The Asia-Pacific Journal | Japan Focus Volume 12 | Issue 30 | Number 3 | Article ID 4154 | Jul 27, 2014

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The Japan-China Confrontation Over the Senkaku/DiaoyuIslands – Between “shelving” and “dispute escalation” 尖閣・釣魚諸島をめぐる日中対立　棚上げと激化のあいだとは

Reinhard Drifte

INTRODUCTION

The dispute over the Senkaku/Diaoyu Islands inthe East China Sea has remained raw andmenacing since its latest eruption as a result ofthe purchase of three islands by the Japanesecentral government in 2012. In contrast to theaftermath of the 2010 incident, the Chineseside under the new leader Xi Jinping haswidened the dispute by political, military andpropaganda means, and the Abe governmenthas hardened its stance by insisting that “Thereis no territorial dispute” and “There never wasany understanding of shelving the dispute”.Rather there was an attempt to political andmilitary counterbalancing, which includesstrengthening of the military alliance with theUS, repositioning Japan`s armed forces to theSouth and reinterpreting Article 9 of the so-called Peace Constitution.

The ongoing military and coast guard stand-offaround the islands risks a serious clash throughe i ther misca lcu la t ion , un foreseencircumstances or risk taking at lower commandlevel.

Senkaku/Diaoyu islands

The Chinese government is aiming to forceJapan to acknowledge that there is a territorialdispute. The repeated dispatch of Chinese coastguard ships into the territorial waters aroundthe islands is to prove that there is indeed aterritorial dispute and that Japan no longer hasexclusive control over the islands. The islanddispute also involves the US as Japan`s alliancepartner with its own high stake in a functioningrelationship with a rising China. The US,therefore , seeks to avo id a mi l i tary“entrapment” despite repeated declarations tothe effect that the mutual security treatyincludes the islands. China`s moves in the EastChina Sea send worrying signals to thosecountries around the South China Sea which

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contest actively (Vietnam, Philippines) or moreguardedly (Indonesia, Malaysia and Brunei)China`s claim to almost 90% of the South ChinaSea, while Japan is supporting these nationspolitically and materially (e.g. providingassistance to beef up the coast guards ofVietnam, Indonesia and the Philippines). FinallyChina challenges the principles of theinviolability of international borders and thepeaceful resolution of international disputeswhich is particularly ominous against thebackground of Russian moves against theterritory of the Ukraine.

This article looks at the major developmentswhich led to the current dangerous situation,and explores approaches for crisis managementor resolution. I conclude that at least initiallythe sovereignty issue over the disputed islandshas to be put aside by creating a newunderstanding that will permit shelving theissue. This new understanding will have to takeinto account the lessons which can be derivedfrom the failed ones of 1972 and 1978 in orderto succeed. Efforts will then have to beconcentrated on Confidence and SecurityBuilding Measures (CSBM) and on how toshare the economic interests in the areaoutside the 12 nautical mile (nm) territorial seaaround the islands. This will require a lot ofgood political will on both sides, something thatis currently missing.

THE HISTORICAL BACKGROUND

- The circumstances of Japan`s acquisition

An analysis of the historical background showsthat we are faced here with the amorphoustransition at the end of the 19th Century from aChina-dominated East Asian Order to onedominated by Western international law, withChina basing its stance on the former andJapan on the latter. As Shaw explains,territorial ownership meant different thingsunder these two different concepts and Chinesescholars use it as a base to refute Japan`sclaims to territorial accession.1

Japan bases its sovereignty claim on the factthat it incorporated the islands as terra nullius(vacant territory) on the 14 January 1895 andhas been continuously occupying the islandssince then.2 China, however, argues that itdiscovered the islands long before and quotesseveral historical documents going back to theMing Dynasty (1368-1644) which mention theislands as part of Taiwan, although Taiwan wasincorporated by the Qing Dynasty only in 1683.3

After Japan`s incorporation of the islands in1895, a private person (Koga Tatsushiro) usedsome of the islands for commercial purposesfor several decades until World War II, alsoproviding habitation for workers who wereemployed in his fish processing plant. Thegovernment of the PRC claimed the islands onlyin December 1971 after a report in 1969 by anUN-related organization mentioning thepossibility of substantial oil and gas reservesaround the area (Reedman/Shimazaki 2006, p.43).4 This late claim was also very much inresponse to the Guomindang government inTaiwan (Republic of China, ROC) which had inFebruary 1971, and again on the 11 June 1971,publicly opposed the return of the SenkakuIslands (called by the ROC `Diaoyutai`) as partof the reversion of Okinawa to Japan in 1972.5

Applying contemporary rules of internationallaw, the Japanese side has a strong claim to thesovereignty over the islands because of theincorporation as vacant territory, and Japan`seffective control which went unchallenged forsuch a long time.

China`s argument about `discovery` is not verystrong in terms of modern international lawbecause it never exercised effective control andChinese never inhabited the islands. In a recentpublication of the State Ocean Administration,however, it is argued that China not onlydiscovered the islands and used them, but alsoexercised long-term control over them withoutclarifying what this means.6 `Discovery`according to the Chinese accounts simplymeans that the islands were mentioned inrecords written by people who passed them and

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used them as orientation points on their seavoyage between China and Okinawa/Japan, andconsidered them as part of China`s coastaldefence.7 Moreover, the assertion that Japanacquired the islands as the result of the Sino-Japanese War of 1894-95, which was ended bythe signing of the Treaty of Shimonoseki inApril 1895, depends on whether one considersthe Senkaku Islands part of Taiwan or part ofOkinawa. The Shimonoseki Treaty included thecession of Taiwan and the Pescadores but didnot mention the Senkaku Islands. The latitudeand longitude of the Pescadores were given anda joint committee for demarcating territorieswas set up.8 The map of Taiwan printed at thetime did not include the Senkaku Islands.China, however, states that the Treaty includedthe Senkaku Islands since they belong toTaiwan, a claim which Japan disputes.9

- Shadow over the polit ical and moralfoundation of Japan`s acquisition

Timing, decision-making process and secrecy ofJapan`s territorial acquisition of the SenkakuIslands cast a shadow on the political andmoral foundations of Japan`s incorporation ofthe islands. But even if the document ofincorporation of the islands was made public byJapan only in 1952, successive Chinesegovernments must have known that Japan wasin control and Japanese citizens partly living onand commercially using the islands.

There is correspondence in 1885 between thecentral government in Tokyo and localgovernment in Ryukyu (called Okinawa today)where the former demanded caution inasserting any claim or putting markers on theislands. The reason given was concern overraising the ire and suspicion of the Qinggovernment, which at that time was militarilystill stronger than Japan. This is interpreted bysome as Japan at least implicitly admitting theQing government`s title to the islands.10 Incontrast to the official Japanese versiondistributed since 1972 that, from 1885 on,

there had been a series of surveys conductedby the Japanese government, there is nodocumentary proof that such surveys wereconducted.11 Moreover, in 1880, negotiationsbetween the Meiji and Qing governments hadtaken place over the establishment of asouthern border because the Qing opposedJapan`s incremental takeover of the Ryukyuisland chain which, in 1879, had beenincorporated into Meiji Japan as a prefecture,after having been under dual Chinese andJapanese suzerainty since 1609. A draft treatywas prepared in which the Japanese proposedto draw the border between Ryukyu and Chinaby giving China the Ryukyu islands of Miyakoand Yaeyama and everything to the south ofthem, in exchange for commercial rights inChina. There was no specific reference to theSenkaku Islands, but according to Hane this isnot surprising since they belonged in theunderstanding of the Qing government to theRyukyu island chain which as a whole was theobject of negotiations.12 The treaty would haveput the Senkaku islands on the Chinese side.For various reasons, China was reluctant tosign the agreement at the time, and from 1885onwards, Japan no longer had any interest insigning either.13 Hane argues that these twocircumstances – Tokyo`s hesitation toincorporate the Senkaku Islands and its makingthem the object of a deal – raise doubts aboutthe Japanese government`s claim today thatthe islands are `inherent territory` (koyu noryodo) of Japan.

