Resolving the Russo-JapaneseTerritorial Dispute

The unresolved territorial dispute between Japan and Russia over the NorthernTerritories/South Kuril Islands remains the largest obstacle to concluding a peacetreaty and fully normalising bilateral relations between the two nations. This booktraces the evolution of transnational relations between subnational publicauthorities in Hokkaido and Sakhalin, examining the relationship between theseties and the Russo-Japanese territorial dispute.

The book investigates why the development of Hokkaido–Sakhalin relationsfailed to create, at the subnational level, an environment conducive to resolving(kanky™ seibi) the Northern Territories/South Kuril Islands dispute during the1990s. Brad Williams suggests that kanky™ seibi did not work primarily becauseRussia's troubled transition to a liberal democratic market economy manifesteditself in ways that ultimately increased the South Kuril Islands’ intrinsic andinstrumental value for the Sakhalin public and regional elite. This in turn hadlimited the impact from the twin transnational processes of cultural and economicexchange in alleviating opposition to the transferral of these disputed islands toJapan.

Drawing upon a wealth of primary and secondary sources from both countries,this book utilises levels of analysis and an analytical framework that incorporatesnational and subnational, as well as governmental and non-governmental forcesto discuss a relatively unexplored aspect of Russo-Japanese relations. As such,Resolving the Russo-Japanese Territorial Dispute will appeal to students andscholars of Asian politics, international relations and post-communist states.

Brad Williams is a visiting fellow in the Department of Political Science,National University of Singapore. He is the co-editor of Japan, Australia andAsia-Pacific Security (Routledge, 2006).

The Nissan Institute/Routledge Japanese Studies Series

Editorial BoardJ.A.A. Stockwin, formerly Nissan Professor of Modern Japanese Studies andformer Director of the Nissan Institute of Japanese Studies, University of Oxford,Emeritus Fellow, St Antony’s College; Teigo Yoshida, formerly Professor of theUniversity of Tokyo; Frank Langdon, Professor, Institute of InternationalRelations, University of British Columbia; Alan Rix, Executive Dean, Faculty ofArts, The University of Queensland; Junji Banno, formerly Professor of theUniversity of Tokyo, now Professor, Chiba University; Leonard Schoppa,Associate Professor, Department of Government and Foreign Affairs, andDirector of the East Asia Center, University of Virginia

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Resolving the Russo-Japanese Territorial DisputeHokkaido–Sakhalin relationsBrad Williams

Resolving the Russo-JapaneseTerritorial DisputeHokkaido–Sakhalin relations

Brad Williams

First published 2007by Routledge2 Park Square, Milton Park, Abingdon, Oxon OX14 4RN

Simultaneously published in the USA and Canadaby Routledge270 Madison Ave, New York, NY 10016

Routledge is an imprint of the Taylor & Francis Group, an informa business

All rights reserved. No part of this book may be reprinted or reproduced or utilized in any form or by any electronic, mechanical, or other means, now known or hereafter invented, including photocopying and recording, or in any information storage or retrieval system, without permission in writing from the publishers.

British Library Cataloguing in Publication DataA catalogue record for this book is available from the British Library

Library of Congress Cataloging in Publication DataWilliams, Brad, 1969–

Resolving the Russo–Japanese territorial dispute : Hokkaido–Sakhalinrelations / by Brad Williamsp. cm. – (The Nissan Institute/Routledge Japanese studies series)Includes bibliographical references and index.ISBN 978–0–415–41321–2 (hardback : alk. paper) 1.Kuril Islands (Russia) –International status. 2. Hokkaido (Japan)–Relations–Russia–Sakhalin oblast’) 3. Sakhalin (Sakhalinskaia oblast’. Russia)–Japan–Hokkaido. 4.Russia (Federation)–Foreign relations–Japan. 5. Japan–Foreign relations–Russia (Federation) I. Title.

KZ3881.K87W55 2007341.4'2–dc22 2006037158

ISBN10: 0–415–41321–4 (hbk)ISBN10: 0–203–96099–8 (ebk)

ISBN13: 978–0–415–41321–3 (hbk)ISBN13: 978–0–203–96099–8 (ebk)

This edition published in the Taylor & Francis e-Library, 2007.

“To purchase your own copy of this or any of Taylor & Francis or Routledge’scollection of thousands of eBooks please go to www.eBookstore.tandf.co.uk.”

ISBN 0-203-96099-8 Master e-book ISBN

© 2007 Brad Williams

Contents

Acknowledgements xiiNote on transliteration xivGlossary and abbreviations xv

Introduction: Subnational governments as international actors 1

1 Tokyo, Moscow and the disputed islands 20

2 Determinants of Russian and Japanese subnational diplomacy and the rise of the ‘Sakhalin factor’ 53

3 Hokkaido–Sakhalin transnational relations 74

4 The Sakhalin political elite and the South Kuril Islands 101

5 Sakhalin public opinion and the South Kuril Islands 130

6 Sakhalin’s commercial environment and local trade 145

Conclusion: Yeltsin, Putin and the ‘Sakhalin factor’ 167

Notes 178Appendix: Hokkaido–Sakhalin sister-city agreements 193Bibliography 194Index 217

Acknowledgements

The origin of this book is a doctoral dissertation submitted to Monash University.I am most grateful for the counsel and support of my supervisors, Pete Lentiniand David Askew. Pete provided thoughtful, thorough and encouraging feedbackat each stage of the dissertation. His enthusiasm for the project has beenpriceless. David provided invaluable guidance. Both also provided much-valuedfriendship beyond the boundaries of academia. I am thankful to Hara Kimie andPeter Shearman for examining the dissertation and for their detailed andinsightful comments.

I express my deep appreciation to many scholars and subnational governmentofficials in Japan and Russia. I have benefited from conversations andcorrespondence with Fujimori Ichir™, Gondaira K™ji, Hakamada Shigeki,Konstantin Sarkisov, Matsuzato Kimitaka, Mikhail Bugaev, Tomita Takeshi andTeratani Hiromi. I am very thankful to many former and current practitioners ofsubnational government relations including Hori Hiroko, Kond™ Juøz™,Maruyama Kazuyuki, Mikhail Tereshko, Nagashima Masayuki, Sat™ Hisasuke,Tanabe Hirokazu, Vitalii Elizar'ev, Vladimir Gorshechnikov and YokomichiTakahiro for taking time out of their busy schedules to answer my questions.Kimura Hiroshi kindly read the manuscript, providing helpful and encouragingcomments. Professor Kimura was also kind enough to invite me to beautifulKyoto to present my findings to his team of young researchers in the RussianResearch Seminar. Many thanks to Amano Naoki, Anno Tadashi, Hama Yukiko,Ide Yasuhito, It™ Sh™ichi, Tomiyama Eiko, Yoshioka Akiko and Yuasa Takeshifor the useful comments and suggestions. I am thankful to Kobayashi Kaori andLolahon Saiidova from the Sasakawa Pan Asia Fund for facilitating my visit andotherwise making it an enjoyable one.

I am especially grateful to Arai Nobuo – a key adviser to Governor Yokomichiand one of the world’s leading experts on the Russian Far East – for the enjoyabledinner conversations in Sapporo, for guiding me around Sakhalin, and forproviding an insider’s account of subnational developments that has not appearedin any English-language publications. His assistance has been invaluable. I alsowish to express my appreciation to Fukuoka Yasunori, Hanazaki Yasuo, SasakiTeruo, Sawada Kazuhiko, Yoshida Yasuhiko and Simon Potter from Saitama

University for their guidance and encouragement of my research. Jeremy Dwyerand Jonathan Clarke kindly assisted me with the Russian language.

I was fortunate to be able to work on this book while a postdoctoral researchfellow in the Department of Political Science at the National University ofSingapore. I am thankful to my colleagues for their encouragement and supportand for helping to provide an excellent environment in which to work on thebook. I would also like to thank the reviewers from Routledge and the generaleditor of the Nissan Institute/Routledge Japanese Studies Series, Professor ArthurStockwin, for their constructive criticisms of the original manuscript, which haveimproved it immeasurably. It has been an absolute pleasure working withStephanie Rogers, Helen Baker and the rest of the team at Routledge on thisproject.

Parts of Chapters 1, 3, 4, 6 and the conclusion have appeared in The NewZealand Journal of Asian Studies, East Asia: An International Quarterly, ActaSlavica Iaponica, Europe-Asia Studies and The Pacific Review (for the last twosee http://www.tandf.co.uk/journals/titles/10799893.asp). Thanks to thesejournals for granting permission to reprint my articles. I am also thankful toMonash University, as well as the Australian and Japanese governments for theirgenerous financial support, which enabled me to complete this project.

I finally wish to thank my mother and father, Ruth and Don Williams, for theirlove and unflinching support for this project. I dedicate this book to them and tomy nieces and nephew, Nyrie, Jessica, Courtney, Luke and Lauren.

The usual caveat applies: any mistakes or oversights are exclusively my own.

Acknowledgements xiii

Note on transliteration

For Japanese names, this book follows the Japanese convention that familynames precede personal names. However, the names of Japanese authors ofEnglish-language works (except translations) follow the English practice of thepersonal name preceding the family name. Macrons are put on long Japanesevowels except in the case of place names, words commonly used in English, andauthor names which usually appear without a macron in their English-languageworks. For Russian words, the Library of Congress transliteration system hasbeen used throughout the book. Established English-language usage has takenprecedence over the Library of Congress system in the spelling of Russian wordsand proper names: thus Yeltsin, not El'tsin. When in English-languagepublication of Russian authorship, Russian names have been transliteratedaccording to a different system whereby the reference will mirror the publicationname while the text will be true to the Library of Congress System. Thediacritical (representing the soft sign) is omitted from the end of frequently usedwords such as oblast' (region) and glasnost' (openness, transparency) and fromthe end of words or names. However, when the soft sign is in the middle of aname (e.g. Luk'yanov) it is retained. All translations are my own unless otherwisespecified.

