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Asia’s odd men out: Australia,Japan, and the politics ofregionalismMark Beeson1 and Hidetaka Yoshimatsu2

’3

1Department of Political Science and International Studies,University of Birmingham, UK and 2The College of Asia PacificStudies, Ritsumeikan Asia Pacific University, Japan.Email: [email protected]

Abstract

Australia and Japan have frequently had difficult relationships with their

neighbours. This paper suggests that when seen in their specific historical

contexts, the fact that Australia and Japan have become ‘Asia’s odd men

out’ is unsurprising. The central argument of this paper is that the consolida-

tion and institutionalisation of regions is in large part a political exercise that

reflects, and is informed by, discrete national conversations. Until and unless

such national discourses align with wider transnational developments,

regional processes are unlikely to prosper. An examination of Japan’s and

Australia’s respective attempts to engage with and define their region reveals

just how problematic this process can be.

1 Introduction

Despite [its] economic connections, the Australian Asian ploy appears unli-kely to meet any of the requirements for success for a civilisation shift by atorn country (Huntington, 1996, p. 152).

3 We would like to thank IRAP’s anonymous referees for helpful comments on an earlier version ofthis paper, and Richard Higgott, Jan Aart Scholte and Chris Hughes for hosting us at the Centrefor the Study of Globalization and Regionalization, Warwick University in 2005.

Received 4 April 2006; Accepted 17 October 2006

International Relations of the Asia-Pacific Vol. 7 No. 2# The author [2007]. Published by Oxford University Press in association with the

Japan Association of International Relations; all rights reserved. For permissions,please email: [email protected]

International Relations of the Asia-Pacific Volume 7 (2007) 227–250doi:10.1093/irap/lcl008 Advance Access published on 12 March 2007

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Many Asians view Japan not only as nationally selfish but also overly imi-tative of the West and reluctant to join them in questioning the West’s viewson human rights and on the importance of individualism. Thus Japan isperceived as not truly Asian by many Asians, even as the West occasionallywonders to what degree Japan has truly become Western (Brzezinski, 1997,pp. 176–167).

Australia and Japan have frequently had difficult relations with theirneighbours. Whether this is measured by Australia’s often frustrated attemptsto gain entry to new regional forums, or Japan’s notoriously difficult relation-ships with China and Korea, both countries suffer from problems ofacceptance and identity. In Australia’s case, other countries in East Asia—notably Malaysia under former Premier Mahathir—have questionedwhether it is a ‘genuine’ member of the region (Broinowski, 2003).4 WhileJapan is unambiguously ‘of ’ East Asia, its leadership ambitions and goodrelations with the region have been undermined by its inability to come toterms with its historical role in the region (Wall, 2005). Such issues have madethe day-to-day conduct of relations in the region problematic for bothcountries, and raised fundamental questions about national identity andthe enduring impact of each nation’s history. In both countries the questionof where each ‘belongs’, and to which other countries they should be mostclosely aligned, continue to be central parts of their respective national policydebates.

In this context, it is significant and revealing that Japan and Australia werethe prime movers behind the Asia Pacific Economic Cooperation (APEC)forum, an organization that was explicitly designed to tackle narrowly con-ceived economic issues. APEC’s diverse membership—which included bothcountries’ key ally, the USA—was drawn from the broadly conceived‘Asia-Pacific’ region (Funabashi, 1995). It might have been expected thatAPEC’s broad membership and technocratic agenda might have diluted issuesof regional identity and allowed both countries to play an active, unproble-matic role in regional affairs while maintaining crucial, ‘external’ relationships.However, APEC’s declining importance and visibility suggest that both itsagenda and its identity have failed to resonate with many members (Ravenhill,2001). The emergence and apparent consolidation of ‘ASEANþ3’, a regionalgrouping predicated on the notion of an East Asian, rather than anAsia-Pacific identity, by contrast, appears to be gaining increased momentum(Stubbs, 2002). If it continues to do so, it will provide a major challenge forboth Australia and Japan and their foreign policy priorities.

4 The potential costs of such antipathy became clear when Mahathir effectively vetoed Australia’sand New Zealand’s attempt to link their bilateral free trade area to the ASEAN Free Trade Area(see Pitty, 2003).

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The central argument of this paper is that the consolidation andinstitutionalization of regions and regional identities is essentially a politicalexercise that reflects, and is informed by, discrete national conversations aboutforeign policy and national identity. Unless such national discourses align withwider transnational developments, however, regional processes are unlikely toprosper. An examination of Japan’s and Australia’s respective attempts toengage with and define their region reveals just how problematic this processcan be. Consequently, we initially provide a brief theoretical introductionwhich spells out why regions—and the definition of regions—are potentiallyimportant, before looking in more detail at the experiences of Japan andAustralia. These countries are especially important and illuminating, wesuggest, because of their historically problematic relationships with East Asia.Their ability to reconcile the tensions between strategic obligations, economicimperatives and cultural preferences will be the defining test of their owncapacity to be effective regional citizens, and of the success of the East Asianregional project more generally.

2 The significance of regions

Regions have become important parts of both the theoretical and practicaldimensions of international relations. There have been a number of ‘waves’ ofscholarly interest in regional processes in the post-war period, especially as aconsequence of the rise of the European Union (EU) (Mansfield and Milner,1999). This has been replicated at a policy level, as governments around theworld have become conscious of the potential advantages that regionallybased modes of cooperation might generate (Fawcett, 2004). The successfulrealization of the EU project, its recent travails notwithstanding, has provideda powerful exemplar for other parts of the world and a direct spur to furtherregional cooperation: countries elsewhere have been rightly concerned thatthey might be at a disadvantage relative to regionally integrated competitors,or excluded from the increasingly pervasive economic groupings that haveconsolidated over the last few decades. In short, despite all the—frequentlyimprecise—talk about ‘globalization’, regions look like they are here to stay.Indeed, regional cooperation may offer a way for individual states to respondmore effectively and proactively to both the challenges posed by intensifyinginternational economic competition (Oman, 1994), and to the strategic uncer-tainties of the post-Cold War era (Buzan and Waever, 2003). The only realquestion seems to be what form they will take and what forces are likely toshape them. To understand the constraints and opportunities that potentiallyface Japan and Australia, it is useful to revisit briefly some of the theoreticalliterature in this area.

