Can Japan stand up to US request to contain China?

By Ai Jun Source:Global Times Published: 2019/5/23 21:03:40

Two days before US President Donald Trump's visit to Japan, a fake news story caught the globe's eye on Thursday - Japan's Panasonic said it was suspending business with Huawei "to comply with US restrictions," according to Reuters. It was reported that roughly 25 billion yuan ($3.6 billion) worth of Panasonic goods were procured by Huawei in 2018. That being said, if the news were true, Panasonic's move could be equated to cutting its own wrists. But Panasonic soon denied the rumor saying "currently Panasonic Corp is still supplying Huawei." 

The story hype has an inextricable connection with Trump's upcoming visit to Japan. 

Japanese Prime Minister Shinzo Abe visited the US in April. Trump is expected to attend the G20 summit next month in Japan. Then why bother visiting Japan again in May? Some say it is because of the honor to be the first state guest to meet with the new emperor. But Trump's real purpose is more about turning Japan into the biggest pawn to contain China. 

In terms of procuring core parts, Japan is a crucial source for Huawei. According to The Nikkei, "Huawei procured roughly 700 billion yen ($6.3 billion) worth of goods from Japanese companies" in 2018. At a time when an increasing number of Japanese major companies, including Toshiba, Mitsubishi and NEC, all shut down their smartphone business, Huawei's orders are revitalizing mobile phone parts manufacturers in Japan. 

China is not the only victim of the US-launched trade war. Japan is too. Setting aside US-Japan controversies in tariff cuts on automobiles, agricultural products and the fact that Washington failed to award immediate exemptions for Japanese products with US steel tariffs in 2018, quite a few products produced by Japanese companies in China are expected to be sold on the US market. They can hardly remain unscathed during the China-US trade conflicts. 

If US demand for China's high-tech products is to be greatly reduced, relevant Japanese industries such as semiconductor manufacturers, which have been exporting substantial quantities of components to China, will be hurt. 

Many Japanese companies rely on doing businesses with their Chinese partners like Huawei. Mature industrial chains have been shaped between China and Japan. When China's business is jeopardized, Japan will also suffer losses. 

It's time for China and Japan to find a stable path of cooperation amid Washington's attempted containment of Beijing. The trade war might serve as a new opportunity for Asia to promote regional collaboration, a China-Japan-South Korea free trade zone and currency exchanges, and more importantly, to safeguard regional trade stability. 

Emphasizing "America first," Trump has seldom provided Japan any benefits. But in the meantime, China-Japan ties have finally returned to the right track after twists and turns with emerging economic and trade potential. Does acting at Washington's beck and call prove rewarding for Tokyo? It's time for Abe to think this through. 

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