Glossary and abbreviations

CIS Commonwealth of Independent States CPSU Communist Party of the Soviet UnionD™ch™ Hokkaid™ch™, Hokkaido Prefectural Government BuildingEEZ Exclusive Economic ZoneFSB Federal'roi sluzhby bezoposnosti, Federal Security ServiceHPA Hokkaido Prefectural AssemblyHPG Hokkaido Prefectural Government IMEMO Institut mirovoi ekonomiki i mezhdunarodnykh otnoshenii,

Institute of World Economy and International Relations, Soviet/Russian Academy of Sciences

Ispolkom Ispolnitel'nyi komitet, Executive committee (of the soviets)JCP Japan Communist PartyJDA Japan Defence AgencyJETRO Japan External Trade OrganisationJSP Japan Socialist PartyKomsomol Kommunisticheskii soyuz molodezhi, Young Communist

LeagueKrai TerritoryLDP Liberal Democratic Party (Japan)MID Ministerstvo innostranykh del, Ministry of Foreign Affairs

(Russia)MITI Ministry of International Trade and Industry (Japan)MOFA Ministry of Foreign Affairs (or Gaimush™, Japan)MOHA Ministry of Home Affairs (Japan)Nomenklatura The Communist system of political appointments, which

designated the class of office-holdersOblast RegionODA Official Development AssistanceOkrug District, regionRaion District, boroughRSFSR Russian Soviet Federated Socialist RepublicSCAP Supreme Commander of Allied Powers

SDF Self Defense Forces (Japan)SLBM Submarine-launched ballistic missileSovet Soviet, councilSSBN Nuclear submarine equipped with nuclear-armed ballistic

missilesSTART Strategic Arms Reduction TreatyUSSR Union of Soviet Socialist Republics

xvi Glossary and abbreviations

IntroductionSubnational governments as international actors

Scope and purpose of this bookThis study traces the evolution of the transnational relations of subnational1

public authorities in Hokkaido and Sakhalin at the regional level, and examinesthe relationship between these transnational relations and the NorthernTerritories/South Kuril Islands problem – the unresolved territorial disputebetween Japan and Russia that remains the largest obstacle to concluding a peacetreaty and fully normalising bilateral relations. It concentrates on the period fromearly to mid-1990 to 2000. This is a suitable time frame as it encompasses mostof the first decade of Russian sovereignty and the transition towards democraticpractices, as well as nearly a decade under market conditions. It also coincideswith the period of Boris Yeltsin’s leadership of Russia, which can be said to havebegun with his election as Chairman of the Russian Soviet Federated SocialistRepublic (RSFSR) Supreme Soviet in May 1990 and ended when he resigned thepresidency in December 1999. Michael Keating contends that a high degree ofcivil society2 and private sector involvement characterises paradiplomacy – aterm he uses to describe the foreign relations of subnational governments(Keating 1999: 11).3 Subnational public authorities in Hokkaido and Sakhalinhave often worked in collaboration with municipal governments and also with abroad range of private actors such as local business, cultural exchange groups,academic institutions and, in the case of Hokkaido, the Northern TerritoriesReturn Movement. This study accordingly adopts a broad and open approach,expanding the analysis to include these actors when they emerge.

This is a study of both the transnational relations of subnational publicauthorities engaged in the areas of economic and cultural exchange, or ‘lowpolitics’, and the impact this has on a ‘high politics’ issue such as a territorialdispute. The major objective is not to establish a new theory, nor to evaluatecontending theories, but to examine why the development of Hokkaido–Sakhalinsubnational government relations failed to create, at the subnational level, anenvironment conducive to resolving (kanky™ seibi) the bilateral territorial disputeduring the 1990s. Supplementary research questions the book addresses are: towhat extent did Hokkaido–Sakhalin subnational government relationscomplement and/or challenge Japan’s Russia diplomacy and Russian policy

towards Japan? Did Sakhalin’s position on the territorial dispute accord withMoscow’s? How did Tokyo and Moscow respond to Hokkaido’s and Sakhalin’sincreased international presence and their burgeoning transnational relationship?

This study’s central argument is that kanky™ seibi did not work becauseRussia’s troubled transition to a liberal democratic market economy manifesteditself in ways that increased the South Kuril Islands’ intrinsic and instrumentalvalue for the Sakhalin regional elite and public, and thus limited the impact of thetwin transnational processes of cultural and economic exchange ex ante onalleviating their opposition to transferring the disputed islands to Japan.

Kanky™ seibiDuring the closing stages of the Second World War, the Soviet Red Army seizeda group of islands in the Kuril chain that stretches from Hokkaido to theKamchatka Peninsula. The Japanese government has consistently demanded thereturn of what it refers to as the Northern Territories. The Soviet Union and itssuccessor, the Russian Federation, have refused to hand over the islands. Thisterritorial dispute has precluded both countries from signing a peace treaty andfully normalising bilateral relations.

Concerning hopes for a possible breakthrough in Russo-Japanese relations inthe early 1990s, Gilbert Rozman observed that:

In the long countdowns preceding Mikhail Gorbachev’s and then BorisYeltsin’s visit to Tokyo, observers wondered if the abrupt expansion ofcontacts between the Russian Far East and the Japan Sea coastal areas ofJapan might jump-start relations between Moscow and Tokyo that continuedto unfold very slowly.

(2000: 199)

Although Rozman does not identify the ‘observers’ who were hoping thedevelopment of local-level ties would help expedite the normalisation of relationsbetween Japan and Russia, evidence suggests that this has informed Hokkaido’sthinking regarding relations with the Russian Far East, particularly Sakhalin. Thefirst explicit reference to the contribution of local exchanges to bilateral relationswas made by the local Hokkaid™ shinbun, which covered Hokkaido GovernorYokomichi Takahiro’s visit to Moscow and the Soviet Far East in June 1990. Thearticle noted that the influence of public opinion had increased with the advent ofglasnost and democratisation of Soviet society. The aim of Yokomichi’ssubnational government diplomacy was, therefore, to make the Soviet Far East’ssubregions cognisant of the merits of exchanges with Hokkaido and to mobiliseSoviet public opinion (raise voices ‘from below’) to call for an improvement inrelations with Japan. Yokomichi – a former labour lawyer and second-generationpolitician who was first elected to the Lower House in 1969, and subsequentlyserved five terms as a Japan Socialist Party (JSP) lawmaker representing a

2 Introduction

Hokkaido constituency before becoming governor in 1983 – referred to hissubnational government diplomacy as the ‘south wind’ blowing from Japan,which he likened to the ‘west wind’ that had swept through Eastern Europe andthe Soviet Union (Hokkaid™ shinbun, 2 September 1990: 2).

Amid the more open atmosphere created by Gorbachev’s glasnost policy andthe gradual processes of democratisation and decentralisation that had beentaking place in the Soviet Union since the late 1980s, an outspoken economist bythe name of Valentin Fedorov arrived in Sakhalin in early 1990 with the pledgeto turn the island into ‘an experiment for market reforms’. Fedorov, who had beenelected the oblast Executive Committee’s chair in April 1990, also formulated hisown unique proposal for resolving the territorial dispute, which attractedconsiderable attention in Japan. Yokomichi, a frequent traveller to the SovietUnion, was fully cognisant of these developments, particularly Sakhalin’sgrowing importance in matters pertaining to the territorial problem.4 Sakhalinwould therefore feature highly in Hokkaido’s subnational government diplomacy.Yokomichi made his first explicit reference to Sakhalin in this context during atrip to the Soviet Union in November 1991. He emphasised that ‘Apart fromrealising exchanges between fellow countrymen, promoting bold economiccooperation with Sakhalin and the four islands is directly linked to creating anenvironment conducive to resolving the [territorial] problem’ (Hokkaid™shinbun, 24 November 1991: 3, italics added). This was essentially aconfirmation of comments Yokomichi made earlier in the trip:

For Hokkaido it is important to create an environment conducive to resolvingthe territorial dispute. I would like to pursue talks with Sakhalin andparticularly the four islands, deepen understanding at the regional level, andalleviate the anxiety of [local Russian] residents.

(Hokkaid™ shinbun, 21 November 1991: 1, italics added)

The italicised words of Yokomichi’s press statements, ‘environment creation’,are the English translation of the Japanese expression kanky™ seibi. Kanky™ seibi,which can also be translated as ‘groundwork’, is a ubiquitous Japanese expressionthat can be used in many different contexts. In a broad sense, it can meanestablishing conditions conducive to achieving a particular goal – a necessaryfirst step on the way to fulfilling an ultimate objective (or a means to an end). Forinstance, it is perhaps most commonly used to describe the process of repairingand maintaining urban and rural infrastructure such as bridges, waterways,railways, roads and buildings for public use.

In the field of subnational government diplomacy, the concept is eitherexplicitly or implicitly linked to the notion many of its practitioners hold thattheir international activities and transnational partnerships can serve asinstruments to assist in resolving problems at the nation-state level. It is groundedin the internationalist belief that increased contact between peoples of the worldfosters greater accommodation and international understanding (Warwick 1973:

Introduction 3

305–6). The concept is also broadly congruent with the notion of track-twodiplomacy and its component strategies of public opinion mobilisation andchannelling of human and material resources for conflict resolution (seeMontville 1991: 162).

