The East China Sea, encompassing roughly 1,250,000 square kilometres, situated between the eastern coast of China and the Pacific Ocean, is troubled waters.

Mainly because Tokyo and Beijing both claim sovereignty over the same islands chain – The Senkaku (in Japanese)/Diaoyu (in Chinese) Islands. The Senkaku/Diaoyu Islands comprise five uninhabited islands and three rocks, aggregating roughly 7 square kilometres. The islands are situated approximately halfway (roughly 400 km) between the Chinese mainland and Okinawa, and about 170 km northeast of Taiwan. The islands are controlled by Japan but claimed by China (as well as by Taiwan) which does not miss an opportunity to refer to Chinese sovereignty over the islands chain as “indisputable”.

While it can be excluded that Tokyo will ever renounce the Senkaku Islands as integral part of Japanese territory, Beijing for its part will not give up its territorial claims, based on Chinese historical records dating back to the Ming dynasty (1368–1644), either. To be sure, China only began to officially state its territorial claim over the islands when in the late 1960s it was reported that the waters around the islands could be rich of petroleum and gas.

Japanese-Sino territorial disputes in the East China Sea, however, are not limited to the Senkaku/Diayou Islands but involve disputed waters totalling roughly 210,000 square kilometres. What’s more, Tokyo and Beijing also disagree on the borders of their respective “Exclusive Economic Zones” (“EEZ”). While Japan claims a division on the median line between the two countries’ coastlines as the border of its “EEZ”, China claims that its “EEZ” extends to the eastern end of China’s continental shelf, which in turn goes deeply into the “EEZ” claimed by Tokyo.

The disputed waters are believed to hold significant gas and oil reserves and as the waters are mostly shallow, resource exploitation is relatively easy. This encouraged China to start test drilling for oil and gas in disputed waters in the mid-1990s, including beyond the median line claimed by Tokyo. In 2004 then, Beijing announced the establishment of a special naval fleet to be deployed to the East China Sea to protect its drilling ships and the country’s territorial sovereignty. Tokyo responded in kind in April 2005 by allocating rights for gas exploration to Japanese companies in Chinese claimed areas. While the Japanese-Chinese tit-for-tat game centred around the drilling for gas and oil continued over the years, Beijing also intensified its naval activities in and close to the disputed waters from the 2000s onwards.

Indeed, since the mid-late 2000s, the Chinese navy sailed increasingly frequently into Japanese-controlled territories in the East China Sea, which led to several clashes with Japan Coast Guard (JCG) patrol ships. In September 2010 then, Sino-Japanese relations underwent a temporary diplomatic ice-time when Tokyo detained the captain of Chinese trawler who intentionally rammed his trawler into a Japanese coast guard patrol boat near the disputed Senkaku/Diaoyu Islands.

As for the good news, in June 2008 Tokyo and Beijing adopted the so-called “Principle Consensus on the East China Sea Issue” which foresees the joint Japanese-Chinese exploration of natural resources in the East China Sea. However, given that the agreement deals exclusively with the possible joint exploration of natural resources, possible steps towards the resolution of maritime border issues in the East China Sea will continue to remain elusive. Through this functional co-operation (which has yet to be initiated), Tokyo and Beijing nonetheless demonstrated a joint interest to side-line controversies and disagreements over sovereignty and reduce them to a level that makes military confrontation over the disputed territories unlikely. However, given that Beijing has repeatedly stressed that joint exploration of resources around the disputed islands will only take place on the condition that Tokyo recognizes Beijing’s complete sovereignty over them, joint exploration of gas and oil in the East China Sea is very likely to place on paper and paper only in the years ahead.

Nonetheless, in November 2001, Beijing suggested to resume bilateral negotiations with Tokyo to settle the dispute related to the boundary lines in the East China Sea. The Japanese government accepted the Chinese proposal to resume negotiations under the auspices of the UN Convention of the Law of the Sea in principle although a start date for negotiations has yet to be announced.

In the meantime, Tokyo is equipping its navy and coast guard with the budget, capabilities and equipment to better deter and counter Chinese intrusions into Japanese-claimed waters in the East China Sea. Through the adoption of Japan’s December 2010 defence guidelines (the National Defence Programme Guidelines, NDPG), Japan’s Coast Guard (JCG) will receive a significant budgetary boost to acquire 21 new patrol ships and seven new reconnaissance jets, to be deployed to where the (potential) “action” is: the East China Sea. To be sure, China’s now officially announced plans to build and deploy an aircraft carrier fleet in the East China Sea will continue to confirm Japan’s defence planners that the envisioned upgrade of Japan’s coast guard and navy fleet in 2012 and beyond is justified.

Washington too has become increasingly concerned about Chinese naval activities in the East China Sea and has in mid-2011, (through US Secretary of State Hillary Clinton) declared that the Senkaku Islands fall within the scope of the bilateral US-Japan security treaty. This announcement confirmed unambiguously that Washington is prepared and indeed obliged to defend Japanese national territory alongside Japanese armed forces in the case of a military confrontation with China over the ownership of the Senkaku Islands.

Unless something “dramatic” happens, territorial disputes in the East China Sea will very unlikely lead to Japanese-Chinese military confrontations in 2012. However, joint exploration of natural resources in disputed waters, not to mention the resolution of issues related to sovereignty over disputed territories.