China's Economic Relations with Japan

China's economic relations with Japan go back to the 7th century AD. This was the time when maritime trade was flourishing between the countries. The kingdoms of Silla and Baekje, which were Korean kingdoms, essayed the role of middlemen. After the fall of the Baekje kingdom in 663 AD Japan had to trade directly with the Chinese as the kingdom of Silla was hostile as a result of the Tang imperialism, which was rampant at that point of time.

Even though the Japanese were not exactly adept at carrying on sea trade at long distances they were able to go on trading. Some historians are of the opinion that this was possible as a result of the expertise of the expatriates of the Baekje kingdom, who helped them amend the making of their ships and also improve on their sea faring skills.

After the Second World War the economic ties between the two countries resumed in the 1960s. This was brought about by the withdrawal of the economical experts from the country by the Soviet Russia. This incident compelled China to resume their economic ties with Japan as that was one of the few viable alternatives thye had at that point of time.

The diplomatic relations between the two Asian countries were formally initiated on the 29th of September, 1972. As per the statistics of the Ministry of Justice in December, 2006 there were 519,561 Chinese nationals staying in Japan. According to the statistics of the year 2005 there were 114,899 Japanese people staying in China and these figures include Hong Kong as well. During the year 2006 China exported goods worth 118.4 billion dollars to Japan and imported goods worth 92.9 billion dollars from Japan. Till the year 2006 Japan has invested 58.2 billion dollars in China.

In the recent year the political relations between Japan and China have not been exactly peaceful. However, it is not expected to have any bearing on the economic relations between the two Asian powerhouses. During the year 2004 China substituted the United States of America as one of the major trading partner of Japan.
The economic experts are of the opinion that macro-economic scenario in the two countries looks to be good enough for the economic relations between the two countries prosper. One of the major factors in this case is the reduction in the difference between the import and export of the country. The goods and services of China are being deemed as being more marketable and this has certainly played a crucial role in the economic relations between China and Japan.