This paper analyzes the rise of maritime China and its implications for Japan’s security policy. 

During the last decade, Japan has sought partnership with many Asian nations - the drive remaining strong regardless of ruling parties. Newly elected Prime Minister Shinzo Abe of the Liberal Democratic Party of Japan is to continue this trend under the name of ‘value diplomacy".

In the midst of growing tensions with China, Japan is deepening its strategic engagement in Southeast Asia. Preserving stability in the South China Sea, which is threatened by renewed frictions around contested territories, is a vital interest for sea lane-dependent Japan. Moreover, Tokyo considers Southeast Asian countries as crucial partners in balancing against an increasingly powerful and more assertive China.

The decision of the Japanese Government to purchase a number of the Senkaku/Diaoyu islands from their private owner sparked fury in Beijing. Such spikes of fever between China and Japan are not without precedent. However, the gravity of this latest episode raises the question of whether a point of no return has been reached in the Sino-Japanese relationship.

Japanese firms are increasingly involved in various global business operations - not only in traditional international trade in goods, but also in offshore production and the new mode of globalization: offshore outsourcing.

As tensions persist between China and Japan in the East China Sea, it is interesting to note that one of the most symbolic actions of the previous crisis has yet to make an appearance this time around. 

Nuclear fission was discovered in the late 1930s. The first application went towards military use, and gradually expanded to civil use such as power generation. Power generation gained importance in two stages: firstly, to shift away from oil in power generation after the oil shocks in the 1970s, and second, to arrest climate change due to CO2-free nature of nuclear power more recently. This typically applies to Japan, which has become the world third largest in nuclear power generation. However, nuclear power is violent by nature, and major accidents of nuclear power plants shook the public confidence in nuclear safety. Japan has been put into such situation in a most radical way due to the Fukushima nuclear disaster of March 2011.

Productivity is increasingly important in the Japanese economy as an aging and shrinking population is expected to constrain labor input. Thus, the creation of innovation is critical for realizing economic growth and maintaining Japan's international competitiveness. Specifically, emerging countries such as China and South Korea are quickly catching up on Japan's level of technological prowess in electronics and other high-tech industries. For that reason, continual investment in R&D and provision of products and services that are competitive in the global market are crucial for Japan's international competitiveness.