Country Report: Japan (April 2017)

The period February-April has witnessed an outpouring of Japanese articles on ties with the United States (as Trump sets his Asia policies and meets with Abe before meeting with Xi Jinping), China (as Japan toughened its stance toward North Korea and South Korea, while readying for the Trump challenge), Russia (as Abe prepared for a late April follow-up summit with Putin amid uncertain fluctuations in Russo-US relations), South Korea (as the election of a new president approached amid strong concern that the result would complicate regional security), and North Korea. With Northeast Asia in extraordinary flux, the Japanese kept searching for clarity on how problems would be resolved. By April, the number one focus was Sino-US relations and North Korea with South Korea left in the shadows.

The three-month period since Trump’s inauguration is marked by two transformative developments: 1) the lead-up to and follow-up of the Abe-Trump summit on the weekend of February 10-12, which reassured Japan that a close alliance would continue; and 2) the lead-up to and follow-up of the Xi-Trump summit on the weekend of April 7-8, which was interpreted in Japan as even greater reassurance that Trump was serious about standing up to China and facing the North Korean threat forcefully. Japanese conservatives took satisfaction from the two periods of summitry and reassurance, despite some misgivings about the use of US military power against North Korea and economic power against Japan. As US-Russia ties defied hopes and South Korea seemed headed in the wrong direction, new concerns arose, but the main message was positive about Japan-US relations.

The year had begun with tremendous soul-searching, as little seemed stable in the outside world. New pressures on Japan were coming from all sides: North Korea, South Korea, China, and now the United States. Yet, Abe’s popularity rested, above all, on his foreign and security policy successes. As reported in the December 30 Mainichi Shimbun, he continued to be rated much higher in this area than in other arenas, despite the failure of TPP, lack of a breakthrough with Russia, lack of progress on the abduction issue, troubled relationship with China, and now the alarm over Trump’s “America first.” Yet, Sankei Shimbun, as on December 29, kept touting his security successes and the necessity of boosting ties with the United States while criticizing Abe’s amending the Constitution and Russia policy.

Most enthusiastic has been Yomiuri Shimbun, which on January 30, reported sharp global criticism of Trump, but emphasized that US foreign policy would not really change and Japan’s value would rise as it helped to convince Trump of the essential US role in the international order, as in Iokibe Makoto’s January 7 article. Abe would forge trust with him and the Japan-US axis would soon be reaffirmed, as on January 3. On January 10, it also looked to progress in Japan-Russian relations and linkages to broader diplomacy with both the United States and China, which might have hinted at a quadrangular approach boosting Japan as a great power force.

Yet, the three main papers further to the left saw the “crossroads” in history differently. Tokyo Shimbun on January 8 called for a more autonomous foreign policy, a day after voicing expectations for improved relations with China in the 45th anniversary year since the 1972 normalization. Asahi offered on January 6 the views of Tanaka Hitoshi, critical of Japan’s efforts to contain China through policies in Southeast Asia and Russia and calling for coexisting with China and resisting Trump’s anti-globalist posture, while highlighting Asia relations and international cooperation. Mainichi was more critical of China, as in January 13 comments by Iokibe and Takahara Akio, who faulted its great power syndrome, but it appeared more concentrated on reforming Japanese society, drawing on lessons from the backlash to social inequality and injustice erupting in Western countries.

After worried responses in Japan to Trump’s inauguration speech, February brought a string of reassurance to Japan: generals put in charge of US security policy were closely followed, as well as the accelerated THAAD deployment, tough posture toward North Korea, and the Abe-Trump summit. The summit led to talk of a “honeymoon” and revival of the “Ron-Yasu” era with two leaders having warm personal relations but also facing trade frictions, as suggested in Sankei on February 14. The Pence-Aso talks were seen as reviving attacks on the automobile and agricultural sectors in Japan and demands for more agricultural imports from the United States, including beef and oranges. Asahi on February 15 pointed to criticism from opposition parties of Abe drawing too close to Trump, while Abe explained that Japan had no choice. One warned of entrapment, whereas the other made clear the danger of abandonment.

