September 13, 2010 / 5:10 AM / 9 years ago

Factbox: Ties and tensions between China and Japan

BEIJING/TOKYO (Reuters) - Japan on Monday freed the crew of a Chinese fishing boat seized last week in disputed seas, leaving unclear what will become of the arrested captain at the center of a territorial rift.

Here are some facts about the nations’ ties:

ECONOMIC POWERHOUSES, SHIFTING RANKINGS

The two biggest Asian economies are increasingly interdependent.

Preliminary statistics indicate that China has edged past Japan to become the world’s second biggest economy, with the United States remaining the world’s biggest by far.

Japan’s second-quarter unadjusted GDP totaled $1.2883 trillion on a nominal dollar basis, against China’s second-quarter unadjusted GDP of $1.3369 trillion.

The GDP of Japan and China combined account for about 17 percent of the world’s total output.

China-Japan trade rebounded in the first half of 2010 after slumping in the global financial crisis. The two countries’ bilateral trade reached 12.6 trillion yen ($150.3 billion) in the first half, a jump of 34.5 percent on the same time last year, according to Japanese statistics. Two-way trade between China and Japan totaled 21.7 trillion yen in 2009.

China has been Japan’s biggest trading partner since 2009. China and Japan are the world’s first- and second-biggest holders of foreign currency reserves.

TERRITORIAL DISPUTES, ENERGY COMPETITION, MILITARY TENSIONS

Tokyo and Beijing both claim sovereignty over a group of East China Sea islets, known as Senkaku in Japan and Diaoyu in China, and they disagree on how to define the boundary between their exclusive economic zones in the sea.

China’s exploration for natural gas and oil in contested parts of the East China Sea has magnified these disputes.

That oil and gas could be valuable, especially as China’s energy use grows, but estimates of reserve size vary wildly.

A Japanese survey in 1970 estimated the East China Sea may hold 7 trillion cubic feet of gas, while Chinese estimates range from 175 trillion to 210 trillion cubic feet, according to the U.S. Energy Information Administration.

Exploration by China in its claimed areas of the sea has shown “proven and probable” gas reserves of 17.5 trillion cubic feet, said a 2005 study.

China consumed 3.1 trillion cubic feet of natural gas in 2009, a rise of 11.5 percent on the previous year, according to China Petroleum and Chemical Information.

In 2008, Beijing and Tokyo agreed on principles to solve the feud by jointly developing gas fields. Progress has been slow and Japan has accused China of drilling for gas in violation of the deal. China postponed the latest round of negotiations.

Japan has also been worried by China’s military modernization, especially its growing naval reach.

China’s defense spending has nearly quadrupled over the past decade, while that of Japan shrank by 4 percent, a Japanese Defence Ministry report said this month.

Japan’s 230,000-member military is one-tenth the size of China’s.

HISTORICAL TENSIONS

Japan invaded and occupied much of China from 1931 to 1945. Bitterness over Japan’s wartime atrocities has faded as a diplomatic flashpoint, but underpins widespread Chinese public distrust of Japan.

China has decried high-profile visits to Tokyo’s Yasukuni Shrine for war dead. Among those honored at the shrine are 14 Class A war criminals convicted by an Allied tribunal after World War Two. Junichiro Koizumi, prime minister from 2001 to 2006, made annual visits to the shrine while in office. His successors have stayed away from the controversial shrine.

TAIWAN, NORTH KOREA

China wants Japan to clearly back Beijing’s “one China” policy. Japan says it accepts that, but many politicians and businesses have close ties with Taiwan, a former Japanese colony.

China and Japan are both part of stalled six-party talks seeking to end North Korea’s nuclear arms program.

But Japan is more critical of the North and joined international condemnation of Pyongyang over the sinking of a South Korean navy ship in March. China, the North’s main diplomatic and economic backer, did not join in the condemnation.

(Sources: Reuters, Japanese Cabinet Office, Japanese Finance Ministry, Japanese Foreign Ministry)

Reporting by Chris Buckley and Yoko Kubota, editing by Miral Fahmy

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