The timing of Japan`s incorporation of theislands is also telling. It occurred when Chinahad lost decisive battles in the Sino-JapaneseWar, had put out peace feelers to Japan on 22November 1895, and its ultimate defeat hadbecome predictable.14 From the documentsquoted, for example by Hane and Shaw, it isclear that the Meiji government felt free inJanuary 1895 to go ahead with incorporation ofthe islands, in contrast to its earlier hesitation.The Chinese surrender followed in March 1895,and the Treaty of Shimonoseki ended the war

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in April 1895. The incorporation by the Meijigovernment is therefore strictly speaking notrelated to the Shimonoseki Treaty although thetiming and historical circumstances establish acausal link to the Sino-Japanese War. TheTreaty does not contain any mention of theSenkaku Islands, only that China would cede toJapan `the island of Formosa together with allislands appertaining or belonging to said islandof Formosa`, as Taiwan was then referred to.The PRC and ROC understands, however, thatthis wording applies also to the SenkakuIslands because they consider the SenkakuIslands as part of Taiwan.15

Under international law, appropriation ofterritory is legally strengthened by making itpublic and by not being contested, butnotification is not an absolute condition.However, even if the islands were incorporatedwithout this being officially made public, itmust have come to the attention of succeedingChinese governments that the islands werebeing economically exploited and temporarilyinhabited by Japanese citizens, since fishermenfrom Taiwan and China pursuing fishingactivities in the area sometimes landed there toescape storms.16

The Japanese government tries to prove theChinese recognition of Japan`s sovereignty bytwo documents: The first is a letter ofappreciation from the consul of the Republic ofChina in Nagasaki in 1920 which thanked thepeople of Ishigakijima for rescuing Chinesefishermen washed ashore on one of theSenkaku islands, stating that the islands arepart of Okinawa prefecture. 17 An article in thePeople`s Daily in 1996 dismissed this letter asthe perception of certain people given thecircumstance of Japan having colonized Taiwanat the time (1895-1945).1 8 The seconddocument is an article in the People`s Daily on8 January 1953 report ing Okinawandemonstrations against the US and explicitlyincluding the Senkaku Islands in thedescription of the Ryukyu Islands.19Another

battlefield today for beefing up their respectiveclaims to the islands are maps. However, thereare many inconsistencies on both sides untilthe 1970s.20

The conclusion from the above analysis canonly be that neither the Japanese nor Chineseversion of the historical background is devoidof weak points. The Japanese claim is certainlystronger in modern international law terms,and the Chinese position is seriously weakenedby the absence of any protest from 1895 to1970 and by the circumstances of the timing ofprotests from 1970 (i.e. report on hydrocarbonresources). But as I will show later, rather thanusing these weak points to reinforce mutuallyexclusive sovereignty claims, the mutualrecognition of these weak points could alsoprovide an encouragement for finding acompromise.

- World War II agreements and the SenkakuIslands

After the 2012 nationalisation of three of theislands, the Chinese government took the linethat Japan`s act was a negation of the results ofWorld War II, thus combining the well-knownhistory discourse of Japan`s aggression againstChina until 1945 with the islands dispute. It istherefore important to investigate briefly whatthese agreements said about the islands.

Based on its assertion about the Sino-Japanesewar of 1894-95 and the Senkaku Islands beingpart of Taiwan, the PRC government arguesthat the allied agreements concerning thepostwar period (Cairo Communique andPotsdam Declaration), and the San FranciscoPeace Treaty of 1951 (neither the Guomindanggovernment on Ta iwan nor the PRCgovernment were invited to the conferenceleading to the treaty) required Japan to returnthe Senkaku Islands. The Cairo Dec1aration inDecember 1943 demanded the return to theRepublic of China of `all the territories Japanhas stolen from the Chinese, such asManchuria, Formosa, and the Pescadores.’21

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Article 8 of the Potsdam Declaration states that` The terms of the Cairo Declaration shall becarried out and Japanese sovereignty shall belimited to the islands of Honshu, Hokkaido,Kyushu, Shikoku and such minor islands as wedetermine`.22 Article 2 (b) of the San FranciscoTreaty stipulates that ` Japan renounces allright, title and claim to Formosa and thePescadores`.23

The Senkaku Islands are nowhere mentioned inthese documents, but because of its assertionthat the islands are part of Taiwan, the Chineseconsider them to be included.24 At the sametime, the PRC has never recognized the legalityof the San Francisco Peace Treaty and theTreaty itself does not even clarify to whichChina Taiwan should be returned.25 In anunsigned draft planning document of May 1950from the Chinese Ministry of Foreign Affairs forthe PRC`s possible participation in the SanFrancisco Peace Treaty, and published in theJapanese media only in December 2012 asproof of China recognizing Japan`s ownership,the islands are referred to by their Japanesename, and it is proposed to examine whetherthese islands are part of Taiwan, thus castingdoubt on China`s claim today that they havealways been part of Taiwan and not Okinawa,and had been ceded to Japan in 1895 as part ofTaiwan.26 Professor Liu Jiangyong of QinghuaUniversity brushed away such doubts byexplaining the use of the Japanese name by thecircumstance that this name was, after theJapanese colonization of Taiwan, the morepopular name.27

It is more l ikely that the Guomindanggovernment, and from 1949 on also thegovernment of the PRC, did not know and/orcare about these islands until 1970. There wasno clear understanding of whether the islandsbelonged to Okinawa or Taiwan, and even theROC position on Okinawa was unclear. DuringWorld War II and in its aftermath, there wasconsiderable confusion within the Guomindanggovernment about whether it should or could

claim the Ryukyu Islands.28 Ishii mentions thatthe ROC government at one stage demanded totake part in the Trusteeship of Okinawa.29

According to an article in the newspaper of theChinese Communist Party, Roosevelt evenoffered Jiang Jieshi Okinawa (which then wouldhave naturally included the Senkaku Islands)during the Cairo conference in 1943, but Jiangturned it down.30

As a result of the San Francisco Peace Treaty of1951, Okinawa, including the Senkaku Islandsas part of the Nansei Shoto Islands (south of29°north latitude refers to all the islands of theRyukyu chain) , was placed under USadministration and became a central anchor ofthe US military deployment in Asia.

Ryukyu Islands

During the San Francisco Peace Treatynegotiations, the US and the UK agreed thatJapan would retain `residual sovereignty` overOkinawa, and that the US would not requireJapan to renounce its sovereignty overOkinawa.31 It is obvious that the Japaneseconsidered the Senkaku Islands as beingincluded in the `residual sovereignty overOkinawa` since, for Tokyo, the islands werepart of Okinawa. Moreover, when thegovernment of the Republic of China

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normalized diplomatic relations with Japan in1952 (Treaty of Peace between Japan and theRepublic of China), the subject of the islandswas not raised by either side. In a separateexchange of notes, both sides agreed that theTreaty `be applicable to all the territorieswhich are now, or which may hereafter be,under the control of its Government` referringto the ROC government.32 But when the USannounced in 1953 its intention to return toJapan the Amami Islands (north of Okinawamain island) as part of the Nansei Shoto, theROC government (but not the PRC) protestedagainst the US legal justification of doing sounder the concept of Japan`s `residualsovereignty` over these islands because thisconcept was not specified in the San FranciscoPeace Treaty.33

- The reversion of Okinawa in 1972 and thedisputed islands

Consequently, when the US started to discusswith Japan the transfer of the administrativerights over Okinawa to Japan, leading to theconclusion of the `Agreement Between Japanand the United States of America Concerningthe Ryukyu Islands and the Daito Islands`(signed on 17 June 1971), the ROC urged theUS in September 1970 not to include theSenkaku Islands, and to keep the sovereigntyissue open.34

Vice President Spiro Agnew with PrimeMinister Eisaku Sato on reversion ofOkinawa. Emperor Hirohito and EmpressNagako look on. May 15 1972

The ROC ambassador to the US, in a note of 15March 1971, explained his government`ssilence concerning the Senkaku Islands untilthen by saying `for regional securityconsiderations the Government of the Republicof China has hitherto not challenged the USmilitary occupation of the Senkaku Islandsunder Article 3 of the San Francisco PeaceTreaty. However, according to internationallaw, temporary military occupation of an areadoes not affect the ultimate determination of itssovereignty`. 3 5 He then asked for therestoration of the islands to the ROC. `Regionalsecurity considerations` certainly meant thatunder the Cold War conditions and itsconfrontat ion with Bei j ing, the ROCgovernment did not want to do anything whichmight have diminished the military power of, orits good relationship with, its Americanprotector. Moreover, Japan was an importantanti-communist neighbour for Taiwan, and

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therefore the ROC government had, in 1951,waived all reparations from Japan.

Under pressure from both allies (the US stillhad diplomatic relations with Taiwan in 1971!),the US had to choose whether to go againstJapan or Taiwan, and in the end decided tosupport Japan`s demand. Moreover, the US feltdriven into a corner by Taiwan because thelatter had the power to torpedo the pendingtextile agreement which the US was justnegotiating with several countries, includingTaiwan. Henry Kissinger, the President`sAssistant for National Security Affairs,suggested promising the ROC that a pendingUS military delegation visiting Taiwan inAugust would buy them off with promises ofmilitary aid. 36

Supporting Japan rather than Taiwan in the endmeant that the US would arbitrarily “detach”the Senkaku Islands from Okinawan territorydespite having clearly considered the two asone territorial unit over which Japan enjoyed“residual sovereignty” despite US occupationuntil 1972.37 This was done by differentiatingbetween Okinawa, which was returned as aterritory, and where the US today has aconsulate-general, and the Senkaku Islands,which were only recognised as being under theadministration of Japan. Any conflictingsovereignty claims were explicitly left for theparties concerned to sort out after thereversion of Okinawa, which included theSenkaku Islands. Since Art. V of the bilateralsecurity treaty applied to all Japanese territorybeing under Japanese administration, thesecurity guarantee therefore applied also to theislands. In this way the US contributedsignificantly to the current difficult situation.

