With China becoming a regional powerhouse, Japan is reconsidering its foreign policy. Being a small, narrow island nation, Japan's primary supplies are imported. Tokyo is aware that its sea lifeline could be threatened once China becomes a strong maritime power.

Not being connected to a mainland, Japan's ports could easily be blocked. These geographical weaknesses are why Japan has relied heavily on the United States for security since the fall of the Japanese Empire in World War II.

Japan's heavy trade with Southeast Asia is protected by the US Navy which exerts significant influence in Asia. But with China becoming a potential adversary, Japan is rethinking its post-WWII peace policy and soon may join other nations in maintaining its own normalised military to protect its interests.

Japan's constitution prohibits the country from having a military. Article nine of the document states explicitly, "land, sea, and air forces, as well as other war potential, will never be maintained."

But after Sept 11, in a symbolic gesture, Japan passed the Anti-Terrorism Special Measures Law. This law authorised Tokyo to dispatch its military to the Indian Ocean to assist the US-led campaign against the Taliban in Afghanistan. These troops actively refuelled US and British warships engaged in the Afghan campaign.

Now that the Afghan campaign is largely over, the Bush administration has asked Tokyo to send offensive Aegis destroyers to the Indian Ocean. Japanese Prime Minister Junichiro Koizumi declined, wary over Asia's response to a militant Japan.

But the US continues to coax Japan, putting increased pressure on Koizumi to support a future Iraqi invasion in a manner similar to that seen in the Afghan campaign.

Japan's current anti-terrorism laws passed to allow it to reassert its military were limited to Afghanistan, however, many, such as defence chief Hisahiko Okazaki, believe this can be changed with a slight modification of existing law.

Nationalist sentiment

Despite Japan's expansionist history, there is still nationalist sentiment among people eager to see the country become a military power again. While their power is limited, the sentiment has the possibility of gaining force should Japan's economy continue to falter while China's grows at a rate of over seven percent.

Now that China is part of Asean, Beijing will look to protect its interests in the South China Sea. Japanese nationalists fear that a proactive China will threaten Japan's trade interests and damage Japan economically.

China is keeping a wary eye on Washington since it has been prodding Japan to strengthen its military. Beijing is aware that Japan could rearm rapidly due to Japan's technological edge and its ties to the US.

The Chinese leadership is also sceptical of an empowered Japan because the island country has attacked them twice in the past. Plus, China fears that a hawkish Japan could become an intrusive arm of the United States.

This complicates China's desire, and US' resistance, to unite Taiwan with the mainland. To nearly all Chinese, including former nationalists in the Taiwanese government, Taiwan's unification with the mainland is non-negotiable.

In the past, when Taiwan threatened to declare independence, Beijing has withstood US threats and warned that China would invade Taipei rather than allow the province to break away.

China, hoping this reunification will come peacefully, fears that the US may demand Japan interfere with China's wish to reunify Taiwan.

Of all the issues between China and its neighbours, the reunification of Taiwan has the greatest potential for military conflict. This is neither what China nor Japan desire, both countries are increasingly connected through trade.

However, Chinese analysts fear that such hopes will be dashed by an aggressive post-Sept11 United States. In case of any conflict, the US mainland would be far from the fighting while Japan would most likely be dragged directly into the conflict.

In fear of being isolated, Japan would be unable to distance itself from the US. If it were abandoned, Japan would be surpassed in influence and economic power by an expanding China.

Dualistic approach

While many in the United States want to continue to profit off China's billion plus consumer market, the Bush administration does not want China to surpass the US in power and influence.

This has resulted in a dualistic approach: on the one hand, the Bush administration is working with China economically, on the other hand, the administration is finding ways to contain the growing giant. This policy can be seen in the US' plan of building a missile defence shield to protect Japan.

Using North Korea as a justification (since it cannot openly admit China is an adversary), the US has garnered support for a missile defence shield. The US may be keeping North Korea as a threat in order to buy time for the creation of the defence shield.

Indeed, China has demanded that the proposed system be limited enough not to negate its own military power. Beijing has warned that an all encompassing shield will pressure China to acquire larger and more powerful weapons; these weapons would not be used to attack Japan and the US, but to preserve China's sovereignty.

The United States will not be able to dictate conditions to China if Beijing has a formidable arsenal of weapons. The shield may also pressure China into building stronger relations with Russia, should it feel its economic potential would be restrained by the United States.

Due to China's vast economic potential, its policy is currently geared around stability and peace. It has been pursuing the Asean-China Free Trade Area (ACFTA), the largest single market in the world. The wild card is the United States.

Beijing nervous

In addition to hardliners in the Bush administration, the new Democrat House minority leader, Nancy Pelosi, is a strong outspoken critic against increasing relations with China.

Pelosi has fuelled conflict with China through her constant support of expanded US arms sales to Taiwan and has demanded that open trade with China not proceed.

Beijing is quite aware of the animosity held toward China by both sides of Washington's political spectrum, and this is one of the reasons they have been striving for some sort of alliance with Nato, whose influence is expanding right to China's borders.

The country does not want to be cast on the opposite side of this growing military alliance.

Beijing is also nervous over the sudden influx of US military bases that have now encircled China; there are bases to the east in Japan, to the south in South Korea along with military support of Taiwan, and now to the west in Kyrgyzstan.

China's wish to be treated as a harmless economic power may go unheeded in Washington.PINR

Erich Marquardt drafted this report; Matthew Riemer contributed.

The Power and Interest News Report (PINR) is an analysis-based publication that seeks to, as objectively as possible, provide insight into various conflicts, regions and points of interest around the globe. PINR approaches a subject based upon the powers and interests involved, leaving the moral judgments to the reader.