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The China-Japan island dispute about the remote island located within the jurisdiction of both countries have businessmen fearing its negative economic impact. The conflict, widely expressing anti-Japanese hatred in China and forcing some Japanese car and electronics factories and shops to close down because of the riots, can have a significant impact in the market relations of both countries.

Japan and China continue to trade amidst the conflict. The trade worth between the two countries is around $345 billion. Because of the factory holidays because of the riots, companies who closed Chinese factories such as Panasonic and JVC fell in the Tokyo Stock Exchange.

The Japanese government has asked Beijing to protect Japanese-owned properties in China with adequate security and jurdisdiction.

Fujitsu Research Institute’s Martin Schulz states that the conflict can have a great negative impact in the whole world today if the situation is not properly resolved. Should the situation get out of hand, the two countries, dependent on each other for their economy, may see a collapse in their profits.

The Diaoyu (in China)/ Senkaku (in Japan) islands were said to be owned by China dating back hundreds of years from their dynasties. However, Japan states that it found the islands unmanned during the 18th century and have laid claim to it before a family purchased the islands. After the second World War, the U.S. returned the islands to Japan after relieving Okinawa of U.S. military presence.

Source: BBC

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Hillary Clinton, the US Secretary of State, will hold a meeting with Chinese Foreign Minister Yang Jiechi to resolve the issue of the acclaimed Scarborough Shoals, which Chinese fishermen had trespassed which violates territorial law in the Philippines and other countries in the sidelines of the annual Association of Southeast Asian Nations (ASEAN) conference.

The US, while not in direct conflict with China, is supporting the Philippine defense in guarding its territorial waters. The conflict, which began in April when the Chinese fishermen were found poaching in its economic zone including the shoal, may go out of hand if no resolution is to ever materialize from the conflict.

Scarborough Shoals is said to store vast oil and gas reserves, as well as marine life for fishing grounds. Experts estimate that the ‘virgin’ islands have rich resources for economic growth.

The ASEAN conference is set to make rules about maritime rights and navigation. They are also preparing a procedure for discussing disputes between countries. The target of this meeting is mainly to alleviate the tension for the said island. China was presented a proposal at this weeks conference. However, China is not a member of the ASEAN and has yet to agree to such proposal.

The meetings held between China and US, while not sparse, haven’t reaped any fruit. Tensions between China, the Philippines, Vietnam, Taiwan and southeast Asian countries near the area might reach violent conflict should the issue not be resolved, says many observers.

Source: News.com

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