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There are a number of basic distinctions that can be made about the wayregions are conceived and about the dynamics that encourage their realizationin different parts of the world. Most fundamentally, perhaps, it is increasinglycommonplace to distinguish between regionalism and regionalization.Regionalism is primarily associated with self-consciously undertaken politicalefforts to create regional institutions and place cooperation on an increasinglyformal basis. This is invariably accompanied by what Hettne and Soderbaum(2002, p. 34) describe as the ‘ideology of regionalism’, or the discursive justifi-cation of the regional project. Regionalization, by contrast, is taken to refer tothe empirical manifestation of trans-border economic integration and is princi-pally driven by the private sector. For both Australia and Japan regionalizationhas never been a problem. On the contrary, underlying structural integrationhas virtually compelled greater cooperation with possibly very different, evenantagonistic neighbours. Indeed, the bilateral relationship between Australiaand Japan rapidly consolidated in the aftermath of the Second World Warbecause the importance of the economic relationship left policymakers withlittle other option (Rix, 1986). Significantly, and somewhat surprisingly, forboth Australia and Japan, this earlier economic determinism has evolved intoa close and productive interaction in a region where such ties are relatively rare.

For both countries, then, it has not been a case of whether to try anddevelop institutionalized regional relations, but the precise political form thismight take. However, despite the underlying structural and material basis forregional development provided by economic linkages or sheer geographicalcontingency, Japan and Australia have found it difficult to embrace the appar-ent advantages of regionalization. There are, as Andrew Hurrell (1995, p. 38)points out, no ‘natural’ regions: ‘it is how political actors perceive and inter-pret the idea of a region and notions of “regioness” that is critical: all regionsare socially constructed and hence politically contested’. The created and pol-itically contested nature of regions has been at the heart of Australia’s andJapan’s difficulties in coming to terms with East Asia. In this regard, WesternEurope has some major advantages: broadly similar political practices, levelsof economic development and similar cultural traditions facilitated the tran-sition to an increasingly coherent regional political community in the post-warperiod. Even more importantly, the USA used its economic, political and stra-tegic leverage to encourage greater European integration in a way it did not inthe ‘Asia-Pacific’ region (Beeson, 2005; Hemmer and Katzenstein, 2002).Consequently, it made the very idea of a readily identifiable, more or lesscoherent region like Western Europe’s much less likely in either ‘East Asia’ orthe much more broadly conceived Asia-Pacific region.

This brief outline of the more important ways of conceptualizing regionalprocesses suggests a number of possibilities. First, regional cooperation offerspotential benefits to states and businesses in an increasingly competitive


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international environment. Consequently, we are likely to see a continuing—possibly growing—interest in regionally based projects. Second, the definitionof regions is crucial, but far from self-evident. The increased use of the term‘East Asia’ and the comparative decline of the ‘Asia-Pacific’ provides a tellingillustration of what a fluid, open-ended and ultimately political processregional definition can be (Beeson, 2007). The enormous potential politicaland economic diversity of the Asia-Pacific, to say nothing of its vast, imprecisegeographical scope, meant that it was always going to be difficult to providethe requisite ‘idea of region’ that has become such an important part of theeffective realization of regional forms (Breslin and Higgott, 2000, p. 335). Aswe shall see, both Australia and Japan invested a good deal of political capitalin trying to promote the Asia-Pacific idea and now find themselves scramblingto come to terms with an emerging regional order that is coalescing around‘ASEANþ3’, rather than the APEC forum they so assiduously promoted.These organizations have come to epitomize the wider fates of the East Asianand Asia-Pacific regions, and the difficulties Australian and Japanese policy-makers have faced as a consequence. Simply put, it has proved very difficultfor both countries to reconcile their underlying economic interests with theirpolitical and strategic relations. As a consequence of a revealing mixture ofdomestic and external imperatives, they remain Asia’s odd men out.

3 Australia: alienation, alliance, and engagement

One of the most important prerequisites for the realization of any widerregional project is the inculcation of a more widely based sense of regionalidentity and its acceptance at a national level. In both Australia and Japan,and arguably in East Asia more generally, the correspondence betweennational and regional projects has been limited (He, 2004). To understand whyrelations with East Asia have been so problematic for Australia, it is necessaryto sketch the evolving historical and geopolitical context in which they areembedded.

3.1 The weight of history

One of the most important potential bases for regional development isbrute geography. It is no coincidence that most regional groupings occurbetween adjacent countries. Neighbours are more likely to have historicallyestablished trade relations that make political cooperation more attractive. It isprecisely this sort of pragmatic response to contingency that gave much earlytheorizing about regions a distinctly ‘functionalist’ flavour (Hass, 1964).Clearly, regionalization does provide a potentially powerful spur to regional-ism, a possibility that has been apparent in Japan’s more active participationin ASEANþ3, and the emerging consensus that some sort of regional forum


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is necessary to tackle distinctively regional problems (Terada, 2003). InAustralia’s case, however, while economic regionalization has provided amajor impetus for political engagement with the region over the last fewdecades, this has not always been so. On the contrary, for much of Australia’shistory a combination of imperial economic structures and hegemonic stra-tegic relations have made authentic ‘engagement’ with its northern neighboursproblematic if not impossible.

As a former British colony, Australia’s trade relations were skewed towardEurope. Indeed, it was not until 1966 that Japan finally replaced Britain asAustralia’s major trade partner (Pinkstone, 1992, p. 183). Coincidently, it alsomarked the beginning of the end of the ‘White Australia policy’, in which suc-cessive Australian governments had, since formal independence from Britainin 1901, excluded some potential migrants on the basis of race. Althoughthese events were not directly related, they were emblematic of a rapidlychanging international economic and political order to which Australianpolicymakers were having to adjust: not only was East Asia’s accelerating,increasingly widespread industrialization creating important new markets forAustralian raw materials, but the changing international political climatemeant that racially discriminatory public policy was becoming unsustainable.In such circumstances, a combination of normative and pragmatic consider-ations provided the impetus for a major reorientation of Australian publicpolicy. Despite the seemingly overwhelming economic and political impera-tives, however, it was a highly contentious process and one that remainsincomplete to this day.