From the Hokkaido Prefectural Government’s (HPG) perspective, it can bedefined as creating an environment at the subnational level conducive toresolving the territorial dispute. The twin transnational processes of economicand cultural exchange would act as instruments to alleviate both local public andelite opposition in Sakhalin and the disputed islands to transferring the NorthernTerritories to Japan, thus making it easier for the Russian government to agree toterritorial concessions. Although the term kanky™ seibi appears in localnewspaper articles, press releases and prefectural government documents in thecontext of exchanges with the Russian Far East and particularly with Sakhalin,5it should be emphasised that establishing an environment at the subnational levelconducive to resolving the Northern Territories dispute is not the raison d’être ofHokkaido’s policy of promoting exchanges with Sakhalin. Business groups inHokkaido obviously seek to make profits from investing in and establishing traderelations with Sakhalin, and cultural exchange groups and a number ofmunicipalities, as well as the HPG, genuinely seek friendly relations, which is amatter of course for border regions. However, at the same time, one cannot denythat kanky™ seibi is an important philosophical objective underpinningHokkaido’s efforts to promote cooperative relations with Sakhalin. Yokomichi’ssuccessor, Hori Tatsuya, who had a long career as a civil servant in the HPG (andalso served one year as vice governor) before being elected as governor in 1995,was perhaps not as outspoken in this regard and was also cognisant of the fact thatterritorial disputes are the state’s preserve. However, Hori still believed there wasa role for Hokkaido, as a concerned party, in resolving state-level problems suchas the territorial dispute (Mainichi shinbun, 12 May 2000: 3; Mainichi shinbun,20 May 2000: 19).6 The Hokkaido Prefectural Assembly (HPA) has also beenactive in promoting exchanges with Sakhalin’s legislators, which it sees as animportant means to creating an environment for resolving the territorial dispute(Hokkaid™ shinbun, 12 December 1991: 2; Hokkaid™ shinbun, 4 August 1992: 4; Hokkaid™ Gikai 1992). As the following chapters demonstrate, severalof the cooperative processes and institutions created thus far between Hokkaidoand Sakhalin have been placed within the broader context of the salutary effectthey will have on resolving the territorial dispute and state-to-state relations.

Although there do not appear to be any Russian-language equivalents to theJapanese term kanky™ seibi, implicit references have been made to this conceptand the value of grassroots diplomacy in the past. For instance, in a localnewspaper interview, the head of the Sakhalin administration’s Department ofInternational Affairs and Foreign Economic Relations, Vladislav Rukavets, spokeof ‘establishing an appropriate atmosphere at the regional level’ (ustanovleniyusootvetstvuyushchei etmosfery na regional'nom urovne) as a step towardsconcluding a bilateral peace treaty (Chinarov 2002: 14). While Rukavets made no

4 Introduction

mention of the disputed islands, others have explicitly linked transnationalrelations with the territorial problem. An article in the Far Eastern EconomicReview claimed that people-to-people diplomacy was one method the Sovietswere banking on to defuse the Northern Territories issue in Japan (Quinn-Judge1989: 30). Similarly, Valentin Fedorov once remarked that if Japanese companieswere to increase their investment in the resource-rich Russian Far East ‘andobtain profits, the Japanese will forget all about the Northern Territories dispute’(Hokkaid™ shinbun, 13 August 1992: 3). It can, therefore, be said that Sakhalinis motivated by objectives which differ from, and indeed conflict with, those ofHokkaido. Unlike Hokkaido, it does not intend that enhanced relations at thesubnational level should result in Russia ultimately surrendering control of thedisputed islands.

Hokkaido is not the only Japanese prefecture whose external relations havebeen influenced by a territorial dispute. The dispute between Japan and SouthKorea over Takeshima/Dokdo Island has, on occasion, spilled over intoShimane’s subnational government relations with North Kyongsang. It is worthnoting that, from Shimane’s perspective, relations with North Kyongsang areoften couched in terms of the contribution it makes to maintaining peace inNortheast Asia and deepening mutual understanding between the South Koreanand Japanese people (see Shimane Ken Chijishitsu 2001). However, unlikeHokkaido’s relations with Sakhalin and the Russian Far East, there is no referenceto the contribution subnational government relations might make to resolve theterritorial dispute. It can be surmised that the Shimane Prefectural Governmentdoes not firmly believe that developing relations with North Kyongsang will haveany impact on resolving this issue. Plausible explanations for this are linked tothe nature of local government in South Korea. Until local government electionsin December 1995, the central government appointed South Korean provincialgovernors (Shin 1999: 7). Despite local officials now being popularly elected andthe formal redistribution of political power between the central and localgovernment agencies, the reality is that the centre largely controls the periphery(Steinberg 2000: 222). The South Korean central government’s firm grip onpower means that the North Kyongsang provincial government has little or noauthority in domestic matters pertaining to the territorial dispute. From Shimane’sperspective, this diminishes the value of targeting and lobbying North Kyongsangin order to change South Korean policy regarding Takeshima.

There are a number of important reasons justifying the study’s focus onsubnational government relations between Hokkaido and Sakhalin. First, thereare very few comprehensive studies of Russo-Japanese subnational governmentrelations. Most of the specialised literature on Japan–Soviet/Russian relations todate has placed the analytical focus on actors such as central governments and, toa lesser extent, private firms – often Tokyo-based general trading companies. Thedearth of academic literature, of course, is not sufficient grounds for conductingresearch into this topic. The reason for the general absence of Russo-Japanesesubnational government relations from analytical discussions might be that they

Introduction 5

are not considered to be very important. However, the systemic and domesticfactors described in Chapter 2 have led to a considerably increased presence ofsubnational governments on the global stage in recent years. It has becomedifficult to differentiate between foreign policy and domestic policy issues in aninterdependent and economically globalising world. ‘This means’, as Earl Frystates, ‘that, over the next few decades, subnational governments will be moreactively involved in overlapping issue areas’ (1998: 6). Moreover, in the cases ofRussia and Japan, there is also evidence of both central governments’ weakeningabilities to drive foreign policy in a unitary fashion.7 The presence of Japaneseand Russian subnational governments and their growing relations has thereforebecome an indelible feature of the international landscape of Northeast Asia andcan be expected to develop further.

Second, among the subnational agents engaged in creating links between thosecommunities mainly located in the Japan Sea and the Russian Far East, Hokkaidoand Sakhalin are perhaps the most active, and their relations the mostinstitutionalised. In the economic arena, Hokkaido and Sakhalin have beenmeeting for nearly two decades at the Japan–Soviet Far East–HokkaidoFriendship Exchange Conferences, which were established in 1984 as a part ofefforts to facilitate periodic economic exchanges between subnationalgovernment officials in Hokkaido and five subregions in the Soviet Far East.Hokkaido and Sakhalin are participants in the Joint Standing Committee forEconomic Cooperation between Hokkaido and the Russian Far East, establishedin September 1992. Both the HPG and the Sakhalin regional government nowmaintain a permanent administrative presence in each other’s capitals followingSakhalin’s decision to open a representative office in Sapporo in September 2006.Hokkaido and Sakhalin concluded what may be seen as a subnational level peacetreaty when they signed an Agreement on Friendship and Economic Cooperationin November 1998. Both sides have established a consultative council,comprising the relevant administrative departments and private economic groups,which meets regularly to discuss ways to implement the agreement’s terms. InSeptember 1997, a number of public and private organisations in Hokkaidojoined together to form the Sakhalin Project Hokkaido Consultative Council,which works in close cooperation with its counterpart in Sakhalin. Incoordination with Alaska, Hokkaido and Sakhalin have also agreed to cooperatein minimising the adverse effects of environmental disasters – the threat of whichhas been accentuated by oil and gas development projects in the Sea of Okhotsk.

The Hokkaido and Sakhalin governors, as well as administrative officials fromboth regions, hold periodic meetings to discuss ways to promote furtherexchanges. Not to be outdone by the regional executive branch, the HPAestablished a legislative body to promote exchange with Sakhalin in December1997 (Hokkaid™ S™mubu Chijishitsu Kokusaika Roshiashitsu 2000: 7). In May2000, the HPA and the Sakhalin oblast Duma signed an agreement to promotecooperation, such as exchanges, between the two legislatures.

6 Introduction

At the municipal level (as of 2005), 12 sister-city and friendship agreementshave been concluded between cities, towns and villages in Hokkaido andSakhalin (see appendix). Wakkanai has established sister-city relations with threemunicipal governments in Sakhalin. The number of Hokkaido–Sakhalin sister-city agreements accounts for a little over one-third of such agreements betweenRussia and Japan.8 From 1996, Hokkaido and Sakhalin sister cities have also beenmeeting at the annual Hokkaido–Sakhalin Sister and Friendship CitiesRepresentatives’ Conference, which the Japan–Russia Association’s Hokkaidobranch and the Sakhalin Japan Association cosponsored (Hokkaid™ S™mubuChijishitsu Kokusaika Roshiashitsu 2000: 6).

In addition to subnational government initiatives, numerous private groupsand organisations on both sides of the Soya Strait have also concludedcooperation agreements. There is a Hokkaido–Sakhalin Friendship and ExchangeAssociation. In education, several universities, high schools, junior high schools,primary schools, and even kindergartens, have established sister-school ties withSakhalin. The Hokkaido Broadcasting Commission, Hokkaido Television Bureauand Sapporo Television have all concluded business cooperation agreements withtheir counterparts in Sakhalin (ibid.: 67). The local Hokkaid™ shinbun maintainsan office in Yuzhno-Sakhalinsk staffed by a full-time reporter. It is clearly evidentthat there is a significant story unfolding at the subnational level between thesetwo subregions. Moreover, the growth in Hokkaido–Sakhalin ties is particularlystriking when one considers that relations between Moscow and Tokyo have, forthe most part, stagnated since the end of the Cold War.

