News / Asia

China Warns Island Dispute Could Hurt Trade Ties

A group of disputed islands known as Senkaku in Japan and Diaoyu in China is seen from the city government of Tokyo's survey vessel in the East China Sea, September 2, 2012.
A group of disputed islands known as Senkaku in Japan and Diaoyu in China is seen from the city government of Tokyo's survey vessel in the East China Sea, September 2, 2012.
William Ide
— China has warned Japan its decision to purchase disputed islands in the East China Sea could have an impact on trade between the two Asian economies.

The last time China and Japan got into a dispute about the islands in the East China Sea, Beijing responded by blocking the export of a crucial high-tech resource known as rare earths.

It is unclear what actions it may take this time, but Chinese officials are already making it clear that there will be repercussions if Japan does not back down.   The islands have been owned for decades by a Japanese family and are reportedly being sold to Japan's government for about $26 million.  

Jiang Zengwei, China’s vice minister of commerce, says with Japan’s so-called purchase of the islands, it will be hard to avoid any negative consequences for economic and trade ties between the two countries.

The Senkaku/Diaoyu IslandsThe Senkaku/Diaoyu Islands
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The Senkaku/Diaoyu Islands
The Senkaku/Diaoyu Islands
Calls are growing for Chinese consumers to boycott Japanese goods and cancel travel plans to the country.

Jiang hinted that the Chinese government would not see anything wrong with the peaceful boycott of Japanese goods.

Jiang says that, although he has not seen any actions by Chinese consumers in response to the Japanese violation of Chinese territorial sovereignty, he thinks that would be their right to express their views and stance in a reasonable manner.

China is Japan’s largest trading partner, and trade between the two countries accounts for more than 20 percent of Tokyo’s external trade, analysts say.

Trade grew to a record $345 billion last year alone.

Last week, a Japanese motor executive said rising tensions between the two countries were having an impact on business.

But Richard Broinowski, a former Australian diplomat to Japan and South Korea says it is hard to imagine the dispute will have a major impact on the two countries trading relations.

Japan and China's Disputed Islands

  • Known as Senkaku in Japanese and Diaoyu in Chinese
  • Uninhabited archipelago of 8 islands  
  • Located in gas-rich area and surrounded by rich fishing grounds
  • The islands have a land area of about 6 square kilometers
“There will be a fair bit of blather, a fair bit of hot air, some indignation, perhaps some kind of trade rebukes at the margin, but I do not think it will have very much to do with the enormously intricate and immensely valuable bilateral trade between China and Japan,” Broinowski said.

Meanwhile, protests continue outside the Japanese embassy in Beijing, where police allowed groups of several dozen demonstrators shouting slogans and singing the Chinese national anthem to pass by the embassy.

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by: Thomas from: London
September 16, 2012 8:17 PM
paid by the Chinese government protesters protest against Japanese buying their own land from private hands. No surprise they call them sick men of Asia.

In Response

by: Thomas from: London
September 17, 2012 7:04 PM
with my brain? you are talking about yourself you brainwashed by communist party Chinese liar. Japanese have rights to those islands as they were the first to claim them and they done that according to international law. I presume Chinese do not accept nor follow any law.

In Response

by: Ray from: Beijing
September 16, 2012 10:58 PM
how do you know the government pay the protesters? if your Country was purchased by others, what will you do? something wrong with your brain.


by: BBK from: Singapore
September 16, 2012 2:34 PM
Calm down, poor chinese.

In Response

by: Song from: USA
September 17, 2012 9:30 PM
Mr Thomas, hate the games, don't hate the players, do you understand what I am try to say?

In Response

by: Song from: USA
September 17, 2012 8:48 PM
I mean China could use North Korea as USA use Japan, Japan is only a chess for USA, China could beef up North Korea and use them as USA use Japan, since the water is rising every day, islands country like Japan, it is sinking everyday to the bottom of the ocean, and Japan needs more lands, that is understandable, but you can't steal from other country, I don't hate Japanese poeple, I did donate money to help Japanese people last time when the ocean hit.

In Response

by: Thomas from: Lodon
September 17, 2012 11:56 AM
Japanese were the first to claim these Islands when no one was living there. How does that make your land? Don`t you have enough land already anyway?

In Response

by: Song from: USA
September 16, 2012 5:44 PM
When North Korea make a few nuclear test in next few month, Uncle Sam will kiss China rear end for help, and all the problem will settle, China need to do nothing, if I am a leader of China, I play this game smartly.


