Japan's Indo-Pacific Strategy at a Crossroads: Seeking ROK-Japan Cooperation for Coexistence

Editor's Note

This is the third report in the special commentary series, "Shangri-La and Beyond: The Accelerating 'Indo-Pacific vs. Belt and Road' Dynamic and South Korea's Strategy." This commentary analyzes Japan's Indo-Pacific strategy within the context of US-China competition, authored by Yeol You, President of EAI and Professor at Yonsei University. While the concept of an 'Indo-Pacific Strategy' gained international recognition during the Trump administration, the author explains that Japan was the first country to officially use this term as a diplomatic strategy. The author notes that for Japan, the Indo-Pacific region was traditionally a space for commerce, but it has transformed into a geopolitical arena due to China's rise and the expansion of regional power dynamics. Furthermore, with the recent intensification of strategic competition between the US and China in the region, Japan's Indo-Pacific strategy faces a difficult choice between its traditional ally, the United States, and its largest trading partner, China. The author emphasizes that Japan must seek creative diplomacy to jointly build a rules-based order through cooperation with South Korea, which faces a similar predicament.

The Quiet Ripples of Shangri-La

The Indo-Pacific (hereafter IP) strategy is Prime Minister Shinzo Abe's signature foreign policy initiative. In his policy speech to the Diet in January 2018, he established the "Free and Open Indo-Pacific (FOIP)" as the core strategic concept of Japanese diplomacy, reiterating it in January 2019. While the concept of the IP gained prominence on the international stage when President Trump officially adopted it during his Asia tour in November 2017, Japan was the first country to actually use it as an official diplomatic strategy. Prime Minister Abe, at the Tokyo International Conference on African Development (TICAD) in 2016, defined a geographical space connecting two oceans and two continents, and imbued it with normative characteristics such as democracy, the rule of law, and market economy, emphasizing freedom and openness. Subsequently, the 2017 Diplomatic Bluebook featured the Free and Open Indo-Pacific strategy as a special topic. Given that Abe himself had articulated a rudimentary regional concept connecting the two oceans in a speech during his visit to India in 2006, when he first served as Prime Minister, it is no exaggeration to say that he considers the IP concept his diplomatic brand.

Japan's promotion of the IP concept is intrinsically linked to the strategic challenge facing Japanese diplomacy: how to engage with a rising China. The IP is a geographical space that encircles China and strategically overlaps with the Maritime Silk Road of China's grand strategy, the "Belt and Road Initiative" (BRI). Therefore, for Japan, the IP strategy is a geopolitical reenactment aimed at securing a leading position in the two ocean networks to deter the expansion of power by the great power, China. This reveals a dual strategy: either to incorporate China into a network of rules and norms established by leading regional powers (namely, the US, Japan, Australia, and India) to drive change, or to tame China by excluding it from the network. The success of this strategy hinges on the extent to which Japan can cooperate with the United States, the linchpin of the IP strategy, focusing on geoeconomic approaches, and how effectively it can forge a coalition of the willing, including South Korea.

The issue is that the US's IP strategy, declared at the Shangri-La Dialogue, has significantly impacted Japan's geoeconomic focus by explicitly announcing competition with China across economic, military, and diplomatic fronts. Japan, which exhibits subtle differences from the US in its approach to China, is facing a phase of strategic adjustment. This presents an opportunity for cooperation with South Korea, and South Korea should seize this to expand its diplomatic space.

The Geopolitics of the Indo-Pacific

If the IP is a maritime space connecting two oceans, then for Japan, the sea has traditionally been a space of commercial significance. Tracing back to the late 19th century, as exemplified by the concepts of the