Finally, compared with other cases of Russo-Japanese subnationalcooperation, Hokkaido–Sakhalin subnational government relations are uniquebecause of the close connection with the bilateral territorial dispute, which castsan unavoidable shadow over their relations. Both subregions play host to severalpublic and private organisations and bodies that are dedicated to resolving theterritorial dispute in a manner they perceive as being congruent with theirrespective national and regional interests, but which is also anathema to the other.Many of the islands’ former Japanese residents who were repatriated to Japanafter the war settled in Hokkaido. They are the core element of the nationwidemovement demanding the islands’ return, which is based in Hokkaido andreceives various forms of assistance from the national, regional and localgovernments. The Sakhalin regional government, on the other hand, hasmaintained a vocal campaign to keep the Russian federal government fromtransferring what are known in Russia as the South Kuril Islands to Japan.Clauses in both the Sakhalin and South Kuril District charters also stipulate thatthe consent of local residents is a precondition for any potential transfer of theislands to Japan. The territorial dispute also affects economic relations,particularly fishing, upon which both economies are highly dependent.

Moreover, the burgeoning attempts to promote various forms of exchangebetween Sakhalin and Hokkaido are often couched in terms of the salutary effectthese will have on Tokyo–Moscow relations and on resolving the territorial

Introduction 7

dispute. This is evident in the rhetoric of both regional governors and also in localpress reports, particularly after a significant achievement in interregionalrelations, such as the November 1998 Agreement on Friendship and EconomicCooperation. The Agreement’s preamble mentions ‘the positive role both regionsplay in the development of political dialogue between the Japanese and Russiangovernments’ (Hokkaid™ S™mubu Chijishitsu Kokusaika Roshiashitsu 2000: 14).Resolving the territorial dispute will not only bring about a completenormalisation of relations between the two countries, but will also enhance effortsto integrate Sakhalin and the rest of the Russian Far East fully into the Asia-Pacific region, which will contribute to regional peace and stability.

Methodology

Primary data

This study employs a limited case study methodology and is based on extensivefieldwork in Japan and Russia in 2000–1. During this period, the author was arecipient of a Japanese government scholarship and was based at SaitamaUniversity just north of Tokyo. The author made three trips to Hokkaido – thefirst in May 2000, the second in March 2001 and the third in August 2001 – andconducted research in Sakhalin, also in August 2001.

The author conducted a number of structured, semi-structured and open-endedinterviews with regional and local government officials involved in subnationalgovernment relations during visits to Hokkaido and Sakhalin. Questionnaireswere also sent to the 33 subnational governments in Japan that (in 2000)maintained sister-city relations with their counterparts in Russia in order to gaugeadministrative perceptions of subnational links. Japanese and Sakhalinsubnational government homepages were also examined.

The story of what happens in the regions and particularly of subnationalgovernment relations is mostly untold by the central press in both countries,which tend to be Tokyo- and Moscow-oriented. This study therefore reliesheavily on regional newspapers and regional government publications. On theJapanese side, the Hokkaid™ shinbun was a major source of information onHokkaido–Sakhalin relations and the HPG’s perspective of this relationship. TheHokkaid™ shinbun also turned out to be a valuable source of information on theSakhalin regional elite and public perceptions of subnational governmentrelations and the territorial dispute. Past and present copies of this newspaperwere consulted in Tokyo University’s Institute of Socio-Information andCommunication Studies (Shakai J™h™ Kenkyuøjo).

Three local newspapers in Sakhalin, Sovetskii Sakhalin (Soviet Sakhalin),Svobodnyi Sakhalin (Free Sakhalin) and Gubernskie vedomosti (The ProvinceNews), provided first-hand information. Hokkaido University’s Slavic ResearchCenter has copies of these three newspapers, which were examined during visitsto Hokkaido. As there is a tendency among Japanese, Russian and Western

8 Introduction

scholars of Russo-Japanese relations to rely on the central press for information,many of the sources utilised in this book will appear for the first time in English-language scholarship. An electronic version of a local English-languagenewspaper, The Sakhalin Times (later The Sakhalin Independent), provided theauthor with an informative and up-to-date link to Sakhalin news after returning toAustralia. While in Japan, the author became a member of the Japan–SakhalinAssociation, established in February 1993, to promote cooperative relationsbetween Japan and Sakhalin.9 The Association’s members receive a weeklynewsletter entitled Saharin to Nihon (Sakhalin and Japan), which contains, interalia, Japanese translations of Japan-related articles appearing in the localSakhalin press. Access to this obviated the necessity of conducting lengthyfieldwork in Sakhalin.

Secondary data

The study is based on extensive reading of English-, Japanese- and Russian-language materials. This provides the necessary background for studying theterritorial dispute and its significance for Russo-Japanese relations, as well asJapanese policy towards Russia and Russian policy towards Japan. Assubnational governments, whether in the domestic or international arena, do notoperate in an institutional vacuum, and since their relations are prescribed bydevelopments at the state level, research into central government objectives andpolicy is useful for contextualising this study. Comparative studies of theinternational activities of subnational governments in other countries were alsoused to contextualise the study of Hokkaido–Sakhalin relations, and the Russianand Japanese central press were used to follow up recent developments inTokyo–Moscow relations.

Contextualising the study: The discourse on subnationalgovernments as international actors

Hierarchy of international issues: ‘High politics’ versus ‘low politics’

There are several underlying themes within the discourse on subnationalgovernments as international actors. The first of these is that the externalactivities of subnational public authorities are largely confined to the realm of‘low politics’ such as economic, social and environmental issues.10 Culturalexchange can also be included in this category. Central governments are usuallyconsidered responsible for ‘high politics’ including security and defence ofnational sovereignty. As territorial disputes are essentially issues related tonational sovereignty and often have a strategic element, as is the case with theNorthern Territories dispute (particularly from a Russian perspective), they are‘high politics’ issues. Scholars of international relations have employed varying

Introduction 9

conceptualisations of ‘high’ and ‘low politics’. Among these, Zhan Jun offers auseful definition:

High politics are those activities between/among either government or non-government actors that manifest direct, major and usually immediate impacton national, regional and international affairs. Low politics centers onactivities that manifest indirect impact on national, regional and internationalaffairs.

(1996: 87)

The notion of a division of labour among central and subnational governmentsin international affairs is particularly evident in the Japanese literature with anumber of related works highlighting subnational governments’ role in promotingeconomic cooperation.11 Moreover, the Japanese Ministry of Foreign Affairs(MOFA) has traditionally seen the international role of subnational governmentsto lie in areas such as cultural exchange and domestic public relations activities.

This tacit division of labour in which central governments are responsible for‘high politics’ issues and subnational governments for ‘low politics’ reinforcesthe notion that somehow subnational governments’ external activities are inferiorto nation-state diplomacy. This idea, which is congruent with a realist assumptionin international relations theory that national security lies at the apex of theinternational issues hierarchy, is reflected in the works of Ivo Duchacek who hasconceptualised these activities as ‘paradiplomacy’. Duchacek has employed theterm ‘para’ as it ‘indicates not only something parallel, but also … somethingassociated in a subsidiary or accessory capacity’ (1990: 25).12

It should be noted that just as the distinction between domestic politics andforeign policy has been blurred in recent years with the advance of globalisationand interdependence, the realms of ‘high’ and ‘low’ politics are also not mutuallyexclusive, but interrelated; security and defence of national sovereignty ofteninfluence economic and social issues, and vice versa. An example of the formerare economic sanctions to punish state belligerence such as the July 1941 Alliedembargo on oil exports to Japan that was intended to curb Japanese aggression inChina. More recently, an official from the South Korean province of NorthKyongsang, sent on exchange to work for the Shimane Prefectural Government,was believed to have been recalled in 2000 partly in protest at comments thatShimane Governor, Sumita Nobuyoshi, made to the prefectural assembly aboutTakeshima Island being Japanese territory.13 As the following chaptersdemonstrate, the dispute over the Northern Territories/South Kuril Islands alsocasts an unavoidable shadow over Hokkaido’s relationship with Sakhalin.

Although there is a general tendency for local government officials to focus on‘low politics’ issues, there have been instances when these activities have had‘high politics’ overtones; for example, 13 US state liquor commissions decided toban the sales of Soviet vodka when the USSR shot down a Korean Airlinespassenger jet in 1983 (Duchacek 1990: 8). Even when the focus is on ‘low

10 Introduction

politics’, there remains the possibility of politicising actions, which occurs when‘low politics’ issues have ‘high politics’ consequences. The Quebec–Franceeducational and cultural agreements concluded in the 1960s, for example, createda political conflict between France and Canada, since the latter saw the agreementas part of France’s ‘high politics’ aims: de Gaulle’s interference with the politicalprocess in Canada and his desire to use Quebec as a ‘springboard’ for his globalforeign policy objectives (Soldatos 1990: 49).

Subnational governments’ international activities: A catalyst for change in state diplomacy and state-to-state relations?

Subnational public authorities engage in two forms of deliberate participation ininternational relations. First, subnational public authorities can influence thecentral government’s decision-making process from within by adopting whatMichael Shuman refers to as ‘consciousness-raising measures’ (1986–7: 159).Such measures include education, research and lobbying. Subnational publicauthorities’ lobbying of central governments, which is probably the mostcommon, highly directed and politicised form of consciousness-raising measures(Shuman 1986–7: 160), manifests itself in a number of ways. First, regionallyelected representatives to Parliament can act as lobbies, ensuring that centralgovernments give greater priority to regional issues. Second, many subnationalpublic authorities have their own representatives in the national capital, servingnot only as eyes and ears, but also as spokespeople and lobbyists with the organsof government that deal with foreign policy. For instance, most Japaneseprefectures maintain offices in the Tod™fuken Kaikan (Prefectural House) inTokyo, which is near the Diet and central ministries, making it a convenient basefor lobbying activities. Although the HPG has an office in this building, it doesnot have full-time staff as it maintains its own representative facility nearby.

