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Although Japan and Taiwan rebuilt their trade relations shortly after the KMT retreated to Taiwan, the Government of Japan (GOJ) was not deeply involved in postwar Taiwan’s economic development until the mid-1960s. This paper traces how the rhetoric of ‘economic cooperation’ with Taiwan was shaped and evolved within the GOJ. Aside from supporting the U.S.’ cold war policy, the GOJ turned positively to the KMT’s demand for economic cooperation in this period as a means of solving the diplomatic crisis resulting from its increased trade with mainland China. Moreover, after the diplomatic crisis, the GOJ continued to use economic cooperation with Taiwan as part of its diplomatic toolbox to reshape its China policy. By connecting postwar Japan’s utilization of development diplomacy with its China policy, this paper contributes a more comprehensive picture of how Japan tried, as a positive actor, to balance its relationship with mainland China and Taiwan within the U.S.’ cold war strategy framework.

In Service of U.S. Cold War Strategy or an Independent Initiative? Japan’s Economic Cooperation with Taiwan (1962–1972)