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Japan does what even the US fears to do, take on China

Discussion in 'China & Far East' started by astodome, Sep 18, 2010.

  1. astodome

    astodome BANNED

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    Beijing: Chinese authorities sought on Friday to forestall anti-Japanese protests ahead of a sensitive political anniversary, blocking the websites of Chinese nationalist groups and erasing discussion of organizing demonstrations from the Internet.



    In this Sept. 7, 2010 file photo released by Japan Coast Guard, a Japan Coast Guard boat, foreground, goes by a Chinese fishing boat which Japan Coast Guard officers are on board for inspection after it collided with two Japanese patrol vessels near a chain of disputed islands known as Senkaku in the East China Sea. China increased pressure on Tokyo on Sunday by warning it to make a "wise" resolution and immediately release the Chinese fishermen and their boat detained after it collided with two Japanese patrol vessels near disputed islands east of Taiwan.

    Ever-present anti-Japanese sentiment in China has been inflamed in recent weeks by Japan's arrest of a Chinese fishing boat captain after his boat collided with two Japanese fishing vessels in waters near an island group north of Taiwan that is claimed by both Tokyo and Beijing. China has demanded the release of the captain. The Chinese boat was also seized.

    On Friday, the website of the China Federation for Defending Diaoyutai was offline, and messages about organizing protests over the incident were scrubbed from Internet bulletin boards. Diaoyutai is the Chinese name for the disputed islands, referred to by Japan as Senkaku.


    Japan does what even the US fears to do, take on China - 1 -  International News ? News ? MSN India

    Shame to US
     
  2. CardSharp

    CardSharp ELITE MEMBER

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    This Indian focus on China is unhealthy. What does Japanese-Chinese relations have to do with India? Why do some Indians nationalists seem desperate for someone to "standup" to China or put it back into "its place"?




    Chinese insularity v Indian insecurity: a recipe for trouble

    There is a very thorough overview of the fractious China-India relationship in this week’s Economist which describes the face off between the two Asian giants as the “Contest of the Century”.

    This might sound a rather hyperbolic title, but when you consider the fact these nations account for roughly a third of the world’s population and an ever-growing portion of global economic heft, the relationship between these two nations is at least as crucial as the US-China relationship that currently fills the spotlight.

    As the Economist contends – and correctly, I think – “How China and India manage their own relationship will determine whether similar mistakes to those that scarred the 20th century [will] disfigure this one.”

    And yet, viewed from this side of Himalaya, it is extraordinary (to a former India correspondent, at least,) how little importance China attaches to India – in terms of column inches, in academic forums in the basic headspace set aside to consider the relationship. India is the Elephant in the Chinese room, except that you often wonder if China even knows it.

    In India, by contrast, China features heavily in the media, looming massively over the endless conferences and academic talking shops set up to discuss, in rather navel-gazing fashion, who’s going to win the race to the top of the Asian superpower stakes.
    India, with its favourable demographic and rising household savings rate, likes to fancy itself as the tortoise in a race that at present is being lead by the Chinese hare. Perhaps it is unfair to say so, but India is so far behind it doesn’t have much option but to hope that China’s rise will sink under the weight of its own internal contradictions.

    The contrasting attitudes of each to the other reflect on the one hand Indian insecurity and on the other, Chinese insularity. This is a dangerous mix.

    Indo-Chinese trade is growing, but as the Economist points out, it is a lop-sided, subservient relationship (Indian iron ore for Chinese finished goods) that deepens Indian fears of Chinese encirclement, as they are outflanked again and again in their own neigbourhood by China – in Burma, in Sri Lanka, In Pakistan.

    At the same time, like an irritating little brother, China basically ignores India or treats it with ill-concealed contempt, both at a diplomatic level, but also on the street where attitudes to India are openly dismissive – a dirty, smelly, chaotic Third World kind of place in the view of many Chinese.

    (As an aside, it will be interesting to see if the Chinese media and blogosphere can even be bothered to scorn India’s feeble efforts at organizing the Commonwealth Games, a badly handled second-tier event that – when compared to China’s stunningly accomplished Olympics of 2008 – tells you all you need to know about the gap between the two nations.)

    In any event, the current state, or rather non-state of the relationship must be a source of serious concern.

    If the US-China relationship is often described like a bad marriage, then the China-India relationship is like that of two very different brothers, who need to get on but at deep, deep level (far deeper than the territorial disputes that the Economists dwells upon far too heavily) are perhaps just incompatible.

    The negative personal chemistry – Chinese insularity and Indian insecurity – is no platform for resolve the crunches that surely lie ahead – over water (Chinese dams on the Brahmaputra), over oil and natural resources (both nations have limited supplies and compete the world over to secure others) and in the Asian arms race that is now firmly underway.
     
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  3. CardSharp

    CardSharp ELITE MEMBER

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    Japan is actually a big help for China to counter the current US policy

    China's Get-Out-Of-Jail Card Vexes Geithner: William Pesek Bloomberg


    The U.S. Treasury secretary has worked 24/7 for 20 months prodding China to revalue the yuan. Even scant progress is vital as November’s congressional elections approach. Geithner can forget it after Japan’s intervention.

    It’s a little-appreciated side effect of Japan’s first yen sales in six years. Any calls for China to boost the yuan will now be met with a blunt retort: Yeah, why don’t you call Tokyo first? Japan’s per-capita income is more than 10 times ours and you’re giving us grief about exchange rates?

