 Yeah, welcome back to Think Tech. I'm Jay Fidel. This is looking to the east In our one o'clock block with Steve Zercher who joins us from Kansai Gaida University in Kobe, Japan. Hi Steve Thank you for joining us. Absolutely. Good to see you again. It's my pleasure So, you know what there we've had a number of shows and you know Foreign service people come and tell us about the declining relationship between China and the United States and Some of them feel that it's all Trump's fault. Others feel that Trump was operating on the basis of a relationship that was already declining And certainly Xi Jinping is making a mess in in Hong Kong and threatening Taiwan And so what we have is a very aggressive China under an increasingly aggressive leader Xi Jinping The new security law in Hong Kong makes that clear So so i'm thinking that you know, there must be some kind of dynamic going on with Japan too Japan's right there And and it has to be in China's gun sites so to speak. So can you talk about that? Tell us what's going on? Yeah, that this is a very important issue for Japan for a variety of reasons, which we can talk about Regarding your excuse me your first point about trump and his Impact in terms of the japan-china relationship or the u.s. China relationship You may recall under obama He he promoted the asia pivot. Do you remember that that term? It's like okay, america. We've always been focusing on the middle east. We've always been focusing on europe for historic reasons But the future economic future the economic growth of the world is no longer in those regions It's out here Which is just clearly the the case if you look at the growth rates Of the countries in asia they far surpass the united states and europe But when trump came in Because he is anti obama right everything obama did he had to undo this was his personal agenda It's very clear now after a three and a half years So he undid the tpp the trans-pacific partnership Now one of the reasons why obama was supporting this and japan Was a very key support of this was to limit china To limit the economic influence of china which japan and united states is recognized as becoming very very powerful But by undoing that it kind of put japan Out in the cold it lost the number one economy. It lost its major partner on this effort So that's how things got started under trump. It really was kind of a confusing move and it was something that was not perceived positively within japan And then over the years as you know Trump has gone back and forth china is very important You know, we we're not going to criticize china when they are overly aggressive like in hong kong I i don't think trump has said much at all about that or it maybe he said a few things He was forced to do that So there's been this background of this uneven relationship. It started very badly with the withdrawal by the united states of the tpp So it's been confusing for japan What to do? So that's kind of the context of how japan views the us china relationship and how it's influencing japan now specifically to your question about japan and china The first thing i need to say is that japan and china have been in economic and political relations for 2000 years j The first recorded document that shows exchange between the two countries is 57 ad So almost 2000 years So I just want to say that so you and your viewers recognize This relationship is in a much longer context than we americans think about we tend to focus on what post world war two What's happened since then? So it's a very complicated relationship. There's elements of chinese culture throughout japan The food the language So in japanese people, maybe they don't really recognize that but if they stop and think They'll you know our kanji comes from china the food sources the philosophy the education system Confucian values all of those things are fundamental parts of the japanese culture So that just shows the context Of how much exchange there's been over the years and china's role in asia and influencing all of asia and in particular influencing japan Now let's bring that up to today How does japan? Manage china and it is complicated So japan's caught the number three economy is caught in between the number one economy and the number two economy And the way it's uh expressed in a very very simple way is that economics hot politics cold So economically japan recognizes how important china is China is japan's number one trading partner and has been that way for the last 15 years There's more japanese offices in china than any other place in the world more than in the united states There are thousands and thousands of japanese people working in china supporting manufacturing So economically there's integration and it's very very tight But politically as you know Japan is aligned with the u.s. Right, so it looks for leadership on foreign policy to the united states So japan is caught in this this kind of trap between their economic influences and their economic Goals and development and growth and political leadership foreign policy leadership, which is looking to the united states So it's a very difficult situation that japan's in abe to his credit Is walking a tightrope between these two countries and it's getting worse As you pointed out china's becoming more aggressive Worldwide and also in the asia-pacific region and there are specific conflicts On territory between japan and china that's in the news every day here So but on the other hand This is an example of how japan will defer to china This this year in april a president g was planned to come to japan for an official visit And then covet happened right and it was originated in china Japan the united states cut off chinese tourists. I think in march in early march japan did not chinese tourists were coming into this country from wuhan Without being tested or anything and why did they do that because they didn't want to create a sense of conflict Uh with president g's visit, which was going to be hopefully in april So it there's a very clear example of how japan is deferring To china in order to try and solidify the relationship between the two countries So you see it's a it's a very complicated question in japan's in a very difficult Position right now the last thing i'll say j i know you have many questions you want to ask is My sense