The maritime concept as a space for business, investment, and cooperation began to waver with the rise of China. Japan initially believed that China would adapt to the liberal regional order upon its accession to APEC in 1991. However, in the 2000s, as China strengthened cooperation with ASEAN under the banner of the East Asian concept and encroached upon the Asia-Pacific space, then-Prime Minister Koizumi proposed an expanded East Asian concept, inviting 13 East Asian countries including ASEAN, China, and South Korea, along with Australia, New Zealand, and India. The aim was to counter China's dominance by promoting a regional concept encompassing values such as liberal democracy, human rights, market economy, and the rule of law, thereby drawing these three countries into Japan's orbit. Subsequently, in 2006, Foreign Minister Taro Aso and Prime Minister Abe introduced the "Arc of Freedom and Prosperity" strategy, connecting regions from the Japanese archipelago through Southeast Asia, India, Southwest Asia, and the Middle East to Eastern Europe. This was also an attempt to seek a regional space that would counter China through universal values, marking a significant departure from Japan's post-war diplomatic posture of pragmatism, economic focus, and reactive diplomacy, and representing its first serious attempt at geopolitical diplomatic competition. The IP concept emerged as an extension of this geopolitical imagination.

The catalyst that transformed this imagination into concepts, plans, and strategies was the dispute with China in the Senkaku Islands in 2010. As China adopted an assertive stance with its "maritime power theory," Japan responded by establishing the "National Defense Program Guidelines" emphasizing the southwestern maritime region from a maritime security perspective to counter China. Furthermore, it declared the "diamond cooperation strategy" involving four countries—the US, Australia, and India—pursuing security in the waters from the Indian Ocean to the Western Pacific. Prime Minister Abe, in coordination with the US, focused on strengthening the Quadrilateral Security Dialogue (QUAD) through repeated summit meetings among the US, Japan, and Australia, and the US, Japan, and India, as well as defense authority consultations. He also advocated for a high-quality development cooperation model as a counter to China's BRI.

The geopolitics of the 'Free and Open Indo-Pacific (FOIP),' which officially emerged in this context, can be summarized as follows: ① to check China's expanding influence, ② to create maritime networks centered on maritime security, ③ to establish universal values as a regional concept, ④ to promote connectivity through development, trade, and investment with regional countries, and ⑤ to pursue non-traditional security cooperation such as building maritime law enforcement capacity, humanitarian assistance, and disaster relief.

Seeking US-Japan Cooperation

With the official launch of the IP concept by the United States in the fall of 2017, the US and Japan embarked on a concerted effort to establish a framework for joint management of the IP space. Through Secretary of State Tillerson's CSIS speech in October, President Trump's Asia tour speeches in November, and the National Security Strategy (NSS) in December, the US identified China's behavior as a major regional threat and put forth the 'vision' of "promoting a free and open Indo-Pacific region." The intention was to establish norms and rules within the IP space as a unit to construct an international order based on them, thereby countering China. This can be seen as a result of the realization that the 'America First' and 'Peace through Strength' doctrines, initially pursued by the Trump administration, were insufficient for stable regional management.

In 2018, the US revised the name to the IP 'strategy' and presented more concrete implementation measures after emphasizing common values and principles such as respect for sovereignty, good governance, protection of fundamental rights, freedom of navigation and openness, peaceful resolution of disputes, fair and reciprocal trade, openness of investment environments, and promotion of connectivity. It pledged new investments totaling $113 million in areas such as 'Digital Connectivity and Cybersecurity Partnership' in the digital economy, 'Asia EDGE' in energy, and 'Infrastructure Transaction and Assistance Network' in infrastructure. It also announced the passage of the Better Utilization of Investments Leading to Development (BUILD) Act in Congress and the establishment of the U.S. International Development Finance Corporation (IDFC) with expanded development finance capacity ($60 billion).

Given that the US IP strategy emphasizes economic, investment, and development aspects, the 'Free and Open Indo-Pacific' concepts of the US and Japan have largely converged in content. In this context, both countries are pursuing cooperation based on the US-Japan Strategic Energy Partnership (JUSEP) for LNG supply and related infrastructure development, and establishing partnerships for expanded PNG power supply and development finance cooperation.

The Gap Between Geopolitical Imagination and Geoeconomic Reality

However, the close rapport between Trump and Abe is not fully reflected in the promotion of the IP strategy. The Abe administration has expressed several concerns regarding the Trump administration's IP strategy. First, President Trump's transactional approach and his unilateral and unpredictable diplomatic behavior. The transactional approach to alliances has raised concerns among all allies, and Japan itself is facing threats of trade retaliation (Section 232) using national security as leverage. There is also lingering anxiety about the possibility of a sudden compromise with China. For instance, if a grand bargain is struck where China offers substantial import expansion measures to the US in exchange for the US condoning China's unfair practices (such as subsidies to state-owned enterprises and forced technology transfer from foreign companies), it would pour cold water on international efforts to restore the liberal trade order. In this regard, Japan has put forth the IP strategy, emphasizing multilateral rules as a hedge against US transactionalism and unilateralism.