The Abe-Trump summit was considered successful beyond expectations. Close relations of trust were established, tough US stance on North Korea and missile defense was welcomed, US affirmation of article 5 of the Security Treaty applying to the Senkaku Islands was unambiguous, and Trump expressed understanding for Abe’s pursuit of Putin, as the February 14 Sankei noted. With North Korea in the forefront, however, Mainichi stressed the same day that it was time to improve the conditions for talking to China. Asahi was harsher in doubting the results of the summit and warning of economic differences. Tokyo Shimbun’s analysis warned that a deal was in progress: security for economy.

The fact that Trump and Abe spent 43 hours together was noted in the talk of a “honeymoon,” as Abe led the way for world leaders to see Trump as an acceptable partner for building trust and cooperating internationally. As Sankei wrote on April 12, concern about US isolationism was cast aside; instead it would deepen its involvement in Asia and strengthen its alliance with Japan. Without ignoring economic challenges ahead, coverage concentrated on the strategic theme.

Sources contrasted the atmosphere of the Abe-Trump and Xi-Trump summits. Both were in the relaxed atmosphere of Trump’s “villa,” but for Abe, the golf-heavy time was for close allies to personalize their bond, while for Xi, this was a way to clear the air to press strong demands. That is the impression relayed in Yomiuri Shimbun on April 8 and 9, pointing to more formality with Xi and refusal to use his language of a “new type of great power relations.” On February 27, the same paper described the Trump-Abe-Xi triangle in rather zero-sum terms, showcasing the strengthened Japan-US relationship, sensing troubled Sino-US ties, and warning of a possible upsurge in anti-Japan sentiments in China with the South China Sea in the forefront.

One theme raised in Japanese articles was the growing role of Japanese diplomacy. Hiraiwa Junji in the March 8 Yomiuri stressed the necessity of encouraging Trump to deal with North Korea (with China’s indispensable role) and avoid extreme policies. Hosoya Yuichi in the March 28 Yomiuri took a broader approach, recognizing setbacks to the international order and seeking a Japan-US-Australia-India maritime strategy in support of freedom of navigation. Yet, he saw a rival order taking shape on the Eurasian continent, geopolitically and geo-economically. Rather than seeing Japan’s role as firmly with the sea power group, however, he said that this is more important, but Japan should also try to play a moderating role with the land power group through multiple bilateral relationships. Rather than recognize Japan’s weak leverage in the face of North Korea and the “strategic triangle” of great powers, he opted, as did many others, for the notion that Japan is diplomatically empowered.

Japan-China Relations

This theme saw relatively little attention considering how much else was in play. An exception was Wang Yi’s press conference on March 8, covered the next day in Asahi Shimbun, which depicted Japan as at a juncture from which it could go in either direction—based on historical consciousness blocking an improvement in ties and healthy development of the Sino-Japanese-ROK triangular relationship. Elsewhere, Japan’s military role was the focus, including in the South China Sea.

Japan-Taiwan Relations

Niwa Fumio in the March Kaigai Jijo wrote about deepening ties between Japan and Taiwan, noting that soon a year will have passed since Tsai Ing-Wen took office and the Japanese have high expectations that their cooperation will advance further. Compared to the Guomindang, the Democratic Progressive Party has consistently been more pro-Japan and critical of China. Niwa notes that Japan is expecting in the area of security improved ties, but also in the affirmation of shared values, as discussed by Tsai in October 2015 when she visited Japan and was greeted by Kishi Nobuo, Abe’s brother. Of the Legislative Yuan’s 113 members, 104 are members of the Taiwan-Japan exchange association. Without diplomatic relations, grass-root civic organizations draw the two societies together. Various prominent figures in Taiwan serve as “pipes” to Japan with long experience in cultivating ties, especially networking with political and economic elites. Even Ma Ying-Jeou, who was labeled anti-Japan, unexpectedly advanced relations with Japan during his tenure, keeping relations stable. Air travel to Haneda airport was resumed after 31 years, Japan research centers were established at leading universities and think-tanks, and after Japan’s September 11, 2011 earthquake, Taiwan’s support drew tremendous gratitude in Japan, along with agreement to liberalize trade. Whatever Ma’s personal views of Japan, Niwa finds that bilateral ties under him advanced a lot. As many as 56 percent of the Taiwan public last year chose Japan as their favorite country, leaving China with 6 and the United States with 5 percent behind. Particularly young people (more than 60 percent of those in their 20s and 30s) put Japan first, influenced by mass culture, the shift away from sinified education since 1990, tourism (5 million combined in both directions), school excursions, and backlash to Ma’s attempts to draw closer to the PRC. Taking economic ties for granted, the article stresses how values and security are drawing Japan and Taiwan closer with high expectations.

