Japanese right-wing politicians risk further undermining Japan's economic prospects

China and Japan, as close neighbors separated by a narrow strip of water, are deeply interconnected through extensive economic ties and integrated industrial and supply chains. These interdependencies have contributed significantly to promoting peace, development, prosperity, and regional stability.

However, recent erroneous remarks on the Taiwan question by Japan's incumbent top leader, which constitute a blatant interference in China's internal affairs, have severely undermined the political foundation of China-Japan relations. These actions carry serious implications, further destabilizing Japan's already fragile economy.

Structural challenges compounded by short-term shocks have left Japan's economy beset by both internal and external difficulties. Japan's path to economic recovery has long been arduous and fragile, hampered by weak domestic demand, sluggish innovation, and demographic pressures such as aging population and declining birthrate. Government debt has reached approximately 2.5 times the country's GDP, among the highest levels among major economies, severely constraining macroeconomic policy space.

Meanwhile, amid tariff-related shocks, Japan's economy shrank an annualized real 2.3 percent in the third quarter of 2025, reflecting deepening vulnerabilities. Meanwhile, inflammatory statements by Japan's current leadership have strained bilateral relations, further darkening economic outlooks.

Some estimates suggest that the impact on tourism alone could reduce Japan's tourism revenue by approximately 2.2 trillion yen (about $14.2 billion) over the next year, dragging down Japan's real GDP by 0.36 percent.

Markets have shown little confidence in the cabinet-approved 21.3 trillion yen (about US$137.4 billion) stimulus package: Japanese government bond yields have repeatedly hit new highs, the yen has weakened significantly, and the Nikkei 225 index at one point surrendered all gains recorded since the new prime minister took office. The concurrent downturn in equities, bonds, and the currency has reinforced "sell Japan" expectations as investors retreat amid slowing growth and diminished political credibility.China holds irreplaceable importance for Japan's economy. As the world's second-largest economy and a major engine of global growth, China presents significant opportunities for Japan with its rapid development.

China is Japan's largest trading partner, the second-largest export destination, and the biggest source of imports. In 2024, bilateral trade reached $308.3 billion. Japanese companies have maintained a long-standing and deep presence in China, with more than 50,000 Japanese enterprises established in China and cumulative investment exceeding $130 billion. In the first three quarters of 2025, Japan's actual investment in China grew by 55.5 percent year on year.

Cross-sector exchanges remain robust: in the first 10 months of 2025, approximately 8.2 million visitors from the Chinese mainland traveled to Japan, accounting for about a quarter of total tourist spending and contributing significantly to employment and economic growth in Japan.

This positive trajectory of economic cooperation has been built through the joint efforts of the peoples of both countries and underpinned by political mutual trust between governments. However, recent erroneous remarks by Japan's leader, which contravene the one-China principle and the guiding principles of the four political documents between China and Japan, have seriously hurt the sentiments of the Chinese people and fundamentally undermined the political foundation of bilateral relations.

The Chinese people cherish peace, value good-neighborliness, and advocate for cooperation and mutual benefit over zero-sum games. However, on matters concerning national sovereignty and territorial integrity, there is no room for compromise or concession.

Given the significant differences between the two countries in population, economic scale, industrial structure, and market capacity, any intensified volatility in such massive flows of trade, investment, and consumption would result in asymmetric and far-reaching consequences.

As Japan endeavors to revive its economic momentum, a small group of right-wing politicians, driven by short-sighted political calculations and indifferent to national interests and public well-being, risk pushing the country toward marginalization in the global economic landscape.

Cooperation and mutual benefit represent the prevailing trend of history, but such progress must be grounded in a stable political foundation. China's development presents significant opportunities for the world, particularly for neighboring countries such as Japan. China has already drawn a blueprint for its development during the 15th Five-Year Plan period (2026-2030), and the continued expansion of the Chinese economy offers vast space for China-Japan cooperation, provided that a solid and stable political foundation is maintained.

We solemnly urge the Japanese side to honor its commitments, reflect on historical lessons, and uphold the four political documents between China and Japan, so as to safeguard the political foundation of bilateral relations and prevent extreme and misguided statements from hijacking and damaging economic ties.

We strongly call on the Japanese side to step back from the brink, acknowledge and correct its missteps, and cherish the dedication and efforts of statesmen and people from all walks of life who have worked to advance China-Japan relations. We also urge Japan to confront history with sincerity, embrace the future with responsibility, cultivate an accurate understanding of China, and return to the right track of peaceful coexistence and cooperative development, thereby contributing certainty and positive energy to a turbulent world.