by: Charlie from: UK
September 15, 2012 5:29 PM
Nowadays,China is most likely to be every country's biggest trading partner.China knows this and they have been using economy as a weapon to blackmail other countries into submission to their unjust and ungrounded territorial claims.Last time they stopped exporting Rare Earth to Japan which is vitally needed for Japan's High Tech Industry.Now they tacitly encourage and allow Chinese nationalists to attack Japan's businesses and citizens all over China.China's aggressive behaviours and double standards should be condemned.It is OK for China to invade and annex other countries into theirs,but it is not OK for other countries to keep what are legallyand rightfully theirs but unreasonable claimed by China.When in the past 4000 years did China ever have full control of the South China Sea? Anyway they still shamelessly claim it belonging to them in ancient time,and allowing Vietnam,the Philippines,Malaysia and Brunei only 12 nautical miles from their shores for fishing simply because these poor countries are too small and weak to fight back.If China gets its way,it would be a matter of time before China claim Vladivostok theirs as well when their navy is strong enough to confront the Russians.Putin knows this that's why he is going to spend $100 billions to modernise the Russian Army and develop the Russian Far East region to prepare for the Chinese onslaught.A boycott against Chinese products is unthinkable,but we can not let ourselves being held by ransom and intimidated by the Chinese forever.Hopefully,America would stand by their commitments to Asia and help deterring China from waging a war of expansion

In Response

by: Panda from: Shandong
September 16, 2012 9:35 AM
UK had controled the America in history, why don't you say USA now belongs to Britain?? Every country has the right (Idiot Japan is not included for their aggressivity in in history)to develop their military to denfend their country and their people, Russia is not excluded, so is the USA and the UK, etc. Don't show your cleverness! For you are really knowing nothing.

In Response

by: Rick from: China
September 16, 2012 12:18 AM
British is always dangerous country and invaded many countries and places including America and Chinese Hongkong. The Americans defeated the British in 1781. Do you forget the history?

In Response

by: Felix from: New York
September 15, 2012 11:27 PM
Have you ever learned any Asian history, ignorant mind? Even Vladivostok you were talking about was taken from China by Russia during a time that China was weak and had no choice but the cession of those territories. Rare Earth is precious. Anyone can get it by its name. China owns some but not a lot and has the right to decide sell it or not. It's not an obligation to sell it to Japan.
How about Islas Malvinas? Does it belong to UK or Argentina? It seems that the UK used to invade a lot of places and had to return it to people who really own those places, right? The Diaoyu Islands was discovered by ancient Chinese a long time ago and belong to China or Taiwan by all means. You could even found the same records in Japanese ancient documents. Dont blame China. Its Japan who should be blamed, who was also the major killer and invader during the World War II, which I think you didnt know. Its time to pay back.


by: Zongyang li from: Beijing
September 15, 2012 12:04 AM
actually,Japanese are once chinese,they moved to these four small islands in Qin dynasty,that's how Japan came into being .
so~the diaoyu island is yours,but you japan is mine!

In Response

by: Bk from: Japan
September 16, 2012 3:02 PM
Senkaku is ours, Japan is yours but China is originally 中華民国.
So Senkaku is Taiwan's, isn't it?


by: task101 from: USA
September 14, 2012 11:10 PM
Chinese should learn true history.
Senkaku has been controlled by Japan since 1895 and it is Japanese territory.
Chinese should condemn their corrupt government bfr condemning Japan.

In Response

by: observer from: New Zealand
September 17, 2012 9:05 PM
It is well known that the diaoyu islands was controlled by Japan since 1895 until 1949 and since 1971 until now. But it doesn't mean it is Japanese territory legally. Do you mean you agree that it is Chinese territory if they take over it from now on? Then Chinese government is doing right thing now.

In Response

by: joe from: USA
September 16, 2012 12:04 PM
Korean is using gun to settle things with Japanese and Korean won, Russia is using cannon to settle things with Janpan, and Russia win, Uncle Sam is not show up for help, China need to make a hard stand and settle them with gun if gun is need, that is only way to do it, China will win, the bottom line, the super nuclear power will sink all japanese island less than half hour, and no more toyota and honda, good for uncle sam and other to sell more juck cars in china, Japan is start some thing that they are not able to finish it, they will lost when they are facing a super nation like China.

In Response

by: Darcy from: China
September 16, 2012 4:16 AM
The truth is that DiaoYu is a part of Chinese teritory.

In Response

by: wangyangming from: chongqing
September 15, 2012 8:44 PM
You did not know the truth .Keep quiet. What would you think if I say America is a part of Britain?


by: almoros idriss from: cameroon
September 14, 2012 11:45 AM
Chinese Leaders have to send peaceful, regional stablity, unity and more itegration brilliant messages to all South East Asians rather than the continued threats! China has more to lead, invest and share more regional resources and great markets better and more valued thank those remote rocks or islands! Whenever you Don't get it, SHARE it!

In Response

by: moo m. from: usa
September 15, 2012 6:43 PM
since 1895, that's long enough, the senkaku has been under Japanese's - If you care about your homeland dignity or the likes, stop your greedy, obnoxiuous belligerent behaviors - stop calling everything has a word china attached to them as china's ...

In Response

by: christina from: China
September 15, 2012 9:29 AM
Why does China have to share this island with other country,especially Japan!This island belongs to our chinese people since long long time ago,when the dignity of your mother land is offended by other countries,can you say these words?When your country is threatened by other country(especially the country which killed thousands of millions of people in your country in the world war 2nd),what would you do?Of course,we do not want to fight with others,and I don not try to accuse Japan of the massacre,we just want peace ,but if other countries try to annoy us,we won't be afraid!