is in terms of what trump's doing to try to get back to that point um Maybe this is partially my own thinking But i have a feeling that japan because they look at things in a longer context like 2000 years relationship with china trump Maybe gone in a few months or even if he wins again. That's just another four years. What's four years out of 2000 So i think japan kind of looks at this relationship with china beyond trump Long answer there j. Hope that wasn't too long. I hope we didn't lose our viewers through my long answer No, I don't think so that you know, no, you're you're really up on this So, you know one thing that strikes me is that it's something you and I have talked about before Is that you know, there's a dynamic of course between Japan and china that has to be in it in a time where everything is changing all around us But they're also and we talked about this before there also is a dynamic between japan and the us Mainly because trump is unpredictable He comes up with new things. You don't know what he's going to do from day to day And I keep hearing that that particular process that particular Characteristic connection with the u.s This is the number one complaint, you know beyond the the goofiness and all the other crazy stuff It said we don't know what america is going to do week to week and business people hate that And japan's government which reflects business interests hates that it's really Really difficult It's hard but china's taking advantage of this. I think part a partial reason why china is More aggressive is they realize that trump is inconsistent and You know, what's he gonna do? So I think that's also a part of what's going on in this region is that China's recognized through covet and through lack of leadership from the united states They're Goal of establishing dominance as a superpower, which frankly, I think we all recognize they are But they still have that goal. They're being able to accelerate their plans to achieve that Yeah, so I you know this In the united states we we think that You know this whole election thing between Trump and his convention and biden his convention and all the stuff about the election Post office. It's limited to a US audience not not it's a worldwide audience and everybody in the world in the smallest town in in Central india is going to know what's going on Yes, and every government in every country is going to be following us And see how it affects them and I think you're you're you're coming a moment ago about how That has affected And to some extent undermined policy with the us By japan and china is because of trump's inconsistency Nobody nobody trusts him to be consistent and you know, they say that in china Stability is everything. That's what shijing ping Must he must have he must he must Take steps for that In fact, you know, that's one of the reasons arguably why he's being so hard on hong kong because Hong Kong is a is a model of the Democratic protest that could be repeated In mainland china and he's got to put it down or wind up losing stability in mainland china So and I think I would guess you can confirm what deny but that the same Need for stability exists in japan maybe in different ways But I think the government and the various government officials in japan want to see stability They do not want to tolerate instability. Am I right about that? Yeah, yeah, I think that's a general principle Of business you cannot make plans if you have you don't have a clear idea Of what will happen six months from now or 12 months from now or 18 months and The asian cultures I can speak more generally here. I have experience in china korea and japan They that's one of the principles. That's one of the things that People expect out of the government is to provide a stable environment a healthy stable environment where people can grow and things can progress And anybody who upsets that in one way or the other That's that's bad and unfortunately Even though trump is not an asian, but he's running the united states as president And that as you point out has a strong influence On this region because of the economic and military power in the united states It's it's really been difficult so it makes the job of abbey even harder because He's caught between japan and china China's very clear what they're doing. There's no question about what china's doing Everyone understands that right? But then on the other side you have the united states and you have The tpp being rescinded within two days of a new president coming in something that they've been working on for years and years and years And the whole motivation was to limit china It was in the us best interest to do this and yet trump undid it So you have those types of things it makes it very difficult for abbey to figure out how to not offend china how to continue to Foster that economic relationship, which is so important to japanese businesses, but on the other hand historically politically, japan is linked to the united states and they have a Erratic partner there. So maybe abbey although he's he's lately. He's been going to the hospital He may be on his way out the popularity of his cabinet now is at lows But whoever would come in behind him would have the same problem. How do I balance the united states and china? So if biden comes in maybe even though he's an unknown Perhaps they would expect that their lease would be a consistent policy Against china the u.s china relationship would be predictable and that would probably be perceived as a positive So we follow frank ching who is a journalist in hong kong and You know his view A couple three months ago was that China wanted to see trump win And so if trump approached china for help As he said he was doing Just like he's approached russia for help now and in 2016. I don't think there's any question about that The man has no shame no principles. He wants to win both of them for help That that chijing ping was somewhat sympathetic with that earlier this year um, but now I think from just from our sources and our Analysis here after all the discussion about china's relationship with the u.s I think that may have changed And that chijing ping really um Doesn't want to see trump Uh elected because he's as as we have said too unpredictable um He offers chijing ping an opportunity to drive a truck through all