On October 22, China’s 20 CCP National Congress came to an end as Xi Jinping inaugurated his third term in office. As Xi strengthens his power and ruling foundation, there has been considerable concern over whether his interaction with the international community will be different. For a long time, China and Japan have had significant differences in their perceptions of territory and history, and in recent years there have been political and economic clashes. In August 2022, China launched a missile into Japan’s exclusive economic zone (EEZ) during a military exercise, causing high tension between the two countries. Although strengthening diplomacy and national defense is a top priority for Japan’s Kishida administration, its approval rating has hit new lows due to economic factors. It can be described as bearing enormous pressure from both inside and outside. On this premise, it is worth paying attention to whether Kishida’s China policy has taken a turn.

On October 12, the US government released a new version of its “National Security Strategy,” which directly identifies Russia as a major threat and positions China as its only competitor. It advocates deepening cooperation with allies on military, diplomatic, and economic fronts to strengthen the overall deterrence capabilities.[1]

The Japanese government’s position is slightly different from that of the US, which ranks Russia and China together as major threats and competitors. Since the outbreak of the Russia-Ukraine war, the Japanese government’s statements about Russia have mostly been condemnation of acts of war or challenges to the international order, rather than positioning Russia as a direct security threat to Japan. The attitude has been evidenced by Japan’s continued shift of its defense focus from the north to the southwestern islands even after the outbreak of the Russia-Ukraine war.[2] In addition, the Japanese government has repeatedly mentioned the military threat of China in its policy documents or high-level speeches.[3] These signs show that while the US and Japan are working closely together in diplomacy and military fields, they do not share the same perception of the threat from China and Russia. In other words, the level of threat from China is far greater than that from Russia from Japan’s current strategic perspective.

Japan’s concern about the threat from China has also been reflected in recent talks by Prime Minister Fumio Kishida. On October 3, Kishida said in a speech to the parliament that he would safeguard peace in Asia and the world through “multi-level diplomacy”and strengthening Japan’s defense capabilities.[4] In the past, the phrase “multi-level diplomacy” has been scattered in Japan’s government documents and policy articles. In the official views of the Japanese government, the term is similar to the “multi-level security cooperation” revealed by the Ministry of Foreign Affairs, which is based on the US-Japan alliance and the expansion of bilateral/multilateral and international cooperation to create a strategic environment favorable to Japan.[5] In comparison with the previous statements, the current version shows that while the policy direction has remained largely unchanged, Japan has added a number of new cooperative countries and platforms in recent years, suggesting that Japan is making progress in this area. [6] On the other hand, although there are still differences in the perception of the “counterattack capability” concept in Japan, the relatively dovish Komeito Party has recently shifted to advocate strengthening national defense, indicating that the threat of China has become a common sense in Japanese political circles.[7]

In summary, under the influence of the Chinese threat, Kishida has determined to strengthen diplomacy and national defense, and the specific policies are being shaped and materialized as well. Regardless of the specific details of the two directions, the ultimate goal is to enhance the ability to contain and deter China to ensure Japan’s national security.

It is noteworthy that although diplomacy and strengthened national defense are Kishida’s top priorities, the first thing he mentioned in his speech on October 3 was not diplomacy and defense, but a declaration that he would work on high prices and economic recovery, which reflects Japan’s current predicament.[8] According to a Kyodo News survey, Kishida’s approval rate was 40.25% in September but dropped to 35% in October. It’s mainly due to the sluggish economy caused by high prices. [9] In addition, the poll conducted by Jiji Press in the same period even shows that Kishida’s approval rate has dropped to 27.4%, a new low since the previous Suga cabinet.[10] In addition to changing public opinion, Kishida may have put economic issues before foreign affairs and national defense for a deeper reason: improving economic development to support his diplomacy and defense policies in the long run.

In terms of diplomacy, the Japanese government has enjoyed a high level of economic growth in the last century that allowed it to expand aid to Southeast Asian countries and establish diplomatic platforms such as the Tokyo International Conference on African Development (TICAD) in Africa. However, due to the economic recession in recent years, it has become increasingly difficult for Japan to compete with China in such policies.[11] As a result, the Japanese government has recently turned its attention to Southeast Asian countries by, for example, providing maritime patrol vessels and radar to Vietnam and the Philippines. This change may be seen as an example of shrinking diplomatic fronts and increasing its commitment to key countries under resource constraints.

On the other hand, although the Kishida administration has repeatedly declared its intention to strengthen national defense, the economic downturn has led to many domestic debates over the sources of defense funds. The Deputy Chief Cabinet Secretary Kihara Seiji had previously said that Japan “would not rule out issuing public bonds as a source of defense financing.” Still, Finance Minister Suzuki Shunichi, based on fiscal discipline, took a more conservative stance.[12] In Japanese civil business and industrial organizations, the increase in corporate tax to cover national defense expenses was strongly opposed by the members.[13] Due to insufficient financial resources, it is difficult for the Kishida government to expand defense spending at this stage; the dilemma can only be resolved by utilizing funds drawn from various ministries, research and development, and public construction.[14]

In other words, although the Kishida administration wishes to achieve more about diplomatic and defense policies in the face of the threat from China, it is unlikely to increase government spending significantly for now due to financial difficulties. If diplomatic and defense policies cannot generate sufficient deterrence due to financial constraints, it is imperative to rebuild the conflict prevention mechanism between Japan and China as soon as possible, which is also the main reason for Japan’s recent calls for dialogue with China.

Although several Chinese missiles fell into Japan’s claimed exclusive economic waters on August 4, 2022, Japan’s Cabinet Secretary Hirokazu Matsuno still said, “the door is open for dialogue with China.” On August 10, after a cabinet reshuffle, Prime Minister Kishida reiterated his intention to engage in dialogue with China. On September 2, Masakazu Tokura, president of the Japan Economic Federation (JEF, or “Keidanren”), urged high-level dialogue between Japan and China at a symposium on the 50th anniversary of the establishment of diplomatic relations between the two countries. On October 21, Foreign Minister Hayashi Yoshimasa said at a press conference that he was “willing to engage in dialogue with China to build a stable relationship between Japan and China.” On October 22, Hayashi further called for a “frank communication” with the Chinese authorities at the 9th “Fujiyama Dialogue.” [15]

Observing these speeches of Japanese politicians, no matter how the relationship evolves, Japan is always open to dialogue, but China seems to have no intention to respond positively. Earlier, although Japanese National Security Agency Director General Takeo Akiba met with Yang Jiechi, the two sides took group photos with a background without national flags after the meeting, reflecting China’s desire to downplay the event’s intention. In addition, the meeting held in China was attended by the visiting Japanese representatives, but Japan has not yet received a return visit from the Chinese side. On the other hand, Xi Jinping’s visit to Central Asia shows that Chinese officials can still visit other countries on the eve of the 20th CCP National Congress. It also reflects that China feels no urgency in reopening dialogue with the Western camp members such as Europe, the US, and Japan in the eyes of the high-level Chinese policymakers.

Since Japan has established solid diplomatic and national defense policy directions, it’s seeking to rebuild the dialogue mechanism with China to reduce the risk of conflict. Against this backdrop, the Japanese government has once again signaled its intention to engage in dialogue after the 20th CCP National Congress. Still, the senior Chinese policymakers have not yet responded positively, and their direction is unclear. That is, the development trend of Japan-China relations is still affected by Chinese policymakers.

(Originally published in the 66^th “National Defense and Security Biweekly”, November 4, 2022, by the Institute for National Defense and Security Research.)

(The contents and views in the assessments are the personal opinions of the author, and do not represent the position of the Institute for National Defense and Security Research.)