This rather self-serving ambiguous US positionwas enunciated when the US Administrationstated during Senate hearings on the reversionthat `The United States has made no claim tothe Senkaku Islands and considers that anyconflicting claims to the islands are a matter

for resolution by the parties concerned`, thelatter including the ROC and the PRC.38 Sincethe reversion in 1971, the US has stuck to nottaking a position on the sovereignty of theSenkaku Islands and emphasizing that the 1971Agreement transferred only the `administrativerights` to Japan. In this way the US allowedJapan to regain control over the SenkakuIslands and enabled it to reinforce itssovereignty claim thanks to the reversion.When reading the proposal by NationalSecurity Staff member John Holdridge to return`the Ryukyus (sic) and the Senkakus` but topass no judgement as to the conflicting claimsto them, Henry Kissinger wrote candidly on themargin of the memo of 13 April 1971: `But thatis nonsense since it gives islands back to Japan.How can we get a more neutral position?`39

While the above sheds some light on why theROC did not make any public claims to the titleof the Senkakus between 1945 and 1970, itdoes not explain its silence before that period,or even for the period 1945-1949, i.e. beforethe establishment of the PRC. Shaw offers thetheory that this was because the ROCgovernment did not have any history of rulingTaiwan and had to rely on Japanese colonialrecords and maps when it took over Taiwan in1945.40 The US Department of State documents(FRUS) reveal that, for the ROC government, itwas very much the opposition by public opinionin Taiwan to the islands` return to Japan, aswell as by overseas Chinese, which putpressure on Taibei in 1970 to oppose thetransfer of the islands to Japan.41 Anotherreason not mentioned in these documents is thereport of hydrocarbon reserves around theislands. The Committee for Coordination ofJoint Prospecting for Mineral Resources inAsian Offshore Areas (CCOP), under theauspices of the UN Economic Commission forAsia and the Far East (ECAFE), had conducteda geophysical survey in 1968. The Committeesaid in a report in May 1969 that thecontinental shelf between Taiwan and Japanmay be extremely rich in oil reserves.42 Soon

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after the publication of this report, Japanstarted to explore with Taiwan and theRepublic of Korea possibilities for jointdevelopment of the Sea`s hydrocarbonresources. In March 1969, Japan beganprotracted negotiations with Taiwan and SouthKorea, leading to an agreement in principle inSeptember 1970, to set up a joint developmentproject.43

If the ROC had until 1945 no experience ofruling Taiwan, then the PRC government hadeven less experience with the area of theSenkaku Islands. Their negligible size andremote location before the likelihood ofhydrocarbon reserves was raised certainly didnot draw any attention to them. The abovecircumstances also explain the timing of thePRC`s claim. In addition, and probably moreurgent at a time when the government was justemerging from the political ravages of theCultural Revolution, the PRC could not stayquiet in the face of ROC and overseas Chineseclaims if it wanted to be recognized as the solerepresentative of China. The first newspaperreports about China`s claims came out in May1970, after Japan and Taiwan had started talkson jointly exploring the energy resourcesaround the Senkaku Islands, and Okinawa`sreversion was announced. Only on 30December 1971 did the Chinese ForeignMinistry publish an official statement claimingthe islands.44

The weakest point of the territorial claim to theSenkaku Islands by the ROC and, since 1949,also that by the PRC is, therefore, that, untilthe ECAFE survey of the East China Sea, theislands were not claimed by either government,and Japan`s control over the islands had beenuncontested. Shaw calls this absence ofobjection a `serious political misstep`.45 Thecontrast to the Chinese claims to almost thewhole of the South China Sea is revealing: the9 dash line (originally 11 dash line) on whichChina`s claims to the South China Sea is basedwas already established in 1947 but had

appeared in Chinese maps in one form oranother since 1936, and was then taken over in1949 by the PRC.46

In meetings with PRC academics in February2013 this author was given several reasons forthe long silence of the Beijing government,including some of those mentioned above. Firstof all, the government saw no reason tospecifically claim the islands because accordingto the PRC interpretation of the ShimonosekiTreaty of 1895. Therefore, having been takenaway from China as part of Taiwan, Japan wasobligated to return them as a result of theabove-mentioned wartime and postwaragreements. All counterarguments about theislands not having been mentioned in theseagreements (in contrast to e.g. the PenghuIslands) were swept away by the assertion thatthe Diaoyu Islands are part of Taiwan. The USadministration over Okinawa, which explicitlyincludes the Senkaku Islands and the US/UKstatement concerning Japan`s residualsovereignty over Okinawa during the SanFrancisco Peace Treaty negotiations (at thattime no difference between Japanesesovereignty over Okinawa and administrativerights over the Senkaku Islands had yet beenmade), were simply considered as having beenaddressed by two PRC statements in 1951which declared the treaty illegal. Interestingly,in these statements Beijing claimed the ParacelIslands, the Spratly Islands and the PratasIslands as part of China.47 Even if the PRCconsidered the Senkaku Islands as part ofTaiwan, it is strange that no claim to theSenkaku Islands was made although Taiwanwas under the control of the Guomindang,whereas the Senkaku Islands in contrast wereplaced under US administration (and moreoverjoined to Okinawa) while the Pratas Islandswere placed under UN Trusteeship. Anotherexplanation given by these PRC academics forChina`s silence is the absence of diplomaticrelations between Beijing and Tokyo until 1972.It is not clear to this author why this shouldhave prevented Beijing from protesting against

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Japan`s territorial claim to the islands since thegovernment on many occasions before 1972protested Japanese policies and even concluded`private` fishery agreements which managed tocircumvent the territorial dispute. Anotherreason mentioned was China`s domesticinstability during the Cultural Revolution1966-69 which certainly distracted the PRCleadership from dealing with such a minorissue as these far away islands.

WAS THE SENKAKU/DIAOYU ISSUESHELVED IN 1972 AND 1978?

What had kept the territorial dispute betweenTokyo and Beijing under control from the 1970suntil the beginning of the 1990s was a tacitunderstanding (`anmoku no ryokai` inJapanese) in 1972 and 1978 to shelve thedispute (`tana age` in Japanese, `gezhi` inChinese). However, the Japanese governmentlater explicitly denied such an understanding.Since this shelving agreement helped to keepthe territorial conflict under wraps for such along time despite several incidents and playeda critical role in the 2010 and 2012 crises, it isimportant to investigate the circumstances ofwhat was understood in 1972 and 1978, andwhy this understanding fell apart. Moreover,this author is convinced that another“understanding” will have to be found in orderto escape from the current dangerousconfrontation, but this will only be possible ifthe appropriate lessons can be learned fromthe demise of the 1972/1978 understanding.

In 1972, the two countries normalizeddiplomatic relations, and in 1978, theyconcluded a Peace and Friendship Treaty. Onthe occasion of both negotiations, it was theJapanese side which raised the issue of theSenkaku Islands, and agreed to proceed to aconclusion of the respective negotiationsdespite diametrically opposed claims to theownership of the Senkaku Islands. In otherwords, both governments agreed to shelve theissue, albeit not in writing or in any public or

legal form. In the case of the September 1972negotiations between Prime Minister TanakaKakuei and Prime Minister Zhou Enlai, theterritorial issue (as well as the exact wording ofJapan`s apologies about its past actions inChina, which Tanaka offered to Zhou Enlai)was so sensitive for the Japanese governmentthat the record of the Gaimusho omits thereaction of Tanaka to Zhou Enlai`s refusal todiscuss the territorial issue. This part wasdeleted by the then head of the China Divisionin the Gaimusho, Hashimoto Hiroshi, who lateradmitted this in an interview in 2000. In theinterview he said that Tanaka Kakuei, inreaction to Zhou Enlai`s reasoning that itwould be better not to discuss the problem ofthe Senkaku Islands, replied, `Let`s discuss itanother time`.48 Yabuki Susumu corrobates thisreaction by quoting the book by ZhangXiangshan, an adviser to the Chinese Ministryof Foreign Affairs, who was present at one ofthe meetings. According to his record, Tanakareplied, `All right! Then it is not necessary totalk anymore about it. Let`s do it anothertime.`49 Before this summit meeting, KomeitoChairman Takeiri Yoshikatsu, who served as animportant go-between for the Japanesegovernment to prepare the visit by PrimeMinister Tanaka, had a similar exchange withZhou Enlai in July 1972, when it was alsodecided to shelve the Senkaku issue. WhenTakeiri met Zhou Enlai on 28 July 1972, thelatter is quoted as saying, `There is no need totouch on the Senkaku Islands issue. Mr Takeiri,you also had no interest. I also had no interest.But the historians raise it as a problem due tothe oil issue, and Mr Inoue Kiyoshi is very keenon it. However, there is no need to placeimportance on it (omoku miru)`.50 It is an ironythat Zhou Enlai even referred to a Japaneseacademic, Professor Inoue Kiyoshi, whosehistorical studies favour China`s claim onhistorical grounds, and whose views had beenpresented in an article in the People`s Daily inMay 1971. In these discussions, it was madequite clear by both sides that the normalizationof diplomatic relations was the most important

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goal, and therefore they agreed to shelve theSenkaku issue.