Japan-India Relations

An article in the April Toa advocated combining Japan’s strength in hard power with India’s strength in soft power. It cited India’s importance at the crossroads between East and West in underwater cables and its global geopolitical importance in the Internet. Yet, it also pointed to challenges India faces in cybersecurity, notably in the financial sector. While located advantageously for servicing IT in the United States with ample English-language speakers who are simultaneously skilled mathematicians, India is in the midst of a government-led struggle to substitute credit for cash. It also faces cyberattacks from Pakistan, which the article observes is cooperating with China. Thus, the article proposes further efforts to deepen Japan-Indian relations.

Japan-Russia Relations

On March 19 Asahi Shimbun was disappointed by Russia’s attitude at the first meeting to implement the Abe-Putin agreement on joint economic development of the islands. Russian insistence that its laws apply contradicted Japan’s expectations for a special area that would not require Japan to deny its claims to sovereignty. On the same day Yomiuri was more hopeful, writing that Russia was cautious, and now it was time to figure out how to have a breakthrough, awaiting talks between Abe and Putin. Russia’s further militarization of the islands was noted on February 23 in Sankei and Asahi. On March 31 in Yomiuri details were revealed of Russia’s stance on 26 joint economic activities, including construction of an electricity generating station for wind power, in seven places to build processing points for maritime products as well as a market with emphasis on meeting the needs of the internal Russian market. Japan proposed about 30 projects—some overlapping—serving both health needs for people on the four islands and tourist groups. The legal complications especially affect projects on land, the paper mentioned. Abe would focus in late April on travel by plane for former residents to gain access to graves.

On March 21 Mainichi Shimbun reported on the 2+2 talks of Japan and Russia, stressing the gap in their thinking. Japan seeks accelerated progress toward a peace treaty, while Russia takes a broader approach to Japan as a member of the G7 with the overall security environment in mind. The two sides clashed on Russian steps to strengthen its forces on the disputed islands, such as deployment of anti-ship missiles there. Talks were no more productive on North Korea, as Russia opposed missile defense and insisted on dialogue with the North. Syria and Ukraine were subjects that led to discord as well. Another article in the same paper focused on accelerated economic talks in the coming weeks prior to a late April visit by Abe to Russia, but it gave no hint of what would transpire except the exchange of proposals on both the joint economic activity sought on the islands and projects in the Russian Far East. Yomiuri on March 21 was similarly conscious of the divide over security, calling the talks a way to create a favorable environment for territorial talks. Yet, it found a big gap over North Korea, China, and bilateral security relations as well, pointing to Russia’s new, disturbing actions on the islands. Instead of increased trust, the opposite appears to be occurring in regard to issues raised at the security talks, as Lavrov took a hardline stance on missile defense and Japan opposed island moves.

Yomiuri Shimbun on April 8 described Japan as caught between the United States and Russia, as their relationship deteriorated further, reducing the prospect of Japan’s regaining the Northern Territories. While it was said that there would be no direct influence on Japan-Russia negotiations, as when Abe visits Russia on April 27, the possibility was raised that Trump would deal with Russia much as Obama had and, presumably view Abe’s pursuit of Putin more critically than many had anticipated.

Sino-US-North Korean Relations

Japan’s take on the Trump-Xi summit was that this was no love fest but a sort of ultimatum, as Trump’s forceful diplomacy on North Korea set the tone, while the reserved response of China offered some basis for hope. Indeed, there was an image of China shifting ground while the United States stood firm in the quest for shared consciousness. Trump made it clear that China would have to impose much stiffer sanctions and that US military preparations were intensifying, as noted in Sankei Shimbun on April 7. Sankei on April 3 had suggested that Xi was eager for stable US relations, in part for the success of the fall party congress. Trump could press China, and he did was a message widely shared in Japanese publications.