Third, various groupings of subnational units often combine in order topromote their common interests vis-à-vis the central government (Duchacek1990: 10). In Japan, the National Governors’ Association (Zenkoku Chijikai)represents an important source of regional pressure on Tokyo through its twice-yearly annual meetings. Although there is no formal nationwide association ofgovernors in Russia, the Federation Council – the bicameral Federal Assembly’supper house, which was created in 1993 – could, in some ways, be seen as aninstitutional vehicle that brings together regional elites for the purpose ofpromoting common interests vis-à-vis the federal government. The FederationCouncil was staffed ex-officio by 178 representatives from Russia’s federalcomponents. According to a law adopted in December 1995, it was formed fromthe governors and legislative heads from each of the 89 components (Sakwa1996: 132). However, the Council’s collective lobbying powers werecircumscribed partly by the fact that its members were full-time officials in theirown regions, which resulted in high absenteeism, making it difficult to gather aquorum. As a result of reforms to the Council introduced in January 2002, its

Introduction 11

members have been replaced by two permanently working representatives, onenamed by each region’s legislature and another appointed by its executive branch(Corwin 2000).

Russian subnational units have also established regional organisations in anattempt to present a unified front to Moscow. The eight regional groupingsinclude Black Earth, Siberian Accord, Central, Northwest, North Caucasus,Urals, Far East and Greater Volga. Although, as Robert Valliant notes, theseorganisations predominantly play an economic role (Valliant 1997: 11), they haveon occasion transgressed into the political arena. For the Far Eastern Association,adopting a political stance has involved the Northern Territories dispute – a pointdiscussed in greater detail in Chapter 4. Although lobbying does not placesubnational authorities directly on the international scene, it does make theminternational actors in the sense that these activities can attract extra-nationalattention, making them targets for foreign interference in the form of lobbyingand bribes (Duchacek 1990: 11–12).

Intra-state policy demands represent only one form of subnational governmentinfluence on foreign policy. Subnational governments can bypass centralgovernment mechanisms by maintaining informal or formal transnationalcontacts. Such contacts are often conspicuous and, in addition to privatetransnational flows, contribute to what Duchacek has referred to elsewhere as‘percolated sovereign boundaries’ (1986). Duchacek identifies six ways in whichsubnational governments promote and defend their interests in the internationalarena: by establishing permanent offices in foreign cities; by going on tripsabroad; by conducting fact-finding missions; by launching trade and investmentshows; by establishing foreign trade zones; and by participating in the work ofinternational conferences or organizations and establishing formal diplomaticrepresentation of their national government in foreign capitals (1990: 14–15). Theambiguous status of subnational governments can also enhance their capacity topursue interests. Purnendra Jain notes they are advantaged by being neithernational government nor non-government. Subnational governments ‘have aquasi-diplomatic status to rely on when useful, but because these are not elementsof national government they do not have diplomatic baggage that can at times bea hindrance in their international pursuits’ (2005: 38).

Concerning the degree of intra-national influence in the foreign policy realm,some scholars credit subnational governments with having substantial influenceon central government diplomacy. In their research on the role of four Canadianprovinces in the foreign policy decision-making process, Elliot and Lily Feldmanargue that the federal government has had to reshape its foreign-policymakingapparatus to accommodate the provinces and has acknowledged its inability toproceed in major international negotiations without provincial participation(1990: 203). Specifically, the federal government has shifted more of Canada’sinternational emphasis to economics as the provinces have pressed theirinternational concerns (Feldman and Feldman 1990: 205).14 Moreover, theCanadian provinces, in cooperation with US states, have forced environmental

12 Introduction

issues on to the agenda of bilateral relations. The scope of intra-national influencein the foreign policy arena is linked to broader issues of democratic development,as well as the institutional and constitutional context of centre–local relationswithin a particular state. Generally speaking, one would expect a nationalgovernment to be more responsive to subnational government demands in afederal polity than in a unitary state. This has clear implications for a case studyof subnational relations in Japan and Russia.

Concerning the impact of transnational contacts by subnational governmentson state-to-state relations, Keohane and Nye argue that transnational relations, ingeneral, not only increase the sensitivity of societies to one another, therebyaltering relations between governments, but may also promote attitudinal changeswhich may have possible consequences for state policies (Keohane and Nye1971: xii–xvii). Others, meanwhile, have tended to downplay subnationalgovernment influence. In an earlier study, Kal Holsti and Thomas Levy claimedthat provincial and state governments rarely use administrative and culturalrelationships to pressure their respective national governments to alter policiesvis-à-vis the other country or to claim a greater role in national policymaking(Holsti and Levy 1976: 303). Neither scholar, however, addresses the issue ofwhether it is possible for subnational governments to use these transnationallinkages in order to pressure foreign regional or national governments to changepolicies on issues affecting bilateral relations. It is this topic that the book seeksto address.

Accepting the Keohane and Nye thesis that transnational contacts can inducechange in international relations, although closeness between regions can, onoccasion, invite distrust and disharmony, there are several studies which suggestthat subnational government relations can be a catalyst for new forms ofcooperation in international relations, bridging political tensions between nations.This is particularly evident in Europe, a continent wracked by centuries of warand violence. In a study of Franco-German twin-city relationships or ‘twinnings’,Beate Wagner argues that the longstanding enmity between the two nations wasfirst overcome at the local level, which opened the door to further cooperation,greatly contributing to Franco-German postwar reconciliation, which wasformalised with the Elysée Treaty’s signing in 1963 (1998: 43). Similarly, DetlefWeigel claims that ‘Town-twinning arrangements have been instrumental infirmly anchoring Franco-German friendship in the minds of the peoples’ (1998:45).15 Local-level cooperation was also evident across the East–West divideduring the Cold War. The development of West German–Polish town-to-towncontacts was considered to be a factor that contributed to stability and continuityin Polish–West German people-to-people relations during the tense period ofmartial law in Poland in the 1980s (Wagner 1998: 39).

Beyond Europe, Japanese progressive mayors in the 1970s believed thatestablishing formal links with Chinese cities would facilitate the signing of apeace treaty at the national level, which was realised in 1978 (Jain 2005: 74).Similarly, cross-border relations between municipalities in Hokkaido and the

Introduction 13

Soviet Far East during the Cold War aimed to promote mutual understandingbetween the two peoples and relax tensions in the highly militarised border zone.

The notion of subnational government relations acting as a catalyst in theresolution of state-to-state problems appears in a number of Japanese studies onthe subject of local government diplomacy. For instance, Kamano Yukio speaksof the importance of subnational governments ‘creating an environment foreasing complex national emotions and fundamentally resolving issues by beingsufficiently cognisant of these problems and deepening exchanges which connectthe minds of people from countries on the Sea of Japan rim’ (1994: 181). NagasuKazuji, a former governor of Kanagawa who was a pioneer in Japanesesubnational government diplomacy, argues that ‘states continue to haveresponsibility in international politics and diplomacy, but where and when thereis trouble, actors other than the state can find a way out’ (1983: 14). Another studyconducted by the Institute for Local Administration (Chih™ Gy™sei Kenkyuø jo)also notes that ‘when central government diplomacy is not going well, localgovernments can act as a conduit in order to resolve the problem’ (1999: 106).16

The notion of subnational public authorities’ international activities andtransnational partnerships acting as an instrument to bridge political tensionsbetween nations has emerged as a key principle underpinning efforts atregionalism in Northeast Asia since the end of the Cold War. For most of thepostwar period, the nations bordering the Sea of Japan were (and in some cases,still are) divided by historical enmity, ideological hostility and great powerrivalry. Japan and South Korea were integral parts of the US’s containmentstrategy in East Asia. Their roles as bulwarks against the spread of communismin the region inevitably drew them into adversarial relationships with the SovietUnion, China and North Korea. Despite their incorporation into the US-ledcapitalist camp, Japan and South Korea were never able to overcome fully thelegacy of the former’s brutal colonisation of the latter. The same can be said ofJapan’s relations with China and North Korea. Less than a decade afterannouncing their military alliance, China and the Soviet Union fell out essentiallyover the issue of leadership of the socialist camp and their dispute led to armedborder clashes in 1969. Territorial disputes involving Japan, South Korea, Chinaand the Soviet Union further complicated already strained relations. Perhaps theonly common feature the constituent regions of Northeast China, South Korea,the Soviet Far East and the Sea of Japan seaboard (pejoratively known as UraNihon or ‘backdoor Japan’) shared was their peripheral economic status vis-à-vistheir respective national centres. During this period, the Sea of Japan/East Seawas a sea of conflict and cross-border (both land and sea) exchanges were heavilyrestricted.17

The Soviet Union’s collapse, the end of the Cold War, South Korea’sestablishment of diplomatic relations with the Soviet Union and China, anddecentralisation, particularly in Japan and Russia, have resulted in whatFurumaya Tadao has described as a slow filling of the deep ‘Sea of Japan gap’(Nihonkai no mizo) (1997: 186). Taking advantage of these structural and

14 Introduction

domestic changes, subnational public authorities and other local actors aredeveloping transnational cooperative structures and processes. One Japaneseobserver has noted that the strengthening of ties amongst local residents and theestablishment of relations of familiarity across the Sea of Japan helps guaranteethat state-to-state relations will not return to the hostility characteristic of theCold War (Kushiya 1994: 173). Also using Japan Sea cooperation as an example,David Arase raises the possibility ‘that local initiative could provide a way tobuild cooperation among economically complementary countries divided bydaunting issues at the level of state-to-state relations’ (1997: 49). In a case thatmay be instructive for Russo-Japanese subnational government relations, anofficial from the Russian region of Pskov, which encompasses all of Latvia’s andmost of Estonia’s borders with Russia, and was the only region in Russia wherea member of Vladimir Zhirinovsky’s Liberal Democratic Party of Russia (LDPR)won a gubernatorial race (Yevgenii Mikhailov in late 1996), made commentssuggesting that by focusing on local socio-economic and humanitarian issues,regional and local authorities could play a positive role in overcoming politicaldisagreements on border demarcation (Alexseev and Vagin 1999: 186).