One of the key obstacles inhibiting a major economic and political reorien-tation toward East Asia and Australia’s rapidly growing economic partners,was Australia’s distinctive history. The sense of isolation and vulnerability thisengendered in the minds of generations of Australian policymakers continuesto influence strategic thinking (Burke, 2001). That this should have been thecase in the earlier phases of Australian history is unsurprising, perhaps:Australians considered themselves a long way from ‘home’, adjacent to a con-tinent about which they knew little and generally cared less. Asia was uni-formly seen as an immediate strategic danger and a more generalized threat toAustralian living standards. Ironically, this latter idea has been completelyoverturned and East Asia is now seen as central to Australia’s continuingprosperity. East Asia’s potential menace has not dissipated as far as strategicplanners are concerned, however. The Second World War and the threat ofinvasion by Japan may have effectively ended Britain’s capacity to underwriteAustralia’s security, but this only led Australian policymakers to cultivate anew ‘great and powerful friend’ in the USA.

The USA has remained the cornerstone of Australian security ever since, arelationship enshrined in the ANZUS Treaty, and regularly reinforced by


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Australian participation in wars in Korea, Vietnam, Afghanistan and Iraq.The intention here is not to explore the merits of any of those conflicts—although it is worth noting that none of them posed a direct threat toAustralia—but to highlight the difficulties that close strategic ties with firstBritain and latterly the USA have had on potential relations with East Asia.Clearly, direct involvement in regional conflicts precluded any possibility ofcloser ties with a number of regional powers and their ideological allies. It wasnot until the early 1970s, for example, that Australian relations with mainlandChina were finally normalized. Even then it would take the ending of the ColdWar to reconfigure the wider geopolitical context in East Asia to a pointwhere a genuinely region-wide form of Asian regionalism was finally possiblein area that had been deeply divided by the Cold War. Despite this dramaticre-ordering of the international system, Australia’s strategic relations remainedcentred on the USA rather than the region to its north, something that hasmade deeper engagement with the region problematic, and led to a compart-mentalizing of Australian foreign policy as a consequence.

3.2 Asian engagement and its aftermath

There has been a good deal of retrospective debate in Australia about whichside of politics—the Australian Labor Party (ALP) or the Liberal–Nationalcoalition—is primarily responsible for reorienting Australian foreign policytoward East Asia (Gurry, 1995). Although it is important to recognize thatthe present government of John Howard has become increasingly alive to theimportance of ‘Asia’, the ALP governments of Bob Hawke and his successorPaul Keating did most to actively promote the idea of ‘Asian engagement’(Dalrymple, 2003)—even if it was not always clear what this term might actu-ally mean in practice. At one level, this was clearly a pragmatic response tothe increasingly recognized economic importance of East Asia, a reality high-lighted by Ross Garnaut’s (1989) influential, eponymous report prepared forthe Hawke government. At another level, it marked a more fundamentalattempt to re-position Australia as a bona fide part of the region to its north.At times these efforts became somewhat farcical. Former Foreign MinisterGarreth Evans, for example, literally tried to re-draw the map to includeAustralia as part of a putative ‘East Asian hemisphere’ (Hiebert, 1995).Nevertheless, the recognition that Australia’s economic and perhaps strategicfuture was intimately bound up with, and dependent upon, its northern neigh-bours saw one of the most intense and productive periods of Australiandiplomacy.

At the centre of this diplomatic effort was the creation of APEC. It isimportant to note that, as originally conceived by Australia, APEC was atrade grouping that offered a way of institutionalizing and stabilizing


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Australia’s relations with its East Asian trade partners and ensuring it was notlocked out of any possible regional trade bloc. Consequently, it did notinclude the USA. As such it was of little interest to Australia’s Asian neigh-bours, who remained dependent on access to North American markets. Asone of APEC’s other major sponsors, Japan represented a widespread desirefor a mechanism that ensured continuing access to American markets(Funabashi, 1995). Not only was Australia’s original vision significantlyredrawn to suit East Asian preferences, as a result, but its modus operandialso reflected the sort of consensual, voluntarist approach that characterizedthe ASEAN grouping’s operations (Acharya, 1997). While this style of policy-making was not conducive to realizing the sort of regional trade liberalizationAPEC was primarily designed to promote, an even more fundamentalproblem revolved around the highly diverse nature of APEC’s membership.Not only was the USA included, but so were a number of Latin Americannations and eventually even Russia5—something that completely underminedthe idea that APEC represented a coherent regional identity or project, andwhich helps to explain its subsequent demise (Ravenhill, 2001).

At the same time that Paul Keating in particular was becoming preoccu-pied with promoting closer ties with the region, a domestic debate was unfold-ing between supporters and opponents of close ties with the region. On theone hand were those who argued that Australia’s future lay with East Asia,and who advocated much closer ties and greater ‘Asia literacy’ as a conse-quence (Fitzgerald, 1997). On the other were high profile critics who claimedthat Australia was being ‘swamped’ by Asians, and who were concerned aboutthe nature of Australian identity and values as a consequence. At its mostvirulent, this tendency culminated in the rise of Pauline Hanson’s One NationParty, which promoted a barely coherent amalgam of protectionist economicsand racial exclusivity, but which achieved remarkable—if short-lived—promi-nence (see Leach et al., 2000). One Nation prospered on the back of a wide-spread rejection of everything Keating and the ALP stood for—somethingthat contributed to the demise of the Keating government and its replacementby John Howard’s coalition government. Significantly, the current PrimeMinister, John Howard, unapologetically campaigned on domestic issues andexplicitly rejected the ‘big picture’ of Asian engagement that Keating hadchampioned (Williams, 1997). The key point to emphasize here is that adebate about Australia’s place in the region and the nature of its relationshipwith East Asia led to a transformation of domestic politics and a repudiation

5 Russia was included in APEC at the insistence of the USA, which saw this as useful leverage inencouraging Russia’s acceptance of NATO’s eastward expansion, and which was indicative of thelack of importance the USA attached to APEC—despite its significance to its two key‘Asia-Pacific’ allies, Australia and Japan. Keating described the US’s behaviour as ‘an act of econ-omic vandalism’. See Keating (1998).