In the April 21 issue of Gendai Business, optimism was expressed about new pressure being applied against North Korea. Equating the struggle to the siege of a castle in the Warring States period, Hasegawa Koyo wrote that the key is China cutting off oil to the North, much as in past sieges cutting off food supplies forced surrender. Kim Jong-un is ensconced in his fortress, the United States has him surrounded, and China is supplying 90 percent of the oil North Korea uses. Trump asked Xi Jinping to cut off oil supplies, the article asserts, and if Xi does not do so, US economic sanctions will apply to China too, causing a big blow to its financial system. If China joins the United States, North Korea’s fighting capacity will be stopped. Its planes will not fly, tanks will not roll, and economy will be paralyzed. The impact will be greater than the stoppage in Chinese coal imports from North Korea. On April 6-7 Trump made his case to Xi, punctuated by telling him personally of the US missile attack in Syria, and on April 12, Xi telephoned Trump, seeking peaceful resolution of the North Korean issue. Trump followed by setting aside designating China a currency manipulator, waiting for a clearer response. Yet, Hasegawa is dubious that Xi will comply due to internal political strife in China limiting his maneuvering room in foreign policy and the overall push for dividing the Pacific into two spheres, which does not leave room for US influence in North Korea. The article refers to China’s policy toward Japan, the South China Sea, and the Korean Peninsula in this context. North Korea is viewed from this broader setting.

Hasegawa expects a drawn-out struggle in which Japan will play a large role after a breakdown in Sino-US cooperation over North Korea. He suggests that on April 18 Mike Pence discussed with Japanese officials this prospect. Japan must give its assent to use of US bases in the country for military operations, as must South Korea for actions by US forces from there. In the near future, US forces will only prepare to go on the attack, mainly to arouse China into action. Moreover, any US military move would possibly be treated as a limited counter-attack, not preemption, while seeing what the North would do next. The precedent of the Gulf of Tonkin pretext for the US war in Vietnam is cited, as Washington seeks consent from Seoul and Tokyo.

On April 18 in Shukan Gendai Kondo Daisuke claimed to reveal the full contents of the Trump and Xi secret talks on North Korea. Trump said strategic patience is over, and on April 4, the NSC met and decided to prioritize military intervention. Xi responded that North Korea is a headache for China too, and in November it agreed to Security Council sanctions and in February ended imports of coal. But Xi insisted that this problem should be resolved by dialogue, that China does not want the United States to use military force. China has repeatedly sought to stop THAAD deployment since last year, but the United States is accelerating this, and this must be stopped. Trump answered that THAAD is for defense against North Korea’s missiles and not aimed at China. Moreover, the North Korean threat is growing. The ROK agrees, and THAAD will not be stopped. Xi asked if the real aim of the Trump administration is the overthrow of Kim and the collapse of the North Korean state. Trump responded that the goal is to stop the development of the North’s dangerous nuclear weapons and missiles. If Kim Jong-un stops these, the regime can continue, and there is not thinking about the collapse of the state. Then Trump asked Xi to apply more pressure on North Korea, irrespective of how it is done. Xi added that China would do what it can and explain it to North Korea, but it cannot accept a preemptive strike. Trump allegedly then remarked that Obama treated China as an enemy with repeated “freedom of navigation” exercises, while he will treat it as an ally. The article adds that the contents of the April 12 phone call have not yet been divulged, but it can be imagined that Xi appealed for the United States not to attack North Korea, to which Trump answered that China should act quickly, if that is to be the case.

Kondo apologized for writing a week earlier that Trump had decided to prioritize the Middle East over North Korea, acknowledging that the opposite is true. Explaining Trump’s reversal from “America first” to George W. Bush-style military action, he turns to personnel matters and a power struggle in Washington. Whereas the US tradition is a tripod of the State Department, the CIA, and the Pentagon, Obama gave preference to the State Department, confirming the notion that it is the Democratic Party’s stronghold, while others are the Republican Party’s stronghold. Acting on this view, Trump is slighting the State Department in every way and relying on the generals for his foreign policy. Thus, some fear that a North Korean nuclear test will be followed by a US air attack, leading to the North’s barrage against Seoul and full-scale war. If in these circumstances, China suspended all assistance in oil, food, and fertilizer as well as financial access, North Korea would be out of supplies in a week, Kondo argues, speculating that North Korea would turn its missiles against Beijing. Kondo suggests that a telephone call from Wang Yi to Lavrov on April 14 was an SOS in response to this danger. Both are angry with Trump, and there may be a complete revival of the Cold War, he warns. In Kondo’s scenario, if there is a sixth nuclear test and the Security Council does not apply adequate sanctions, Trump would decide to act militarily, North Korea would send a top emissary to China, but he might be met with the same brusque, standoffish treatment as a prior emissary received in 2013.