those mistakes that trump makes And take advantage of of trump's uh In competence, but at the same time that that instability really bothers him And so trump's request for help from china Is not being met these days and of course i think china is going to be circumspect about it But I think they're probably saying no no we're not we're not going to help you go you know go go talk russia Don't don't ask us we we're not gonna We're not going to do the social media thing. We're not going to do the uh, you know internet research agency We're we're not going to do that And so I think it becomes more and more clear that chijing ping is is waiting trump out He's probably keeping his options open, but he doesn't want to affirmatively help trump win Okay, so the question yeah, I I have absolutely no information. This is pure speculation on my part, but I would imagine that the ldp the the dominant party here who's again the prime minister is avi they may also Be doing scenario planning and hoping That trump is out At this point too. That is I there's no official information on that nothing I picked up from the press, but I'm just my own guess after being here a while Many decades They may be hoping the same thing I mean in japan's case, it's even worse than china because china's taken advantage of trump's incompetence in japan Hasn't been able to do that because japan's linked so closely politically to the united states They've kind of suffered along with the rest of us in america through the lack of leadership and inconsistent I mean in north korea is a perfect example You know for avi was using north korea for nationalistic purposes making them the The boogie man trying to use that as a case to change the constitution as we were talking about before to allow Japan to become military militarily proactive And then who shows up there and takes pictures with his buddy You know without any advanced warning to japan and completely destabilizes just drops everything out from abe's campaign to turn north korea into the military Enemy to justify his own domestic political agenda It just evaporated. You know abe looked like a joke. Yeah abe's been saying north korea north korea is so terrible so terrible and trump goes there and says, oh, he's my friend He's my buddy. I'm going to take pictures You know things are going to be better the nuclear program in north korea is going to end now It was insane. If I were abe I would be I I'd be very careful about trump because trump, you know in making these Strange moves he he does have the effect of stabbing people in the back in terms of foreign policy And yeah, I think his motivation was Was his own self aggrand aggrandizement His own pr and american president the first american president to go to north korea Uh, he figured out this will I don't know what he thought but anyway. Yeah, he maybe the impact on japan and abe Probably never crossed his mind Yeah, so well if I were abe I I'd wonder if trump was reelected Whether he'd still have the same kind of support from the us if I were If I were the premier of taiwan, I would have the same concern Whether trump would support taiwan going forward. I mean he sent somebody from from his I forget who it was somebody from the state department over there a week or two ago to uh Evidence some support for taiwan, but in the long term. I don't I don't think they can trust him I think they know they can't trust him. So it gets as you said it gets very complicated So here's shijin ping is getting more aggressive Japan has this kind of conflict. They don't want to appear To be shoving off from trump on the other hand They're probably waiting for a better deal with biden biden would give him a better deal He'd return to the obama pivot as you mentioned Probably yeah Yeah, be a better deal for japan And and it's the same time you have to appreciate there are a lot of people in this country Who really have come to hate china? Because they listen to trump His his leadership Is so strong I put that in quotes on the point of let's all hate china. Let's punish china. Let's let's blow them up in every way we can Um, he can't get away with all of the things he wants to do But he has turned the opinion of the base Against china Yeah, I think it's more than the base j. It's the public opinion in the united states is 60 70 anti china right now That's beyond his base. Yeah, you're right, but this is pure politics. I think more than anything else and let's say trump gets reelected You know and within the first three months you may go to china It doesn't mean that anything will happen I think he's using this as a political weapon because he thinks he can score points against biden on this particular issue Again just puts more pressure on japan Right and of the lead up to the election just makes it harder for japan to parse This balancing act between china and japan. It's China in the united states. I mean so Yeah, um, there are elements of that in um in japan too There are japanese people And japanese politicians that are hawkish And think that japan should be more aggressive about limiting This push by china certainly for territorial push in the age of pacific region And they seem to be Actually becoming more powerful. So this economic influence is certainly there But it seems to be diminishing somewhat And the people the politicians who are saying we need to be more strongly anti china and be explicit about that So in the news just recently This state visit that i mentioned to you earlier that was scheduled for april And had to was delayed because of cove it. It's been left open as to when It will occur. So abe is still saying we were we will invite president ji into japan at some point however These the more right wing the hawkish Politicians now are saying we should cancel the invitation entirely because of the way china's behaving right now And they give the example of hong kong and the secaucus islands where there is this territorial dispute So there is i think lately Maybe somewhat because of the influence of trump and the china you know that the china flew You know calling it the wuhan flew rather than corona like the rest of the world does i think that is having some influence and it's giving maybe more credence or More cover for the right wing politicians in japan that look beyond the economics And just want to