about political and security relationships with natural allies in the region such as India, Australia, Mongolia, Thailand, Vietnam and ,– despite the nationalist posturing,  South Korea. These steps, combined with enhanced trade relations with ASEAN and APEC will reduce the magnitude of the challenges Japan may encounter in future foreign policy pitfalls.