    It’s smiles all around in Beijing. China is growing 10 percent a year, Premier Wen Jiabao says efforts to avoid overheating are in “good shape” and investment is still pouring in. The glue holding it together is a cheap currency. Japan just gave China a green light to keep it that way.

    Adding insult to injury, Japan’s intervention was confirmed on Wednesday, the day U.S. lawmakers began a two-day meeting to address China’s currency. And largely for nothing: Japan’s chances of driving down the yen in the long run are virtually nil. Not with the dollar and euro falling for very logical economic reasons.

    “The U.S. can hardly brand China a currency manipulator while Japan is bulldozing the yen,” says Simon Grose-Hodge, a strategist at LGT Group in Singapore.

    Japan’s Example

    Japan’s example gives China extra ammunition to resist calls for action at a meeting of Group of 20 finance ministers in Washington next month. It’s the equivalent of a get-out-of- jail-free card. It’s also an incentive for officials in Seoul and Taipei to intervene to stem increases in the won and Taiwan dollar.

    The yen isn’t representing global imbalances the way the yuan does. China should let the yuan rise, and not just disingenuously ahead of congressional hearings. It’s stunning that the yuan this week rose to the highest level since 1993. The key is for that trend to continue and accelerate after the gavel bangs.

    China’s $2.5 trillion of currency reserves are more a sign of an unsustainable model than financial strength. When does China stop hoarding? When reserves reach $3 trillion? What about $4 trillion? Really, what an unproductive use of state resources. This cash glut also inflates China’s money supply, raising the risk of overheating.

    Chinese Action

    Yes, an undervalued yuan makes it harder for troubled economies in the U.S. and Europe to boost growth. The reason China should act is because it’s in its best interest. It would raise purchasing power and allow officials to make better use of China’s savings.

    China will move when it internalizes these benefits, not because Congress or Geithner demand it. Any hopes that might happen sooner rather than later were dashed by the sudden return of Japanese intervention.

    Prime Minister Naoto Kan is acting in what he believes to be Japan’s self-interest. There’s a clear every-economy-for- itself dynamic coursing through the world these days and Kan has both voters and opposition lawmakers to whom he must answer. It would have been better, though, for Kan to wait for broader support from Group of Seven members.

    China’s economy recently surpassed Japan’s, and trade data show the extent to which Japan is benefiting from Chinese demand. In the long run, a stronger yuan would probably benefit Japan more than a weaker yen. Short-term thinking is winning out in Tokyo.

    Living, Dying

    As Jesper Koll, Tokyo-based head of equity research at JPMorgan Chase & Co., points out, “Japan lives and dies with the yen.” And that’s just the problem. The perception among executives is that a strong yen equals bankruptcy. It would be better if they responded with innovation, increased productivity and a sense of sobriety.

    By giving in to the business lobby, Kan’s party suggests that it’s devoid of fresh economic thinking. Unilateral yen sales were the bailiwick of the Liberal Democratic Party that controlled Japan virtually uninterrupted for 54 years until August 2009. Kan’s Democratic Party of Japan showed a decided lack of originality by intervening.

    Ominous Message

    Worse, it sent the message that there’s nothing wrong with Asia’s obsessive approach to exchange-rate management. But there is. Every time officials in Seoul, Taipei or elsewhere act to hold down currencies, they are delaying the process of recalibrating growth models away from exports to domestic consumption. Global imbalances grow worse.

    Policy makers in Malaysia, Thailand and the Philippines signaled recently that they may step in to limit volatility in their currencies. You can bet on it if Japan’s yen sales continue. Two years after the collapse of Lehman Brothers Holdings Inc., Asia sees exports as the only game in town.

    Such beggar-thy-neighbor policies will only get Asia so far. Everyone simultaneously wants to export their way out of trouble and can’t. This global race to the bottom will be of limited success.

    For Geithner, Japan’s intervention is very poorly timed. The Obama administration is desperate to get some yuan-related points on the scoreboard ahead of November. That just became much harder thanks to events 7,000 miles away from Washington
     
  4. somebozo

    somebozo ELITE MEMBER

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    After reading the article I dont see anything what the Japs have done other than spark some protests which the Chinese authorities deem unhealthy and dont want to make a big issue out of this mistaken incident. However the Indians want to paint a picture of Japanese invasion by China because presumably this is what the US really fears to do.
     
  5. CardSharp

    CardSharp ELITE MEMBER

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    ^^^^ Let's not use racial slurs please even in passing.
     
  6. twocents

    twocents FULL MEMBER

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    Morality police?
    It's not that strong a term anyway.
     
  7. CardSharp

    CardSharp ELITE MEMBER

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    Maybe but if I don't like being called a gook (not that strong a term right?) I can't imagine this being acceptable.
     
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  8. siegecrossbow

    siegecrossbow PDF THINK TANK: ANALYST

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    Shame to the U.S. for looking at the bigger picture and refusing to plunge the world into Nuclear war and complete chaos. Shame on those cowards. :usflag:
     
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  9. indushek

    indushek SENIOR MEMBER

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    Man i am seeing to many articles on China these days on this forum. I don't know whats gone wrong and seriously these TOI and MSN and Rediff should be kicked once in a while in their @$$.

    One is okay but one too many causes indigestion.
     
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