When both sides negotiated the Treaty of Peaceand Friendship in 1978, there was a similarwillingness to put the territorial problem asidein order to achieve the conclusion of the Treatyalthough the Gaimusho (Japan`s Ministry ofForeign Affairs) has so far not released thedocuments. According to Fravel, a chronology(nianpu in Chinese) of Deng’s activitiespubl ished by a party research of f icesummarizes a meeting between Deng Xiaopingand Japan`s Foreign Minister Sonoda Sunao,according to which Deng stated, `It's not thatChina and Japan do not have any problems. Forexample [there are] the Diaoyu Island andcontinental shelf issues. Don't drag them innow, they can be set aside to be calmlydiscussed later and we can slowly reach a waythat both sides can accept. If our generationcannot find a way, the next generation or theone after that will find a way.’51 After theratification of the Treaty, Deng visited Japanand declared at a press conference on 25October 1978 that the issue should be left tofuture generations who may be wiser. In Dietdiscussions, it was also made clear by LDPSecretary General Ohira Masayoshi andForeign Minister Sonoda Sunao that it was inJapan`s national interest to go along with DengXiaoping`s proposal to leave things for the next20 or 30 years.52 Ohira declared at the time onthe question of an agreement to shelve theissue (tana age) that `tana age` was notcorrect, rather the other party (senpo) wouldnot bring the issue up (mochidasanai).53 Or, asSonoda wrote later, while it is true that Chinais claiming these islands as their territory, theislands are currently in Japan's hands, and havenot become an actual issue among Japan andChina. If Japan takes the trouble to bring upthe subject at this occasion and wakes up asleeping giant (literally `disturb a bush only tolet a snake out’ – yabu wo tsutsuite, hebi wodasu), it will be a total loss (moto mo ko mo nai)for Japan.54

One cannot but conclude from these accountsthat both sides agreed to shelve the territorialissue while in no way abandoning their claimsto the islands, otherwise there would not havebeen a normalization of diplomatic relations in1972 or a Treaty of Peace and Friendship in1978. It did not mean that the Chineseaccepted Japan`s territorial claim since Chinahad stated its own claim in these negotiationsand has since 1971 never abandoned the claim.It is also obvious that both sides knew thatthere was a territorial problem, otherwise`shelving` would not have made sense. Thedirector of the Treaties Division and laterDirector General of the Treaties Bureau,Kuriyama Takakazu, who was involved in thenegotiations in 1972 and in 1978, stated in aninterview in 2012 that he understood both thena n d t o d a y t h a t t h e r e w a s a ` t a c i tunderstanding` (anmoku no ryokai) betweenJapan and China to shelve the territorial issue.55

Asai Motofumi, who was director of theTreaties Division in 1978-80 and director of theChina Division in 1983-85, also confirmed thatit was the understanding not only in theGaimusho but also among the politicalleadership (Nagatacho) that there was aterritorial problem concerning the SenkakuIslands.56 Miyamoto Yuji also mentioned in2012 that in his time as head of the ChinaDivision in the 1990s, there was still, on theone hand, a clear position that the SenkakuIslands were Japanese territory, but on theother, the fundamental stance of maintainingthe status quo (genjo i j i ) and a taci tunderstanding that no action needed to betaken.57 Tajima Atsushi, who was the Directorof the China Division in 1978 and participatedin the discussion between Foreign MinisterSonoda and Deng X iaoping in 1978,emphasized in an interview published in June2013 that the Chinese side`s perception of an“agreement (goi)” was one-sided and that theJapanese side only l istened to Deng`sexplanation that the issue of the SenkakuIslands (and of the disputed sea border!) shouldbe left to future generations. The Japanese side

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was satisfied that Beijing had no intention tochange the status quo and therefore judgedthat “no reaction was required”.58 DespiteTajima`s intention to refute the existence of an“agreement”, it is clear that there was animplicit understanding since the status quo wasin Japan`s favour.

Another indirect indication that Japan tacitlyaccepted the existence of a territorial problemand was willing to suspend the issue to protectthe overall relationship with China was thegovernment`s restraint for some time after1972 and 1978 in taking actions which mighthave been interpreted by China as inflamingthe territorial dispute. The government neverallowed prospecting and drilling for oil or gasreserves around the islands, and showedrestraint in allowing landing on or makingeconomic use of the islands. As we will see inthe next part, however, this restraint was notabsolute and still left room for measures whicheroded the shelving agreement.

It is obvious from the historical context of the1972 and 1978 negotiations that both sides hadmuch greater interests at stake than theSenkaku Islands. Moreover, the shelvingagreement was very much in favour of Japan asthe country in de facto control over the islands,thereby reinforcing Tokyo`s ownership claim ininternational law. Later, when China`s political,economic and military weight increased and itbecame doubtful whether the US would invokethe Security Treaty guarantee to protect themilitarily-indefensible islands against a Chinesemilitary challenge, the shelving agreement wasuseful for Japan against any such contingency.59

T H E E R O S I O N O F T H E S H E L V I N GUNDERSTANDING

While one can well understand the desire bythe Japanese and Chinese leaders to deepenthe bilateral relationship through the two tacitunderstandings in 1972 and 1978, and to trustthat all remaining problems, including theterritorial dispute, would then be easier to

solve, with hindsight, this faith looks more likewishful thinking. It is indeed rather unusual toconclude a Peace and Friendship Treatywithout clarifying an open territorial issue, thevery heart of a country`s security policy. Sincethe 1970s, this dispute has not only been asensitive issue within Japan, but also within themuch more limited circle of the Chineseleadership, with political groupings in bothcountries instrumentalizing it for their ownnarrow purposes.

The main conceptual problem with the bilateralunderstanding has been that it was based onthe assumption that the conditions allowing itsformulation in the 1970s could be frozen for aslong as it would take to find a solution to theopposing territorial claims. However,maintaining the conditions for the continuedreliance on the bilateral understanding wouldhave demanded much greater efforts by bothsides to clarify what the status quo is, and whatmeasures would be seen as violating the statusquo. Instead, as Ishii Akira put it, the leaderson both sides procrastinated and allowed theterritorial issue to become the symbol ofnationalism in both countries.60 As a result,various changes and pressures in the domesticand international environment graduallyeroded these conditions, with Japan`sgovernment in the end publicly even denyingthat there was a dispute which could have beenthe object of shelving, and prompting the PRCin the 2010 and 2012 crises to shower Japanwith political and economic sanctions, whichwere unprecedented for two countriessupposedly bound by a Peace and FriendshipTreaty.

The shelving agreement obviously had no legalforce, but denying its existence was politicallyunwise and morally wrong. Okabe Tatsumiargues that for political convenience, Japanagreed in 1978 to shelve the issue, but that thiswas different from shelving the dispute in alegal sense.61 The following official Japanesestatements can be interpreted in this light: in

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October 1990, Cabinet Secretary SakamotoMisoji, after restating Japan`s sovereigntyclaim, still declared that the island issuebetween Japan, China and Taiwan (sic) shouldbe solved by a later generation, thus implyingthat there was a territorial dispute which hadbeen put aside.6 2 But by the time Chinapromulgated its law on territorial waters inFebruary 1992 (see below), the Japanesegovernment would unequivocally and publiclydeny that there had been any agreement toshelve the issue and even that there was aterritorial issue. When Prime MinisterMiyazawa Kiichi protested against the Chineselaw in February 1992, referring to a priorunderstanding with Deng Xiaoping over theSenkaku Islands, the Ministry of Foreign Affairs(MOFA) issued a correction denying such anunderstanding. 6 3 In September 1996,Administrative Vice-Minister Hayashi Sadayukisaid that Japan had not agreed with Deng’s ‘puton the shelf’ proposal, i.e. arguing that therewas no territorial issue.64 In the following, theauthor analyses the three main circumstanceswhich account for the breakdown of thebilateral understanding.

THE CORROSIVE ROLE OF INTERNATIONALLAW

The requirements of international law regimes,particularly the UN Convention on the Law ofthe Sea (UNCLOS), which was ratified by Japanand the PRC in 1996, prompted both countriesto take domestic and/or internationaladministrative and legal steps (for example,passing legislation related to the administrationof their maritime space, demarcating their seaborders, and claiming borders for their EEZ)which had a general purpose but did notsufficiently take into account the need toprotect the bilateral understanding of puttingthe territorial dispute aside. Moreover,international regimes have `vested otherwiseworthless islands with immense economicvalue`.65 They encourage the assertion ofsovereignty and penalize states for appearing

to acquiesce in a rival state`s claim to adisputed territory. Paul O`Shea applied theterm `sovereignty game` to this diplomatic-legal tit-for-tat, based on Alexander Wendt`sconception of sovereignty as a sociallyconstructed institution.66 Finally the vaguenessof international law allows states to cherry pickthose norms which fit best their interests andclaims.67 It is probably with this situation inmind that former Chinese ambassador to Japanand the UN, Chen Jian, explained at thebeginning of a talk on 30 October 2012 thatinternational law is a root cause of the currentterritorial disputes.68 This author has too muchrespect for international law, notably UNCLOS,to agree with this strong statement, but isaware of the weaknesses of many legalstipulations.

With regard to the Senkaku dispute,international law regimes have thus broughtwith it the following complications:

- Both countries must always consider thatwhatever is decided in relation to the disputedSenkaku Islands might have implications forthe country`s other territorial disputes (Japan`sterritorial disputes with Korea and Russia;China`s EEZ dispute with Korea or territorialdisputes with the other littoral claimants in theSouth China Sea ).

- Any action taken by the Japanese governmentwith regard to the Senkaku Islands can beinterpreted as the official expression of thegovernment in control of the islands, and Chinawill therefore feel obliged to protest in order todefend its claim.

