Northeast Asia’s wrong turn

In May, Korea, Japan and China signed a trilateral investment agreement, marking the first major step toward achieving the long-term vision of institutionalizing regional economic integration.

What a difference five months makes.

Now all three countries have become involved in bitter and potentially dangerous disputes with conflicting claims over tiny offshore rocks, threatening to block the economic cooperation needed to help save them from the effects of a looming demographic time bomb.

Since the 1960s, Northeast Asia has been the world’s most dynamic growth region with the economic rise of first Japan, then South Korea and now China. But by 2030, it will be the world’s fastest-growing geriatric ward in terms of population, sapping economic vitality as all three countries struggle to deal increased social spending on the elderly.

Closer economic cooperation promised a solution to dealing with some of these problems and it was an important reason why China, Japan and Korea have been pursuing steps toward regional integration since the 2008 global financial crisis. Besides holding trilateral summits, they established a Trilateral Cooperation Secretariat in Seoul last year with a rotating secretary-general and agreed to begin discussions on a regional free trade agreement. The major question now is whether the three countries will go ahead with the free trade agreement (FTA) negotiations that were scheduled to begin soon.

The sudden emotional outbursts over the long-running disputes concerning the Dokdo/Takeshima and Diaoyu/Senkaku islands have severely disrupted the slow and painful progress that had been made in achieving the comfort level necessary to make the FTA negotiations and related measures possible. Recent hopes for regional cooperation have now been replaced by growing worries about stability in Northeast Asia.

President Lee Myung-bak must share part of the blame for what has happened. His visit to Dokdo in August, the first by a Korean president, has had profound unintended consequences. Although Koreans may have derived great emotional satisfaction from the visit, it was not a constructive act but rather provocative.

There is little doubt that Korea has a stronger historical claim to Dokdo, while its control of the islets strengthens its case. Koreans will consequently argue that Lee had a perfect right to visit Dokdo. But such a view fails to recognize the reality of regional political dynamics.

In a broader context, expectations that Japan will give up claims to Dokdo are futile as long as Tokyo presses its case for the recovery of the four Northern Territory/South Kuril islands that were occupied by Russia during World War II. This issue is of major importance in Japan and has held up the signing of a formal peace treaty with Moscow ending the war. Tokyo views the abandonment of claims for Dokdo as weakening its case for the South Kuril Islands.

More immediately, Lee’s visit to Dokdo caused a loss of face for Japanese Prime Minister Yoshihiko Noda, who has sought to improve relations with Seoul, while his political power is weakening. Adding to Noda’s woes was that Lee’s visit coincided around the same time as nationalist activists from Hong Kong and Taiwan landed on the Senkakus.

With Noda being attacked by right-wing nationalist politicians, such as Tokyo Governor Shintaro Ishihara, over Lee’s visit, it probably led to Tokyo’s recent actions to strengthen its control over the Senkakus, triggering one of the deepest crises in post-war Sino-Japanese relations. Ishihara has urged Japan to follow the Korean example on Dokdo and build structures on the Senkakus to solidify its claim.

There is a general consensus among outside observers that Korea, Japan and China should move pass the island disputes and focus on the big picture of peace and prosperity in Northeast Asia, given the daunting social challenges ahead. One possible cause for optimism is the belief is that the current territorial disputes reflect uncertainties over political transitions in all three countries this year and that once new leaders are in place the situation will calm down.

But such hopes may be misplaced because of the historical baggage stemming from Japan’s colonial rule of Korea and its invasion of China in the 1930s and 1940s. The reasons these issues are bubbling to the surface once again is that there is growing public belief in China and Korea that Japan is a declining power, which creates an opportunity to demand apologies and compensation from Tokyo for its wartime behavior. In response, Tokyo is turning to such nationalist politicians as Shinzo Abe, the new Liberal Democratic Party leader, and Toru Hashimoto, head of the maverick Japan Restoration Party

Northeast Asia is thus being affected by two conflicting trends. One is the need for a breakthrough in regional geopolitics to forge closer cooperation so that Korea, China and Japan will be able to maintain economic competitiveness in the years ahead. The other is the deep emotional currents that are being unleashed as the power balance shifts within the region in favor of China and Korea.

Unfortunately, Northeast Asia finds itself in a Catch-22 situation. Stronger regional institutions would help resolve the territorial issues by promoting greater understanding of each other’s positions, but institutional integration is unlikely to happen as long as the disputes are allowed to fester.

John Burton, a former Korea correspondent for the Financial Times, is now a Seoul-based independent journalist and media consultant. <The Korea Times/John Burton>

news@theasian.asia