TOKYO, Japan — The immediate threat of a clash between Chinese and Japanese vessels near the Senkakus has abated, but the recent brinksmanship over the islands in the East China Sea has left one of the region's most important bilateral relationships in tatters.
On Sunday, China abruptly canceled celebrations scheduled for Thursday to mark 40 years since the countries normalized diplomatic ties.
The row of the five islets, known as the Diaoyu in China, has led to the cancellation of thousands of flight bookings, mostly from China to Japan, as well as sports and cultural events. A Japanese business delegation announced Monday that it would not make a planned visit to Beijing later this week.
Senior Japanese officials said they regretted China's decision to postpone the anniversary event "indefinitely," thereby letting slip a possible opportunity to arrest the rapid decline in relations in recent weeks.
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"This is unfortunate and we are very disappointed," Masaru Sato, a foreign ministry spokesman, told GlobalPost. "We don't believe that this specific issue should be allowed to affect the broader perspective of our relations. We are asking China to take a cool and calm approach."
The postponement is being interpreted as a de facto cancellation in retaliation for Japan's decision to buy the islands from their private owners — a Japanese family — earlier this month.
The purchase led to government-sanctioned demonstrations in dozens of Chinese cities, attacks against Japanese-owned businesses and threats of a boycott of the country's imports.
The potential for the situation to deteriorate was evident again on Monday morning after three Chinese surveillance vessels were seen in Japanese territorial waters near the Senkakus. The civilian vessels later left the area without incident, according to local media reports.
There has been a glaring absence of high-level communication between the two governments throughout the latest rise in tension.
But in a sign that Japan wants to re-establish lines of communication, Prime Minister Yoshihiko Noda today sent Chikao Kawai, a vice foreign minister, to Beijing for talks with his Chinese counterpart, Zhang Zhijun.
Concern is growing, meanwhile, about the impact the row will have on two-way trade relations, which were worth a record $345 billion last year.
The Japan-China Economic Association decided to postpone a planned visit to Beijing by 175 Japanese business leaders due to start tomorrow, citing difficulty in arranging meeting with Chinese officials. The group had been due to meet the Chinese premier, Wen Jiabao, but shortened, then canceled, its trip in response to last weekend's mass anti-Japanese protests across the country.
Instead, two senior members of the association, including Hiromasa Yonekura, chairman of the influential Japan Business Federation, will hold smaller meetings in the Chinese capital on Thursday.
The cancellation comes amid reports that Japanese companies with interests in China are having difficulty securing visas and completing customs procedures. Some firms have been told that their products will undergo more frequent inspections, raising fears that red tape is being used to slow imports.
"We are trying to forecast things in advance and preparing as much as possible to avoid any impact on our business," Takanobu Ito, chief executive of automaker Honda, told reporters.
In another sign of declining confidence, a recent poll found that more than 40 percent of Japanese firms feared the territorial row could affect their business plans, with some considering pulling out of China.
Noda said in an interview with the Wall Street Journal published on Sunday that the dispute and the violent protests it sparked in China last weekend could deter foreign investors. "China should be developing through the various foreign investments it receives," he told the paper. "Anything [China does] to discourage that is a disservice to itself."
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Noda will use his speech to the UN general assembly later this week to call for the resolution of territorial disputes based on the rule of law. Those comments are intended not only for China, but also South Korea, which has refused a Japanese invitation to take their dispute over the Takeshima islands — known as Dokdo in South Korea — to the International Court of Justice in The Hague.
The mood among citizens in Japan and China reflects the general gloom that has descended on diplomatic and economic exchanges, according to a poll published today in the Asahi Shimbun. It found that 90 percent of Japanese and 83 percent of Chinese people took a negative view of current bilateral relations. While 49 percent of Japanese hoped for deeper ties in the future, 40 percent thought Japan should keep its distance from China.
Among the biggest sticking points were territorial disputes and a belief among Chinese respondents that Japan has yet to fully atone for its pre-war and wartime conduct on the Asian mainland, including its 14-year occupation of northeast China.