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Japan's own future is its true strategic challenge

By Warwick Powell | China Daily Global | Updated: 2025-12-30 09:10
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Sanae Takaichi, Japan's prime minister, leaves after a press conference at the prime minister's office in Tokyo, Japan, Dec 17, 2025. [Photo/Agencies]

The Taiwan question, for Japan, is a distraction from far deeper and more structural challenges. Tokyo's future prosperity and security will not hinge on what happens across the Taiwan Strait nearly as much as on whether it can address its long-standing vulnerabilities in food, energy and geopolitics.

Japan faces hard realities, but it also has options — if it is willing to make bold choices that break with inherited strategic assumptions.

Japan is one of the world's most import-dependent nations, yet the country has no coherent long-term strategy for securing its critical energy and food supplies. Compounding the challenge is the dense network of United States military bases on Japanese soil that operate with extraterritorial privileges and restrict Japan's strategic autonomy. For decades, Tokyo has assumed that the US alliance compensates for all other vulnerabilities. That assumption is now dangerously outdated.

Japanese officials, behind closed doors, might question whether Washington would risk its own homeland cities, let alone its forward-deployed troops, in the name of defending Tokyo.

The recently released US National Security Strategy underscores this unease: It pushes allies to shoulder more responsibility and to assume greater operational risks. The US wants its allies and subordinates to shoulder more risks, covering for the realities of diminished US capacity and resolve.

Rather than increase its exposure, Japan needs to reduce it. And that requires looking beyond the US alliance and toward the region it actually inhabits.

The truth is that Japan cannot do without China or Russia. Tokyo probably knows this, even if it does not say so publicly. Consider Japan's approach to Russian energy.

Despite joining Western sanctions after the Russia-Ukraine conflict began, Tokyo quietly ring-fenced its stakes in the Sakhalin-1 and Sakhalin-2 oil and gas projects invested in by multinational entities, including Japanese investors.

Japanese utilities continue to import Russian liquefied natural gas because they have no alternative capable of delivering the same stability at scale. Energy security simply outweighs diplomatic posturing.

The same realism guides Japan's economic footprint in China. Japanese companies operating in China generate substantial foreign exchange earnings that support Japan's foreign reserves, corporate profitability and macro-financial stability. For all the rhetoric about "de-risking", Japanese companies cannot replicate in Southeast Asia or South Asia the productivity, demand depth, or supply-chain integration they have had in China, which is not just Japan's largest trading partner, but the gravitational center of East Asian industrial organization.

Yet Tokyo's political rhetoric often veers in the opposite direction, emphasizing perceptions of threat and downplaying interdependence. This mismatch between discourse and reality is the clearest sign that Japan's current strategic posture is untenable. A nation that must protect Russian liquefied natural gas flows and Chinese earnings streams cannot credibly act as if decoupling or confrontation is a viable long-term path.

Japan's real challenge, then, is not Taiwan. It is the task of building a sustainable foundation for its own future. That requires three bold shifts.

First, Japan must genuinely atone for its wartime actions. Reconciliation is not a moral add-on but a strategic necessity. A Japan at peace with its past can move forward; a region with Japan at peace can embrace deeper cooperation. This is the key to unlocking trust with China, the Republic of Korea and the Democratic People's Republic of Korea.

Second, Tokyo must deepen economic and institutional integration within East Asia. The Regional Comprehensive Economic Partnership agreement, trilateral China-Japan-Republic of Korea investment mechanisms, and expanded regional currency swap arrangements can mitigate liquidity risks and reduce Japan's dependence on US macro-financial stabilization. These frameworks enhance resilience and ensure Japan's seat at the regional table.

Third, Japan should pursue a structured detente with Russia, laying the groundwork for a Northeast Asia economic development zone. Through Russia, Japan may also find indirect channels for reducing tensions with the DPRK.

Taken together, these steps offer Japan a path toward greater autonomy and stability, rooted in the region's economic logic rather than Cold War alignments. The country's future depends on whether it can construct a diplomatic and economic architecture that reflects the real sources of its security and prosperity. Proclamations about Taiwan are a misguided distraction.

Japan does not need more rhetoric about threats; it needs a new grand strategy. And the boldest thing Japan can do today is to stop looking across the Pacific for answers and start looking around its own neighborhood.

The author is an adjunct professor at Queensland University of Technology in Australia and former policy adviser to former Australian prime minister Kevin Rudd.

The views do not necessarily reflect those of China Daily.

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