limit china in the region for purely for political reasons Yeah, i think there's a lot of people in china that that are mad at japan too Well, yeah, my last trip to china. I found people talking down japan And well the chinese government uses This this as a political weapon as well in the same way trump uses china to Excite his base and create a bogeyman You know and let's let's say china china sometimes does that against japan and this j this is another huge issue to talk about And that is china and japan's relationship during the colonial period in world war two. So there are still enduring Issues of uh, you know hatred and about what japan did Yeah, yeah it backed into world war two. So it's very easy for the chinese government to reignite that And talk about the atrocities that the japanese government Carried out during the colonial period and during world war two nanjing is is the the famous example which Many of these right wing japanese politicians deny even happened You know hundreds of thousands of people were killed chinese people were killed by the japanese military according to mainstream historians But in japan they deny that there's a certain segment of the Politicians and segment of society that denies that so That hasn't been in evidence in the last uh Five years or so or so, but you know 10 years ago It was pretty pretty open and there were chinese people. Maybe that's when you went j to china There are chinese people protesting in the street and burning japanese cars attacking japanese businesses Because it was it was a big it was it was a soccer field a soccer game. I don't know if you remember Um, no between a japan team and a chinese team in china And they got into a whole mob scene fighting each other about it in the soccer state So that that erupts periodically. It's been fairly calm and what the earlier part of this year china the official press was being somewhat complimentary of japan Because japan was being more cooperative with covet and we're sending masks and equipment to china initially so There's been at least at that national level Kind of a calm period that we're in right now, but at any given point any given Incident something breaks out. It could revert back to that overt nationalism In china and also to some extent here in japan You know you you mentioned steve about the constitution call it the macawthor constitution in in japan Where the military can only be used for defensive purposes and right and although You know that there have been exceptions to that over the years That's still the constitution and that's still the basic Rule of how japan and its military You know get along But but query, you know if there was fisticuffs say in the senkaku islands or any anywhere Where china is trying to establish You know extraterritorial jurisdiction And camp on other jurisdictions And take advantage if you will on territorial grounds I mean it happens china does this regularly most most recently was in india in the himalayas Big fight on a mountaintop between chinese and indian troops Very interesting But they keep on pushing always pushing So the question really is with that constitution can china fight back Can japan fight back sorry can japan fight back can japan protect itself Against chinese aggression um yes Yeah, japan has the right to defend itself and and of course that can be construed in a variety of different ways, but frankly The u.s. japan security alliance is still as strong as ever. So japan still exists under u.s military protection Right, so if a conflict was to break out between japan and china the u.s would be involved So that's that's still i mean a very important element to this overall relationship another reason why japan has to be so careful in terms of how it deals with the united states because it has Since world war two Depended on the jet of the u.s military to protect it i mean japan has the number one military behind it and I think any president whether it be trump or biden or whoever If japan was threatened in some way by china would probably intercede even taiwan I mean i there there could be a military reaction by the united states If china was for some crazy reason that they decided to invade taiwan Now that that i'm trying to won't do that. I don't think but if they did the u.s would probably Have a response So so that's the that's a bigger context of any type of conflict between japan and china if something breaks out The united states military planes will be flying, you know over wherever wherever this This breakout has occurred and u.s ships would be coming in and china knows that and japan knows that Yeah, we we got to maintain that kind of deterrence. I think it's very important for The interests of the united states not only yeah, and you have I think it's 40 000 american Soldiers in japan as you do in korea. So they're all over the okinawa You know they're all over the place. So the united states military presence is just dominant Now what about your kind of knows you mentioned that there are a lot of Japanese businesses with offices in china and and for that matter, I guess it goes both ways Chinese businesses with offices in japan Yeah, japan is china's third biggest trading partner Yeah So the the question is uh, how does that affect all this? I mean it seems to me that's a sort of a point of conciliation because you you don't want to disrupt Economic relations with anybody if you're making money at it, you know, like right try to stay friendly What what do you get on that particular dynamic? Oh, yeah, that's a very very important factor um, for example tourism Which up until covet had been japan's fastest growing industry segment international tourism who had gone from uh Five six years ago, maybe five million international visitors To over 30 million international visitors and the biggest group Chinese I mean they're they're During the peak periods, you know up through the early part of this year And also 2019 there were almost 10 million chinese people who came to japan to visit Generating tremendous amounts of revenue because chinese people love buying japanese goods because they have a petition for high quality I mean this is kind of a cliche Everyone in japan knows that chinese tourists come here and they buy A whole variety of medicines and consumer items and diapers Everything that they