China’s Anti-Japan Protests: Patriotism needs to face the economic reality

By Tiange Jia

The Diaoyu/Senkaku Islands dispute between China and Japan has been heated discussed for months. Recently during two weeks, because of the 81st anniversary of the Japan invasion in the WWII on September 18, the anti-Japan protests flood over many major cities across China. Japanese companies and products are boycotted by the patriotic crowd. As two crucial economies in East Asia, what influences will the protests bring the economies of both countries?

Riot police block demonstrators outside the Japanese embassy in Beijing during a protest on Sept. 15, 2012.

JASON LEE / REUTERS
Riot police block demonstrators outside the Japanese embassy in Beijing during a protest on Sept. 15, 2012.
 

As two neighbors closely related in every aspect of international affairs, one side’s action will directly affect the result of the other side. It’s not hard to imagine that the boycott activities will cause damages to both countries. In my opinion, the patriotic protests will bring losses to both countries’ economies.

One of the Chinese patriotic representative said on Weibo (a Chinese mini blog website similar to Twitter):”China is Japan’s largest international trading partner in terms of import, export and total trade value. Japan’s economy is mostly relying on the Chinese market. If Chinese people stop buying Japanese goods for a month, thousands of Japanese companies will bankrupt. If we stop buying Japanese goods for six months, half of the working force in Japan will lose their jobs. If we stop buying Japanese goods for a year, Japan’s economy will be crushed.” After I read this, all I think is that the Ministry of Education should add economy class as one of the required courses in college. China and Japan are interrelated in international trade. Japan needs efficient and less expensive working force from China, and China needs Japan’s high-tech producing technology. That is one of reasons why there are so many Japanese assembly plants in China. Thus, the selling condition of Japanese brand products will affect benefits of both Chinese and Japanese countries.

Japan companies provide core techniques and China provides labor. It’s an efficient and economical way to product competitive goods in world market. As a result, both countries benefit from the corporation. Data shows that 95% of Sony’s products are made in China. If people boycott Sony and stop buying its products, Sony will shrink its scale of production plants in China and starts to fire workers. China will suffer an increase in unemployment rate. Especially in this period, since Chinese economy has a sign of recession, the unemployment rate increases will cause a further instability in society in the future. From the example we can see that both China and Japan will hurt from the boycott. The patriotic activity turns out to be hurting themselves in the long run.

People take photos of a Japanese car damaged during a protest against Japan's "nationalizing" of the disputed Diaoyu Islands -- also known as Senkaku Islands in Japan -- in Xi'an, in northwest China's Shaanxi province, on Sept. 15, 2012.

AFP / GETTYIMAGES 
People take photos of a Japanese car damaged during a protest against Japan’s “nationalizing” of the disputed Diaoyu Islands — also known as Senkaku Islands in Japan — in Xi’an, in northwest China’s Shaanxi province, on Sept. 15, 2012.
 

Speaking from another perspective, I believe the boycott activity is a temporary choice that is evoked by the recent political issue. Economy concepts tell us that people are rational that they will choose to buy goods that fit their economic goals. Thus, in the long run, consumers will come back to the more economical and energy-saving Japanese cars. The Chinese workers and producers have to pay for the losses from the protests.

“We hope the government could take some measures to stop us from the direct losses from the protests, and to make the Japanese cars selling industries back to normal.” said by a Chinese selling manager of a Japanese car company in Guangzhou, China. After the patriotic fever, everyone needs to go back to their own lives and face the realities of living.

Read more:
http://www.jetro.go.jp/en/news/releases/20120223142-news
http://world.time.com/2012/09/18/anti-japan-protests-reach-fever-pitch-as-panetta-visits-beijing/
http://www.eastasiaforum.org/2012/09/21/chinas-anti-japan-protests-keeping-the-automaker-damages-at-home/
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2 Responses to China’s Anti-Japan Protests: Patriotism needs to face the economic reality

  1. Peter Petri says:

    This nicely shows just how interdependent the two countries are. Not only is China Japan’s largest trading partner, but Japan is China’s second biggest trading partner (after US) and the source of many advanced components used in China’s exports. Although both governments are now attempting to quiet the protests, some damage is already done. According to the Wall Street Journal, Toyota is already shifting production lines from the Lexus models targeted for China to other models. Even if such political tensions stop, it will be hard for companies to rebuild confidence for large investments and long-term contracts–the last thing we need in a weak global economy.

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