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Japan Eastern Europe and the Former Soviet Union
Japan's experience with communist countries was quite
limited
in the decades immediately after the war. In the 1980s,
however,
its patterns of interaction with China and the Soviet
Union
diverged sharply, its relations with China growing
quickly, those
with the Soviet Union stagnating. Other communist areas,
such as
Eastern Europe, continue to be only minor trade and
investment
partners for Japan.
Exports to Eastern Europe and communist countries in
Asia
totaled US$9.8 billion in 1990, or 3.4 percent of Japan's
exports.
Imports from these countries totaled nearly US$17 billion,
yielding
a US$7.2 billion deficit. Imports from the Soviet Union
declined
during the first half of the 1980s, from nearly US$1.9
billion to
less than US$1.5 billion, and then recovered to almost
US$3.4
billion by 1990, representing modest growth for the entire
period.
Imports from China, however, nearly tripled in this time,
from just
over US$4.3 billion in 1980 to nearly US$12.1 billion in
1990.
Export trade followed a similar pattern: exports to the
Soviet
Union stagnated and then grew modestly, to over US$3.1
billion in
1988, before declining to US$2.6 billion in 1990. Those to
China,
however, expanded rapidly, from nearly US$5.1 billion in
1980 to
just under US$9.5 billion in 1988, before falling to
US$6.1 billion
in 1990.
China and Japan have geographic proximity, extensive
cultural
ties, and a long history of commercial relations. However,
Japan's
trade relationship with China was severely constrained in
the 1950s
and 1960s because of its support for the United States
policy of
containment. Japanese business did not expand such
commercial
relations significantly until the United States-China
rapprochement
in the early 1970s and Japan's subsequent establishment of
diplomatic relations with China
(see Relations with China
, ch. 7).
Japan recognized the Beijing government in 1972. After Mao
Zedong's
death in 1976, China pursued economic contacts with the
West, and
trade with Japan expanded rapidly. The new relationship
was
reinforced by the signing of a long-term trade agreement
in 1978.
In 1980 Japan granted China reduced tariff treatment under
the
Generalized System of Preferences.
Investment in China also expanded once relations
improved in
the 1970s. Japanese data show some US$2 billion of
cumulative
direct investment in China by 1988, and Japanese
investment in
China continues to grow significantly in the 1990s. China
also
became the largest single recipient of foreign aid from
Japan
during the 1980s and into the 1990s.
Commercial relations with the Soviet Union also
paralleled
strategic developments. Japan was very interested in
Siberian raw
materials in the early 1970s as prices were rising and
détente
persisted. The challenges to détente, especially the
invasion of
Afghanistan in 1979, and falling raw material prices put
strong
constraints on Japan's trade and investment relations with
the
Soviet Union. Only after Soviet policy began to change
under
Mikhail Gorbachev's leadership, beginning in 1985, did
Japanese
trade resume its growth.
Further complicating economic relations with the Soviet
Union
was the dispute over four small northern islands occupied
by the
Soviet Union toward the end of World War II. No progress
had taken
place on this issue during four decades of intermittent
negotiations
(see Relations with Russia
, ch. 7).
Japan's trade was also constrained by the Coordinating
Committee for Multilateral Export Controls (CoCom), which
controlled exports of strategic high technology. In 1987
the United
States discovered that Toshiba Machine Tool had shipped
machine
tools on the restricted list to the Soviet Union, tools
used to
manufacture quieter submarine propellers. Although the
Japanese
government moved reluctantly to punish Toshiba (and the
United
States imposed sanctions on Toshiba exports to the United
States in
response), the final outcome was stronger surveillance and
punishment for CoCom violations in Japan.
Japanese investment loans and trade credits went mainly
to
Siberian resource development. But this development never
expanded
as originally expected. Soviet interest in revitalizing
the economy
in the late 1980s suggested that future Japanese
investment would
be concentrated in the western regions of the Soviet Union
rather
than in Siberia.
Japan's trade and investment relations with East
European
countries and with communist countries in Asia were
limited. In
1990 exports to Eastern Europe were only slightly more
than US$1
billion, and imports were approximately US$1.6 billion.
Economic
problems within Eastern Europe as the nations grappled
with moving
toward market-oriented economies continued to limit trade
with
Japan. Trade with Asian communist countries was even less
significant. The Democratic Republic of Korea (North
Korea) is
geographically close to Japan, but that nation's default
on its
trade debt in the 1960s, combined with the political
tension
between it and the Republic of Korea (South Korea) keeps
North
Korean trade with Japan at a minimum.
Data as of January 1994
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