mistrust the chinese manufacturers and making they buy here and wrap it up and so that's a huge part of the Japanese economy and the most successful growth segment and it really rests on the relationship with china Now unfortunately that has all gone away because of covet but Once we have a vaccine japan and china will both do as much as they can to try and rebuild that And have tourism begin to go back and forth, but mostly chinese people coming to japan So that's a very clear example of how important economically The relationship between the two countries is Are japanese people i mean customarily before covet Do they buy a lot of things from china? I mean china may not have the same quality of manufacturing, you know that's no They don't buy things from china. No, no, um, it doesn't work the other way A very simple example My wife is japanese and she told me to go to the store to buy honey And I bought some honey and I didn't look very closely. It was made in china Through it away. She wouldn't even have it in the refrigerator. I had to go back and get honey from new zealand. That's okay So there is a general perception on the part of japanese That chinese products the quality is low and they get this from the chinese people because the chinese people tell them that The chinese people say yeah, our stuff is terrible. Don't buy it so there isn't that kind of The same awareness chinese people view japanese products as high quality japanese people view chinese products as low quality But the trade occurring is on manufacturing level You know of so many japanese companies are manufacturing their products in china Then shipping from china to us. This is how it all works So that lays the basis for this economic trade agreement between the two countries It's more on the manufacturing side not so much on the consumer side at least from japan's perspective Well, you know, I read recently that the number one automobile manufacturing Country now is china They're making tons of cars and they have somehow lifted american technology to make those cars pretty well Um, and I suppose they've probably lifted japanese technology too I don't know exactly how good those cars are against japanese cars, which are, you know, to me are the world's best But but query whether anybody's driving a chinese car in japan I don't think i've ever seen a chinese car here in japan There's and i it's actually hard to find american cars. BMW. Audi. There's a few european brands They have been successful But japan protects its auto industry very carefully toiota Honda and all of those companies have worked very closely with the ldp to make sure that it's difficult for foreign Manufacturers of cars to be successful in japan although there are some exceptions the united states manufacturers. They've all given up They're they're not even really here So but china gm that they sell more cars in china than they do in the united states gm does That is their growth opportunity and that mark you're right jade even with covet The automotive industry in china is growing now There are more cars being bought now because china managed covet In a much better way and things are bouncing back now Well, they're number one in so many things, you know, they're number one in ai They're number one in manufacturing solar cells They've made up their mind to do that and they've done that But we're almost out of time steven. I want to ask you one last question I mean what what what's coming home to me here is that the relationship? with between japan and china is It's it had the us is involved in that relationship You can't you can't answer the question unless you can imagine now What the us will do when the trump are under biden? And so it's an it's unanswerable until the election Really? Because things will or can change then but my question to you though. It's a slightly personal is Would do you see yourself? As going to china Now we're in the future now after covet, you know Yeah, I at this point in my life um No If I was coming out of college I used to advise my students They come to japan and i'm very happy to have them here But the japan economic prospects are are limited because of demographic issues things we've talked about in previous shows The market opportunity is in india and in china So I used to give them the advice that you really should think about these countries It's like when I came to japan japan was on the upswing. You know, I was lucky to be here at that time However today That's a little bit more complicated, isn't it? And the other thing too is that there are so many smart chinese graduates of us schools So if you're an american and you graduate from a good school and you want to do business in china You have to compete with chinese people who are fluent in the language, right? So it's it's a bit of a challenge. I think actually I was talking with a friend of mine yesterday about Where we would go to and it's it's actually vietnam Maybe myanmar some of these southeast asian economies, which are beginning just to break out of the the old You know top-down Stalinist chinese communist malice models and now are opening up to the world economy. That's where Tremendous growth opportunities are that's where it'd be a lot of fun to be Maybe as a teacher or more importantly as a businessman or businesswoman So that if if a student was to come into my office right now and ask me You know, where should I which where should I think about where would I want to where would I suggest that they go to? I would look at these countries. Have you been to vietnam j No, we would if you're visited there. We're going to go and kovat stopped us. Oh, it's too bad It's a wonderful country. The the people are so friendly Uh, and you just you get that vibe that things are going on. It's it's like being in hong kong uh, or being in in Shanghai you just have a feeling this country is progressing and moving forward. Oh, you know, I do want to I do want to discuss that exact point with you Okay, and we get together. I mean we're looking east from japan What do you see for the future for Japanese business and Japanese? Japanese students and what have you anyway, we're out of time steve zercher Our kansai gaida university enlightening us about looking east. Thank you so much steve Yeah, my pleasure j. As always look forward to our next show