At this point, clarification is in order. In spite of the cases mentioned above,this study does not suggest there is a common understanding that subnationalgovernments can create an environment conducive to resolving territorialdisputes between nations. It is central governments that ultimately makedecisions regarding national border demarcation. However, the point to note isthat there was a perception in Hokkaido that relations between the two particularsubnational governments of Sakhalin and Hokkaido might become a steppingstone or precursor to resolving a specific territorial problem (the NorthernTerritories/South Kuril Islands dispute).

Conflict and cooperation

Another salient theme within the discourse is that the external activities ofsubnational governments can challenge, or at least complicate, nation-statediplomacy. Quebec is the most frequently cited example of a subnationalgovernment’s external activities conflicting with central government policyobjectives as it actively attempted to secure international support in its bid to gainindependence from Canada. Quebec, however, is not an isolated example. EarlFry has argued that the growing involvement of (US) state and local governmentsin the global arena complicates Washington’s efforts to speak with one voice onimportant economic issues (1990b: 125). US states’ adoption of unitary taxes onthe earnings of multinational corporations operating within their territorialjurisdiction has caused some consternation for Washington as these taxescontravene many bilateral taxation agreements it has concluded. Moreover, in achallenge to US federal immigration laws, various states and municipalities haveapproved local ordinances on such issues as the right of sanctuary forideologically approved political refugees, while other communities have

Introduction 15

approved non-binding resolutions to protest US policy in Central America(Duchacek 1990: 8).

There is also evidence suggesting that during the 1990s, many constituentregions and republics of the Russian Federation took advantage of political andeconomic decentralisation to articulate and conduct quasi-foreign policies(Alexseev 2000). These subnational foreign policy initiatives were often madewithout paying much attention to Moscow’s wishes and consequently conflictedwith or complicated federal policy. Notable examples include Chechnya’sdeclaration of independence and insisting on its right to self-determination, andthe Republic of Tatarstan appointing its own trade representatives in 14 locationsoutside Russia and the former governor of Primorskii krai, YevgeniiNazdratenko, stalling the implementation of the 1991 border demarcationagreement with China until 1997, which as Mikhail Alexseev argues ‘could becited as evidence of Russia becoming less and less of a “unitary” actor in theglobal arena’ (2000). One can also draw a parallel here with the outspokenposition taken by the regional political elite in Sakhalin, particularly ValentinFedorov, against possible territorial concessions by the central government toJapan regarding the South Kuril Islands.

One should not be surprised that conflict can and does occur between centraland subnational governments over the direction of foreign policy. As each has itsown self-defined interests to defend, conflict between two levels of governmentover domestic public policy is a common occurrence and indeed may beconsidered the very life-blood of democratic polities. In an increasinglyglobalising and interdependent world, there is therefore no reason why foreignpolicy should be immune from intergovernmental discord.

Other examples of conflict between central and subnational governments overforeign policy exist, but it is important to note that the majority of subnationalgovernments’ external activities are, in fact, congruent with central governmentdiplomacy and are often encouraged by them. Following on from the pioneeringwork of Ivo Duchacek, Panayotis Soldatos, eschewing the word ‘fragmentation’,has adopted the term ‘segmentation’ in order to conceptualise the foreign policyactivity of local governments. He argues that these activities do not necessarilyentail a disintegrative phenomenon, as the term ‘fragmentation’ implies, ‘butcould, in many instances, be part of a rationalisation process in external relations’(1990: 36).

The cooperative aspect of the external activities of local governments is aparticularly dominant theme in the Japanese discourse. Suzuki Yuø ji argues that theinternational policies of each (Japanese) subnational government, rather thanrunning counter to state policy, have a strong tendency to avoid those activitiesthat may even slightly contravene national objectives and instead limitthemselves to a position that servilely complements state diplomacy (kuni nogaik™ seisaku no tsuijuøteki hokan) (1983: 207–12). This view is echoed byKamano Yukio who, in a study of Toyama and Ishikawa (two Japaneseprefectures that are active in pursuing relations with other localities in Northeast

16 Introduction

Asia), claims that they view the importance of local government internationalexchange too narrowly, limiting themselves to complementing state diplomacy,1994: 202). As a specific example of centre–local cooperation in the foreignpolicy arena, in recent years, subnational governments in Japan have beenaccepting trainees from developing countries, some under the national officialdevelopment assistance (ODA) programme run by the Japan InternationalCooperation Agency (JICA), an organ affiliated with the MOFA, and othersinvited by subnational governments themselves through sister-city programmesor as a part of local ODA activities. Financial considerations may be a factor inexplaining the complementary nature of subnational government diplomacy.According to one scholar, there are many cases where the localities are able toobtain central government funding if they put forward proposals that are inaccordance with state policy (Tanaka 1983: 278). This implies that manysubnational governments may be unwilling to pursue independent initiatives forfear of not being able to secure the necessary funding. It also suggests that thecentral government can employ financial means to ensure subnationalgovernment compliance with state policy. Subnational governments in Japanhave formerly been able to raise only about one-third of their operating revenuethrough independent local taxation (referred to as san-wari jichi or ‘30 per centautonomy’), making them highly dependent on the central government forfunding (Samuels 1983: 40).18 The Japanese government’s reforms to local publicfinances aim to reduce this dependency by delegating authority and responsibilityfor raising revenue to local government.

The tendency for Japanese subnational government diplomacy practitioners tolimit themselves to complementing state policy is also grounded in the broaderself-perception of local government, in general, as merely a ‘lower-level organ’(mattan soshiki) of the central government, which should not actively pursueautonomous policies. This perception is slowly changing, but is still evident inmany local administrations today. Many MOFA bureaucrats who believe thatmanaging the nation’s external activities should be left primarily to the ‘experts’share this view. In this context, Purnendra Jain speaks of MOFA’s dismissivedisposition towards subnational governments and their international activities,which underpins a general understanding of them as ‘private or non-state actors,rather than other, lower-level, government actors’ (2005: 33). While centralgovernment officials formerly monopolised the skills and organisational supportrequired to conduct effective diplomacy, this is no longer the case today as anincreasing number of regional and municipal governments have establisheddepartments to deal with their external activities that are staffed by trainedofficials.19

Complementing state diplomacy is important, particularly when it contributesto such goals as international peace, cooperation and stability. However, ifbilateral relations are not satisfactory, as in the case of Russia and Japan, thecomplementary activities of local governments may only serve to perpetuate thestatus quo. Opinion is divided in Japan regarding the issue of whether local

Introduction 17

governments’ international activities should complement state diplomacy.Scholars such as Shut™ Nobuhiko believe it is possible for local governments topursue their own diplomacy as long as it does not fundamentally overturn statepolicy (1995: 53). However, he sees little possibility of this happening, arguingthat subnational government internationalisation takes the form only of sister-cityagreements and ties with friendly cities. He refers to this as ‘cheers diplomacy’(kanpai gaik™), which, far from complementing government diplomacy, isnothing more than exchange visits (1995: 57). These earlier attempts at localgovernment diplomacy drew some criticism as local officials were seen as usinglimited local funds to satisfy their personal desire to travel. Shut™’s description,however, is not entirely valid today as significant qualitative improvements havebeen made with many localities entering into agreements ranging from promotingcultural and economic ties to protecting the environment. While Kamanorecognises that complementation is important, he also argues that localgovernments need to move forward and develop ‘local government diplomacy’(jichitai gaik™). Specifically, he speaks of the need for ‘internal’ (uchinaru) and‘external’ (sotonaru) internationalisation, which entails a respect for human rights(particularly for foreign residents living in Japan) and opening the way tocoexistence (1994: 202–3). Others are less satisfied with the ancillary rolesubnational governments are asked to play. Tanaka Naoki argues that the purposeof subnational government international exchange activities is not to complementstate-to-state relations, but rather to bring about changes in it (1983: 234–6).

Regarding this theme of conflict and cooperation, as will be discussed ingreater detail in Chapter 3, kanky™ seibi at the subnational level is generallycongruent with Tokyo’s current policy aims towards Russia. This policysimultaneously attempts to undertake two inseparable tasks. According to HiroshiKimura, these are ‘to negotiate with Russia over the sovereignty issue of theNorthern Territories and to create an environment favorable for the resolution ofthis difficult issue, which is dubbed simply kankyo seibi’ (1997: 369).

However, it should be noted that although Hokkaido’s efforts to promotecooperative relations with Sakhalin and create an environment at the subnationallevel conducive to resolving the territorial dispute generally accord with the aimsof Japan’s present Russia diplomacy, there have been instances in the past whenthe means Hokkaido have adopted have conflicted with, or at the very leastcomplicated, Japanese policy towards Russia and Sakhalin. This aspect ofinterregional relations is discussed in greater detail in Chapter 3.

Synopsis of chaptersChapter 1 begins with a discussion of the Northern Territories’ importance toJapan and especially to Hokkaido. In order to provide a frame of reference fromwhich to address the study’s supplementary research questions, the chapterfollows with a broad overview of the fundamental principles and approachesunderlying Japan’s post-Cold War Russia diplomacy, as well as Russia’s policy

18 Introduction

towards Japan and the disputed islands. Chapter 2 examines the factors thatcontributed to the increased international presence of subnational publicauthorities in Sakhalin and Hokkaido and the development of relations betweenthe two regions. It also discusses how some of these factors also led to the gradualelevation of Sakhalin oblast’s authority (both the regional political elite and public opinion) in matters pertaining to the dispute over the South KurilIslands in the decade following the Soviet Union’s collapse in December 1991.Chapter 3 explores Hokkaido’s and Sakhalin’s efforts to develop cultural,humanitarian and economic exchanges and considers how these complementedand/or challenged Japan’s Russia diplomacy and Russian policy towards Japan,and how Tokyo and Moscow responded to Hokkaido and Sakhalin’s increasedinternational presence and their burgeoning transnational relationship.

