1. What is the matter?

In November 2025, Prime Minister Takaichi stated in the Japanese Diet that a military blockade of Taiwan in the event of a Taiwan contingency could constitute an existence-threatening situation. This means that Japan could assist US forces with military forces as use of collective self-defense under UN Charter.

China reacted strongly. It recommended tourists not to visit Japan and students not to study in Japan, citing the deteriorating safety in Japan. It is not a fact, but it is a strong expression of displeasure of the Chinese government.

But, it's nothing but a case of “what's the big deal now?”

According to Article 6 of the Japan-U.S. Security Treaty, revised in 1960, U.S. forces can use bases in Japan to defend Korea, Taiwan, and the Philippines. This is the so-called “Far East Clause.” It clearly reflects the early postwar U.S. policy of preventing former Japanese and U.S. territories from falling into the hands of Stalin and Mao Zedong.

Subsequently, the Japanese government established a legal framework allowing the Self-Defense Forces to support U.S. forces. Logistical support for US forces in the event of a “significant influence situation”, meaning a contingency that could affect Japan was made possible by Prime Minister Obuchi Keizo in 1999.

And use of force for assisting US forces in the event of “crisis of national existence”, meaning a contingency that could pose existential threat to Japan, was also made possible by Prime Minister Abe Shinzo in 2015.

Nonetheless, China did not hide its anger, because fundamentally, the positions of China and the U.S.-Japan alliance on Taiwan are entirely different. In 1972, Dr. Kissinger, accompanying President Nixon on his historic visit to China, drafted the Shanghai Communiqué. The Shanghai Communiqué clearly stated the U.S. position: “Since the Chinese on both sides of the Taiwan Strait maintain that there is only one China, the United States does not challenge this, but hopes the Taiwan issue will be resolved peacefully.”

This means that while there are two Chinas—the Republic of China and the People's Republic of China—both insist there is only one China, so the U.S. does not challenge this. It also explicitly added that the Taiwan issue should be resolved without the use of force. Chinese Prime Minister Zhou Enlai said once to then Prime Minister of Japan, Tanaka Kakuei that Kissinger was a genius, commending his drafting talent.

Japan shares this position. In the 1972 Japan-China Joint Declaration, Japan stated that while it accepted the Cairo Declaration of 1943 through the Potsdam Declaration of 1945, it understood and respected the Cairo Declaration's stipulation that Taiwan be returned to China. The underlying intent was that Japan had renounced Taiwan later in the San Francisco Peace Treaty and thus was not in a position to say to whom Taiwan belonged after that.

2. Background of Japan-China and US-China normalization

China had to accept the drafting on Taiwan by Dr. Kissinger in the Shanghai Communique and in Japan-China joint communique in 1972, because the Soviet tanks were headed to Beijing.

After Stalin's death in 1953, Mao Zedong opposed Soviet leader Nikita Khrushchev's policy of "thaw" with the West. The Sino-Soviet split began. Mao resolved to pursue nation building based upon his own communism without Russian support. The "Great Leap Forward" (1958-59) ended in catastrophic failure, causing tens of millions to starve to death. Disliking being elevated to a ceremonial role, Mao launched the "Cultural Revolution" (1966-76), resulting in millions more deaths.

Mao pursued aggressive foreign wars. He repeatedly expanded its territory or its sphere of influence through interventions like the Korean War (1950), the annexation of Tibet (1950), and the invasion of India (1962). After the clash with Russia at Zhenbaodao, or Damansky Island (1969), six Russian divisions advanced south into Mongolia. Struck by fear, China jumped toward normalizing relations with the United States and Japan. At that time, China urged Japan to jointly counter Soviet hegemony, but Japan refused.

Americans had also a reason to hasten the normalization with China. The Nixon administration was exhausted by the Vietnam War. President Johnson's large troop surge backfired domestically, and the civil rights movement and anti-Vietnam War protests were gaining momentum. Seeking to exploit the Sino-Soviet split, the U.S. aimed to pull China away from the Soviet Union and to end the Vietnam War. This was the Kissinger's strategy and it succeeded, leading to the end of the Vietnam War and the era of the U.S.-Soviet détente began.

Toward the end of the last century, two big changes happened in the security situation in East Asia. First is Taiwan's Democratization (1994) and the Missile Crisis caused by China(1995–1996). Under Taiwanese President Lee Teng-hui, Taiwan's constitution was amended. Free elections were held in 1996. Lee Teng-hui became the first democratically elected president in history.

Sentiments among Taiwanese (native Taiwanese), suppressed under long Kuomintang dictatorship, erupted. A new Taiwanese civic identity emerged. A startled China fired missiles off the coast of Taiwan (1995-1996). After the urgent dispatch of two U.S. aircraft carrier strike groups, the situation calmed. However, this marked the shift of China toward an "A2AD (Anti-Access/Area Denial)" strategy. The beginning of a major military expansion started.

