The Senkaku/Diaoyu Islands Controversy: Much More than a Territorial Dispute

Oct 04 , 2012

The Senkaku/Diaoyu Islands, a small group of islands located in the East China Sea, have once again sent Sino-Japan relations into a tailspin. Similar to the flare-up two years ago when a Chinese fishing vessel collided with a Japanese Coast Guard patrol boat, this episode threatens to have negative spillover effects in the two countries’ growing economic relationship.

Many are hoping that, as in 2010, the controversy will eventually subside and the two sides can resume bilateral relations as usual. However, there are growing signs that the dynamics associated with this ongoing dispute are permanently changing, with ominous implications for the future of stability in East Asia.

Many Americans may not realize that the Senkaku (known as “Diaoyu” in Chinese) Islands were once governed by the United States. Under Article III of the US-Japan peace treaty of 1951, the United States gained “administrative rights” over the entire Ryukyu Island chain, which included Okinawa as well as the Senkaku Islands. In order to cultivate Japan as a US ally, the US adopted a policy of recognizing Japan’s “residual sovereignty” over the Ryukyu Islands.

In other words, the United States administered the islands knowing that they would eventually be returned to Japan. Following a meeting in Washington in 1969, President Richard Nixon and Japanese Prime Minister Eisaku Sato issued a joint statement that spelled out the details regarding the Ryukyu Islands’ reversion to Japan, which would occur three years later. This agreement stimulated interest in China (both Republic of China on Taiwan and the People's Republic of China) regarding the future status of the Senkaku/Diaoyu Islands.

In the case of the Republic of China (Taiwan)—which the United States recognized as the legitimate government of all of China—Taipei launched a vigorous and heated lobbying campaign directed at Nixon administration officials, which was aimed at preventing the Senkakus from being given back to Japan.

On June 8, 1971, President Nixon determined that he would not be able to accede to Taiwan’s demand; however, as a concession to Taiwan, the US would assert its neutrality over the sovereignty matter essentially by announcing that the return of “administrative rights” to Japan of the Senkaku Islands “can in no way prejudice the underlying claims of the Republic of China.” Nixon also promised additional military assistance—what was termed “defense possibilities”—to Taiwan as an additional concession.

Later, US State Department attorney Robert Starr would elaborate on this neutrality doctrine with a carefully crafted legal formula: “The United States believes that a return of administrative rights over those [Senkaku] islands to Japan, from which the rights were received, can in no way prejudice any underlying claims. The United States cannot add to the legal rights Japan possessed before it transferred administration of the islands to us, nor can the United States, by giving back what it received, diminish the rights of other claimants.”

Thus the neutrality doctrine would guide US policy and diplomacy for the next 40 years. It was a legal formula designed to keep the United States from having to take sides, given its competing interests in Japan, China and Taiwan. It was also a doctrine predicated on the hope that the two primary claimants (Japan and China, with the People’s Republic of China eventually overtaking Taiwan as the primary advocate for the Chinese case) could find an amicable solution.

Unfortunately, this never happened.

So this brings us to 2012 in which Japan continues to enjoy administrative rights (and de facto sovereignty) over the Senkaku/Diaoyu islands, while the People’s Republic of China feels increasingly aggrieved. Japan’s decision to name and nationalize the islands, moreover, reflects its view that it also enjoys de jure sovereignty over the islands. The People’s Republic of China, however, is increasingly dissatisfied with this arrangement and has viewed Japan’s recent actions as a major provocation.

This raises a crucial question: how can this controversy be addressed or solved? Unfortunately, in this instance, time does not (and will not) heal wounds. In other words, the opportunities for a peaceful solution are quickly fading due to the influences of three major factors.

The first factor relates to the relative power position between Japan and the People’s Republic of China. In the 1970s and especially the 1980s, Japan’s economic power was unrivaled in East Asia, while China was comparatively undeveloped and militarily weak. Today, the situation has changed. China is a rising economic and military power while Japan, with the world's third largest economy, is undergoing a gradual trend of relative decline (economically, demographically and, ultimately, militarily). This means that China is increasingly in a position to demand a change in the rules and overall status quo concerning the Senkaku/Diaoyu Islands.

The second factor concerns the geographic location of the Senkaku/Diaoyu Islands within the East China Sea. As China’s naval power grows, the East China Sea is emerging as a “contested space” between China and Japan. At least one Chinese media report asserted that recent naval exercises in the East China Sea were partially intended to signal Beijing’s dissatisfaction with the overall Senkaku/Diaoyu Islands’ arrangement.

Similarly, Japanese strategic documents increasingly reflect Tokyo’s concerns about assertive Chinese military exercises in the East China Sea (including in areas near the Senkaku/Diaoyu Islands). For some Chinese military leaders, this increasingly active maritime posture in the East China Sea–where China and Japan also have disagreements over energy resources and boundaries– represents a “new normal” that will ultimately require Tokyo’s acquiescence, which of course will not come easily, if ever.

The third factor is arguably the most important: the US role in the controversy. In the 1970s and 1980s, the United States signaled to Japan the applicability of Article 5 of the US-Japan defense treaty (in a Senkaku Islands military contingency), although often with careful or conditional language. A briefing paper for Henry Kissinger in 1972, for example, stated that the Mutual Security Treaty “could be interpreted” to apply to the Senkakus. Two years later, a US defense official told the head of the Japanese Defense Agency that it was his “personal view” that the security treaty would apply to the Senkakus.

However, more recently, US assurances to Japan appear to have become more direct. On October 27, 2010, for example, Secretary of State Hillary Rodham Clinton seemed to dispel any strategic ambiguity regarding the applicability of the defense treaty when she affirmed: "the Senkakus [Diaoyu] fall within the scope of Article 5 of the 1960 US-Japan Treaty of Mutual Cooperation and Security" (This was subsequently confirmed by similar statements by other US officials).

Thus viewed from this perspective, the Senkaku/Diaoyu Island controversy is not merely a bilateral dispute involving Japan and China; these islands are at the focal point of Sino-American competition and potential conflict.

Consequently, the Senkaku/Diaoyu Island controversy is potentially more serious than many of the region’s other key flashpoints, including the South China Sea and Taiwan. This presents the United States with a dilemma: how to maintain neutrality on the sovereignty question while at the same time ensuring that disagreements between Tokyo and Beijing do not become inflamed—as they have now—or worse, lead to war.

This may require an activist approach on the part of the United States to encourage both countries to come up with a permanent, mutually-agreeable solution, perhaps facilitated by international adjudication. Simply “shelving” the issue for future generations, postponing negotiations or denying that a dispute even exists may no longer be viable options, particularly when so much (for all three countries) is at stake.

Dr. Paul Smith is a Professor of National Security Affairs at the Naval War College in Newport, Rhode Island. The views and opinions in this essay are the author’s own, and do not reflect the positions of the Naval War College, US Navy or US Government.


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