- Both countries had to comply with UNCLOS inorder to benefit from this regime and officiallydraw sea borders which start with base lines onwhich are dependent the extent of theTerritorial Waters (12 nm from the base line) ofthe Contiguous Zone (24 nm from the baseline), of the EEZ (200 nm from the baseline),and of the Extended Continental Shelf (under

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certain conditions, up to 350 nm from the baseline can be claimed). The issues arising fromthis are whether Japan and China would applythe drawing of the sea borders to the disputedterritory, and, if so, whether the SenkakuIslands could be classified as `islands` whichare entitled to an EEZ, or just `rocks` whichwould entitle them only to territorial watersunder UNCLOS Article 12.3, and how to drawthe EEZ border in the East China Sea`sSenkaku area. These issues were bound to havean impact on the bilateral understanding in oneway or the other, and would have requiredspecial action in order to keep the territorialdispute shelved.

When China passed its Territorial Law in 1992,it explicitly included the Diaoyu Islands which,naturally, was immediately protested by theJapanese government while still showing aconsiderable amount of understanding andspecifically saying that the law did not violateJapan`s sovereignty over the islands.69 At thattime, the Japanese government was stillpreoccupied with preventing China`s isolationafter the 1989 Tiananmen crackdown. Chinaalso played down the impact of this law andeven referred to Deng Xiaoping`s 1978statement of leaving the territorial issue for thefuture.70 When Jiang Zemin visited Japan inApril 1992, he also reaffirmed the shelvingaccording to Deng`s promise in 1978, whilestill restating China`s claim to the islands.71

However, the Chinese Ministry of ForeignAffairs (hereafter Waijiaobu or CMOFA)originally had not wanted to include theSenkaku Islands.72 When it ratified UNCLOS in1996, China referred to the 1992 Law andpromulgated the precise location of many of itsbase lines, but left out some of them, includingthose for the Senkaku Islands.73 In 1998, theNational People`s Congress promulgated thePRC Exclusive Economic Zone and ContinentalShelf Act, which did not mention any specificgeographical areas. Clearly, the Chineseleadership was trying to walk a fine linebetween its territorial and EEZ claims

(including the need to respond to domesticdemands, increasingly dominated by nationalisttendencies), the requirements of theinternational law regime, and the maintenanceof good relations with Japan.

Japan ratified UNCLOS in June 1996, andestablished in the following month the Law onthe Territorial Sea and the Contiguous Zone, aswell as the Law on the EEZ and ContinentalShelf, which were supplemented by guidelinesfor implementation. The latter also establishedan EEZ around the Senkaku Islands. Japan didnot include the Senkaku Islands in its straightbaseline claim.74 Two separate bills creating theBasic Law of the Ocean Sea? and the Law onEstablishing Safety Areas for MaritimeStructures were passed by the Diet in April2007, and came into effect on 16 July 2007.75

The latter two laws were passed mainly havingin mind any future exploitation of naturalresources in the contested EEZs. NaturallyChina does not recognize the validity of theselaws for the Senkaku Islands, or for the EEZborder between the two countries. Theterritorial dispute is also a major obstacle foragreement on the EEZ border in the southernarea of the East China Sea, which is not madeeasier by the fact that an agreement on the titleto the Senkaku would have a major impact onthe size of the EEZ area of the successfulclaimant, particularly if the islands wereaccorded an EEZ.

F I S H I N G A N D O T H E R E C O N O M I CINTERESTS

Fishing is a major interest for all littoral statesof the East China Sea. Although Japan andChina have concluded consecutive fisheryagreements for the East China Sea, the 1997agreement (effective from June 2000) excludesfrom the application of the fisheries agreementthe territorial waters adjacent to the SenkakuIslands. Instead, the extant 1975 FisheryAgreement, which deemed the areas aroundthe Senkakus as part of the high seas, was

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allowed to prevail.76 In 2012, a letter related tothe 1997 Agreement about fishing in the EEZwas revealed in which Foreign Minister ObuchiKeizo had stated to the Chinese ambassador inTokyo, Xu Duxin, that Japan’s laws andregulations would not apply to the `waters inquestion` (togai no suiiki). It is understood thatthe `waters in question` include the SenkakuIslands, although their name is not mentionedand the Japanese government today denies it.77

Sato Masaru, a former intelligence analyst ofthe Japanese Foreign Ministry, explained thatthis letter referred to the EEZ around theSenkaku Islands and applied only to Chinesef ishermen. 7 8 However, the Japanesegovernment seems not to want to allow foreignfishermen uncontrolled access to the territorialwaters around the Senkaku Islands, and hasbeen patrolling the area. This has led to theexpulsion of Chinese fishermen and subsequentprotests by Taiwan and the PRC. The Japanesecontrols have apparently increased in thedecade since 2000, while Chinese fishingactivities have also vastly increased.79 Moreresearch is needed on these developments tojudge whether yet another `unofficialunderstanding` between Tokyo and Beijing hasbeen undermined.

Finally, in this context, one has to mention theissue of private and state ownership of theSenkaku, as well as the role of non-state actors.In 1896, Koga Tatsushiro obtained a free leaseof 30 years for the islands of Uotsurijima,Kubajima, Minami Kojima and Kita Kojima.After his death in 1918, his son, Koga Zenji,took over the business. In 1926, after the endof the free lease, the Japanese governmentconverted it to a rental basis.80 In 1932, theJapanese government changed the status ofthese four islands from state-owned toprivately-owned land by selling them to theKoga family. After 1945, Kubajima andTaishojima (the latter was always state-owned)were leased to the US as firing ranges. In 1972,Koga Zenji sold Kita Kojima and MinamiKojima, followed by Uotsurshima in 1978, and

Kubajima in 1988, to Kurihara Kunioki, a realestate investor, and his family. In 2002,Kitakojima, Minami Kojima and Uotsurijimawere leased to the state which paid Yen 25million per year for them in rent.81 The USmilitary used Kubajima and Taishojima from1957 as firing ranges, and after the reversionof Okinawa in 1972, continued to do so until1979. It paid rent to the private owner ofKubajima, but after 1971, the rental paymentwas effected by the Japanese government.82 Itis also interesting to note that even in theJapan-US minutes of 15 May 1972 about thesetwo firing ranges, the islands are still referredto by their Chinese characters which aretranscribed in the English version as Kobishoand Sekibisho rather than Kubajima andTaishojima.83

The relevant point here is that, since theshelving of the territorial issue in 1972 and1978, the islands changed private owners, andthe state rented three of the islands from theirprivate owner and owned one. The leasing in2002 and the `nationalization` (no money wasinvolved) of the Uotsurijima beacon in 2005caused Chinese protests, but the privateownership changes did not cause any Chinesereaction.84 This is an illustration of thedeterioration of the bilateral relationshipduring the following years, because it was thesale of three islands to the Japanese centralstate which touched off the 2012 crisis.

THE IMPACT OF OIL AND GAS INTERESTS

The 1969 ECAFE Report had led to claims bythe ROC and the PRC over the Senkaku Islands.The most promising area defined in this reportfor hydrocarbon resources happened to bearound the Senkaku Islands. Since Japanabandoned its joint exploration plans withTaiwan in 1972 with the diplomatic recognitionof the PRC, no Japanese activities have takenplace because of concern about China`sreaction.

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In order to fulfill its growing demand for oil andgas, and to diversify away from its highdependence on Middle Eastern supplies, Chinastarted in the 1970s to prospect and extractenergy resources in the East China Sea.85 Toovercome the territorial dispute in the south ofthe East China Sea, and the divergent positionon how to draw the EEZ border in the rest ofthe East China Sea, China proposed `jointdevelopment` of hydrocarbon resources. InOctober 1980, PRC Deputy Premier Yao Yilineven proposed to a Japanese businessdelegation that development of off-shore oilresources around the disputed islands be donejointly by China, Japan and the US.86 Anotherbilateral proposal was made in 1984 by DengXiaoping, who urged solving the territorialproblems of the Spratly Islands in the SouthChina Sea and the Senkaku Islands by jointlydeveloping the disputed areas beforediscussing the question of sovereignty. But inthis case, as well as later proposals until 1996,Japan first demanded a settlement of themaritime border or recognition of its title to theSenkaku Islands.87

China`s relentless progress and expansion ofoil and gas development increasingly causedfriction between Japan and China, which alsoimpacted on the territorial dispute. Since 1996,Chinese research vessels have entered thewaters of the Senkaku Islands, including itsterritorial waters.88 Japan exerted greatrestraint and until 2004, did not allow Japanesecompanies to survey the ECS even in the areawhich it claimed as its EEZ, let alone aroundthe Senkaku Islands. Moreover Tokyo`spermission for surveying in 2004 by a Japaneseexploration company (never followed upbecause of the political risks involved) inresponse to Chinese oil and gas developmentnear Japan`s claimed EEZ border was only foran area further north, away from the disputedislands.