Second is the China's major military expansion thus started. Even after the Western economies suffered a major blow from the Lehman Shock (2008), China's economy remained robust. It surpassed Japan's economy (2010), matched the EU, and began chasing the US.

China invests annually massive military spending (currently ¥36 trillion) in a major military expansion effort. Its fleet approaches 400 major vessels (U.S.: 300, Japan: 50). It possesses 600 nuclear warheads. Matching the U.S. deployed warhead count of 1,500 is only a matter of time. President Xi Jinping ordered preparations for an invasion of Taiwan to be completed by 2027.

Another complicating factor is the President Xi Jinping's retro-style governance. President Xi Jinping grew up as a Red Guard during the Cultural Revolution era. He represents a generation that was completely deprived of any opportunities of education. He harbors a sense of crisis that the liberalized economy following Deng Xiaoping threatens the Communist Party's dictatorship.

His leadership style is a mini-Mao, and he is hostile to free thought and free market. He pursues ideological control, strong patriotism, a self-sufficient economy, and the absolute supremacy of Communist Party rule. Consequently, the real estate bubble has collapsed. Youth unemployment rates have risen. Low growth has become the "new normal." The illusion of "East rising, West declining" after the Lehman Shock is fading. But he continues to hold power in his own hands. His style is the true one-man dictatorship like Mao or Stalin.

Seeing this new situation over Taiwan Strait, the US hardened its position. The first Trump administration declared the era of great power competition between the US and China, deeming the engagement policy a failure. Vice President Pence, Secretary of State Pompeo, and Deputy National Security Advisor Pottinger made a speech to announce this. Relations with China became tense.

3. How to avoid Taiwan contingency?

Taiwan contingency must be avoided at any cost. Deterrence of Taiwan contingency is much less expensive than a real war.

Economic impact of Taiwan contingency is enormous. First is the impact on the financial sector. Massive amounts of short-term dollar risk capital flowing into Asia will be rapidly withdrawn. Asian currencies like the yen, won, and Taiwan dollar will plummet. Asian stock markets also will crash. To take an example, daily trading volume on the Tokyo Stock Exchange is about ¥5 trillion. Over half is dollar-denominated capital. This will evaporate from Tokyo market.

Second is the impact on the shipping industry. The East China Sea and the South China Sea become combat zones, in addition to the waters around a blockade of Taiwan. If Lloyd's refuses to provide marine insurance, Tokio Marine & Nichido will also find it difficult to offer coverage. Japan's economy relies on a fleet of 4,000 merchant ships. Nearly all energy and two-thirds of food are sourced from overseas. Japan's sea lanes are forced to take significantly longer, more circuitous routes. Shipping costs rise.

Third and the hardest is the disruption of trade with China and evacuation of Japanese nationals. Trade with China, including rare earths, would cease entirely. Transactions with China would only be possible via third countries. Investments in China would freeze, with recovery impossible. Not only SMEs but also large corporations would face severe hardship. Japanese businesses men in China would repatriate via third countries.

Forth and not the last is the disruption of Taiwanese semiconductors.

Imports of semiconductors from Taiwan will cease. Furthermore, Taiwan is blockaded, making repatriation difficult after an emergency occurs.

Taiwan contingency must be avoided. For that purpose, the West led by Japan, US and Australia should make China understand that Taiwan invasion is too costly.

In fact, Taiwan is not an island easy to conquer. It is roughly the size of Kyushu. It is a fully democratic nation of 23 million free people that abhors dictatorship. Taiwan became a part of Japan in 1895. Ninety percent of its native inhabitants (Taiwanese) share no history with the People's Republic of China since 1949 nor even the Xinhai Revolution and the Republic of China since 1911. Peaceful unification is impossible.

Attempting military unification would require crossing the Taiwan Strait to conquer Taiwan after cyberattacks, missile strikes, and naval bombardment. Taiwan's military has 170,000 regular standing troops. Destroying this force would necessitate landing over 300,000 troops. Taiwan lacks large beaches like Normandy, making amphibious invasions extremely difficult.

Currently, the Xi Jinping administration aims to exploit internal divisions in Taiwan using the Kuomintang. China's campaign emphasizes two points: 1) President Lai Ching-te's Democratic Progressive Party is fomenting independence and provoking war with China, and 2) the U.S. military will not come to Taiwan's help. Additionally, China frequently conducts heavily military exercises around Taiwan to intimidate.

Taiwanese are realists. They are satisfied with maintaining de facto independence. While they oppose the KMT’s pro-China policy, they also avoid the DPP's radicalization on the independence issue.

4. Japan’s strategy to keep peace and stability over Taiwan Strait

Prime Minister Takaichi is determined to maintain the "Strategic and Mutually Beneficial Relationship" with China. This is the brand strategy of Prime Minister Abe. Prime Minister Abe's "Strategic and Mutually Beneficial Partnership" restored Sino-Japanese relations that had deteriorated due to Prime Minister Koizumi's repeated visits to Yasukuni Shrine.

