The rapid rise of China as a political and economic power with significant and growing global influence has major implications not only for Northeast Asia but the world at large. The international community welcomes the rise of a stable and prosperous China, able to take on a leadership role in Asia for the stability of regional peace and security. China has played a proactive role in fostering security ties with a number of Asian countries in recent years as well as investing in multilateral institutions. However, uncertainty surrounds China's continued expansion and transformation of its military forces.

During the past decade, China's economic growth has averaged 8-9 per cent a year and has witnessed extensive economic expansion with massive foreign investment. Even during the current global downturn, China has been the primary driver behind recovering of global economy. China has set itself the target of-according to its long-term social and economic development plan-achieving by 2020 a fourfold growth in GDP compared to that in 2000. Despite this goal, there are several reasons for concern in domestic contexts, the reason being that there are a number of risks and uncertainties that threaten to undermine the sustainability of China's domestic development, such as an environmental problem, rise in energy demands and the massive unemployed population. What is more, rebalancing growth between urban and rural areas, between rich and poor people and between ethnic majority and minority will depress domestic demand and could feed social instability.

Throughout history, the relationship between China and Japan has more often than not been marked by mistrust and animosity, or even violent conflict. Despite three decades of normalized bilateral relations, several past and present issues serve to complicate the relation between the two states. Since a positive and functioning relationship between China and Japan, the two great powers in Northeast Asia, in many ways is a prerequisite for peace and stability in the region, a souring bilateral relationship is not only problematic for the states involved, but has implications for neighboring states and the international community at large. Against this background, it has become increasingly important to understand, identify and implement measures that can prevent and manage conflicts and disputes between these two states.