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of the idea that Australia’s future was inextricably dependent on, or ought toprivilege, ties with Asia—an idea the crisis of 1997 helped to confirm (Beesonand Bell, 2000).

3.3 The Howard era

In this transformed international and domestic environment, the Howard gov-ernment was able promote a new style of foreign policy. A number of aspectsof the Howard government’s approach merit emphasis as they highlight justhow complex balancing Australia’s relations with the region and other keyallies has proved to be. First and most importantly, perhaps, from the outsetHoward was intent on ‘reinvigorating’ the relationship with the USA, whichhe claimed had been neglected in favour of links with Asia (Beeson, 2003).While the degree of neglect of Australia–USA relations might have been over-stated,6 the recalibration of Australian foreign policy gelled with a secondaspect of Howard’s foreign policy: an emphasis on bilateralism rather thanmultilateralism. Not only did this new approach lead to a further downgradingof APEC as a consequence, but it would ultimately be replicated within theUS itself. The election of George W. Bush and the USA’s own post-S11 policyoverhaul has seen the most powerful country in the world display a similarscepticism about multilateralism, and a preference for bilateral or even uni-lateral policy as a consequence (Daadler and Lindsay, 2003). The differencebetween the USA and Australia, of course, is that the USA has the political,economic and strategic leverage to make such a strategy feasible—whatever itsimpact on the overall international system may be.

However, the intention here is not to explore the merits of multilateralismvs bilateralism, but to consider policy in relation to regionalism. In thiscontext a couple of further points are worth making. First, Howard has beenat pains to emphasize that just because Australia is geographically adjacent toAsia, this does not mean that it should choose to downgrade ties with othernon-Asian countries as a consequence. Indeed, on Howard’s (1996) first over-seas trip after winning office he declared that ‘We [Australians] do not claimto be Asian . . . I do not believe that Australia faces a choice between ourhistory and our geography’. This is especially true of Australia’s relationshipwith the USAwhich, from Howard’s perspective is especially crucial as a guar-antor of Australian security. Equally significantly, Howard’s (2004, p. 7) highprofile identification with, and championing of, the US relationship is predi-cated on what he considers the ‘shared values and common interests’ that bindthe two countries together.

6 Bipartisan support of close ties, especially strategic ones, has been a non-negotiable staple ofpolicy for both the ALP and colation parties. The former leader of the ALP, Kim Beasley, is oneof the USA’s strongest supporters in Australia, as is his successor Kevin Rudd.


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The idea that close ties between nations can only be achieved on thebasis of shared values has become a feature of the Howard government’sforeign policy. Foreign Minister Alexander Downer’s (2000) claim thatAustralia could never be culturally integrated into the Asian regionsuggested that the Howard government had little enthusiasm for becomingmore intimately connected to the region or part of any putative regionalidentity. On the contrary, the Howard government has developed anapproach Howard describes as ‘positive realism’, which is an essentiallypragmatic foreign policy response driven by the need to deal with neigh-bours like China, which are economically and strategically of centralimportance to Australia’s future, but which subscribe to values that are soalien as to preclude the sort of close ties that characterize relations withthe USA and Britain (Wesley, 2005). This does not mean that such apragmatic approach cannot be successful. On the contrary, in the sameway that Australia has little choice other than to come to terms with itsneighbours, many in the region view Australia as too important as asource of vital resources to exclude politically (Leaver, 2001). Again, thekey question is what form such relations will take.

The increasing interest in, and potential importance of, ASEANþ3 hashighlighted Australia’s marginal place in East Asia’s emergent institutionalarchitecture. Belatedly the Howard government has recognized the potentialimportance of such developments and succeeded in getting an invitation tothe East Asian Summit—but not before it was obliged, like Japan,7 toabandon its opposition to signing ASEAN’s Treaty of Amity andCooperation (Kelly, 2005) . While this has been portrayed as a relativelyinsignificant incident by the Howard government, it reveals a tension at theheart of its policy toward East Asia: Australian policymakers are reluctantto commit fully to regional bodies that may compromise strategic ties withthe USA, and the obligations this has traditionally implied. Not only hasthis fundamental, non-negotiable allegiance with the US led to a seriesof ill-judged comments by Howard about Australia’s ‘deputy sheriff ’ role inthe region and his preparedness to mimic US policy and contemplate pre-emptive strikes in Southeast Asia (Fickling, 2002), but it continues to makethe nature of Australia’s Asian engagement uncertain, partial and politicallycontentious. In such circumstances, the prospects for achieving insiderstatus as an authentic part of the region’s institutional and political activitiesremain uncertain.

Such a possibility was confirmed in the recently concluded inaugural EastAsian Summit: Australia was invited, but its marginal status was confirmed by

7 Japan’s acquiescence was in part a consequence of its intensifying regional leadership competitionwith China, and the latter’s rapidly improving relations with the ASEAN states. See Ba (2003).


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new Malaysian Premier Abdullah Badawi who ‘confirmed Australia and NewZealand would be second-class participants in Asia’s vision, with . . . “ASEANPlus Three” to be the “driver” of integration’ (The Age, 2005). Despite strik-ing a more conciliatory tone toward regional integration of late, the Howardgovernment has conspicuously not been invited to join this latter, potentiallymore powerful organization.

4 Japan: history, identity and unfulfilled expectations

Given Japan’s economic importance to East Asia and the fact that it isunambiguously ‘of ’ the region—geographically, at least—in an wayAustralia is not, its uncertain position is surprising. Yet Japan’s proble-matic relationship with Asia is long-standing, overlaid with conflict, andcontains major tensions between its political and economic elements.Many of these issues have their roots in Japan’s identity problems, whichbegan with the Meiji Restoration, when Datsu-A nyu-O (‘get out of Asiainto Europe’) became one of the major slogans of the era. This objectivewas realized—albeit it an unexpected manner—with Japan’s victory in theRusso-Japanese War in 1905. Subsequently, Japan directed its militaryambitions towards its neighbours, in a process that culminated in theSecond World War. The occupation of Korea, the conflict with China andthe invasion of Southeast Asia may have occurred generations ago, butthey continue to affect relations to this day. Japan’s occasionally ‘insensi-tive’ behaviour frequently alienates its neighbours and makes goodrelations inherently problematic (Onishi, 2006).

