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Chinese Foreign Minister Wang Yi speaks to reporters after meeting Japanese Prime Minister Shinzo Abe at the Prime Minister's office in Tokyo on April 16. (Photo by Uichiro Kasai)
China up close

Behind China's sudden olive branch to Japan

Beijing's about-face is preparation for trade war with Trump

KATSUJI NAKAZAWA, Nikkei senior staff writer | China

TOKYO -- On April 16, a day before Japanese Prime Minister Shinzo Abe met U.S. President Donald Trump at the Mar-a-Lago resort in Florida, Chinese State Councilor and Foreign Minister Wang Yi was in Tokyo to meet his counterpart, Taro Kono.

They were relaunching the "high-level economic summit" between Japan and China for the first time in eight years. The rocky relationship between the Asian neighbors has prevented the economic summit, as well as many other bilateral initiatives, from sustaining any momentum.

But here was Wang, touting the merits of free trade. "The two sides should safeguard economic globalization and free trade system," the state-run Xinhua News Agency reported Wang as saying.

A closer look at the meeting reveals many clues about the thinking of the Chinese leadership -- its hopes and fears -- as well as its power structure.

First, it was the Chinese who were pressing to hold the talks -- the fourth of their kind -- at the earliest possible date. "They raced against the clock like never before to fix a specific date," said a surprised Japanese government source.

Beijing had been declining Tokyo's requests to resume the dialogue for years. Now, as trade friction with the U.S. intensifies, the tides have turned.

Chinese Vice President Wang Qishan is seen at a meeting at the Zhongnanhai Leadership Compound in Beijing on April 18.   © Reuters

Secondly, in coming back to the economic talks, China downgraded the seniority of the delegation. In the past, the head of the mission was chosen from the 25-member Chinese Communist Party Politburo. The last two meetings in 2009 and 2010 were led by then-Politburo member Wang Qishan, the then-vice premier in charge of economic affairs.

Wang Yi is not in the Politburo, and neither is he a vice premier.

"China overtook Japan in terms of economic size in 2010, and the gap has since widened," a Chinese expert on Sino-Japanese relations said. "Emboldened by this, China has downgraded the framework of the talks."

Furthermore, the foreign minister is not the primary minister on economic affairs.

Based on tradition, the more powerful Liu He, not Wang Yi, should have been dispatched to Japan. Liu, a close aide to Xi, joined the Politburo last October and became a vice premier in charge of macroeconomic policy in March.

But as President Xi Jinping's economic adviser, Liu has his hands full coping with the U.S. trade friction, and the lower-ranking Wang got the nod.

This choice put Tokyo on guard. "Despite being well-versed in Japanese affairs, Wang Yi has been at the forefront of excessive Japan bashing over the past five years," said one Japanese official, expressing a view widely shared within the government.

In a counter move to the downgrading, Japan's No. 2, Deputy Prime Minister and Finance Minister Taro Aso, chose to skip the meeting.

With the nonexpert Wang Yi at the table, it is thought that Wang Qishan in Beijing was calling the shots from behind the scenes.

Chinese President Xi Jinping smiles after delivering a speech at the Boao Forum in Hainan Provence on April 10.   © Kyodo

Wang Qishan, a longtime close ally of Xi and former widely feared anti-corruption czar, retired at the Chinese Communist Party's 19th national congress last October, stepping down as a member of both the Politburo Standing Committee and the Central Committee. But he made a surprise political comeback in March as China's new vice president.

While no longer on the seven-member standing committee, the party's top decision-making body, the Chinese state media has made it clear he is still in power by introducing his name in news reports just after the top seven, unofficially positioning him as the No. 8.

Neighboring North Korea, however, cut the pleasantries and left no doubt how they saw Wang Qishan's position when they reported about Kim Jong Un's surprise March 25-28 visit to China.

In a 40-minute documentary broadcast on North Korean TV, President Xi is seen shaking Kim's hand, followed by Premier Li Keqiang. In a telling detail, the documentary cuts to Wang Qishan also shaking Kim's hand, bypassing the five other members of the standing committee.

Foreign Minister Wang Yi's sudden enthusiasm for reaching out to Japan must have been on the orders of the Xi Jinping-Wang Qishan duo.

President Trump's hardened stance toward China, especially over trade, has raised the specter of a full-scale trade war between the world's two largest economies, rattling global markets.

Japanese Minister of Economy, Trade and Industry Hiroshige Seko, right, shakes hands with Chinese Commerce Minister Zhong Shan in Tokyo on April 15. Zhong is in charge of the Belt and Road Initiative.   © Kyodo

The high-level economic summit was held at the Japanese Foreign Ministry's Iikura Guest House, with 15 senior government officials, including ministers and deputy ministers, attending from each side. Among the Chinese delegates were Commerce Minister Zhong Shan and Finance Minister Liu Kun, both close aides to President Xi.

Regardless of the downgrading, the meeting marked a big step forward in bilateral ties. During Wang Yi's three-day visit, a relatively long stay, the two sides held wide-ranging and in-depth exchanges of views. That included a lengthy three-hour-and-45-minute meeting and working dinner between Wang and Kono on the eve of the April 16 summit.

The sidelines were filled with plenty of diplomatic activity, too, with Zhong meeting with Japanese Minister of Economy, Trade and Industry Hiroshige Seko, and Liu sitting down with Finance Minister Aso.

Zhong and Liu belong to political factions comprising the president's former subordinates in different provinces. Zhong is a member of the "Zhejiang faction," while Liu is in the "Fujian faction."

Zhong is in charge of the Belt and Road Initiative to create a massive economic zone linking China and Europe by land and sea. Careful observers would note that Zhong smiled more often than Wang did during the Japan visit, perhaps a sign of his confidence in his relationship with Xi.

U.S. President Donald Trump,right, praised China's Xi after a meeting with Japan's Abe in Florida on April 18. (Photo by Akira Kodaka)

The Chinese delegation's visit to Japan came ahead of perhaps the most important months in decades regarding Asia diplomacy. This week, Kim Jong Un meets South Korean President Moon Jae-in for the first inter-Korea summit since 2007.

In May, Chinese Premier Li Keqiang visits Japan for a trilateral summit with Japan and South Korea. By early June, Trump and Kim are scheduled to meet for a historic summit.

The U.S., China, Japan, South Korea and North Korea will be playing their cards to emerge on the winning side of this geopolitical power game. If Wang Yi's aim was to bring Japan closer to China and lure it away from the U.S., he was not fully off target. In a news conference after the Trump-Abe meeting at Mar-a-Lago, President Trump surprised Abe by showering compliments on Chinese President Xi for his pressure on North Korea, and shot down Abe's invitation for the U.S. to return to the Trans-Pacific Partnership trade pact.

When Wang and Kono sat down for a meeting and dinner ahead of the economic dialogue, North Korea was high on the agenda. But nothing has been made public about what the Chinese foreign minister said to his Japanese counterpart regarding Kim Jong Un's recent visit to China.

As foreign minister, Wang had a seat at the table when the leaders of China and North Korea met. He would be a prime source for inside information.

Many scenarios lie ahead regarding North Korea. China has hinted at possibly reviving the six-party talks with the U.S., Japan, Russia and both Koreas. It has also suggested a possible four-way meeting between China, the U.S. and the two Koreas.

Kim's announcement on Saturday that North Korea no longer needs to test nuclear weapons or long-range missiles, and that it would decommission a nuclear test site have made all participants go back to the drawing board.

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