BEIJING/TOKYO (Reuters) – Hundreds of Japanese businesses and the country’s embassy suspended services in China today, as anti-Japan protests threatened to reignite and drag a territorial dispute between Asia’s two biggest economies deeper into crisis.
Two people thought to be Japanese nationals landed on one of the islands at the centre of the dispute, police in Okinawa said, raising fears the move could lead to direct clashes.
China’s worst outbreak of anti-Japan sentiment in decades has led to protests and attacks on Japanese companies such as car makers Toyota Motor Corp and Honda Motor Co , forcing them to halt operations. Japanese restaurants have also been attacked and expatriates are staying indoors.
More Japanese companies announced closures and suspensions at plants in China yesterday and today.
The worst of the protests broke out at the weekend and eased on Monday, but tensions escalated again today, the anniversary of Japan’s 1931 occupation of parts of mainland China, as Chinese protesters regathered.
Hundreds of protesters rallied outside the Japanese embassy in Beijing, shouting anti-Japan slogans and throwing water bottles at the building, which was ringed by riot police. In the central city of Changsha, major public squares and shopping centres were cordoned off and patrolled by riot police.
Tensions were also high out at sea, around the disputed group of uninhabited islets at the centre of the dispute. In the East China Sea, the islands are claimed by both Japan and China and contain potentially large gas reserves.
A flotilla of around 1,000 Chinese fishing boats are reported by Chinese and Japanese media to be converging on the area, called the Senkaku by Japan and Diaoyu by China, raising the risk that an accident could worsen the situation.
Japan said a Chinese fishing patrol boat had broadcast a radio message declaring the waters to be Chinese territory and asking Japanese Coast Guard vessels to leave. It was not clear how many of the Chinese boats had reached the area.
In 2010, a bilateral crisis over the islands erupted after a fishing boat collided with a Japanese Coast Guard vessel.
The Japanese government has set up an information-gathering operation to monitor the movements of the Chinese fishing boats.
The long-standing territorial dispute erupted last week when the Japanese government decided to nationalise some of the islands, buying them from a private Japanese owner.
The dispute has paralysed some major Japanese businesses in China, sending China-exposed Japanese stocks down heavily on the Tokyo stock market and raising concerns about any wider impact on economic and trade ties between the two countries.
China, the world’s second-largest economy, and Japan, the third-largest, have total two-way trade of around $345 billion.
Mazda Motor Corp has temporarily halted production at its Nanjing factory, which it jointly operates with Chong-qing Changan Automobile Co Ltd and Ford Motor Co.
Mitsubishi Motors Corp said it would also halt operations at one of its China factories, a joint venture with the Guangzhou Automobile Group Co, today, while Yamaha Motor Co also said it was suspending operations at four plants in China.
Toyota and Honda said arsonists had badly damaged their stores in the eastern port city of Qingdao at the weekend, prompting Toyota to halt operations at some factories in China.
Electronics group Pana-sonic Corp said it was closing three China factories today after two were attacked by mobs and a third, in southeastern Zhuhai, was sabotaged.
The anti-Japan protests are regathering just as the United States, a strong ally of Japan, sends Defense Secretary Leon Panetta on a visit to both countries this week. Panetta has said Washington will not take sides in the territorial dispute and has urged calm and restraint to prevail.
But the rhetoric from Chinese state media struck a different note, with China’s state mouthpiece, the People’s Daily, linking memories of Japan’s occupation of China to its present-day determination to defend Beijing’s territorial claims.
