Keywords: Abe's win looms over future Sino-Japan relations, China to spur domestic demand in 2013, say experts

Abe's win looms over future Sino-Japan relations

Japan's Liberal Democratic Party (LDP) won the new parliament majority on Sunday and LDP President Shinzo Abe was elected a second term as the nation's Prime Minister.

Abe's win aroused worldwide attention, including Chinese media, over the impact the hawkish leader will have on future policy and Sino-Japanese relations.

People's Daily issued an opinion piece on Monday, saying that there are three main issues Japan must seriously consider following the LDP win, the most important of which is whether Abe will visit the controversial Yasukuni Shrine.

A visit to the shrine, which honors Japanese war dead, including Class A war criminals, would be seen as an expression of the new government's attitude toward Japan's past militarism.

The spat over the Diaoyu Islands also continues to undermine Sino-Japanese relations, while attempts by some Japanese politicians to remove limitations placed on Japan's military after World War II is another vital concern.

The article held that Sino-Japanese relations are at a crucial stage and both nations are making efforts in the interest of reaching a consensus over the Diaoyu row. The article suggested that Abe bring the conflict under control and bring the nation back to furthering Sino-Japanese and regional cooperation.

Similarly, the Global Times carried an editorial on Monday saying that Abe is facing two limitations; the right-wing forces and nationalism within Japanese society and China's rising strength, which Japan is economically dependent.

Abe is likely to seek a balance between the two, said the editorial.

"Right after Abe's win, he claimed that the Diaoyu Islands belong to Japan. Such a hasty claim is right-wing pandering. Abe knows better than anyone else the complexity of the Diaoyu Islands dispute, but his speech did not deliver this nuance," the editorial held.

"It's necessary that China conduct talks with the Abe administration to avoid any potential military confrontation over the Diaoyu Islands. But talks need to be based on the precondition that the Chinese presence in the waters and airspace around the Diaoyu Islands will remain," the editorial concluded.

Xinhua News Agency said in a commentary piece on Monday that voters' dissatisfaction with the current Democratic Party of Japan (DPJ) was a major reason why the LDP won the election.

The article ascribed this voter dissatisfaction to the DPJ's failure to follow through on previous campaign promises, such as not raising consumer tax rates. A social security and taxation reform bill aimed at raising taxes was approved by Congress this August.  

Internal conflict, including the withdrawal of more than 200 of its members over the past three years, also showed the party's lack of solidarity.

The Beijing News commented on Monday that Japan's new cabinet is to face a slew of difficulties, including reviving the economy and reducing debt, as well as repairing relationships with its neighbors and with the US.

In light of its diplomacy, Japan will not lean too far right when dealing with sensitive issues, including amendments to its constitution, the article added.

As with previous LPJ governments, Japan will also try to stabilize its relationship with China by intensifying economic cooperation while holding steadfast to its political platform.

The article further explained that Japan will try to recover mutual economic ties by not provoking patriotic sentiment in China or at home.

China to spur domestic demand in 2013, say experts

China promises to "enhance the quality and efficiency of its economic growth" according to a statement issued after the conclusion of the two-day central economic work conference on Sunday in Beijing.

The conference, which usually sets the tone for economic policy in the coming year, immediately set off speculation in Chinese media as to specific upcoming economic reform.

People's Daily held on Monday that a shift in economic development from short-term growth to economic restructuring, as well as providing incentives for innovation and stimulating domestic demand would not only guarantee China's own stable economic growth, but over time also affect the world economy.

Guangzhou Daily ran an article on Monday quoting Cao Yuanzheng, chief economist of the Bank of China, as saying that China is very likely to continue its current positive financial and prudent monetary policies.

According to Cao, China's year-on-year GDP growth and consumer price index (CPI) next year will either remain the same as or increase slightly over 2012. Namely, year-on-year GDP growth in 2013 will reach about 8 percent compared with around 7.7 percent this year, while CPI growth will be around 3 percent, compared with this year's 2.7.

Beijing-based news portal china.com.cn also commented that the value of China's A shares might rocket to 2200 points as a result of the economic meeting, a positive sign for the nation's economy. The article added that A listed companies involved in urbanization, agricultural modernization, ecological protection and consumption upgrades will make for good investments.

Gao Peiyong, the director of the Chinese Academy of Social Sciences' Finance and Trade Economics Institute, told the Shandong-based Qilu Evening Post a great force in stimulating domestic demand comes from migrants to urban areas, who must enjoy equal rights in medical treatment, housing and education, among others during urban-rural restructuring. 

Yuan Gangming, a researcher at the China and the World Economy Research Center at Tsinghua University, echoed Gao in saying that China's economy should rely more heavily on stimulating domestic demand rather than on government and property investment.