A greater concern is that, as repeatedly expressed in the December 2017 National Security Strategy and Vice President Pence's speech in October 2018, the US defines the IP region as a space for defending the liberal order against China's oppressive order—a space of intense value conflict where coexistence is impossible. Consequently, the US calls for joint responses to China's infringement of sovereignty and predatory actions. However, if the US were to engage in comprehensive pressure, Japan's position would be significantly diminished. As seen in the Huawei case, if the US restricts direct investment, technology, and personnel movement to China, the impact on the Japanese economy would be substantial.

Japan has consistently pursued improved relations with China through economic cooperation. Particularly, with the continuation of US unilateralism and the US-China trade dispute, Japan has been emphasizing cooperation with China as a hedge. At the Japan-China summit in October 2018, Japan announced conditional cooperation with China on third-country infrastructure investment, emphasizing four conditions: "openness, transparency, economic viability, and the fiscal soundness of the recipient country." This move seeks common ground between the IP strategy and the BRI.

In this context, the "National Defense Program Guidelines" announced in December 2018 also weakened the traditional geopolitical emphasis on countering China by using phrases such as "strengthening multi-layered and multi-faceted security cooperation" and "stability of the maritime order" in the IP region. Despite explicitly mentioning the IP 'strategy' in the 2018 Diplomatic Bluebook, the Japanese government avoided the term 'strategy' in 2019, changing it to 'concept (vision)'—a move also mindful of China. In essence, Japan, unable to decouple from the Chinese economy, is pursuing an IP strategy that deters the expansion of China's sphere of influence without defining China as a strategic competitor or adversary, while simultaneously seeking economic cooperation.

Patrick Shanahan's speech at the Shangri-La Dialogue, which summarized the "Indo-Pacific Strategy Report," served as an occasion for Japan's concerns about the US to materialize. While the previous IP strategy indirectly criticized China's behavior but emphasized inclusivity ('not excluding any country') and offered alternatives to the BRI in areas such as infrastructure investment (especially energy infrastructure), economic development, and governance, the latest report identifies China as a revisionist power and the "greatest long-term threat" to the vital interests of regional countries, declaring full-fledged competition across economic, military, and diplomatic fronts. Under the premise that "economic security is national security," the US has presented various policy objectives and means to pursue freedom and openness in the IP region. Furthermore, it has declared significant budget investments in the military to enhance formidable military power based on technological innovation. In diplomacy, it has pledged long-term investments to strengthen strategic relationships with allies and friendly nations, as well as regional mini-lateral and multilateral security networks, listing specific policy objectives. Even if the US mobilizes new investments through legislative acts like BUILD and the establishment of institutions, the scale is only one-tenth of the BRI, indicating limitations in geoeconomic means. Therefore, the US intends to fully utilize military and diplomatic cards to tame China. The US stance is firm, not hesitating to provoke China's core interests by referring to Taiwan as a country.

At this point, Japan's IP strategy inevitably falls into a dilemma. To align with the US, Japan must now be willing to consider China a security threat and agree to a transition towards geoeconomic means that incorporate military deterrence, such as the promotion of universal values, economic connectivity, development cooperation, governance, and non-traditional security cooperation. Consequently, Japan must be prepared to compromise economic interests for security and diplomatic objectives when dealing with China. Amidst the region's transformation into a stage for US-China confrontation, will Japan follow the US line, or will it maintain its existing position and adhere to building an inclusive order?

Building a Rules-Based Order and ROK-Japan Cooperation

In essence, Japan's IP strategy aims to create institutional balance against China by fostering cooperative relationships with regional countries in economic, development, and non-traditional security areas. Simultaneously, it seeks to create an order based on rules and norms that incorporate universal values, thereby securing stable economic relations while cautiously embracing China. The US also pursues a rules-based international order by seeking to build a free and open order with regional countries and thereby deter China's predatory and revisionist actions. China, too, has recently pledged to promote the BRI based on international norms such as openness and transparency.

