Territory is tied to the future and to the people who control a territory as the future unfolds. For Japan, being an island country, the Japanese needs for more territory can only go in two directions: either Japan seizes territory elsewhere, or Japan seizes opportunity in marketplaces. After the Second World War Japan moved away from any designs to seize territory by conquest and rapidly moved towards gaining market share. Although Japan tried many types of manufacturing, the most lucrative results were with automobile manufacturing and consumer electronics manufacturing. To gain access to the wealthiest markets in the world, Japan built a cautious posture, attempting not to offend those in the marketplaces they were entering.
Consumer Electronics And Automobiles
During the 1950s and 1960s Japanese companies developed commercial applications for consumer electronics based on American solid state transistor technology. Japanese manufacturing adopted quality processes that allowed their consumer electronics manufacturing to become the most advanced and cost efficient in the world. The Japanese government offered financial support to most Japanese electronics companies, which allowed them to scale quickly to global markets – primarily the European and North American markets.
Japanese consumer electronics success boomed in the 1970s and 1980s, as they offered color televisions and video tape machines with advanced features and high dependability. By 1977 the United States resisted the onslaught of Japanese consumer electronics, with charges of dumping and predatory commercial practices. For three years 1977 to 1980 the United States limited Japanese color televisions to 1.75 million units in the US marketplace per year. As a result Japanese companies invested in US factories for assembly, repair, and distribution. Big Japanese electronics companies began hiring American workers in the United States, which helped diffuse friction over consumer electronics exports from Japan.
In the 1990s Japan experienced a decade long deflationary economic downturn, which brought attention to structural issues in the Japanese economy. Life long employment guarantees, government support for private corporations and limitations on innovation all came onto the table as areas of concern. It wasn’t clear exactly how to move forward and Japan was reluctant to pursue digital technology with the same gusto they previously brought to analog consumer electronics. During this lost decade Asian competition took hold of the consumer electronics manufacturing marketplace. Taiwan, China and South Korea all succeeded at gaining market share, and all three eagerly pursued new digital products like computers and especially cell phones. Japan no longer had an exclusive lock on high end consumer electronics manufacturing and innovation. The Japanese global territory became less dependable as an engine for economic growth as they now had to compete with several Asian neighbors.
Japanese automobiles are also high value export products that have tied the Japanese economy to the global marketplace. Japanese business conglomerates (zaibatsu) at the center of the Japanese automotive industry expanded rapidly in the 1970s, 1980s and 1990s becoming the largest automotive producing country in the world in 2000. Since the first years of the new century Japanese production has decreased slightly and Japan is currently the third largest automotive producing country in the world. Japanese cars were always designed for durability. Considering a large percentage of Japanese cars are exported, durability means repair and parts are not needed as frequently, which provides a sales edge in all markets. In the U.S. market there is concern that there is no reciprocity between U.S. auto makers and the Japanese marketplace. For all these decades, Japan has managed to remain a closed market, which encourages the U.S. to import more from Europe and South Korea.
In the last ten years Japanese cars and electronics have had quality defects, sometimes requiring recalls. Since Japanese manufacturing and innovation success are firmly founded on quality control, this development is distressing and has drawn intense Japanese attention. Cars have more electronics in them and consumer electronics have more software in them than in past decades. The complexity of these new products is a challenge for quality programs everywhere, but in Japan these challenges are directly tied to the country’s economic viability. Japan’s territory is a global marketplace and quality products are essential for continued success, especially considering the United States auto industry’s resentments about the closed Japanese automobile market.
Conflict In The East China Sea
Japan’s territory is largely about market access at this point, but not exclusively. There are two conflicts that tie Japan to immediate regional forces as they play out in global geopolitics. Japan makes claim to exclusive economic zones in the East China Sea that overlap with both South Korea and China. Each of these countries projects their territorial maritime rights offshore for 200 miles in accordance with the United Nations Convention on the Law of the Sea. The problems come from conflicting interpretations of what offshore claims mean to each of these three countries.
There is a section of the Chinese coast that China extends out to the eastern end of the Chinese continental shelf, which extends out into the East China Sea. That extension falls within the guidelines of the the United Nations Convention on the Law of the Sea, yet produces a significant overlap between Chinese and Japanese claims. Similarly, South Korea and Japan have a long-standing dispute over jurisdiction of Liancourt Rocks in the Korea Strait, which is also part of the East China Sea. As you can see on the map below, both of these conflicts cause dispute about ocean access and use. And, these disputes have the potential of becoming military engagements.
Japan is an island nation and has both limited land territory and a substantial population, so ocean access is important for fishing and mineral rights. But for decades these conflicting claims lay dormant, because all three countries attempted to avoid confrontations. In 1995 China discovered an undersea natural gas field, Chunxiao gas field, which lies very close to the ocean border between Japan and China. Japan believes the gas field extends over the border into their territory and is afraid that as China develops the gas field they are draining away resources that are actually coming from Japanese ocean territory. So, not only do these Asian countries compete for global market share in electronics and automotive distribution, they also compete for resources in their immediate territorial ocean claims.
In order to deal with this ocean conflict Japan has adopted the enemy-of-my-enemy-is-my-ally strategy vis-a-vis China. In 2012 Japan and South Korea signed a military treaty for mutual support. That treaty allows both Japan and South Korea to set aside whatever disputes they may have in the East China Sea in order that they cooperate as they both face threats from China and North Korea. Japan’s territorial cycle is about access to resources whether they are market resources or ocean resources and for now Japan has chosen to build military alliances to support her claims and in the hopes of facing down China’s expanding military strength.