Chinese Banks to Pull Out of IMF Annual Meeting in Tokyo

To spite the host country because of the row over Senkaku Islands, it seems.

Both Japan and China have much serious problems to attend to, be that their economies, finance, and in case of Japan radiation contamination from the ongoing nuclear accident which no one pays attention to these days. Instead, they focus on these pieces of real estate that promise untold rich natural resources.

From Fox Business News citing Dow Jones Newswire (10/2/2012):

Japan's territorial dispute with China could finally be spilling onto the global stage.

Several big Chinese banks say they've canceled participation in the high-profile annual meeting of the World Bank and International Monetary Fund--to be held in Tokyo next week--as well as in the constellation of events taking place alongside. Some of the banks say they've also pulled out of another big financial-industry conference scheduled to take place in the western Japanese city of Osaka at the end of the month.

Most of the banks haven't given a reason for their last-minute no-shows. But the withdrawals come amid an escalating tit-for-tat between China and Japan, which recently nationalized a set of islands in the East China Sea that are also claimed by Beijing. China has shown its displeasure by canceling some diplomatic events and sending patrol boats into what Japan considers its territorial waters--with one group going through Tuesday. Some Japanese companies have reported falling demand for their goods in China and unusually strict inspections as well as processing delays at Chinese ports.

"Quite frankly, it's Japan-China relations," said an official at the Tokyo branch of the Agricultural Bank of China, explaining why the bank was pulling out of both IMF-related events and the Osaka conference, which is sponsored by Belgium-based SWIFT, a group set up by financial institutions to handle transactions. The bank is still sponsoring and participating in a meeting of the Institute of International Finance--a global association of financial institutions--that is taking place in Tokyo at the same time as the IMF meeting, another official said.

The moves by the Chinese banks are the latest sign that souring relations between Asia's two biggest economies are starting to affect the broader, economic realm, and go beyond regional squabbling. The annual meeting of the IMF and World Bank is the largest single gathering of finance and economic officials, non-governmental organizations and bankers. Organizers estimate some 20,000 delegates will be in Tokyo for a range of meetings and seminars, taking place Oct. 9-Oct. 14.

(Full article at the link)

I guess China's thinking goes like this: "China is so important for global economy, and everyone wants China to be there in the important meetings like IMF/World Bank events. By not attending the event, the member nations will put pressure on Japan to be more accommodative to China's request, for the global economy depends on China's well-being." Something like that.

The Dow Jones article has this comment from a Singapore-based author:

"The point is really about China being a global player," said Fraser Howie, a Singapore-based co-author of "Red Capitalism," a book on China's financial system. "China may rightly demand a seat at the head table, but what signal does it send when they go off in a huff over these types of issues. Such boycotts are pointless. They only harm China and make China out to be a unstable and unreliable partner."

Well, many Asians including Japanese and Chinese are myopic, physically. Maybe that also affects the way they perceive and think broadly, while enabling them to focus intensely on issues close at hand.

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