	Introduction

After a period of diplomatic rancor earlier in the decade, Japan and China have demonstrably improved their bilateral relationship since 2006. The emerging détente has expanded to include breakthrough agreements on territorial disputes, various high-level exchanges, and reciprocal port calls by naval vessels. China-Japan economic interdependence has grown as trade and investment flows have surged over the past decade. China-Japan economic ties serve as an anchor for the overall bilateral relationship, and the two nations and have become the key players in a robust East Asian trade and investment network. On the other hand, military strategists in each country remain wary of the other's motives. Beijing is suspicious of any moves that hint at Japan developing a more assertive and active security posture, and Japanese defense planners note with alarm China's burgeoning military modernization. The détente, pursued with vigor by leaders in both Beijing and Tokyo, follows an exceedingly tense period in the relationship under former Japanese Prime Minister Junichiro Koizumi (2001-2006). The durability of the recent détente could have significant implications for U.S. interests. U.S. interests in the region are generally well served by pragmatic Sino-Japanese accommodation. Equanimity in the Tokyo-Beijing relationship not only fosters stability and prosperity, but also allows the United States to avoid choosing sides on delicate issues, particularly those related to history. Multilateral efforts such as the Six-Party Talks on North Korea's nuclear program can be complicated by acute bilateral tension among the participants. In the event of a conflict in the Taiwan Straits, Japan would almost definitely play a role in a U.S. military response. Military to Military Relations

Even modest improvements in the defense relations between China and Japan are notable given the history of warfare—and particularly China's widespread accusations of the exceptional brutality of Japanese imperial forces during Japan's invasion and occupation of China. Potential Complications and Issues for U.S. Policy

		U.S. Interests

In economic terms, China and Japan are very important to the United States. Fragility of Détente and Public Sentiment

Regional analysts, while optimistic about the immediate future of Sino-Japanese relations, remain cautious about the ultimate stability of the relationship. The United States declined to get involved in this dispute. Japanese press outlets have reported repeated naval incursions by Chinese vessels and submarines into Japanese territorial waters.
After a period of diplomatic rancor earlier this decade, Japan and China have demonstrably improved their bilateral relationship. The emerging détente includes breakthrough agreements on territorial disputes, various high-level exchanges, and reciprocal port calls by naval vessels. Over the past ten years, China-Japan economic interdependence has grown as trade and investment flows have surged. China -Japan economic ties serve as an anchor for the overall bilateral relationship and have become the center of a robust East Asian trade and investment network. On the other hand, military strategists on each side remain wary of each other's motives. Beijing is suspicious of any moves that hint at Japan developing a more active and assertive security posture, and Japanese defense planners note with alarm China's burgeoning military modernization.
The durability of the recent détente could have significant implications for U.S. interests. U.S. interests in the region are generally well served by pragmatic Sino-Japanese accommodation. Equanimity in the Tokyo-Beijing relationship not only fosters stability and prosperity, but also allows the United States to avoid choosing sides on delicate issues, particularly those related to historical controversies. Multilateral efforts such as the Six-Party Talks on North Korea's nuclear weapons program can be complicated by acute bilateral tension among the participants.
The history of post-war Sino-Japanese relations reveals why the relationship has been so difficult to manage for the past several decades. Japan's conquest of large swathes of China, and perceptions in China that Japan continues to downplay wartime atrocities committed by Japan's imperial forces, remain sensitive subjects. Historical grievances have framed much of the interaction between Beijing and Tokyo, including a particularly rocky period under former Prime Minister Junichiro Koizumi (2001-2006). The United States has also played a major role in shaping relations between the Asian powers through its war-time involvement, post-war occupation and reconstruction of Japan, the "Nixon Shock" of the early 1970s, and its reaction to the events in Tiananmen Square in 1989.
Despite the promise of Sino-Japanese relations remaining strong in the short-to-medium term, there are multiple potential complications and issues of concern for the United States. Among these are the dynamics of economic and diplomatic rivalry in the region, the fragility of the relationship due to historical differences and skeptical public sentiment, sensitive sovereignty issues in territorial disputes, complications surrounding the Taiwan factor in East Asian geopolitics, ongoing military incursions by Chinese vessels, and suspicions in both Tokyo and Beijing.
This report will be updated as warranted by events.