Bloomberg News

Noda May Fail to Meet Hu at APEC Amid Japan-China Tension

September 07, 2012

Japanese Prime Minister Yoshihiko Noda may fail to secure a meeting with Chinese President Hu Jintao at a summit in Russia this weekend as tensions rise over a maritime territorial dispute.

“Formal talks are unlikely at this point,” Noda told reporters today in Tokyo. Chief Cabinet Secretary Osamu Fujimura, who last week said the two leaders would meet at the Asia-Pacific Economic Cooperation summit in Vladivostok, earlier said “there’s still diplomatic back and forth” over whether something could be arranged.

China has condemned Japan’s plan to buy islands, known as Diaoyu in Chinese and Senkaku in Japanese, lying in the East China Sea near oil and gas reserves. Tensions between Asia’s two biggest economies has hurt Japanese companies such as Nissan (7201) Motor Co. doing business in China.

“This is very difficult to control because if I’m a Chinese leader I would rather be hard on Japan than be seen working with them,” said Robert Dujarric, director of the Institute of Contemporary Asian Studies at Temple University’s Tokyo campus. “Both sides have to figure out a way to tone down the rhetoric. The stakes are much too high.”

Noda’s government is in talks to buy the islands from a private Japanese owner, a plan that was set off by an attempted purchase by Tokyo Governor and China critic Shintaro Ishihara. Deputy Prime Minister Katsuya Okada said yesterday the deal could lead to “peaceful and stable” relations with China, as nationalization would eliminate any other plans for the islands.

China’s Disapproval

China’s government has repeatedly voiced its disapproval and state-run media have been filled with editorials and articles expression opposition to the move by Japan.

“The so-called nationalization of the island has seriously damaged China’s sovereignty and hurt Chinese people’s feelings,” Foreign Ministry spokesman Hong Lei said at a Sept. 5 briefing in Beijing. “China’s will and determination to safeguard our sovereignty is unshakable.”

Ishihara’s announcement set off tit-for-tat visits by activists on both sides of the islands and anti-Japanese demonstrations in China and Hong Kong last month. The protests have affected deliveries for Nissan, Japan’s biggest automaker by sales in China, Chief Operating Officer Toshiyuki Shiga told reporters yesterday at an auto forum in Chengdu, China.

Noda’s cabinet may approve a deal to buy the islands for 2.05 billion yen ($26.1 million) on Sept. 11, the Nikkei newspaper said two days ago. Japan has administrative control over the uninhabited islands and pays the Japanese owner rent, a situation Okada described as “unstable” because they could be sold to anyone.

Korea Dispute

Separately, Noda will meet Russian President Vladimir Putin at APEC, Fujimura told reporters. Noda isn’t scheduled to meet South Korean President Lee Myung Bak amid a separate dispute over rocky islets claimed by both countries.

Lee last month made a surprise visit to the islets, known as Dokdo in Korean and as Takeshima in Japanese, which Noda called “unacceptable.” The two sides played a game of diplomatic ping-pong over a letter Noda sent to Lee in protest, and South Korea has rejected Japan’s proposal to take the disagreement to the International Court of Justice.

Japan is also embroiled in a territorial row with Russia over an island chain seized by the Soviet Union at the end of World War II. The sovereignty issue has prevented the two sides from signing a formal peace treaty.

Noda said after meeting Putin in June that the two countries would resume negotiations. Gemba met with Russian Foreign Minister Sergei Lavrov in July, and while they pledged to continue talks on the issue, there is “a huge gap” between the two countries, Japan’s Foreign Ministry said in a statement following the meeting.

To contact the reporters on this story: Takashi Hirokawa in Tokyo at thirokawa@bloomberg.net; Isabel Reynolds in Tokyo at ireynolds1@bloomberg.net

To contact the editor responsible for this story: Peter Hirschberg at phirschberg@bloomberg.net


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