China and Japan's Simmering Island Row is Threatening to Boil Over

Chinese and Japanese nationalists are actively asserting their country's claims over the disputed Diaoyu/Senkaku islands, sparking protests and a heated diplomatic row between the two countries. To outsiders, it might seem as if this is a relatively new dispute, which started with the Tokyo governor's recent announcement in April that he would purchase the rocky islets. In fact, tensions have been brewing since at least September 2010, when a Chinese fishing boat rammed Japanese coastguard patrols and unleashed a bilateral crisis.

That same year, China started to take a more assertive approach towards Japan by increasing its aerial and law enforcement presence in disputed waters to demonstrate its sovereignty. Many Chinese strategists perceive Japan to be a former empire continuing on a downward slide while China's star is rising, and the rise of hardline voices in Japan has led many Chinese analysts to call for more resolve in Beijing. From the Chinese perspective, the time is right to respond resolutely and stake its ground in this dispute with its eastern neighbour.

In Japan, public attitudes towards China deteriorated drastically in 2010, in what is known there as the "China shock". It happened when China eclipsed Japan to become the world's second-largest economy, and began to adopt a more hardline approach to maritime disputes. This resulted in an upsurge in Japanese nationalist sentiment, culminating in campaigns to name, and more recently to purchase, disputed islands. On a strategic level, concerns about China's rising military and economic power have prompted Tokyo to broaden its regional network by engaging Pacific countries and multilateral forums such as Asean, while strengthening its own defence capabilities and stepping up security co-operation with the US.

Chinese hardliners see these moves as Japan's willingness to act as a proxy of the US in its efforts to contain China's rise and expand US presence and influence in the Asia-Pacific region. In Japan, what is perceived as China's determination to restructure the regional landscape is fuelling nationalist anxiety about Japan's ability to defend its territory against a Chinese expansion.

Nationalism makes sovereignty in the East China Sea a highly explosive issue, much more so than the South China Sea for example. Due to the link with atrocities committed during the Japanese invasion, sentiments over the status of the Diaoyu/Senkaku islands run deeper in the Chinese psyche than any other territorial dispute in modern Chinese history. Japan, on the other hand, feels threatened by China's rise, and fears that its territorial sovereignty might be eroded. Therefore, incidents surrounding these islands strike directly at historical wounds, stirring national pride and constricting the already narrow space for diplomatic manoeuvre.

Public opinion is a double-edged sword, particularly for China. Beijing tries to use it to justify assertive actions and coax other countries to compromise, but it also faces the tricky dilemma of satisfying increasingly outspoken and critical citizens. Last week's dramatic landing of Hong Kong activists on the Diaoyu/Senkaku islands was widely applauded on microblogging sites, which soon called for more anti-Japanese protests.

But other internet users also raised doubts about the Chinese government's determination and capability to protect its territorial claims, going so far as to ask for military intervention. China fears these protests could turn into criticism of the government, as has happened in the past.

While neither Beijing nor Tokyo desires a large-scale conflict, there is deepening pessimism on both sides over the prospects of a peaceful settlement to the Diaoyu/Senkaku dispute. And the deep strategic mistrust that characterises relations between the two countries is currently aggravated by their respective domestic political turmoil. While Japan's leaders are navigating a fragmented and shifting political landscape, the Chinese leadership is steering a delicate power transfer, limiting the capital available to either Tokyo or Beijing to go significantly against populist or nationalist sentiment.

Neither side is willing to initiate the much-needed call on the bilateral hotline established precisely for this type of situation. The longer the two sides let the tension brew, the harder they will find it to prevent the dispute from boiling over.