COMMENTARY/ Kai Kajitani: In China, businesses not protected, risk revealed

September 19, 2012

THE ASAHI SHIMBUN

The anti-Japan protests in China have seen the destruction and looting of Japanese businesses and shops.

The territorial dispute over the Senkaku Islands (called Diaoyu in China), a diplomatic issue, has affected private-sector commerce and has damaged business activities beyond politics.

The Chinese government did not stop those acts; it condoned them. It failed to separate business from diplomacy. And at one point, a senior official in the Chinese Commerce Ministry said that a boycott is understandable.

These developments show China's government may be no protector of business. Rather, it is a possible impediment. It has reminded the rest of the world of the so-called China risk, which is one created by that nation's unique political system.

Some protesters were indiscriminate in their violence. They attacked Japanese firms that have blended into local economies and boosted employment.

I found it regrettable that such firms suffered damage after making hard efforts to fit into local life.

Doing business in China could bring great benefit to Japanese firms. I have no idea whether there will now be a rise in the number of businesses withdrawing from China. If many companies leave, the remaining ones will have more opportunities.

Attention will now turn to whether authorities will properly punish those behind the violence and whether they will offer appropriate compensation to firms and shops that suffered losses.

The Japanese government should demand that China's leaders approach these issues in a responsible manner.

(This article is based on an interview by staff writer Kim Soonhi.)

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Kai Kajitani is an associate professor of Chinese economy at Kobe University’s Graduate School of Economics.

THE ASAHI SHIMBUN
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