Nevertheless, at times Japan has made significant efforts to improve itsregional standing. After the war, Japan made reparation payments toSoutheast Asia and attempted to take the initiative regionally by proposingthe establishment of several institutions for Asia. When Prime MinisterNobusuke Kishi visited Southeast Asia in 1957, for example, he proposedestablishing an Asian Development Fund, an idea that did not materialize,mainly due to the lack of US and Asian support (Sudo, 1992, pp. 45–46).Japan also took the lead in establishing the Asian Development Bank (ADB)in 1966, and in hosting the first Ministerial Conference for the EconomicDevelopment of Southeast Asia in Tokyo in 1966. Significantly, however,Tokyo was unable to secure the ADB headquarters (Wan, 2001, pp. 152–153),and the Development conference was not held after 1975. Thus, despite itsbest efforts, Japan’s attempts at regional leadership were not supported byAsian countries.

From the 1960s onwards, Japan put emphasis on regional cohesionunder the ‘Asia-Pacific’ framework. Concrete institutions were launched atthe private sector level in collaboration with Australia to promote the


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Asia-Pacific idea.8 Japan’s attempts to shape the region and its identity weremanifest in the Ministry of Economy, Trade and Industry’s (METI)9 efforts topursue the Asia Pacific Cooperation concept, which culminated in the creationof the APEC. METI aimed to achieve two strategic goals through APEC. Thefirst was to respond to new trends in US trade policy. In the late 1980s, theUS government intensified unilateral and North America-oriented trade pol-icies. METI hoped to enmesh the US in a regionally based multilateral frame-work in order to reduce their impact. The second was to promote a shift from‘development relying on the United States’ to ‘development based on the div-ision of roles according to each country’s economic capability’ (Yamakage,1997, p. 229). APEC was to be the vehicle to promote the alignment of econ-omic development and economic interdependence in the framework of theAsia-Pacific. At the same time, the foundation of APEC was potentially aseminal achievement of identity creation for Japan which, like Australia, wassomething of a ‘liminal nation’ that had not become a core member of anyregional groups and had an anxiety about unstable identity (Oba, 2004;Higgott and Nossall, 1997). APEC was a place where Japan might play a dis-tinctive role in Asia-Pacific diplomacy that combined its position as a memberof a ‘western’ group, a key American ally, and a nation in Asia.

Consequently, when moves to develop a new East Asian grouping began inthe early 1990s, Japan stayed aloof and continued to support the Asia-Pacificmodel. When Malaysian Prime Minister Mahathir proposed the East AsianEconomic Caucus (EAEC) concept in 1991, Mahathir expected that Japanwould take the lead in its development.10 He was to be disappointed. At apress conference at the ASEAN-PMC in August 1995, a senior MOFA officialclearly stated that Tokyo ‘firmly believes that the EAEC should be launchedwith the blessings of all APEC countries. Any attempt to divide APECcountries should be avoided’ (Leong, 2000, p. 78). Consequently, despite thefact that the ASEAN economic ministers invited China, Japan and SouthKorea to an informal meeting in April 1995, the Japanese government contin-ued to push for the participation of Australia and New Zealand, with theresult that this expanded economic ministers meeting eventually did not takeplace (Yamakage, 2003, p. 22).

8 Foreign Minister Takeo Miki referred to the ‘Asia-Pacific Diplomacy’ idea in 1967, and PrimeMinister Masayoshi Ohira proposed the ‘Pacific Basin Cooperation’ concept in 1980. The majorprivate driven institutions are the Pacific Basin Economic Council (PBEC) in 1967, the PacificTrade and Development Conference (PAFTAD) in 1968, and the Pacific Economic CooperationCouncil (PECC) in 1980.

9 METI was at this time known as the Ministry if International Trade and Industry, undergoing aname change as part of a bureaucratic overhaul in 2001.

10 The EAEC was to comprise the ASEAN countries, Japan, South Korea and China, excludingAustralia and New Zealand as well as the USA.


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4.1 The Asian financial crisis and the reorientation of ‘Asia’

The Asian financial crisis of 1997–98 had a major influence Japan’s Asiapolicy. The Japanese government provided huge financial support for crisis-hitcountries,11 but its efforts to play a decisive leadership role were frustrated byUS and IMF opposition. Recently, however, various government agencies havepositively committed to the formation of regional mechanisms designed tofoster closer cooperation under the ASEANþ3 Framework. In this regard,Japan has been deeply involved in the development of the Chiang MaiInitiative (CMI) and associated financial architectures in East Asia.12 TheCMI was the first concrete achievement of ASEANþ3 cooperation and hasdeveloped substantial institutional frameworks. Japan had already concludedbilateral swap agreements with South Korea and Malaysia as a part of theNew Miyazawa Initiative, and proposed to expand and combine agreementsamong East Asian countries (Kishimoto, 2001, p. 305). Significantly, theJapanese Ministry of Finance (MOF) undertook informal negotiations to gainexplicit support from the USA.