As is well known, international order is a product of international legitimacy that reflects the structural properties of the international system (i.e., power distribution structure) and incorporates shared norms. Therefore, great powers that dominate and maintain order must possess not only the physical power to make subordinate states accept their unequal power but also the ability to generate legitimacy. In this regard, for the US to build a rules-based order centered on the IP, it must secure social legitimacy and (quasi-voluntary) consent from regional countries.

Currently, many countries in the IP region desire US engagement but seek to avoid participating in strategies that comprehensively counter China. ASEAN, in particular, has consistently emphasized "ASEAN centrality," fearing the potential disintegration of ASEAN amidst US-China confrontation. While India expresses concern over China's military activities in the Indian Ocean, it has clearly stated its opposition to forming an anti-China united front. Japan, for its part, seeks to counter China militarily through security cooperation within the framework of the US-Japan alliance and the Quad, viewing it as a separate layer from its IP strategy. South Korea has also maintained an ambiguous stance on the IP strategy. During President Trump's Asia tour in the fall of 2017, when FOIP was first proposed, a South Korean government official expressed negative views on participation. Subsequently, as the US has been concretizing its strategy, South Korea has been pressured to state its position.

Among the countries caught between the US and China, Japan and South Korea, due to their externally dependent systemic characteristics, are particularly exposed to the unilateral bullying of great powers and therefore must strongly support a rules-based order. Although it is a reality of international politics that rules and norms are also established under the leadership of great powers, a rule-based international order, where international politics operates through a network of defined rules and norms, can expand the scope of action for middle and smaller powers and provide room to avoid the tragedies of great power politics.

While Japanese diplomacy is clearly on an upward trajectory, it lacks the capacity to strategically rally regional cooperation without bypassing South Korea (Korea passing). South Korea, too, leaves room for cooperation with Japan and seeks ways to cooperate with the IP strategy through its New Southern Policy, but this is like trying to stop a flood with a hoe. The strategic environment facing South Korea involves a massive systemic change that foreshadows the division of the Asia-Pacific. Responding merely through economic cooperation and development project arrangements within the framework of the New Southern Policy, driven by the idea of expanding business and diversifying diplomacy, will lead to insurmountable national challenges.

The governments of Japan and South Korea cannot afford to be preoccupied with disputes over historical issues such as comfort women and forced labor, the radar irradiation incident involving a patrol aircraft, and the issue of holding summit meetings. It is time to move beyond mutual recrimination and emotional rejection, and to engage in creative cooperative diplomacy for the establishment of international norms and rules, enabling the IP and the BRI to coexist. Through this, we must lay the foundation for transforming the confrontational structure between the US and China into a cooperative one. Shangri-La calls for a paradigm shift for both South Korea and Japan, presenting an opportunity for improving relations and expanding the scope of diplomatic activity.

■ Author: Yeol You_ __ President of EAI and Professor at the Graduate School of International Studies, Yonsei University. He holds a Ph.D. in Political Science from the University of Chicago. He has served as Dean of the Graduate School of International Studies at Yonsei University, Dean of the Underwood International College, and President of the Association for Japanese Studies in Korea, and currently serves as President of the Korean Political Science Association. His main research areas include international political economy, Japanese foreign policy, and East Asian international relations. His recent publications include Japan and Asia's Contested Order (2018, with T.J. Pempel), Middle Power Diplomacy of Korea(2017, co-edited with Sangbae Kim and Seungjoo Lee), and Understanding Public Diplomacy in East Asia(2016, with Jan Melissen).

■ Managed and Edited by: Su-ee Choi, Senior Researcher at EAI

Inquiries: 02 2277 1683 (ext. 206) I schoi@eai.or.kr

The EAI Commentary is a series of commentaries planned to provide a forum for experts from various fields to offer in-depth analyses and policy recommendations on major domestic and international issues. Please cite the source when quoting. EAI is an independent research institution independent of any partisan interests. The claims and opinions expressed in reports, journals, and books published by EAI are not attributable to EAI and represent solely the views of the respective authors.