Shukan Gendai on April 23 projected the scenario of a new Korean war, lasting three months and resulting in 4 million deaths before Kim Jong-un is hunted down in an underground hiding place. This scenario contrasts to the easy victory promised in North Korean accounts of a successful takeover of the South. The article cites the April 10 Zhang Liangui piece in Global Times, which estimates a 70-80 percent chance of a new Korean war. The tension over Korea has risen sharply in April.

On April 26 Newsweek Japan discussed China’s response to a US attack on North Korea, reflecting on a Huanqiu Shibao article of April 22. It reported that Trump’s message to Xi had been that China is the lifeline of the North and can easily resolve the crisis. He asked for China’s help and explained that if China did not sufficiently provide it, the United States would make another choice. China has been put in a very difficult situation, and its proposal for a mutual freeze with no US-ROK military exercises was rejected by Washington and Seoul. The article proceeds to assert that the armistice called for the removal of foreign troops from the peninsula, but even after Chinese forces withdrew, US forces remained. Also, that only the US side boycotts the political talks that were to follow. Yet, China wants to sustain the “honeymoon” with Trump that has just been realized. If there should be a new nuclear test, it has no room for maneuver, the article insists, noting that radiation fallout will reach China. One likely response is a sharp reduction in oil to North Korea, with supplies for humanitarian reasons continued but possibly enough impact to affect industry. Yet, the North is not likely to relent, leading to questions about how China may react to a military strike. Would it be amenable to pinpoint strikes on nuclear and missile facilities? Although opposed diplomatically, China would not take military action, it is surmised. The risk exists of a North Korean attack on Seoul in retaliation. Without the April 6-7 summit, it is assumed that China’s response would be intense, taking some military action and invoking the defense treaty with North Korea. Xi’s reaction to Trump’s attack on Syria is called a “dramatic change,” suggesting that it would tacitly accept a pinpoint attack on the North. If US and ROK troops moved beyond the 38th parallel, however, China would militarily intervene. China has made clear that forceful unification is unacceptable. China’s opposition to North Korea’s nuclear and missile programs is due to their threat to China, to regional stability, and most of all, the domino effect of nuclear weapons in South Korea and then Japan.

Posutoseven on April 26 posited a shift in Xi’s policy on North Korea after the murder of Kim Jong-nam, as seen in the cutoff of coal imports five days later. This has made North Korea very angry, since more than 40 percent of the value of its exports to China are coal. How far will this change of direction from protecting the regime and prizing it for the balance of power go? The article speculates that the result may be acceptance of the collapse of the Kim system. Yet, the article also says that the sudden change resulted from Trump’s willingness to use military force. In the April 17 Sankei, one also finds recognition of a change in tone from China, noting as possible explanations for the diversification of views: the Kim Jong-nam murder; the sense North Korea had shifted from a latent threat to a real risk as Japan and South Korea could go nuclear; the US threat to use military force; and Xi’s need for stability before the party congress. That same day, this paper had remarked on the Chinese coverage of the Xi-Trump summit as building mutual trust and a voyage of friendship. Asahi Shimbun found the world stunned by the turn of events: the United States was praising China and distancing itself from Russia, contrary to what was expected of the Trump regime. On April 14, it too was struggling to grasp the geopolitical currents in movement, while North Korea was at the center of this whirlwind of diplomacy. For Japanese media, however, much less was said about the reasons for China’s change than about the signs of success for Trump (and Abe too).

South Korea

This was a depressing time for those who had hoped that Japan and South Korea can improve their relationship. Coverage of impeachment and later the arrest of Park Geun-hye was alarmist. There was no sign that Japan would countenance a revival of talks over the “comfort women” issue. Meanwhile, on “Takeshima day,” February 22, there was talk of widening consciousness that it is inherent Japanese territory and communicating this to the rest of the world. This suggests a renewal of the public relations battle with South Korea—this time pushed by Japan—to convince the United States and other audiences of the justice of Japan’s historical thinking. Yomiuri went so far that day as to editorialize that despite close cooperation with South Korea over North Korea, there is no easy compromise on the Takeshima issue. No thought is given among conservatives to finding more common ground with South Koreans.

