1. China as a Threat or an Opportunity
Perception of China as an economic threat
In the early 1990s, China's rapid economic growth, combined with its external posture,
generated an argument in Asia that China could become an economic and military threat.
The importance of China in Japan's total trade started to increase substantially around that
time and, in 1994, the bilateral trade deficit with China became Japan's largest.
Nevertheless, there was no sense of urgency in Japan about the economic threat China
was said to pose. It was widely believed that the level of economic development was so
different that China was not going to threaten Japan's lead in the immediate future.
By the year 2000, however, the argument that China was an economic threat gained
momentum in Japan. There were several inter-related factors behind this development.
First, imports from China accelerated in 2000. The success of the Japanese apparel
brand "Uniqlo" impressed Japanese consumers with high quality products made in China.