Chapters 4, 5 and 6 address the study’s main question regarding why thedevelopment of Hokkaido–Sakhalin subnational government relations did notcreate an environment, at the subnational level, conducive to resolving theterritorial dispute by significantly alleviating public and elite opposition inSakhalin to transferring the islands to Japan. Chapter 4 examines the first part ofthe ‘Sakhalin factor’: Sakhalin’s political elite. It outlines their views on theterritorial dispute. Particular attention is paid to the South Kuril Islands’ value asa bargaining tool to extract various political and economic concessions for theregional elite. It then discusses whether the Sakhalin leadership’s positionregarding the territorial dispute complicated Russian policy towards Japan andhow Moscow in turn responded to this.

Chapter 5 investigates the second aspect of the ‘Sakhalin factor’: local publicopinion. It examines why the improvement in mutual perceptions and new-foundfeelings of trust and friendship between the peoples of the two regions, fosteredby subnational government exchange, was not sufficient to alleviate publicopposition to transferring the South Kuril Islands to Japan. Chapter 6 examinesSakhalin’s commercial environment and highlights how it acted as animpediment to the development of Hokkaido’s trade and investment ties withSakhalin. The chapter concludes with an examination of perhaps the only area inwhich interregional economic relations flourished: the trade in fish and marineproducts and how this trade impacted on attempts to resolve the territorialdispute. The concluding chapter sums up the findings and discussions and thenexamines briefly how Vladimir Putin’s federal reforms have diminishedSakhalin’s authority over the South Kuril Islands.

Introduction 19

1 Tokyo, Moscow and the disputed islands

IntroductionIn one of the strangest anomalies in international relations today, Japan andRussia have yet to sign a peace treaty and relations between the two countrieshave not been fully normalised, although more than six decades have passed sincethe end of the Second World War. The primary reason for the stalemate inbilateral relations is a dispute over the ownership of a group of islands, known tothe Russians as the South Kuril Islands and to the Japanese as the NorthernTerritories (Hopp™ Ry™do), which the Soviet Red Army seized during the closingstages of the Second World War. The Japanese government has consistentlyargued that it is willing to conclude a peace treaty only if Russia agrees to returnthe four islands. For its part, Russia has steadfastly refused to transfer all fourislands to Japan.

This chapter provides a broad overview of the fundamental principles andapproaches of Japan’s post-Cold War Russia diplomacy, as well as Russia’spolicy towards Japan and the Northern Territories/South Kuril Islands. Thisprovides a frame of reference from which to address the study’s supplementaryresearch questions pertaining to the extent to which Hokkaido–Sakhalinsubnational government relations and Sakhalin’s position regarding the territorialdispute during the 1990s was congruent with the respective central governmentpolicies. In order to gain a better understanding of Japan’s policy towards Russia,the chapter first explores why the Japanese government has been so steadfast inits demand for the Northern Territories’ return, highlighting the islands’ symbolicimportance to Japan. As Chapters 4, 5 and 6 examine the reasons behind theSakhalin regional elite’s and public’s opposition to transferring the islands toJapan, it is not necessary to consider the islands’ importance to Russia in thischapter. It then examines how the Japanese government and public, as a whole,have internalised the attachment to the four islands through a process ofsocialisation, paying particular attention to Hokkaido’s role in this process.

This chapter argues that the linkage of politics and economics is an importantelement among the underlying principles behind Japan’s policy towards Russia.The Japanese government has gradually loosened this linkage, which hasinfluenced the level of economic aid towards Russia, as well as the issue

surrounding joint ventures on the disputed islands, but not severed it completely.It also contends that in the face of a feared backlash from conservative andnationalist opponents, Boris Yeltsin adopted a strategy of postponing theterritorial dispute’s resolution. Most of his promises to Japan were subsequentlytactical in nature, designed to achieve this broader objective, as well as economicand geopolitical goals.

Japan’s Russia diplomacy

Political objective: Demand for the return of the Northern Territories

Economic significance

It is widely acknowledged that the four islands of Etorofu, Kunashiri, Shikotanand Habomai (which are in fact a group of islets) would be of little economicimportance to Japan. They have no petroleum potential, and while Etorofu andKunashiri are forested and contain deposits of tin, zinc, lead, copper, nickel,sulphur and metallic sulphides, taken as a whole, the disputed islands would onlymarginally supplement Hokkaido’s mineral and lumber resources (Akaha andMurakami 1993: 168–9). Because of the physical geography of the islands andtheir extremely poor infrastructure, these resources would be extremely difficultand costly to exploit. In 1990, Japanese economist Ohmae Ken’ichi estimatedthat a public works investment programme large enough to bring facilities on theislands up to the same level as those on Hokkaido might cost each Japanesetaxpayer 60,000 yen (about US$500) (Quinn-Judge et al 1990: 30). Given that theislands’ physical infrastructure has drastically deteriorated in recent years – mostnotably following a powerful earthquake in October 1994 – this figure would bynow almost certainly be much higher.1

The islands’ greatest economic value lies in the maritime area over whichJapan could claim jurisdiction were it to secure their return (Kimura and Welch1998: 218). The Northern Territories’ exclusive economic zone (EEZ) totals196,000 square kilometres and is blessed with abundant marine resources. It issaid to be one of the world’s three great fishing grounds, containing the spawninggrounds for several commercially viable fish species. It is also thought to containexploitable deposits of titanium, magnetite, nickel, copper, chromium, vanadiumand niobium (Akaha and Murakami: 1993: 168–9). The Pacific EEZ of Shikotanand Habomai is more significant in this regard, being larger and much richer thanthat of the bigger islands (ibid.: 169). Although the rich fishing grounds arecertainly attractive to Japan, Japanese fishers, using fast and sophisticated vesselsare, for the most part, able to enter the islands’ fisheries at will. It is thereforedoubtful that Japan’s desire to recover the islands is based solely on economicconsiderations.

Tokyo, Moscow and the disputed islands 21

Strategic significance

During the 1970s and 1980s, the Soviet military considered the islands to be ofvital strategic importance. They were militarised during this period in response tonew developments in strategic deterrence, and also as a means of applyingpressure on Japan for concluding a Peace and Friendship Treaty with China in1978 – a move that heightened fears in Moscow of an emerging strategictriumvirate among the United States, Japan and China aimed at curbing Sovietinfluence in the Asia-Pacific region. The Sea of Okhotsk, along with the BarentsSea, served as the two bastions protecting Soviet submarine-launched ballisticmissiles (SLBM) submarines from American antisubmarine warfare operations,thus helping to guarantee Soviet second-strike nuclear capability. The islandsstraddle important access routes from the Sea of Okhotsk to the Pacific Ocean.Japanese military officials have maintained that the islands are strategicallyimportant. However, as Masato Kimura and David Welch note, their reasoninghas been entirely derivative of Soviet arguments. In other words, Japaneseofficials regarded the islands as strategically significant only because the Sovietsdid (1998: 222). Possession of the islands would not have affected Japan’s abilityeither to defend itself or to project its military power beyond its borders. In fact,the Northern Territories dispute’s unresolved nature may have served Japan’spolitical interests. William Nester argues that Tokyo had long used the territorialdispute as a concrete threat to justify to the Japanese people the military alliancewith the United States and the role of Japan’s Self Defence Force (1993: 723).2The islands’ strategic value has diminished since the end of the Cold War. Thishas been reflected in successive Japanese Defence White Papers, which, since1995, have deleted past references to the Northern Territories straddlingimportant access points into the Sea of Okhotsk.

Symbolic importance

Rather than having any significant tangible value, the Northern Territories appearto be of symbolic importance. The value which the Japanese place on the islandsis expressed by Kimura Hiroshi, Graham Allison and Konstantin Sarkisov whobelieve ‘the continued [Russian] occupation of the four islands forces Japanese toremember forever the pitiful defeat in the Second World War, and also [toremember] that a noticeable portion of Japan’s limited land has been taken’(1993: 33). The ‘pitiful defeat’ these three scholars speak of is a direct referenceto the Soviet Union’s declaration of war against Japan during the closing stagesof the Second World War. The Soviet declaration of war against Japan on 9August 1945 was a violation of the 1941 Neutrality Pact and came at a time whenJapan was actively seeking peace with its northern neighbour. The Soviet troops’occupation of the Northern Territories commenced on 28 August and wasconcluded on 5 September 1945 (Slavinsky 1992: 56). This was a full three daysafter representatives of Japan and the Allied powers signed documents formallyproclaiming Japan’s surrender. During the Soviet attack, 640,000 Japanese

22 Tokyo, Moscow and the disputed islands

soldiers and civilians were taken prisoner and interned in Siberian prison camps.Of this number, approximately 60,000 perished as a result of harsh weather andlabour conditions (see Panov 1992: 115). Most Japanese internees were notrepatriated until 1948. As a result of these actions, Japanese perceived the SovietUnion as a kajiba dorob™, a thief who steals when somebody else’s house is onfire (Hasegawa 1987: 50).