While the US government adamantly opposed the Asian Monetary Fund inautumn 1997, it did not object to the CMI. This was partly because Washingtonrecognized the need for regional facilities as measures to prevent the recurrenceof the disruptive 1997 financial crisis, and partly because the CMI was not athreat to the International Monetary Fund’s authority or preferred practices(Henning, 2002, p. 61). However, the MOF must take some of the credit, too, asit successfully lobbied Washington about its merits,13 and has subsequentlymade efforts to create suitable surveillance mechanisms in East Asia. When theASEANþ3 finance ministers agreed to exchange data on capital flows bilater-ally in May 2001, Japan concluded an agreement for this objective with fivecountries (Indonesia, South Korea, the Philippines, Thailand and Vietnam). Inorder to facilitate this process, the MOF established the Japan–ASEANFinancial Technical Assistance Fund at the ASEAN Secretariat in September2001. The fund aimed to assist ASEAN members to improve their monitoring,

11 In October 1998, Finance Minister Kiichi Miyazawa announced the New Miyazawa Initiative.The initiative aimed to provide packages of support measures totalling US$30 billion, of whichUS$15 billion would be made available for the mid- to long-term development while anotherUS$15 billion would be used for the short-term capital need during the process of implementingeconomic reform. The total amount that the Japanese government provided for assistance reachedUS$80 billion, US$70 billion of which was implemented by December 1999 (MOFA, 2000).

12 The CMI was announced at the second ASEANþ3 finance ministers meeting in May 2000. Theinitiative aimed to provide liquidity support to member countries that would face short-runbalance of payment deficits, through an extension of the existing ASEAN swap arrangements andthe development of a network of bilateral swap agreements that included Japan, China and SouthKorea.

13 A senior MOF official recalls that it was tough to convince Washington that the initiative wouldbe completely different from the AMF (Nikkei Kinyu Shimbun, 12 May 2000; Asahi Shimbun, 24May 2000).


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collection and reporting systems on capital flows. The MOF sent its bureaucratsand other specialists in finance to several Southeast Asian countries under theNew Miyazawa Initiative (Kishimoto, 2000).

METI’s policy reorientation towards East Asia was also notable. METItook the lead in shifting Japan’s trade policy from multilateralism to bilateral-ism. In 1998, METI began internal discussions about new trade policy, andrevealed its new policy orientation in its 1999 White Paper (Munakata, 2001).Afterward, METI made public ‘Japanese Policy to Strengthen EconomicPartnership’, and has revised it every year.14 METI’s decisive commitmentwas a driving force in agreeing on an FTA with Singapore, Malaysia, thePhilippines and Thailand. What METI envisioned in the FTA policy was theformation of the East Asian business zones where common standards andrules in addition to tariff cuts would be institutionalized and help to expandbusiness operations and improve industrial competitiveness (METI, 2003).

It is no coincidence that Japanese economic ministries took the lead inpromoting cooperation programs with East Asia. Production and distributionnetworks that were formed in the early 1990s developed further through asophisticated division of labour in the entire East Asia region (Kimura, 2003).Linkages through FDI contributed to the rise of trade, a large portion ofwhich was conducted as intra-firm trade. East Asia as a group steadilyincreased its share in Japan’s overall trade, and China including Hong Kongsurpassed the USA as the primary trade partner in 2004. The recovery fromthe decade-long recession was largely sustained by the ‘China boom’, whichstimulated demands in various sectors such as steel and shipbuilding. Thesegrowing economic linkages, mixed with strong pressure from business associ-ations, have left the economic ministries with little option other than topromote regional cooperation.15

Clearly, therefore, Japan ought to be well placed to become a major, effec-tive and valued actor in East Asia’s emerging regional architecture. After all,it is still the largest economy in the region, a major source of aid and invest-ment, and a potential source of economic and even strategic stability for therest of the region. Yet despite efforts to promote regional cooperation innarrow functional issue-areas, Japan remains incapable of fulfilling its promiseand exploiting its advantages. To understand why, we have to consider Japan’ssense of itself and the powerful undercurrents of national identity that con-tinue to make regional relations problematic.

14 METI, ‘External Economic Policy’, available at http://www.meti.go.jp/english/policy/index_externaleconomicpolicy.html.

15 Nippon Keidanren (Japan Business Federation), the most influential business association inJapan, has demanded close economic linkages with East Asian countries. In its recent positionpaper, the federation called for the East Asian Free Economic Zone to be formed by 2015 underjoint leadership by Japan and China (Nippon Keidanren, 2005).


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4.2 Japan’s identity as an Asian nation

Japanese foreign policy is characterized by some striking tensions that help toexplain both Japan’s importance, but also its inability to play a major leader-ship role in the region or to establish close relations with many of its neigh-bours. On the one hand, Japan’s massive trade and investment has made it theprincipal engine of East Asian regionalization for many years, an economicweight the Japanese government has tried to turn into political leverage andinfluence in the region with some success (Hatch and Yamamura, 1996). Onthe other hand, however, processes of regionalism, or political attempts toinstitutionalize cooperation that effectively define the region’s collectiveidentity, are ultimately socially constructed; in this context Japan’s identityand history have made its integration with East Asia more problematic. Inshort, the question of whether Japan belongs to ‘Asia’ or ‘the West’ is stillunresolved.

Some scholars argue that a ‘common cultural zone’ is emerging in EastAsia (Shiraishi, 2004; Aoki, 2005), which ought to benefit Japan and enhanceits ‘soft power’ in the region,16 making closer ties more feasible. The zone hasbeen formed as a consequence of the enhanced exchange of pop cultures andthe advent of the urban middle class. The middle class in big cities in EastAsia has adopted similar life styles and enjoyed common cultural productssuch as Hong Kong movies and Korean soap operas. The Japanese culturerepresented by J-pop, animation and comics has also contributed to the for-mation of the common cultural zone. Similarly, East Asian cultural booms,especially the so-called the hanryu boom (Korean wave), became a majorsocial phenomenon in Japan.17

Yet growing cultural linkages between Japan and Asia have equivocal influ-ences on the Japanese people’s perception of Asia. A recent Japanese govern-ment survey revealed that the proportion of Japanese people who hold eithersome or strong feelings of warmth towards South Korea rose from 43.4% in1993 to 55.0% in 2003 and 56.7% in 2004. The high ratios in 2003 and 2004corresponded with the hanryu boom in Japanese society. However, the corre-sponding figure for Southeast Asia remained almost unchanged (35.4% in1993 and 36.2% in 2003), while that for China actually declined from 53.8% in1993 and 47.9% in 2003. Even the 2003 figure for South Korea was far belowpositive feelings about the USA (75.8%), and almost same level as that for

16 ‘Soft power’ refers to a nation’s ideational and cultural influences that ‘coopt rather than coerce’,and which can be significant in allowing it to shape the international order and the behaviour ofothers. Given Japan’s repudiation of offensive military power, this sort of influence becomes evenmore important. See Nye (2002, pp. 8–12).

