Photo: Putin and Abe during the meeting in Sochi, May 2016 (Source: Sputnik News)
World War II has not only left a huge impact on modern international relations but also a number of unresolved issues. It has been 71 years since its end and yet, there are two countries who until now failed to sign a peace treaty due to a lack of agreement on the territorial status of four islands in the Pacific. A number of measures were proposed by both Russia (and before that, Soviet Union) and Japan to initiate the peace talks and settle the dispute but every time some obstacles have prevented them from doing it. The issue had been put on hold for more than a decade until Japan’s Prime Minister Shinzo Abe made a personal commitment to come to an agreement on the status of Northern Territories (called Southern Kurils in Russia) during his time in office.  This initiative was strongly supported by Russian president Vladimir Putin, for whom it is a valuable opportunity to break Russia’s international isolation in the aftermaths of the conflict in Ukraine and attract Japanese investors to Russian Far East. But what are reasons for Abe’s determination to resolve the Northern Territories dispute out of other territorial issues that Japan faces? How does this strategy fit into Abe’s controversial foreign policy? And what makes upcoming several months a perfect timing to settle the dispute? To answer these questions and to provide a better explanation of the argument, this article will further overview the background of the dispute and its place in the countries’ current affairs. Next, a ‘new approach’ to the Russia-Japan relations in general and a long-awaited (and long due) agreement in particular will be discussed. Finally, we will analyze the implications behind the sudden progress in negotiations on the dispute to prove that not resolving the Kurils’ problem is not only in economic and strategic interests of both countries, but might also come as personal benefits for Putin and Abe.
Source: BBC News
The status of the islands is disputed largely because of a simple technicality, or, more specifically, the lack of a definition and meaning of the Kuril Islands in the San Francisco Peace Treaty in 1951.  Four Japanese islands (Iturup/Etorofu, Kunashir/Kunashiri, Shikotan and Habomai islets) have been captured by the Soviet Union several days before the end of the World War II, and the deportation of 17,000 Japanese nationals inhabiting the islands followed shortly.  USSR and now Russia assert their claims to the islands on the statement in Potsdam Declaration that “Japanese sovereignty shall be limited to the islands of Hontsu, Hokkaido, Kyushu, Shikoku and such minor islands as we determine” and Japan’s full acceptance of it. Following the Potsdam Declaration, the condition of Japan renouncing all claims over the Kuril Islands was included in San Francisco Peace Treaty of 1951, which was signed by Japan and US but not signed by the Soviet Union. 
In its claim over the disputed territory Japan has made advantage of the fact that the Treaty failed to specify the meaning of the Kuril Islands, asserting that Etorofu, Kunashiri, Shikotan and Habomai do not belong to the Kuril chain but instead are a part of its Northern Territories. The Japanese side also declares that the islands have been in Japan’s possession since 1855, Soviet Union has attacked Japan in violation of neutrality pact and after Japan announced its surrender.  The only time two countries came close to resolving the issue was during the joint Soviet-Japanese Convention in 1956 when Nikita Khrushchev agreed to concede two of the four disputed islands, but the convention did not result into formal agreement due to US advising Japan against it.  Since the end of the Cold War, the relations of the two countries have been improving significantly, but the issue still remains unsolved due to a fluctuating stance on both sides. In addition to the ascending nationalistic sentiments in Russia and plans to develop the islands as a military base, Russia is set on signing a peace treaty first and only after that would it consider resuming the talks on the possible return of two islands. In contrast, Japan insists on the concession of the disputed territory first which can lead to signing a peace treaty.
The absence of legal foundation that countries could possibly refer the dispute to, strong nationalistic views in Japan and Russia, as well as commitments to their respectful strategic alliances certainly add more obstacles to resolving this long-running dispute. However, in the past 12 months a visible progress has been made, with the narrative on both sides changing to a much softer tone.  Clearly, concession of the islands could not happen overnight, which is why Abe, in a very smart move, has proposed a “new approach” to the problem during his visit to Russia in May, 2016. According to this eight-point strategy, Russia and Japan will enhance economic cooperation in areas of energy, transportation, agriculture, technology, healthcare, urban infrastructure, culture, and small and medium-sized business, that would not only benefit both countries economically in the nearest future, but will also lay the ground for further talks on the territorial issue.  Since it is important that close partners do not have any disputes between them, this “new approach” is aimed at encouraging the states to work on improving their ties first, and then, with the groundwork laid for mutual trust, make a deal on the disputed islands, be it a concession of two of them or a complex multi-facet agreement with allowing dual access to all them.
It might seem quite obvious why Russia, in spite of building up a strong government propaganda, would be willing to discuss the peace treaty: the economic sanctions and the drop in oil prices equally contributed to the worst recession the country faced in years with its GDP shrinking by 3,7% in 2015.  The island deal with Japan could ease Russia’s international isolation, reduce country’s dependence on China and stop it from slowly becoming China’s reservoir of cheap natural resources, and initiate the positive economic growth in Russian Far East with the help of Japanese contributions, to add to the amount of investments from China that already exceeds the regional budget.  It should come as no surprise that at an annual economic conference in Vladivostok this year, Vladimir Putin has made a rare remark about reaching “certain compromises” on the issue, even though the Russian president is known for his highly controversial stance on territorial integrity. 
One explanation for Abe’s determination could be his attempt to build a so-called “security diamond” in Indo-Pacific by strengthening its relations with US, Australia, and several ASEAN states in a response to a growing threat from China.  If Japan and Russia reach an agreement on the disputed islands, Russia may become another country that Abe seeks to build closer security ties with in order to counterbalance the power of China in the region, whose decision not to comply with the International Court ruling on the East China Sea has contributed to increase of tensions in the region.  Given that Russia is one of the main China’s strategic partners and one of the few states that has real bargaining power with North Korea, Japan’s security policy would undoubtedly benefit from a better relationship with Russia. After securing support from US by signing new Defense Guidelines last year , Abe has made a significant effort to improve relations with Russia despite strong opposition from Barack Obama whose presidential term is coming to an end, meaning American leader’s limited opportunities to object the negotiations.  The uncertainty about an outcome of the presidential race in the US also makes it a perfect timing for Japan to significantly improve the chances of settling the dispute and reaching a promising level of cooperation with a struggling but still influential neighbor, who, also has abundant natural resources, which are so scarce in Japan.
What is also worth noting, is the fact that both Putin and Abe might have personal reasons to resolve the issue. A possible agreement on the islands would allow Abe to make a prompt rebound domestically after his Abenomics policy was largely deemed ineffective, and give a boost to his influence in East Asia considering his strategic advances in the area. As for Putin, a high-profile deal with a G20 member would be a strong sign for other countries not to follow US in extending the existing and imposing further sanctions on Russia. The deal would also come at a time when the threat perception of each other among Russian and Japan citizens is really low, and there will not be a lot backlash on the concessions made from both sides.  By visiting Russia four times in a row without a single reciprocal visit from Putin, Abe has made it clear that he is determined to commit to building stronger ties with Russia. This strategy might finally pay off in December with signing a projected economic deal during long-awaited Putin’s state visit to Japan, and a good chance of reaching a preliminary agreement on the Kurils as well. Of course, a lot of arrangements are to be made before finalizing it, but there might be no better chance of starting on it then this December.
***The views expressed herein do not necessarily represent the opinions of JTMS or Yonsei Institute for North Korean Studies
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