The Senkaku Islands dispute contributed to thefailure to follow up on the joint understanding

in June 2008 (ryokai in Japanese; liangjie inChinese) to engage in joint development of anarea in the north of the East China Sea and toallow Japan to join the Chunxiao gas fieldexploitation which had been developed byChina in a disputed EEZ area.89 During thenegotiation of the 2008 joint understanding,the Chinese demanded joint development ofenergy resources in the area around theSenkaku Islands in exchange for theircompromise on joint development in otherareas of the East China Sea. Although theCh inese government agreed to theunderstanding without getting satisfaction onits demand, the failure to achieve greaterreciprocity from the Japanese in the Senkakuarea then made it domestically impossible forthe Chinese government to go any further withnegotiating an implementation of theunderstanding.90 In December 2008, twoChinese patrol vessels of the China MarineSurveillance (CMS, Haijiandui in Chinese)which is under the State Ocean Administration(SOA), entered for the first time the territorialwaters around the Senkaku Islands in anapparent move to strengthen its claim to theislands.91

INSTRUMENTALIZATION OF THE SENKAKUDISPUTE BY POLITICIANS AND NON-STATEACTORS

The raising of the territorial issue by China(ROC and PRC) and the campaign of the BaoDiao (Protect the Diaoyu) movement, notably inTaiwan and Hong Kong, since the ECAFEreport, led to a similar involvement of theJapanese political right and other nationalisticgroups which took up the issue as a symbol ofnationalism. In 1973, several rightwingpoliticians within the ruling Liberal DemocraticParty, including Ishihara Shintaro who in 2012became the t r igger f o r the cen t ra lgovernment`s purchase of some of the Senkakuislands, established the so-called Seirankai. Itwas particularly Ishihara who raised theterritorial issue and opposed its shelving by

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Prime Minister Tanaka.92 Against the increaseof tensions between Japan and China since themiddle of the 1990s, the supra-partisan DietAssociation for the Preservation of TerritorialIntegrity was established in 2004. It had 60members by 2011. On 30 March 2004, theSecurity Committee of the Lower House passeda resolution on preserving territorial integrityand demanded a stronger Japanese stance. Itwas the first time the Diet passed a resolutionrelevant to the Senkaku Islands in this vein.93

Edano Yukio, chief of the Constitution ResearchCommittee of the Democratic Party of Japan(DPJ), then in opposition, proposed that Self-Defense Forces (SDF) troops should bestationed on the disputed Senkaku Islands toprevent incursions by other countries.94 SinceSDF members are civil servants (komuin), thisdemand sounds very similar to the demands byAbe Shinzo on 15 September 2012 to stationkomuin on the islands (without clarifyingwhether he meant soldiers or other civilservants), although he postponed a decisionwhen taking over the government in December2012. 9 5 This shows the opportunist icexploitation of the territorial dispute forelectoral purposes.

Nationalist politicians and activists have alsobeen demanding to erect facilities on theislands such as a weather station, a beacon, aheliport or a harbor, in order to assert Japan`ssovereignty. The Nihon Seinensha (JapaneseYouth Federation), a nationalist organizationaffiliated with the major yakuza groupSumiyoshi-kai, caused several incidents bylanding on the islands, starting with erecting alight tower or beacon first on Uotsurijima inSeptember 1978 which was enlarged in 1988,and another one on Kitakojima Island in 1996.96

Each such landing caused protests in China andamong the Chinese diaspora, and prompted thePRC government to complain officially. It alsoled to demands by the Seinensha that the lighttowers be officially recognized by thegovernment and the maintenance be taken onby the Maritime Safety Agency (later called

Coast Guard). But even the compromise ofincluding the light tower into official charts wasan official act, reinforcing Japan`s effectivecontrol over the islands. The discussion aboutthe official handling of the light tower alsoraised the nationalist fever in Taiwan, and itsmilitary even prepared (but then cancelled atthe last moment) a commando action at the endof 1990 to destroy the facility.97 In February2005, amidst rising tensions over China`senergy developments in contested parts of theEast China Sea and Chinese protests againstPrime Minister Koizumi`s Yasukuni Shrinevisits, the Japanese government finally ceded tothe demands of the group to take over theUotsurijima lighthouse structure and itsmaintenance.98 Until then, the Gaimusho hadsucceeded in delaying this state takeover as`too premature` in order not to provokeChina.99

As can be seen, the Japanese government triedto resist these nationalist claims but it couldnot fully circumvent them, thus keepingChina`s suspicions alive. Moreover, whereasthe Japanese government always tries toprevent the landing by foreigners on theislands, it has not until fairly recentlyprevented the landing by Japanese. In order tokeep foreigners out of the islands and theirterritorial waters, the Japanese Coast Guard(CG) has been patrolling the area, which againis an official act. It may have been thenationalist pressure from within the LDP aswell as from right wing circles which promptedOhira Masayoshi when he was Prime Ministerto send in 1979 a general survey team of 50persons (including Kurihara Hiroyuki) to theislands in order to investigate the building offacilities like a heliport. Such demands hadalready been made by the LDP on 24 March1978.100 Although the final report of the surveyspoke against building facilities and nothingfol lowed from it , the Kurihara familyconsidered Ohira – although generally knownto be a pro-China politician - to be the mostsupportive prime minister of all for the

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Japanese assertion of effective control over theislands. Before that Ohira had also agreed toKurihara Hiroyuki`s proposal to set up onUotsurijima a monument to honour KogaTatsushiro which was done with thegovernment`s material and financial support.101

Even within the Chinese leadership, theterritorial issue has been divisive. Just whenthe two sides were negotiating the Peace andFriendship Treaty in April 1978, about 100Chinese fishing vessels, some armed, appearedaround the Senkaku area with bannersdeclaring China`s title to the islands. While thiswas explained at the time in Japan as a meansto pressure the Japanese during the treatynegotiations, it now seems now more likely thatthe Senkaku issue was used by followers of theChairman of the Military Commission, HuaGuofeng, as a means of attacking the re-emerging Deng Xiaoping. The PRC centralleadership explained at the time that this was`accidental` and Deng Xiaoping promised itwould never happen again.102

These latter incidents are also important whendiscussion turns to the question who started toundermine the understanding about shelvingthe islands dispute – Japan or China? Was itChina when it passed the 1992 Territorial Lawas is often mentioned in Japan, or did it alreadyviolate the understanding in April 1978 as someothers claim? However, if the latter incidentwas beyond the control of the Chinesegovernment, it could be argued that it was theJapanese government with the erection of amonument or the 1979 survey that touched offfrictions. Yet the blame game does not help infinding a solution, instead these incidentsshould make it clear that both sides bear partof the responsibility for undermining the1972/78 understanding and should therefore bewilling to come to a new understanding.

THE DETERIORATION OF THE BILATERALRELATIONSHIP SINCE THE 1990S

In addition to the above developments, it was

the general deterioration of the bilateralrelationship since the middle of the 1990s thatchanged the conditions for maintaining theshelving of the territorial dispute. Japanbecame suspicious of China`s non-transparentmilitary modernization, particularly of the navywhich has been expanding its operations,including the East China Sea.103 Other negativedevelopments were the progress of Chinese oiland gas exploration in the East China Seadespite disagreement over the common EEZborder, visits by Japanese political leaders tothe Yasukuni War Shrine, and other issuesrelated to Japan`s past aggression againstChina.

A nadir in the bilateral relationship wasreached during the rule of Prime MinisterKoizumi Junichiro (2001-2006) because of hisannual visits to the Yasukuni Shrine. But whilethe political relationship got colder, theeconomic relationship expanded and prospered(`Cold Politics, Hot Economics`). This also had–at first glance counter-intuitively – adeleterious effect on the motivation to workharder to maintain the conditions for puttingaside the territorial conflict since thisdichotomy gave the false impression thatpolitics and economics could be kept separateforever while the territorial issue was pending.The worsening of the territorial conflict from2010, and particularly from 2012, with China`sharsh political and economic retribution, wouldbear this out.

Part of the rationale for the Chinese navy`sincreased presence in the East China Sea isChina`s oil and gas developments, as well asthe wish to preserve the navy`s access to thePacific Ocean to prevent Japanese/USobservation or to intervene in a crisis. Thiscould not but affect the territorial dispute. InMay 1999, 12 Chinese warships conducted amanoeuvre in waters north of the Senkakuislands. The exercise was the first of its kind tobe carried out by China in that region.104 OtherChinese naval movements in the East China

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Sea increased, including reports aboutintelligence-gathering ships. In the last fewyears, the political influence of the PLA, andparticularly of the PLA Navy (PLAN), hasconsiderably increased.105 The Japanese reactedby increasing their military deployment and astrengthening of Japanese-American militarycooperation. However, the Senkaku area iscontrolled by the Coast Guard which is a lawenforcement agency, and the Japanese navykeeps away from policing. This incidentallyreinforces Japan`s claim, as policing is doneonly within national territory or EEZ areas.