This approach recognizes the strategic importance of bilateral relations, with both sides striving to stabilize the relationship. Differences in values and other positions are set aside to maintain the status quo, including peace in the Taiwan Strait and deepening economic ties.

At the same time, Japan will, together with US, to deter China to go to a Taiwan contingency, but in a quiet manner. Strengthening the Japan-U.S. Alliance is the corner stone for that. In the US MAGA people are less and less enthusiastic to be entangled in foreign conflicts. The less the US is committed, the more Japan shall be committed to the peace and stability in Asia. That is the only way to make US commitment more robust on the region.

Based on the recognition of the right to collective self-defense made possible by Prime Minister Abe in 2015 as well as the goal of defense spending reaching 2% of GDP announced by Prime Minister Kishida in 2022, Japan will make its fair share of contributions to peace and stabllity over Taiwan Strait.

More than that, a Taiwan contingency is a matter of life and death for Japan. To keep the U.S., which has shown a bit of isolationist tendencies, anchored in Asia, it is necessary for Japan to share more U.S. responsibilities. Prime Minister Takaichi will revise the national security strategy and the national defense strategy in December 2026, one year earlier than scheduled. She will come up with more ambitious national security goals for that purpose.

Lastly, economic security dimension should be mentioned briefly here. From the normalization of Japan-China and U.S.-China relations until the end of the Cold War, China served as a strategic partner in countering the Soviet Union. And the Western nations fully deployed their supply chains into China during the post-Cold War era when free trade was strongly praised.

However, as China pivots toward Russia and the risk of a Taiwan contingency becomes increasingly real, a reassessment of economic ties with China is underway. Efforts to prevent the leakage of sensitive technologies to China and recognize the risks of excessive dependence on China are advancing.

References

1. U.S.-China Shanghai Communiqué, Item 12 (February 28, 1972)

12. The U.S. side declared: The United States acknowledges that all Chinese on either side of the Taiwan Strait maintain there is but one China and that Taiwan is a part of China. The United States Government does not challenge that position. It reaffirms its interest in a peaceful settlement of the Taiwan question by the Chinese themselves. The U.S. does not challenge this position. The U.S. interest lies in the peaceful resolution of the Taiwan question by the Chinese themselves.)

This statement was drafted by Dr. Kissinger and highly praised by Zhou Enlai. It merely acknowledges the fact that both China and Taiwan assert that China is one. Reading between the lines, it actually states that there are two Chinas: the People's Republic of China and the Republic of China, and that a military solution to the Taiwan issue is unacceptable. Compared to the Japan-China Joint Declaration, the U.S. position is more strongly expressed here.

2. Article 3 of the Japan-China Joint Declaration (September 29, 1972)

"The Government of the People's Republic of China reiterates that Taiwan is an inalienable part of the territory of the People's Republic of China. The Government of Japan fully understands and respects this position of the Government of the People's Republic of China and upholds its position based on Article 8 of the Potsdam Declaration.

3. Article 8 of the Potsdam Declaration (1945) states; VIII. The terms of the Cairo Declaration shall be carried out, and the sovereignty of Japan shall be limited to the islands of Honshu, Hokkaido, Kyushu, Shikoku, and the minor islands as we may determine.

4. Cairo Declaration (1943) states; The purpose of the Allied Powers is [...] to restore to the Republic of China all territories stolen by Japan from the Chinese people, such as Manchuria, Taiwan, and the Penghu Islands."

5. Article 2(b) of the Treaty of San Francisco (1952) states; Japan renounces all rights, titles and claims to Taiwan and the Penghu Islands. Therefore, Japan maintains a position that it is the Allied powers to decide who could claim Taiwan. In practice, Chiang Kai-shek of the Republic of China entered the city of Taipei.

6. Article 6 of the Japan-U.S. Security Treaty (1960)

"For the purpose of contributing to the security of Japan and to the maintenance of international peace and security in the Far East, the United States of America shall be permitted to use facilities and areas in Japan for its Army, Air Force, and Navy."

During the cold war, Japan's Self-Defense Forces focused entirely on deterring the Soviet Union in Hokkaido, so that the U.S. military defends Japan's surrounding regions (the "Far East" in the treaty text refers to Korea, Taiwan, and the Philippines) using U.S. military bases in Japan. The U.S. has concluded mutual defense treaties individually with South Korea, Taiwan, and the Philippines. However, the U.S.-China (Republic of China) alliance dissolved in 1972. The U.S. Congress enacted the Taiwan Relations Act, committing to Taiwan's defense.

7. Evolution of Japan's Threat Perception and Defense System Enhancement

The Soviet Union dissolved (1991). Japan’s strategic focus shifted to the Korean Peninsula due to North Korea's nuclear crisis. The Law Concerning Measures for Situations in the Vicinity of Japan (1999) was made under PM Obuchi.

Entering the 21st century, national security focus shifted to Taiwan, because of Chinese very rapid military build-up. The　Peace and Security Legislation (2015. Permitting the exercise of the right to collective self-defense) was made under PM Abe.