China, Japan’s Leaders Meet, Signal Thaw

After weeks of acrimony between their nations, the leaders of China and Japan met in Brussels. From CNN:

Chinese Premier Wen Jiabao and Japanese Prime Minister Naoto Kan met Monday in Brussels, on the sidelines of the Asia-Europe Meeting.

They met in a corridor outside the conference venue after a working dinner and spoke for about 25 minutes, Kan told reporters, according to Japan’s Kyodo news agency.

During the meeting, Wen stressed the mutual benefits of China and Japan maintaining good relations, according to China’s state-run media.

Wen and Kan “agreed to step up people-to-people exchange and communication between the governments, and hold China-Japan high-level meeting at an appropriate time,” according to the Xinhua news agency.

Wen also reiterated China’s claims to the Diaoyu Islands, China’s state-run media said. The Japanese call the islands the Senkaku.

Yet the recent events will undoubtedly have longer-term repercussions that have not yet been fully felt. The Globe and Mail looks at how China’s move to interrupt exports to Japan of rare earth metals used for the development of a huge number of high-tech goods, may have backfired in the long run:

By stepping up customs checks at its ports on rare earths headed to Japan – thereby slowing exports to a trickle – Beijing instigated a brief but telling panic among the many Japanese technology firms who need rare earths to produce everything from smart phones to Toyota Motor Corp.’s prized hybrid automobile, the Prius. One day after the new customs procedures were introduced, Japan – which depends on China for nearly all of its rare earths – caved in to Beijing’s key demand in the fight, releasing the captain of a Chinese fishing boat that rammed two Japanese coast guard vessels last month near the uninhabited islands known as the Senkaku in Japan and the Diaoyu in China.

But China also communicated a message to its neighbour besides the one it intended. While the government of Prime Minister Naoto Kan was shocked at how far and how fast Beijing proved willing to escalate the quarrel over the islands, Tokyo also got a potentially valuable lesson on the dangers of relying so heavily on China for rare earths and other natural resources.

The tactic may have helped Beijing win the release of the fishing captain, but it may also result in a loosening of its stranglehold on the international market for rare earth metals.

See also “Summary Box: Japan fights China grip on rare earth” from Business Week.

October 4, 2010 10:08 PM
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