Until the central government`s purchase ofthree of the islands in September 2012, it wasthe activities of non-state actors from Japan,Taiwan, Hong Kong and the PRC, whethernationalist activists or fishermen, which causedthe greatest direct confrontations since Japan`scountermeasures were a demonstration of theexercise of sovereignty which the PRC becameincreasingly unwilling to tolerate. In 1996, aHong Kong protester who tried to cover the lastmeters from his boat to one of the islandsdrowned. Another incident occurred in 2008when a Japanese Coast Guard ship rammed aTaiwanese sport fishing boat which hadentered Senkaku territorial waters. The actioncaused the boat to sink.106

In March 2004, for the first time since 1996,seven Chinese activists landed on Uotsurijima.When the Japanese police made arrests, theChinese Foreign Ministry protested, calling it aserious violation of Chinese sovereignty. Thearrests were made under the immigrationmanagement law which includes a clause onexpulsion of illegal foreign trespassers.107 Inlight of the 2010 incident in which a PRCfishing trawlere twice rammed a Japanesecoast guard ship it is important to note thatdespite guidelines which were to give = lawenforcement agencies the authority to dealwith trespassers `according to the law`, it wasreported that the central governmentintervened at the last minute, did not press for

an indictment and ordered the release of thearrested Chinese. The government did not wantany further complications that might torpedothe planned China visit by Foreign MinisterKawaguchi Yoriko, and was satisfied to havedemonstrated effective control over theSenkaku Islands by arresting and expelling theChinese.108 A Japanese journal reported thatthere was a Japanese pledge to China followingthis incident that in future an intruder wouldnot be put in detention but only arrested aslong as it was not a serious case; in turn Chinaagreed to prevent the departure of vessels withprotesters from its harbours. Such anunderstanding has not surprisingly been deniedby the Japanese as well as by the Chinesegovernment.109

The China Marine Surveillance (CMS) startedirregular patrol activities near the SenkakuIslands in December 2008 when two CMSvessels stayed for over nine hours in theterritorial waters of the Senkaku Islands asmentioned above. This was interpreted in Japanas a major escalation.110 Former ambassador toChina, Miyamoto Yuji, called this newdevelopment a qualitative change in theSenkaku dispute which went beyond previouscases of intrusion by fishermen or protesters.111

This deployment was followed by others thefollowing year against a background of Chinareinforcing its maritime control. Japanresponded by building up its own defenceefforts in the south, including plannedstationing of some troops on Yonaguni Island,one of the closest islands to the SenkakuIslands.112

THE 2010 FISHING TRAWLER INCIDENT

It is against this complex background that theChinese fishing trawler Minjinyu 5179 with acrew of 15 entered the territorial waters of theSenkaku Islands on 7 September 2010 nearKubajima. There were many other Chinesefishing trawlers in the same area and severalships of the Japanese Coast Guard were trying

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to chase them away. Pursued by three JapaneseCG vessels, the Minjinyu 5179 twice collidedwith two of the CG vessels. There are differentinterpretations whether the Chinese captainZhan Qixiong intentionally rammed the CGvessels , and there are some strangeinconsistencies highlighted in the reports of theincident.113 Some non-Japanese authors likeSheila Smith and Linus Hagström are non-committal on the question of the collision, butmost Japanese authors blame the trawler andthis author is more inclined to believe that theramming was intentional.114 The Chineseunsurprisingly blame the CG vessels.115 Theissue of intention is important insofar as itgives some indication about the risk ofrecurrence and of escalation. The followingcircumstantial evidence suggests intentionalramming by the Chinese captain:

- There is ample video footage leaked by a CGofficer which specialists have interpreted asintentional ramming by the Chinese captain.116

- The captain seemed to have been drunk and isknown to be a volatile person. 117

- Fishing in the East China Sea is verycompetitive and Chinese fishermen areparticularly annoyed about the patrols andcontrols by Japanese and Korean lawenforcement agencies in the as yet un-demarcated EEZs among all three countries.

Chinese fishermen have a reputation of oftenbeing violent, as many incidents in the SouthChina Sea and in the Yellow Sea seem to prove.Only three months later, in December 2010,another Chinese fishing trawler captainrammed a South Korean coast guard vessel inthe Yellow Sea, however, his boat sank as aresult and the Chinese captain drowned.118

Chinese crews are often armed with metalpipes and attack law enforcement agents whichhave led to other fatal casualties in 2011 and2012.119

The 2010 trawler incident is further relevant in

our context in v iew o f the Japanesegovernment`s handling it (legal aspect; denialof the shelving understanding), China`scountermeasures, and the aftermath of thegovernment`s purchase of three islands inSeptember 2012. After the collisions, theJapanese government arrested the crew andconfiscated the trawler. The following day, theChinese government demanded the release ofthe crew and the trawler, which the Japanesegovernment did on the 13 September, butkeeping the captain in custody. The Japaneseambassador to China, Niwa Uichiro, wassummoned six times by the Chinese between 8and 19 September. Beijing`s reaction escalatedafter the Chinese captain`s term of detentionwas extended on 19 September to last from 20to 29 September. On 20 September, Chineseauthorities detained four Japanese citizens forentering a restricted military area in Hebeiprovince. Even without the trawler incident thedetention of the four Japanese would haveharmed the bilateral relationship, but,happening in this context, it was, rightly orwrongly, immediately linked by the Japanese toother Chinese sanctions as discussed below.The result, however, was that the Japanesereleased the Chinese captain.1 2 0 Evenimmediately after the crew`s arrest, theChinese government had already begun tocancel the second round of negotiations forimplementation of the understanding on energycooperation in the East China Sea concluded on18 June 2008. Other reprisals and sanctionsfollowed, including the suspension of rare earthexports to Japan on which the country`s hightechnology industry is very dependent.Although, before the incident, the Chinesegovernment had already moved to reduce rareearth exports, which naturally hit Japan as thebiggest importer, Japanese media reported thatthe Chinese customs authorities totallysuspended exports in late September.121 Theexact circumstances of this alleged embargoare still not yet clear as discussed in detail byAlastair Johnston.122 The crisis ended when thedeputy prosecutor in Ishigaki announced on 24

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September the release of the captain, citing the`diplomatic impact` of the case on the bilateralrelationship. Some considered this as surrenderby the Japanese and the result of dubiouspolitical interference into the legal process.The opposition had a field day attacking thegovernment`s handling of the incident.123 TheJapanese Foreign Ministry spokesman declaredthat the government had applied domestic law,and again refuted the idea of there being aterritorial problem to be resolved.124 Othersargue that the incident had several benefits forthe Japanese government because it obtained areconfirmation of the US security guarantee toinclude the Senkaku Islands, it helped toconvince the public about the necessity of moreJapanese defence efforts, and it exposed Chinaas an assertive if not aggressive power.125

China claimed that the incident showed thatJapan had changed its approach to handlingthis type of incident, which could beinterpreted as a confirmation that both sideshad reached an informal understanding afterthe 2004 incident.126 However, this incident wasmuch more severe since the captain`s twocollisions with CG ships were interpreted bythe Japanese government as intentionalramming. The captain was charged withobstruction of Performance of Public Duty as aresult of the ramming. On the other hand, onecannot blame China for allowing this boat toleave its Chinese harbour because it was afishing trawler and not a protesters` campaignvessel. What made this incident so serious forthe Chinese was Japan`s very public assertionof its sovereignty over the islands in the way ithandled the Chinese captain and the explicitdenial of the shelving understanding of the1970s. On 21 September, Foreign MinisterMaehara stated that Japan had not agreed withChina to shelve the territorial dispute.127 Thisdeclaration followed the second extension ofthe captain`s detention on 19 September whichprompted the Chinese government to allowwidespread demonstrations in China and toplace a series of sanctions against Japan

(cancellation of ministerial meetings; `self-restrictions` on visits to Japan by Chinesetourists; and postponement at very short noticeof the visit of 1000 Japanese youth, plannedfrom 21 September, to the Shanghai WorldExhibition). Japan is estimated to have lost¥31.8 billion due to a decline in the number ofChinese tourists.128

I t is di f f icult to judge whether theseunprecedented countermeasures were centrallydirected, and it is l ikely that it was acombination of various power centrescompeting and/or feeling the need to be seenacting in accordance with the increasingly anti-Japanese mood.

Japan`s domestic circumstances made a speedysolution such as that in 2004 difficult. The DPJhad come to power only in 2009 and lackedforeign policy experience. There was noeffective communication between the twogovernments, at least at the beginning of theincident, in contrast to earlier times. TheJapanese leadership obviously misjudged howthe Chinese would interpret Japanese handlingof the incident, which it perceived as a reversalof Japan`s previous (albeit graduallydiminishing) restraint. Although the DPJ hadinitially a more pro-China leadership when itcame to power (notably Prime MinisterHatoyama Yukio and Secretary General OzawaIchiro), this had changed by 2010. The ministerin charge of the CG (which is under theMinistry of Land, Infrastructure, Transport andTourism) on the day of the incident, wasMaehara Seiji, a known defence hawk, whothen became Minister of Foreign Affairs in acabinet reshuffle on 17 September. He wastherefore much more at liberty to take a hard-line stance against China while the DPJpresidential election – won again by Kan Naoto– took place on 14 September, followed by theprime minister`s departure to New York toattend the UN General Assembly on 22September. The foreign minister before the 17September was Okada Katsuya, who was also