Park Cheol-hee on January 29 in Tokyo Shimbun explained the South Korean view on the “comfort women” issue, saying that the “irreversible resolution” part hurt the pride of the Koreans. Also, the Japanese attitude that because their government had paid 1 billion yen, Korea should show sincerity on the statue does not make victims feel better. Yet, he proceeds to call on everyone to keep the big picture in mind: the threat of North Korea, the assertiveness of China, and Trump’s pressure on allies. In these circumstances, Japan-ROK cooperation is indispensable, the spirit of the agreement should be sustained, and extreme nationalism should be overcome, he concluded.  

On April 7, the editorial staff of Gendai Business asked why a pro-North Korean politician might be elected the next president of South Korea and what that would mean. It reported on a conversation between Kondo Daisuke and Muto Masatoshi, former ambassador to South Korea. It noted the tremendous turmoil in South Korea as it faces a challenging environment. Describing Moon Jae-in as pro-North Korea and critical of THAAD, it asked why a majority support such an extremist. Muto answered that society, especially youth, have a sense of hopelessness, not seeing a future for themselves. Entrance exam competition is more severe than in Japan, as kids go to school with two box-lunches and return only around 10 pm, apart from attending cram schools. Even for students at top-level universities, high barriers stand in the way of finding employment. The gap is huge between the few who are able to enter a chaebol and others, relegated to small and medium-sized firms, as those not on the permanent employee track are worse off even than counterparts in Japan. It is not easy to marry if one does not enter a good company. In these conditions, people have come to hate the chaebol. The suicide rate for the elderly is the highest in the OECD. Park Geun-hye’s promised economic democratization was a failure, and the scandal implicating her led to further discontent. It was Moon Jae-in who most vigorously criticized her. If he were to win and go first to North Korea, as he promised, South Korea would be isolated from international society, it is argued, but many believe that only his kind of radicalism could change Korean society.

The article proceeds to attribute to many Koreans the views that there is nothing wrong with North Korea possessing nuclear weapons, and that once reunification occurs, the country can stand up to Japan and other neighboring states. It says that the Japanese cannot understand this sympathy with North Korea, but adds that it is another reason for Moon’s support. It does not rule out the possibility that the South would accept unity under North Korean leadership. Aware of Moon’s rise, Washington is rushing to deploy THAAD. After his election, it might also be wary of sharing intelligence, which could be leaked to North Korea. After all, Kondo argues that in November 2007, Moon leaked a draft UN resolution on human rights to North Korea.

Muto also said that in October 2015 Obama had asked Park to speak out on China’s violation of international law in the South China Sea. Kondo added that China is interested in great power relations with the United States and Russia and views both North Korea and South Korea in the context of Sino-US ties. He also suggests that if THAAD deployment is completed, the reactions in China will parallel the anti-Japanese demonstrations in 2012 after Japan’s nationalization of the Senkakus. While Park balanced China and the United States, Moon would seek to balance North Korea and the United States, Kondo concluded. Muto countered that if in May China holds massive demonstrations against South Korea, its image there would suffer greatly. Moon would have no choice but to stick closely to an ally.

China’s retaliation against South Korea for THAAD deployment was closely followed in Japan. Focusing on Jeju Island, one article noted that of 1,585,000 visitors in 2016 360,000 were foreigners, of whom 85 percent were Chinese. Koreans hired Chinese speakers and opened numerous shops for these visitors, but the number has fallen 80-90 percent from its peak. Hidden in the bar graft is evidence that over the past few years, in contrast to the previous ones, Japanese visitors have been scarce, said Asahi Shimbun on April 4. On March 8 Yomiuri had linked China’s growing pressure on South Korea to the Korean economy’s excessive dependence on China. Asahi also examined the tourism drop-off on March 4, contrasting 2005 when 2.44 million Japanese visited South Korea compared to 710,000 Chinese to 2016 when Japanese visits had stalled at 2.3 million, while Chinese ones had surged to 8.07 million. The ban on Chinese group tours now is part of the intensifying attack on South Korea.

In one of many Sankei articles on March 9 on China’s bullying of South Korean firms, emphasis was put on China’s boycott of Lotte encouraged on the Internet and even television and newspaper stories. It noted that the possibility of boycotting Japanese firms and goods had been raised in China under Jiang Zemin and Hu Jintao, but brakes were put on it in consideration of attracting foreign investment. However, now Japanese business circles and government should awaken to the possibility that today’s Lotte will be tomorrow’s Japanese firm. It should deal with China differently.