Sino-Japanese relations are back on track since hitting their lowest point in 2012, with Japanese companies' investment in China moving away from "taking advantage of cheap resources" to responding to a path of organic growth, Masashi Iwanaga, general manager of the Beijing Office of the Japan-China Economic Association (JCEA), told the Global Times in an interview on Wednesday.
He made the comment ahead of the G20 Summit, which will be held in Osaka, Japan from Friday to Saturday.
"Japanese companies' investment in China now focuses on areas involving China's internal demand ... such as automobiles, robots, information technology, electronic parts and industrial automation," Iwanaga said.
This is in contrast to the past, when Japanese investors built factories in China to take advantage of its cheap labour for processing and exporting finished products to third markets.
In 2018, Japanese companies' investment in China grew 18 per cent year-on-year, according to data provided by the JCEA.
"Japanese companies are anticipating more business communication with China to seize opportunities after a normalized bilateral relationship for businesses," according to Iwanaga.
In 2012, China and Japan, the two major Asian economies' diplomatic relations nearly froze due to disputes over the Diaoyu Islands, which prompted a widespread boycott among Chinese of Japanese brands, as well as soured trade and economic ties.
Against rising global protectionism and the US withdrawal from the Trans-Pacific Partnership (TPP), the Japanese business community also hopes to facilitate more trade deals with multiple partners, with the China-Japan-South Korea free trade agreement seen as important to promote trilateral cooperation, according to Iwanaga.
"Japan holds the same stance as China in opposing protectionism, and the two countries should work together to strengthen the multilateral trade system and defend free trade," Iwanaga said.
Japan will lead discussions on WTO reforms to "make the mechanism play the role it was designated to do" during the G20 Summit, Iwanaga said in the interview.
"It is important that high-technology companies highlight the safety of their products in promotions and China and Japan promote mutual market openness," Iwanaga said.
Iwanaga said that Japan welcomes the upcoming meeting and expects that it could contribute to a solution to China-US trade tensions or at least lead to an improvement in relations. "China and the US are the world's two biggest economies, and the trade row between them not only has affected Japan but also the world economy and disrupted the global supply chain."
Iwanaga declined to comment on whether Japanese companies would yield to US pressure and suspend business ties with their Chinese peers, but he said that the Japanese government has not proposed banning telecom equipment from certain countries or specific enterprises.
"It is important that high-technology companies highlight the safety of their products in promotions and China and Japan promote mutual market openness," Iwanaga said.
"Japanese companies value their business with China, but at the same time we also value economic communication with companies in US and other countries. For enterprises, they will carry out business on the basis of complying with the laws and regulations of their home countries."
Sidebar
Xi-Trump meeting a hot topic in Osaka
The world's eyes are increasingly on the coming meeting between Chinese President Xi Jinping and US President Donald Trump during the G20 Summit in Osaka, and local residents there are no exception.
The Xi-Trump meeting seems like the hottest topic of discussion in Osaka. Some residents in the city told the Global Times that they hope the upcoming G20 Summit could yield concessions from both sides to promote global development in a peaceful manner.
"I hope the China-US meeting could yield tangible outcomes. Japan has a sluggish economy, and if a solution is reached to end the trade war, it could benefit Japan's economy," a 50-something Osaka resident surnamed Miyajima, who is the manager of a parts manufacturing company, told the Global Times on Wednesday.
Miyajima said the orders that his company has received have shrunk due to lingering China-US trade tensions, and that's hurt his income. He is pinning his hopes on a deal to mitigate tensions.
"The negotiations could go any way, from no progress to a cancellation of all tariffs," another middle-aged man, who declined to give his name, told the Global Times. But he said it wasn't likely that the meeting would solve all the issues between the world's two largest economies as the over US worries about China's technology rise will remain.
The summit features eight themes, including the global economy, trade and investment, innovation, the environment and energy.
Some interviewees said that talks on WTO reform to uphold multilateralism could also be high on the agenda.