17 Hanryu means a fad for all things South Korean, urged by popular Korean movies, dramas andpop music. In particular, the ‘Winter Sonata’ romantic television drama of Bae Yong Joon pro-voked the ‘Yong-sama’ boom among Japanese women.


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‘Australia and New Zealand’ (54.8%) (Cabinet Office, 2004). This implies thatthe Japanese people’s perception of its neighbouring countries has notimproved significantly, while they still have strongly positive feelings aboutWestern countries in general and their security guarantor, the USA, inparticular.

For a long time, Japanese political elites defined Japan’s role as a bridgebetween the West and Asia. As an underlying idea, Japanese policymakersportrayed Japan’s relationship with the rest of Asia in the context of ‘Japanand Asia’, not ‘Japan in Asia’. A recent comparative study of identity showsthat the Japanese still consider themselves only as Japanese, with only a weakidentity as ‘Asians’.18 Not only is it apparent that Japanese people have yet todevelop a broader sense of Asian identity that might underpin closer ties withthe region, but it becomes easier to understand why narrowly conceivednational issues remain so important and enjoy so much domestic supportdespite the obvious damage this does to Japan’s international position.

4.3 Historical legacies and the alliance

The intersection of national and international issues, and the impossibility ofkeeping them separate in the contemporary era, is clearly evident in Japan’scontinuing struggles to come to terms with the historical legacy of its warrecord. Two issues are especially contentious in this context: the glossing overof Japan’s war-time record in history textbooks and Prime Ministerial visits tothe Yasukuni Shrine—both of which have attracted increasingly heated criti-cism from South Korea and China (Funabashi, 2005). For a while in the late1990s, these criticisms had actually diminished: in the Japan-Korea JointDeclaration in October 1998, Prime Minister Obuchi acknowledged the factthat historically Japan had caused tremendous damage and suffering to theKorean people through its colonial rule, and expressed his ‘deep remorse andheartfelt apology’ for this fact. At the same time, the declaration proclaimedthat Japan and South Korea were building a relationship of trust and mutualunderstanding, and looking towards the next century.19 Likewise, in making aformal visit to Japan in October 2000, Chinese Premier Zhu Rongji stated

18 A comparative study of identity in nine East Asian nations in 2000 revealed that, although mostEast Asians continued to define their identity primarily on the basis of nation, religion or race,their views of transnational sources of identity were more expansive than Japan’s. When asked ifthey felt part of a supranational group, and given the choice of ‘Asian’, ‘Chinese’, ‘Islamic’,‘Other supranational identity’ or ‘Do not think of myself in this way’, South Koreans, Thais andFilipinos were positively ‘Asians’, registering 88.6, 81.9 and 75.1%, respectively. As for theJapanese, 26.4% selected ‘Asian’ and 70.9% chose the last category, refusing to think themselves inany supranational fashion (Inoguchi, 2002, pp. 267–269).

19 ‘Japan–Republic of Korea Joint Declaration: A New Japan-Republic of Korea Partnershiptowards the Twenty-first Century’, 6 October 1998, available at http://www.mofa.go.jp/region/

asia-paci/korea/joint9810.html.


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that ‘the Chinese side has no intention of provoking the Japanese people overhistorical issues. It is important that the Japanese side also must not forgetthat phase of history’ (Tsugami, 2000).

Despite this, the Koizumi administration that began in 2001 reversed muchof the progress that had been made in improving relations with Korea andChina. When Koizumi first visited Yasukuni Shrine in August 2001, China’sand Korea’s responses were relatively muted. Koizumi even made a one-dayvisit to China and South Korea respectively in October in order to try andimprove relations with its two neighbours. Chinese Premier Zhu stated at atrilateral summit the following month that Japan’s relations with the twocountries were becoming frank due to Koizumi’s initiatives to improve them.20

Yet, despite this apparent good will, relations have deteriorated dramatically oflate following repeated visits to Yasukuni Shrine by Koizumi (April 2002,January 2003, January 2004, and October 2005). Given the strength ofnational feeling about these issues in both Korea and China, their reactionshave been unsurprisingly hostile. It is indicative of how much relationsbetween Japan and its neighbours have soured that, although the leaders ofJapan and China have had meetings on the sidelines of international confer-ences, there were no direct meetings for five years between October 2001 andOctober 2006.

Japan’s position in this context is remarkable when compared withAustralia’s. Australia, it needs to be remembered, has been involved in everymajor conflict in East Asia since the Second World War, and yet it has notfaced criticism of its military record in Asia. This differential treatment is aconsequence of Japan failing to confront its historical role, the conventionalwisdom has it (Wang, 2002, p. 126), but it is also clear that China in particu-lar has skilfully exploited Japan’s discomfort for its own purposes.21 Thereason Japan has found it so difficult to resolve this issue despite the politicaldamage it has caused is because domestic attitudes have been deeply rootedparts of national identity since the Meiji era. While the Japanese admit thatthe Pacific War was a mistake and that they were guilty of causing great suffer-ing in the region, they still have ambivalent feelings about the war. Modernhistory since the Meiji restoration has seen Japan successfully achieveWestern-style modernization while simultaneously keeping a distinct nationalidentity. Consequently, and despite the fact that this process finally led to adisastrous war, many Japanese find it difficult to renounce some of the positive

20 Japan Times, 6 November 2001.

21 Chinese authorities appear to have used anti-Japanese sentiment to undermine Japan’s attempts tosecure a UN seat, for example. See ‘UN power play drives China protests’, International HeraldTribune, 12 April 2005.


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aspects of the earlier period as it would be tantamount to denying their his-torical national identity (Inoguchi, 2004, pp. 33–35).

