Japanese experts warn reckless political moves would undermine economic ties with China

Leading figures in Japan's business sector and civil society have stressed the need for their country to engage in constructive dialogue with China, with one warning that reckless political actions would undermine the bilateral economic ties which play a significant role in the Japanese economy.

Their comments came after Japanese Prime Minister Sanae Takaichi's remarks over Taiwan drew stern protests from Beijing.

Yoshinobu Tsutsui, chairman of the Japan Business Federation, said on Monday, "I believe it all comes down to continuing communication and dialogue across various fields, and having both sides move toward resolving the issue."

Tsutsui was speaking to reporters after he met with Takaichi at the Prime Minister's Office along with the heads of the Japan Chamber of Commerce and Industry (JCCI) and the Japan Association of Corporate Executives (JACE).

Tsutsui emphasized that "political stability is the prerequisite for business exchanges", urging the Japanese government to continue constructive dialogue.

Ken Kobayashi, chairman of the JCCI, said: "Japan and China are economically inseparable. We should maintain a mutually beneficial relationship."

Mutsuo Iwai, acting chairperson of JACE, said "it is important not to let private-sector dialogue come to a halt".

Kazuyuki Hamada, an international political economist and Japan's former parliamentary vice-minister for foreign affairs, said Takaichi lacks a deep insight into Japan-China relations and that there are growing concerns that this blind-spot could lead to a heightening of tensions in the Asia-Pacific region. This would in no way benefit the economic interdependence of Japan and China, he said.

According to preliminary figures released by the Japan National Tourism Organization, the number of visitor arrivals in Japan from the Chinese mainland reached 7,487,200 in the first nine months of 2025, up 42.7 percent year-on-year, with Chinese students forming the largest cohort of international students in the country.

The economic impact of Chinese tourists and students on Japan "is immeasurable", said Hamada.

"Opportunities for mutual visits and direct understanding naturally form the basis for economic exchange," he added.

"If such opportunities for communication between the peoples of both countries are hindered, the economic repercussions would be enormous."

Masaaki Kanai, director-general of the Asian and Oceanian Affairs Bureau at Japan's Ministry of Foreign Affairs, began a visit to China on Monday. Hamada said he hopes Kanai, as a special envoy for Takaichi, will bring "concrete, future-oriented proposals — especially from the business community — for rebuilding Japan-China relations".

"Differences in positions and ways of thinking are to be expected between neighboring countries, but there is no other bilateral relationship like that of Japan and China, where history, culture, economics and geopolitics are so deeply intertwined. Prime Minister Takaichi should once again take this firmly to heart," he said.

Takakage Fujita, secretary-general of the Association for Inheriting and Propagating the Murayama Statement, a Japanese civil society group dedicated to upholding the 1995 statement that admitted Japan's wartime mistakes, said Takaichi's recent remarks are "reckless actions that undermine crucial Japan-China economic ties".

Fujita said the importance of Japan-China economic and trade exchanges is self-evident, as they play an extremely significant role in the Japanese economy.

"In particular, it is certain that East Asia, centered on China, will become the core of the global economy," he added.

"For Japan, its economic and trade relations with China will therefore become even more important."

Yangchoon Kwak, a senior professor in the College of Economics at Rikkyo University in Japan, said any decrease in Chinese tourists visiting Japan would lead to lower consumption and deal a blow to the tourism and service sectors.

A contraction in tourism and services would further spill over into the trade, logistics and related industries that support goods and services, Kwak added.

"According to one estimate, if the number of visitors from China were to fall sharply, the resulting drop in inbound consumption could reduce spending by 2.2 trillion yen ($14.2 billion), lowering real GDP by about 0.36 percent. In short, the risks extend not only to trade in goods but also to economic exchange in the broader sense," he said.

In the past, when Japan-China relations deteriorated, Japanese exports to China fell sharply. If there was to be a prolonged period of tension this time around, Japanese industries that have a high dependence on the Chinese market, such as machinery, semiconductor components and auto parts, may be heavily affected. The manufacturing sectors of Japan and China are closely interconnected, and any disruption in the supply of parts and materials or any increase in costs would also affect Japanese companies, Kwak said.

"If China moves to scale back economic ties with Japan, companies may, over the long term, be forced to reconsider their production and procurement routes that run through China," he added.

"Thus, if trade, investment and people-to-people exchanges become rigid or constrained, the impact would not be limited to Japan. It could influence regional and global supply chains involving both countries."

Kwak stressed that, for Japan, China is a strategic market – with China's middle-income class continuing to grow, the country remains important to Japanese companies, not just as a low-cost base but also as a "growth market".