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711. Rough Waters in the South China Sea: Navigation Issues and Confidence-Building Measures

Author:
Ji Guoxing
Publication Date:
08-2001
Content Type:
Policy Brief
Institution:
East-West Center
Abstract:
In the wake of a collision between a U.S. spy plane and a Chinese jet fighter off the coast of Hainan in April 2001, verbal skirmishing between the United States and China revealed sharply different conceptions of jurisdictional and navigational principles. These differences persist and will likely be the cause of future conflicts; they have already caused strife among countries ringing the South China Sea. Central to these conflicts are the exclusive economic zones (EEZ) that extend 200 nm into the sea from coastal nations' baselines. Created by the UN Law of the Sea Convention, these zones attempt to accommodate coastal states' interest in controlling offshore resources and maritime powers' interests in maintaining freedom of navigation. But ambiguities in the Convention's language combined with coastal states' proliferating EEZ claims have created a tinderbox. The situation will remain volatile as long as the focus remains on jurisdictional disputes. But confidence-building efforts aimed more narrowly on practical navigation issues and managing “incidents at sea” offer a starting point for first bilateral and then multilateral agreements. In the wake of a collision between a U.S. spy plane and a Chinese jet fighter off the coast of Hainan in April 2001, verbal skirmishing between the United States and China revealed sharply different conceptions of jurisdictional and navigational principles. These differences persist and will likely be the cause of future conflicts; they have already caused strife among countries ringing the South China Sea. Central to these conflicts are the exclusive economic zones (EEZ) that extend 200 nm into the sea from coastal nations' baselines. Created by the UN Law of the Sea Convention, these zones attempt to accommodate coastal states' interest in controlling offshore resources and maritime powers' interests in maintaining freedom of navigation. But ambiguities in the Convention's language combined with coastal states' proliferating EEZ claims have created a tinderbox. The situation will remain volatile as long as the focus remains on jurisdictional disputes. But confidence-building efforts aimed more narrowly on practical navigation issues and managing “incidents at sea” offer a starting point for first bilateral and then multilateral agreements.
Topic:
Security, Energy Policy, and International Law
Political Geography:
United States, Japan, and China

712. Finance and Changing US-Japan Relations: Convergence Without Leverage—Until Now

Author:
Adam S. Posen
Publication Date:
08-2001
Content Type:
Working Paper
Institution:
Peterson Institute for International Economics
Abstract:
In the postwar era, US-Japan economic relations have been characterized by substantial tensions, yet this has not damaged the underlying security relationship or critically harmed the multilateral economic framework. In fact, these two economies have become more integrated over time even as these tensions played out. These tensions, however, have required an enormous expenditure of political capital and officials' time on both sides of the Pacific and have led to foregone opportunities for institution building and policy coordination. They have deepened since Japan “caught up” with the United States around 1980, and Japanese and US firms began increasingly to compete for profits and market share in the same sectors. Moreover, as both the US and Japanese economies continue to mature – both in terms of the age of their populations and their industrial mix – they will likely face even greater tensions between them over allocating the management and costs of industrial adjustment.
Topic:
Economics, International Trade and Finance, and Political Economy
Political Geography:
United States, Japan, Israel, and East Asia

713. Unchanging Innovation and Changing Economic Performance in Japan

Author:
Adam S. Posen
Publication Date:
05-2001
Content Type:
Working Paper
Institution:
Peterson Institute for International Economics
Abstract:
The Toyota Commemorative Museum of Industry and Technology gives its visitors much to ponder. Established at the site in Nagoya where in 1911 Sakichi Toyoda founded his automatic loom factory (the basis of the family fortune, which later funded his son Kiichiro's development of automobile production), the museum was opened on June 11, 1994, the 100th anniversary of Toyoda's birth. It is a popular stop on field trips for Japanese schoolchildren, who are required to study in the 3rd grade the automobile industry. The messages, which Toyota wishes to instill in its young visitors, are the importance of “making things” and of “creativity and research.” And confronting all museum visitors upon entry, having central place in the vast and largely empty first room of the exhibits, is Sakichi Toyoda's one-of-a-kind vertical circular loom.
Topic:
Economics, International Trade and Finance, and Political Economy
Political Geography:
Japan, Israel, and East Asia

714. Foreign Direct Investment in China: Effects on Growth and Economic Performance

Author:
Edward M. Graham and Erika Wada
Publication Date:
04-2001
Content Type:
Working Paper
Institution:
Peterson Institute for International Economics
Abstract:
By almost all accounts, foreign direct investment (FDI) in China has been one of the major success stories of the past 10 years. Starting from a base of less than $19 billion in 1990, the stock of FDI in China rose to over $300 billion at the end of 1999. Ranked by the stock of inward FDI, China thus has become the leader among all developing nations and second among the APEC nations (only the United States holds a larger stock of inward FDI). China's FDI consists largely of greenfield investment, while inward FDI in the United States by contrast has been generated more by takeover of existing enterprises than by new establishment, a point developed later in this paper. The majority of FDI in China has originated from elsewhere in developing Asia (i.e., not including Japan). Hong Kong, now a largely self-governing “special autonomous region” of China itself, has been the largest source of record. The dominance of Hong Kong, however, is somewhat illusory in that much FDI nominally from Hong Kong in reality is from elsewhere. Some of what is listed as Hong Kong-source FDI in China is, in fact, investment by domestic Chinese that is “round-tripped” through Hong Kong. Other FDI in China listed as Hong Kong in origin is in reality from various western nations and Taiwan that is placed into China via Hong Kong intermediaries. Alas, no published records exist to indicate exactly how much FDI in China that is nominally from Hong Kong is in fact attributable to other nations.
Topic:
Economics, International Trade and Finance, and Political Economy
Political Geography:
United States, Japan, China, Israel, East Asia, Asia, and Hong Kong

