China's delegation to the annual meetings of the IMF and the World Bank inTokyo will not be led by its most senior finance officials, a report from state news agency Xinhua said on Tuesday, in what looked like a deliberate snub of Japan... [Reuters report]
The recent increase in hostility between China and Japan is beginning to unsettle the region as no one really knows how the dispute over some islands will end. And by "some islands", I do not mean to trivialise the matter or suggest that this is a spat over nothing ... it is clearly strategic, financial, and particularly emotional. Feelings in China are running high, it is true, with Japanese business in that country suffering all the way from retail to manufacturing.
The IMF, however, is a global body of which both Japan and China are significant members - and whose contribution is important to the rest of the world. It demands the attention, and therefore the attendance of the most senior delegates from each country if anything is to be achieved. And certainly, in the case of China, there is ultimately a bigger role for them to play in the future, even to the extent of leading that organisation.
For those who are unaware, the annual IMF meeting is held for two consecutive years in Washington DC and then on the third year it is held in an outside city. Recent hosts have been Istanbul (2009), Singapore (2006), Dubai (2003), Prague (2000) and Hong Kong (1997). It is the one time in the year, every year, where you will (usually) find every senior banker, regulator, and Finance Minister in the one place. The meetings that take place outside the official meetings are every bit as important as the formal sessions themselves. Therefore to deny access to senior Chinese officials, and vice versa, on an occasion like this seems to me to be a little short sighted.
This is not about China versus Japan, or it shouldn't be. Had the meeting been held anywhere other than Japan this year, I imagine that Chinese officials would have been present as normal. But on this occasion it is not the location that is important - the meeting is! And it is at times like this when there needs to be a realisation that there are some occasions when one needs to rise above the rhetoric and act like a senior statesman.