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more inclined to take a strong stance. Maeharaas well as Okada had seen the CG`s video ofthe collision which could not but have left themwith a very negative impression of the Chinesecaptain`s actions.129 It certainly did not helpwhen Maehara, in his new post as foreignminister, qualified China`s reaction in the Dieton 18 September as `very hysterical`, and thendeclared on 21 September that there had neverbeen an understanding about shelving theterritorial dispute.130 On 23 September,Secretary of State Hillary Clinton assuredvisiting Foreign Minister Maehara that theSenkaku Islands were covered by the bilateralJapan-US Security Treaty, an intervention thatwas certainly also not welcome to the Chinese.However, there have been speculations that inexchange for this strong US reconfirmation ofthe security guarantee, in order to get out ofthe stalemate, the Japanese had to promise torelease of the Chinese captain, which occurredthe following day.131

The 2010 incident had several consequenceswhich made a recurrence very likely. First of allthe incident raised tensions to a degree lastseen during the anti-Japan demonstrations in2004 and 2005, which had been mainlyconcerned with Japan`s attempt to gain apermanent UN Security Council seat and thehistory issue. These tensions had made itimpossible to have any new negotiation roundto conclude a treaty about cooperation in theexploitation of hydrocarbon resources in theEast China Sea and thus reduce another majorsource of bilateral tensions, and one moreover,related to the Senkaku issue. Against thisbackground, but also in line with its previousposition, Japan rejected a Chinese proposalmade in October 2010 for joint resourcedevelopment in the Senkaku area.132 The legalaftermath of the incident continued for sometime, with Japan claiming compensation fromthe Chinese captain for the damage caused tothe two CG vessels, which was rejected byChina and countered with demands forcompensation and an apology. The Japanese

prosecutor dropped the case against thecaptain only in January 2011, but the CG stillsent a bill to the captain in February 2011.133

While the incident helped the Japanesegovernment to obtain strong US support on theapplicability of the bilateral security treaty tothe Senkaku Islands, and generally helped toconvince the Japanese public about the needfor greater Japanese defence efforts (includinga strengthening of US leverage vis-à-vis Japanconcerning the realignment of its forces onOkinawa), it reduced Japan`s independencewith respect to the degree of support itprovided for US China policy.

Secondly, the incident further undermined theconditions which were the foundation for theunofficial shelving of the Senkaku issue. If itwas not yet clear to everybody that there was aterritorial dispute over the Senkaku Islands,then this incident, with the unprecedentedChinese sanctions against Japan, lifted the lastremnants of doubt. Maehara Seji, who repeatedon 25 occasions in Diet debates between 10September and 16 November 2010, that thereexisted no territorial dispute, made this officialposition even less convincing.134 The incidentprompted Beijing to publicly undermineJapan`s territorial claim further by announcingon 29 October 2010 permanent deployment oflarge fisheries patrol vessels in waters near theSenkaku Islands, which was reciprocated bythe CG deploying patrol vessels of over 1000tons in the same area.135 In a further tit-for-tat,on 17 December 2010, the city government ofIshigaki, the administrative authority of theSenkaku Islands, passed an ordinance todesignate 14 January the day to commemoratethe Senkaku Islands` incorporation in 1895.136

The further erosion of the shelving agreementafter October 2010

The next major confrontation over the SenkakuIslands in September 2012 occurred againstthe background of more measures taken by

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both sides to support their respective territorialclaims, and domestic circumstances in bothcountries which were even less conducive to re-establish trust and good relations. The growingUS-China political and military rivalry in EastAsia, as exemplified by the Asia pivot whichChina perceives as directed against its rise,certainly did not help. Initially, the year 2011saw a recovery of relations from the 2010incident. Bilateral trade reached a new highwith a volume of $345 billion. Japanese foreigndirect investment in China soared nearly 50 percent in 2011 to $6.3bn.137 Moreover, theChinese public was very impressed with thedisciplined way the Japanese people reactedtowards the triple disasters which hit thecountry on 11 March 2011, and there was anoutpouring of sympathy which also included thesending of a Chinese search-and-rescue missionto the affected Tohoku area.138 Yet, thisimproved atmosphere was quickly dispelledwhen the results of the textbook review werepublished on 27 March, which asserted Japan`sterritorial claim to the Senkaku Islands (as wellas to Takeshima/Dokto) and denied the Chinesefigure of 300,000 victims in the Nanjingmassacre.139

In the meantime, the Japanese governmentcontinued to turn the legal screws whichaffected the Senkaku Islands by implementingdomestic laws in order to be congruent withinternational law and strengthening maritimecontrol. In February 2012, the Japanese cabinetpassed bills to enhance the Japan CoastGuard's law enforcement powers in territorialwaters which would, for example, authorize theCG to order foreign ships to leave Japan`sTerritorial Waters without first boardingthem.140 Other administrative measures derivedfrom the Basic Law on Ocean Policy, which hadbeen enacted in 2007 and which provides theframework for administrating remote islands.Since 2009, Japan has given names to hithertounnamed islands to substantiate its claims toan EEZ. For this purpose, in August 2011, thegovernment placed 23 uninhabited islands

under state control, but four islets near theSenkaku Islands were exempt, out ofconsideration for China. In March 2012,however, the government abandoned thiscaution and registered Kitakojima as a nationalasset.141 In November 2011, the governmenthad let it be known that it would shortly releasea new list of names for islands which wouldinclude islets of the Senkaku group.142 Chinaprotested and a meeting in Beijing planned inFebruary 2012 between President Hu Jintaoand representatives of seven bilateralfriendship groups from Japan was cancelled. Anopinion piece in the People's Daily (RMRB) on17 January 2012 said Japan's move ‘is a blatantmove to damage China's core interests’.143 On 2March 2012, Tokyo finally announced a list of39 islands which included four islets in theSenkaku Islands group.1 4 4 The Chineseprotested immediately on the same day and, ina tit-for-tat, the State Oceanic Administrationreleased on 3 March standard names anddescriptions of the Senkaku islands and its 70aff i l iated is lets . 1 4 5 Another Chinesecountermove was the announcement on 16March by the SOA that they had startedpatrolling near the Senkaku Islands. This wasfollowed promptly on the same day by one CMSship entering the Territorial Waters of theSenkaku Islands, and the same vessels withanother CMS ship cruising in the ContiguousWaters of the islands.146 In November 2010 anofficial of the Ministry of Agriculture's Bureauof Fisheries which operates the Fisheries LawEnforcement Command (FLEC) had alreadyannounced that his organization would fromnow on deploy fisheries patrol vessels of over1000 tons to maintain continuous patrols.147

THE 2012 CONFRONTATION: ISHIHARASHINTARO LIGHTING THE FUSE

It was in this tense environment that TokyoGovernor Ishihara Shintaro announced on 16April 2012 that the Tokyo Metropolitan

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Government (TMG) was negotiating thepurchase of three of the four privately-heldSenkaku islands by the end of the year, i.e.Uotsurijima, Kita Kojima and Minami Kojima.The lease of the central government for thesethree islands was due to expire in March 2013,and no incident would have occurred if thegovernment had quietly renewed the lease. Thecentral government stated that it had notknown about Ishihara`s intention, but thatthere had been contacts on various occasionsbetween the government and the privateowner.148 This seems convincing since stateownership would have provided betterprevention of incidents, even more than justleasing. Taken aback by Ishihara`s surprisemove, the Chief Cabinet Secretary FujimuraOsamu declared the following day that thecentral government might acquire the islands`if required`, and Prime Minister Noda impliedin a Diet speech on the 18 April that a purchaseby the central government was one of theoptions. Both statements were widely reportedin China. 1 4 9 Ish ihara had chosen hisannouncement for maximum effect on theoccasion of a speech at the conservativeWashington DC-based Heritage Foundation. Hemade it clear that this project was meant as acriticism of the DPJ-led central government,which he considered failing in its duty tosufficiently protect Japan`s sovereignty bysaying that the central government should bebuying the islands but that the Gaimusho wastoo afraid of offending China. The location ofhis announcement was meant to gain strongersupport from the US for Japan`s territorialclaim.150 As we have seen above from Ishihara`sactivities in the 1970s, this announcement wasin many ways the logical conclusion of his longlasting obsession with the Senkaku Islands andhis hatred of communist China. It was the 2010incident in particular which had encouragedhim to renew his old plan of buying the islandsafter his earlier failure to do so. His goodconnections with the owner Kurihara Kunioki,who shared his nationalist proclivities, helpedIshihara to become the favoured purchaser.151

The possibility of having the three islandsunder the control of the nationalistic governorof Tokyo who wanted to build facilities on theislands to strengthen Japan`s sovereignty wasunpalatable to the Noda government whichfeared complications with China. In a meetingon 18 May, Noda and his top advisers decidedin principle to purchase the islands.152 Pressureon the government increased, to pre-emptIshihara because he was astonishinglysuccessful in raising voluntary contributionsfrom the public to buy the three islands, thuscircumventing any legal difficulties in usingTokyo`s taxpayer money and also proving thepopularity of his move: By 1 June he hadcollected 70,000 donations totaling around¥1.01 billion which increased to ¥1.46 billionby 6 September.153 On 27 July, the TMG ran anadvertisement in the Wall Street Journal askingfor US understanding and support for thepurchase plan.154 The TMG had to requestcentral government permission to conduct asurvey of the islands, which the governmentrefused to grant on 27 August, forcing the TMGto conduct a survey from a ship on 2September.155 In the end, it was the higher sumand the shortest delay of concluding the dealwhich prompted Kurihara Kunioki, who wasapparently in some fi