In many ways, therefore, this historical legacy is a uniquely Japaneseproblem, but in other regards Japan faces similar dilemmas to Australia whenit comes to establishing foreign policy priorities and relations with the region.Japan’s relationship with the USA has, like Australia’s, been the central pillarof Japan’s postwar international relations and security. In Japan’s case,though, the USA–Japan alliance was ‘political’ first and strategic second.22

Because of its overall importance in Japan’s foreign and domestic policies, theend of the Cold War did not lead to the termination of a security treaty whoseprime objective was to defend Japan from the communist threat. Tokyo andWashington sought to redefine their security relations. The new NationalDefence Program Outline, formulated in November 1995, reaffirmed thecentrality of the Japan–USA Security Treaty to Japan’s security policy(Sakanaka, 1997; Muroyama, 1997). The completion of such attempts was theenactment of the ‘Law on Emergencies around Japan’ in 1999.

Thus, the bilateral relationship with the USA has become the centrepiece ofJapan’s foreign policies and a potential constraint on other relationships. Evenafter the Japanese government intensified Asia-oriented policies in the late1990s, its diplomatic posture continued to oscillate between Asia and theUSA. In the new millennium, Japan’s MOFA has launched several initiativesdesigned to enhance linkages and cooperation with East Asia. However, mostof them were vague and indecisive, reflecting the continuing centrality of thealliance with the USA and the reluctance of Japanese officials to jeopardize it.For example, when Prime Minister Koizumi made a formal visit to SoutheastAsia in January 2002, he proposed the creation of a ‘community that actstogether and advances together’. This community concept, announced in par-allel with a proposal for the Japan–ASEAN Comprehensive EconomicPartnership, was largely Japan’s response to China’s active regional diplomacythrough the agreement on a free-trade area with ASEAN. What was most sig-nificant about this vaguely defined community, perhaps, was that it containedAustralia and New Zealand: the inclusion of Australia and New Zealandreflected Japan’s intention of including countries that share values and stra-tegic interests similar to the USA and assuaging American concerns about thepossible emergence of exclusionary East Asian countries groupings.

The same sort of contradictory dynamics could be seen when theASEANþ3 summit was held in Bali in October 2003. The ASEAN membersencouraged China and Japan to accede to the Treaty of Amity andCooperation (TAC), the grouping’s framework for peace and stability adopted

22 From the perspective of the USA, of course, Japan’s significance was primarily strategic as abulwark against Soviet expansionism in Asia. See Schaller (1982).


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at the first ASEAN summit in 1976. Five out of the 10 ASEAN leadersstrongly urged Prime Minister Koizumi to join the TAC at the summit.23

While China acceded to the treaty at the summit, like Australia, Japan was farmore ambivalent and non-committal as a consequence of considerationsabout, and commitment to, the USA–Japan alliance and American sensi-tivities. Eventually, Koizumi signed a document expressing Japan’s intentionof joining the TAC at the Japan–ASEAN summit two months later. At thissummit, Japan and ASEAN issued the Tokyo Declaration that referred to‘Deepening East Asia Cooperation for an East Asian Community’. Yet, thedeclaration did not define the scope of the proposed East Asian Community.Japan’s stance continued to reflect US concerns about possible participants ofthe East Asian Community, and when an informal ASEANþ3 ForeignMinisters meeting was held in May 2005, Japan suggested that the USA beinvited to the first East Asia Summit as an observer. As far as Japan was con-cerned, the USA continued to constrain the development of more independentrelationship with the region.

5 Concluding remarks

Both Australia and Japan have had difficulty in establishing themselves asauthentic and effective members of an emerging East Asian community. InAustralia’s case, this is not entirely surprising: although the definition andscope of regions is inherently artificial, some are more ‘natural’ or likely thanothers. The membership of the ASEANþ3 grouping has a greater potentialcoherence and reflects a greater number of common East Asian historicalexperiences and patterns of development—especially the impact of Europeanimperialism, the Cold War and ‘late’ development—than the more expansiveAsia-Pacific region does (Stubbs, 2002). Indeed, the momentum that hasdeveloped behind these two visions of regional order accounts for their relativesuccess and the growing consensus that East Asian regionalism is an ideawhose time has come. Australia’s ‘outsider’ status in this context may havebeen a consequence of brute geography, but it has been compounded by anumber of historical, political and strategic factors that have made close tieswith East Asia more problematic: generations of policymakers have tended toidentify with, and align themselves to, extra-regional forces. In such circum-stances, ties with ‘Asia’ have often assumed a slightly awkward and instrumen-tal quality. Even though Australia managed to take part in the East AsianSummit, the joint communique reflected China’s growing influence and unam-biguously indicated that ASEANþ3, not the EAS, would be the principalvehicle of future integration (Beeson, 2007).

23 Asahi Shimbun, 11 December 2003; 19 November 2003.


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Japan’s awkwardness is more surprising. Japan’s economic weight and thepowerful role it has played as a force of regionalization, should have made it apowerful force for, and actor in, processes of regionalism. Likewise, it is amember of ASEANþ3 and thus has ‘insider’ status in the emerging East Asianregionalism. That it has not been able to play such a role must be attributed toits own inability to come to terms with its problematic historical legacy, andthe constraining nature of the ties that historical legacy has generated. On theone hand, relations with key neighbours remain poisoned by war-time grie-vances and resentments. On the other hand, Japan’s continuing ties to the USAmean that—as in Australia’s case—close relations with the region are mademore difficult because of the desire not to jeopardize relations with its ‘greatand powerful friend’. It is striking that the one area in which Japan has beenable to play an effective role has been in monetary cooperation—an arena inwhich its economic power and technocratic competence may prove decisive,and where questions of identity and history are less likely to intrude.

If a distinctly East Asian form of regionalism continues to gain momentumboth countries will face difficult challenges. At best, this will involve skilfuldiplomacy and finessing relations with East Asia on the one hand and theUSA on the other. At worst, the emergence of a more politically coherentEast Asia—especially one that is increasingly Sino-centric and less dependenton a declining American hegemon—may force a painful and contentious reca-libration of national priorities and allegiances that is more in keeping witheconomic realities. Somewhat ironically, therefore, regionalization my ulti-mately come to define Japan’s and Australia’s orientation to processes ofregionalism as both countries are forced to come to terms with a region inwhich they may not feel comfortable, but which they cannot do without.

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