In Response

by: task101 from: USA
September 14, 2012 11:44 PM
Chinese r uneduceted ppl who didnt know about Senkaku until recently.
Chinese govt agitated their ppl to make protest.
Chinese ppl should condemn their corrupt govt bfr condemning Japan.

In Response

by: Anonymous
September 14, 2012 1:25 PM
when the land of your country are sold by another neighbour, can you still say : come , come to my house, this house is also yours.
how generous you are! if you think you have to share your money, your belongings with an stranger, totally stranger!


by: jonathan huang from: canada
September 14, 2012 9:17 AM
China is peace loving country. Chinese want a peace environment for developing, that is why we dont want to war we want to keep all disputes to next generation but it is Japan keep provoking China. It was Japan started those stupid island selling issue. BTW, China only has land border dispute with India and Bhutan, and we are negotiating with Bhutan since we have very good relation now. We have disputes on South China sea and east China sea, but China dont want to escalate those disputes if all relevant countries can respect China proposed Code of conduct. China is a growing superpower, having war is not of our interest, at least not now, so stop provoking us, or you will get hurt.

In Response

by: wangyanmin from: China
September 15, 2012 8:49 PM
People's Liberation Army are ready!

In Response

by: sudeep paralkar from: india
September 14, 2012 11:19 AM
China's aspiration to be superpower was because of heavy investments and imports by USA & Japan since 1980s.Now demographics and economics are in favour of China the great talk of super power has started.It is baffling the China has such a short memory.I and rest of asian brothers will agree that China is flexing its muscle.It has already hurt other nations.The language of CODE OF CONDUCT is signs of flexing muscles and not of peace loving nation.


by: Kim from: Sydney
September 14, 2012 9:06 AM
I think we as human in this world should not always look at the past and anger remain in heart because before this world classified as countries, we were living in groups and there were always war and killing. Now it's country and country war and killing. Next may be world and world war and killing. Why can't we all find peace and sharing the joy and happiness instead of creating war and killing. Every body in this world is responsible for creating peace and if we all working together then this world will have a peacful place. I wish China and Japan can see each other as family. Everyone do make mistake big or small and if, we fogive and forget then we all will live in a peaceful world.

In Response

by: Anonymous from: Germany
September 14, 2012 1:31 PM
i agree with you. in this case, if Japan did not provoke China for purchasing the disputed island. this world will be much more peaceful..
it is not China, it IS Japan who started this stupid thing. It is a political battle in Japan who want to gain more support and transfer the attention of the Janpanese for their recession.


by: sudeep paralkar from: India
September 14, 2012 6:07 AM
China is having border / island disputes with India,Vietnam,Philippines,Malaysia,Indonesia,Japan,Brunei,.The long list indeed.China needs to respect its neighbhours.It is indeed strange that nation with so many disputes should be part of secuirty council.China is growing its military muscle at alarming pace.Spending close 100 Billion USD per annum.South China Sea Conflict has potential to turn into major war in 21st Century if issues are not resolved in right time.

In Response

by: christina from: china
September 15, 2012 10:26 AM
I don't mean to offend you but,actually,China is doing what she should do.get back to read the history,what our goverment did was trying to protect our countrie's territory and her sovereignty,may be you don't know the history,then please get back to read CAIRO DECLARATION,and please respect the truth.As for India,Philippines and other countries,I do not want to argue with you,but don't you think it's really strange?China should develop her own economy now,why do many countries come to trouble us at the same time?may be you want to say china is aggresive,but in reverse,I do think it's a conspiracy which aims to china.what i do want to emphasize is that,we want peace,we want our own territory and sovereignty,we want you to treat china in a fair way! Diaoyu island belongs toCHINA!!!

In Response

by: Tom from: Canada
September 14, 2012 2:59 PM
Just reminder, USA spent 800 Billions USD a year on their military. 8 times more than china.
I bet so do India want to spend more on their military too but they can not affort to do so.
Go back to 19 centry how many western countries came to robbed china because china could not defence itself. Today China learned the lession by increase its military.

In Response

by: Aeris from: Henan
September 14, 2012 9:38 AM
Japan is also having borderland disputes with almost all of its neighbors. So what you call evidence is clearly ridiculous. History is created by people and spreaded also by us intelligent creatures, which means everyone can have his or her own opinion and illustration. I, support my nation.

The only great pity is that Japan is still not courageous enough to admit the crimes it commited in World War II to other Asian countries, like military raping. I hate smoking first of all, the same as raping. Nevertheless, it is not directly related to the recent island dispute. But it's obviously different when Chinese people are faced with two border disputes, China vs Phillipines and China vs Japan. The latter one indubitably causes our people to be more aggressive.


by: Anonymous
September 14, 2012 3:22 AM
The Diaoyu Islands are an integral part of Chinese territory. Japanese aggressed our Chinese ever,now they want to aggresse again .That can't be allowed.

In Response

by: sam from: peking
September 17, 2012 6:38 PM
i see comments of people who clearly not from where they say they are and can barely speak English. Japan has dishonored itself and was punished . now it is time to forgive. china is dishonoring itself now everyone can see it now no one can trust China only china making a big deal over my property .we are combat ready.. learn to mind your own business

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