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economically. Sovereignty over the islands could
decide who controls around 40,000 square kilometers
of the surrounding continental shelf or exclusive
economic zone (EEZ) area. This control would confer
ownership of natural resources in the area, such as
fisheries and potential oil and gas reserves. 23
One of the main reasons the diaoyu islands
have attracted so much political attention was the
discovery of oil and gas. Before the discovery of oil
and gas deposits in the area of the islands, China and
Japan had an indifferent attitude toward the Diaoyu/
Senkaku Islands. 24 However, in 1968, the United
Nations Economic Commission for Asia and the Far
East suggested the possibility of large hydrocarbon
deposits in the waters surrounding the diaoyu/
Senkaku Islands. 25
In addition to the economic and security benefits
of the Diaoyu/Senkaku Islands, the dispute is difficult
to resolve because of its political implications. China
and Japan’s domestic politics and international status
are directly related to the dispute over the islets. How
each government handles the dispute reflects on
the legitimacy of the Chinese and Japanese central
governments in domestic politics and on their foreign
relations on the international stage. 26 Furthermore,
how the Diaoyu/Senkaku Islands dispute is resolved
will also serve as the blueprint for the resolution
of other Chinese and Japanese maritime territorial
disputes. 27
Experts generally break the complicated Diaoyu/
Senkaku Islands issue into three specific aspects:
ownership of the islands, the return of the islands, and
the demarcation of maritime boundary. Regarding
ownership, China and japan disagree on whether
the islands were terra nullius (land unclaimed) when
Japan claimed sovereignty over the islands in 1895. 28
Second, China and Japan dispute whether Japan
returned the islands to China after the Japanese
defeated in World War II. Lastly, China and Japan
debate how their maritime boundaries are drawn in
accordance to the United Nations Convention on the
Law of the Sea (UNCLOS). 29
Historical Developments
Although the Sino-Japanese dispute over the
Diaoyu/Senkaku Islands began when Japan annexed
the islands in 1895, it was not until the late 1960’s that
the dispute became a major issue in Sino-Japanese
relations. 30 In 1969, the U.S. and Japan issued a
Joint Statement that led to the Ryukyu Reversion
Agreement signed in 1971. One of the provisions
of the agreement stated that the Diaoyu/Senkaku
Islands was a part of Okinawa and was to be returned
to Japanese rule. 31 thousands of Chinese students in
the United States protested for several months and
expressed their concerns in an open letter to the u.S.
President and Congress. 32 At the same time, both the
People’s Republic of China on the Chinese mainland
and the Republic of China (ROC) government in
Taiwan disputed the claims. When, in 1970, Japan
notified the ROC government that Taiwan’s claims to
the islands were invalid, the Taiwanese government
planted the ROC flag on the islands, and three
members of Taiwan’s National Assembly visited the
islands to signify their control over the islands. In
June 1971, the Agreement Between Japan and the
United States of America Concerning the Ryukyu
islands and the daito islands was signed. All of the
disputed Diaoyu/Senkaku islands were included in
the areas returned to Japan. 33 Although initially with
this signing the U.S. supported Japan’s claims, the
U.S. shortly afterward took a neutral stance over the
dispute, which at the time, was between the ROC and
Japan, because it wanted to improve relations with
the People’s Republic of China. 34
The period from the reversion of Okinawa and
Diaoyu/Senkaku islands to Japanese rule in 1972
to today is characterized by a series of encounters
followed by periods of inactivity. One of the first
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