715. The Japanese Network State in U.S. Comparison: Does Embeddedness Yield Resources and Influence?

Author:
Jeffrey Broadbent
Publication Date:
07-2000
Content Type:
Working Paper
Institution:
Walter H. Shorenstein Asia-Pacific Research Center
Abstract:
Scholars describe the East Asian—Japanese and South Korean—state as a network state that guides the private sector by means of embedded relationships (i.e., informal persuasive ties). In theoretical terms, these embedded ties represent informally institutionalized social capital. This study refines the network state thesis by comparing embedded ties with tangible resource exchanges in their effects upon political influence among political (organizational) actors in Japanese and U.S. labor politics. The network state thesis predicts that in Japan embedded ties should channel the flow of tangible resources (e.g., vital information, political support), and that embedded third party brokers should mediate this flow. Embedded ties have generally pervaded the Japanese polity, whereas in the United States, they have remained concentrated within the labor sector. In Japan, the embedded ties form a “bow tie” pattern: the Ministry of Labor (MOL) bridges a structural hole between corporatistic business and labor. The presence of embedded third parties predicts the dyadic exchange of information. Political support, by contrast, forms a distinct, nonembedded network, centered on political parties. Tensions between the embedded network and the instrumental political support network help explain characteristics of Japanese politics, such as the relative slowness of its response to financial crisis.
Topic:
Industrial Policy and Politics
Political Geography:
United States, Japan, Israel, East Asia, and South Korea

716. The Domestic Context of the Alliances: The Politics of Tokyo

Author:
Akihiko Tanaka
Publication Date:
01-2000
Content Type:
Working Paper
Institution:
Walter H. Shorenstein Asia-Pacific Research Center
Abstract:
It is now almost a cliché to say that domestic politics and foreign policy are closely connected. Yet however trite this expression, nonetheless it is true. Japan's international behavior and particularly its security policy cannot be fully understood without analyzing its domestic politics. In post–World War II Japan, security policy has been the dominant theme of domestic politics and source of ideological divide.
Topic:
Security
Political Geography:
United States, Japan, Asia, and Tokyo

717. A New Beginning: Recasting the U.S.-Japan Economic Relationship

Author:
Bruce Stokes
Publication Date:
07-2000
Content Type:
Working Paper
Institution:
Council on Foreign Relations
Abstract:
The time is ripe for a bold new initiative to recast the U.S.-Japan economic partnership for the 21st century. A new Japan is emerging. Foreign investment is on the rise. Tokyo is deregulating and restructuring its economy. A new generation of Japanese entrepreneurs and venture capitalists has arrived on the stage.
Topic:
Economics and Political Economy
Political Geography:
United States, Japan, Israel, East Asia, Asia, and North Africa

718. Economic Crisis and Corporate Reform in East Asia

Author:
Meredith Woo-Cumings
Publication Date:
06-2000
Content Type:
Working Paper
Institution:
Council on Foreign Relations
Abstract:
The Asian financial crisis of 1997–98 involved, among other things, a failure of regulation. Some believe this failure is endemic to global capitalism, and others believe it was profoundly local and idiosyncratic, emanating from regulatory flaws in the affected countries, stretching an arc from Thailand and Indonesia to Korea and Japan. There is also a debate about the nature of the regulation that failed. Some argue that the crisis emanated from a surfeit of nettlesome regulations and endemic industrial policy; others claim it happened for want of effective regulations and (even) industrial policy. Across the hypotenuse of these disagreements, however, stretches a universal recognition that regulatory infrastructure and institutions do matter and that they must play a major role in the way we think about economic development. After the miracle years in East Asia, “good governance” has become the Spirit of the Age.
Topic:
Economics and Political Economy
Political Geography:
United States, Japan, Indonesia, Israel, East Asia, Asia, Korea, and Thailand

719. The United States, Japan, and China: Setting the Course

Author:
Neil E. Silver
Publication Date:
04-2000
Content Type:
Working Paper
Institution:
Council on Foreign Relations
Abstract:
The political dynamics of China-Japan relations have changed in reaction to three events: the demise of bipolar world politics, China's ''rise,'' and Japan's unexpected economic stall. These changed political dynamics have brought important challenges and consequences for the United States.
Topic:
International Relations and Security
Political Geography:
United States, Japan, China, Israel, East Asia, and Asia

720. Report on Allied Contributions to the Common Defense 2000

Publication Date:
03-2000
Content Type:
Working Paper
Institution:
Board of Governors of the Federal Reserve System
Abstract:
This Report presents the Department of Defense assessment of the relative contributions toward the common defense and mutual security made by our NATO allies, our Pacific allies, (Japan and the Republic of Korea), and the countries of the Gulf Cooperation Council (GCC). Under legislative provisions dating to the Defense Authorization Act of 1981 (P.L. 96-342, Section 1006), the Department of Defense is required to compare the defense burdens borne by our allies, explain disparities, and describe efforts to eliminate such disparities. This Report addresses requirements originally set forth in the 1984 National Defense Authorization Act (P.L. 98-525), Title X, Section 1003, Defense Burdensharing, paragraphs a-d. The most recent baseline legislation addressing this reporting requirement is the FY 1997 National Defense Authorization Act, Title X, Section 1084. This Report also covers burdensharing reporting requirements set forth in the FY 2000 Department of Defense Military Construction Appropriations Act (P.L. 106-52), Section 119.
Topic:
Security, Defense Policy, and NATO
Political Geography:
Japan, Australia/Pacific, and Korea