Economic statecraft, interdependence, and Sino-Japanese ‘rivalry’

Abstract China’s increasingly active economic diplomacy in recent years has often been deeply linked to its geostrategic interests. Japan is said to be watching this development with alarm. Analysts have often claimed that this has resulted in Sino-Japanese rivalry, where the Japanese see any gains made by China in zero-sum terms, and make concerted efforts to counter China’s growing influence. This article, however, is critical of such views. While elements of rivalry may indeed be visible in some aspects of Sino-Japanese relations, it would be premature to apply this perspective to economic statecraft, which is inherently multifaceted. This article claims that too much attention has been paid to the strategic aspects of Chinese economic statecraft at the expense of economic/commercial ones that could foster cooperative relations between Beijing and Tokyo. It argues that Japan does not hold a monolithic view that Chinese diplomatic activities in the economic realm are an axiomatic threat to Japanese security interests, and it remains premature to say that Japan and China are ‘rivals’ in the realm of economic statecraft. Future analysis in this area needs to pay greater attention to the complicating effects that economic interdependence can have in strategic policies.