Tsuyoshi Hasegawa further emphasises the Northern Territories problem’spsychological dimension, claiming that the Soviet attack on Japan and thedropping of the atomic bomb on Hiroshima are the only two events during thewar that left the Japanese with a feeling of victimisation (1994: 333). TheJapanese claim to the Northern Territories is rooted in a deeply held belief aboutthe injustice of the Soviet/Russian occupation and the legitimacy of the Japaneseclaim to the four islands. This perception of the injustice and illegitimacy of theSoviet/Russian occupation has both a historical and a legal basis.3 However,studies by Hara (1998) and Wada (1999) reveal that until at least the early 1950sthe MOFA recognised Etorofu and Kunashiri as a part of the Kuril Islands overwhich Japan renounced sovereignty in the 1951 San Francisco Peace Treaty,suggesting that the historical claim over all four islands has greater credence thanthe legal one. Japan’s legal claim to Shikotan and especially to Habomai, basedon the argument that these islands are an extension of Hokkaido’s Nemuropromontory, is more convincing. The desire to rectify this perceived injustice hasmade Japanese decision makers less willing to compromise in finding a solutionto the dispute and less tolerant of the territorial gains of the Soviet Union/Russiaas they regard them as illegitimate (Welch 1993: 31).4

In addition to rectifying the perceived injustice that Russia’s continuedoccupation of the Northern Territories has caused, it is also thought that thedemand for the islands’ return is broadly linked to a Japanese sense of identity.According to Kimura and Welch:

The Japanese sense of identity included the Northern Territories. Japan willnot be complete, and the Japanese will not feel themselves fully to be mastersof their own homeland, until the foreign occupation ends, or until theJapanese cease to think of the islands as an intrinsic part of Japan.

(1998: 232)

In fact, it has been argued that the Northern Territories are regarded as such anintrinsic part of Japan and that the issue has become so entrenched in the Japaneseconsciousness that a ‘Northern Territories Syndrome’ (Hopp™ Ry™do Sh™k™gun)has developed (Hasegawa 1992: 86–97; Rozman 1992: 12). The four islands’return is seen as the aspiration of the entire nation, with the issue being elevatedto the pedestal of an unquestioned national goal (Hasegawa 1994: 331). To acertain extent, survey data support these claims. For instance, in a poll conductedin February 1993, 86.7 per cent of Japanese respondents agreed that Russiashould return the Northern Territories (Shadan H™jin Chuø™ Ch™sasha 1993). As

Tokyo, Moscow and the disputed islands 23

the issue concerning the Northern Territories’ ownership has virtually no impacton the material lifestyles of the overwhelming majority of Japanese citizens, theycan remain supportive of the four-island claim without having to pay anysignificant opportunity cost. However, as will be discussed shortly, the territorialdispute does directly affect the economic wellbeing of a number of people innorthern and eastern Hokkaido, particularly local fishers, whose resolve to see allfour islands returned to Japan has weakened somewhat. It should also be notedthat the nationwide campaign for the Northern Territories’ return did not get intoits stride until what had been Japan’s most important territorial problem wasresolved with the return of Okinawa in 1972.

There is a consensus among politicians, regardless of political persuasion, thatRussia should return the four disputed islands. This consensus was first expressedin September 1973, in the form of a Diet resolution, which was co-sponsored byall political parties, calling on the government to demand the NorthernTerritories’ return (Asahi shinbun evening, 20 September 1973: 1). In fact, formany years the opposition parties took a tougher stance than the Japanese LiberalDemocratic Party (LDP) on the Northern Territories issue. The Japan CommunistParty (JCP) and the Japan Socialist Party (JSP, from 1996 the Social DemocraticParty) continuously called for the entire Kuril Island chain’s restoration.However, just prior to Gorbachev’s visit to Japan in April 1991, the JSP shiftedits support to the reversion of the four islands (Asahi shinbun, 7 April 1991: 4).The Clean Government Party (K™meit™) and the Democratic Socialist Party alsoshifted their positions in May 1991 (ibid.), leaving the JCP as the only party thatstill adheres to the ‘all-Kuril claim’.

Masato Kimura and David Welch argue that ‘Even a [Japanese] leader whowas personally indifferent to the return of the islands would have a strongelectoral incentive to pursue the claim if he or she valued high office, and wouldpay a high electoral price by abandoning it’ (1998: 238). The 1955–6 peace treatynegotiations with the Soviet Union illustrate how previously some contendingpoliticians have attempted to use resolution of the Northern Territories dispute asa fulcrum to lever their political fortunes. During the third round of negotiationsin Moscow, Foreign Minister Shigemitsu Mamoru contradicted his previousassertion that the conclusion of a peace treaty was possible only if the Sovietsreturned all four islands when he abruptly changed his mind and declared that hewould settle for the return of only Shikotan and Habomai. It is widelyacknowledged that he made this compromise believing that a successfulconclusion of a peace treaty with the Soviet Union would heighten his chances ofbecoming the next prime minister after Hatoyama Ichir™’s retirement (deVillafranca 1993: 614). Shigemitsu was thwarted, however, by the spoilingactivities of Secretary of State John Foster Dulles, who suggested the US mightnot return Okinawa if Japan made concessions to the Soviet Union on theNorthern Territories. Prime Minister Hatoyama, who announced that he wouldretire after bilateral relations were normalised, was eager to conclude a peacetreaty with the Soviets, believing this would give him a diplomatic victory to

24 Tokyo, Moscow and the disputed islands

match that of his rival Yoshida Shigeru (prime minister at the time of the signingof the 1951 San Francisco Peace Treaty), and also allow him to end his politicalcareer on a high note (hanamichi) (Saito 1993: 278). There was speculation thatHashimoto Ryuø tar™, whose approval rating had slumped to record lows in opinion polls in late 1997 and early 1998, reflecting growing frustration over hiseconomic policies, may have been searching for a breakthrough in relations withRussia to shore up support for his embattled administration (Asahi shinbun,20 April 1998: 2).

Although Japanese politicians may indeed risk the wrath of their electorate forabandoning the claim for the return of all four islands, a voter backlash arisingfrom the adoption of a more realistic and flexible approach to recovering theNorthern Territories is not as severe as one is otherwise led to believe. This isillustrated by the involvement of former LDP lawmaker Suzuki Muneo in Japan’sRussia policy. Japan’s long-standing negotiating position has been thesimultaneous return of all four islands (ikkatsu henkan). Japanese public opinionappears to favour this policy, although support for it differs according to agegroup.5 However, as discussed below, the government has shown some flexibilityin recent years regarding the timing, modalities and conditions of the islands’return as long as Moscow confirms Japanese sovereignty over all four of theislands. Believing that an all or nothing approach regarding the recovery of theNorthern Territories was unproductive, Suzuki proposed that negotiations on thereturn of Habomai and Shikotan be separated from those on Etorofu andKunashiri. Under this ‘return of two islands first’ approach (nit™ senk™henkanron), the Japanese government would seek from Russia confirmation ofthe validity of the 1956 Joint Declaration. Using this as a lever, the governmentwould then urge Russia to return Habomai and Shikotan and continuenegotiations over Etorofu and Kunashiri (Hasegawa H. 2001: 15).6

Suzuki sought to reverse Japan’s previous policy, finding an ally in the then-Director-General of the Ministry’s European Affairs Bureau, T™g™ Kazuhiko.Prime Minister Mori Yoshir™ was believed to have supported the two-stepapproach in the hope that success would help bolster his cabinet’s popularity,although he reportedly pressed Russian President Vladimir Putin for the return ofall four islands during the Irkutsk summit in March 2001 (Yomiuri shinbun,8 April 2001: 1). Both Suzuki and T™g™ went to considerable lengths to carry outthis objective, conspiring to eliminate key opposition from within the MOFA.This is believed to be the reason behind the decision to move the Director of theRussian Desk and proponent of the four-island formula, Kodera Jir™, from hisposition to a post at Japan’s London Embassy.7 The Suzuki–T™g™ line caused anoutcry in Japan, particularly from the mass media, which claimed that it wassending the signal that Japan was willing to compromise with the return of justtwo islands (Yomiuri shinbun, 21 May 2001: 3). A subsequent proposition fromPutin that Russia might be able to do a deal for the return of only Habomai andShikotan suggests that this was precisely the message that was received.Unfortunately, the problem for Suzuki and T™g™ was that Tanaka Makiko, foreign

Tokyo, Moscow and the disputed islands 25

minister in the newly inaugurated Koizumi administration, also held the opinionthat Russia should return the four islands simultaneously and ordered Koderaback to Japan as a means of reinforcing the message that Japan would maintainits long-standing four-island negotiating position (Yomiuri shinbun, 9 May 2001: 2).

Suzuki was forced to resign from the LDP in March 2002 over his involvementin a series of scandals, including allegedly rigging bids for government-fundedaid projects in the Northern Territories in favour of contractors from his ownconstituency in Hokkaido. The Japanese mass media were quick to scrutiniseSuzuki’s interference in a variety of MOFA affairs, particularly his enunciation ofthe ‘two islands first’ approach to resolving the territorial dispute, but it is notablethat there was very little discernible criticism from his own electorate, which, itshould be added, includes Nemuro – the frontline in the Northern TerritoriesReturn Movement. It is difficult to imagine that Suzuki would publicly putforward a proposal that was at odds with the majority view of his constituency. Itis even possible to surmise that Suzuki was merely conveying the wishes of thepeople in eastern Hokkaido. Suzuki does not appear to be unique in this regard.Yokomichi Takahiro revealed during an interview with the author (21 February2001) that while he publicly called for the four islands’ simultaneous return, heprivately informed the government that there were people who believed thatJapan should get Russia to return two islands if the opportunity arose. HoriTatsuya believed Russia should return the four islands simultaneously (Hokkaid™shinbun, 9 June 1999: 3). In a notable policy shift, Nemuro Mayor, FujiwaraHiroshi, citing ‘non-return fatigue’ (mihenkan hir™), stated in June 2006 thatwhile he could not renounce Japanese sovereignty over the four islands, he wouldaccept the ‘two islands first’ policy as a means of breaking the impasse over theterritorial dispute (Hokkaid™ shinbun, 28 June 2006).

Hokkaido and the Northern Territories

The Northern Territories dispute casts a long shadow over economic, political andsocial life in Hokkaido. Before the Second World War, the islands wereadministered as political subdivisions of Hokkaido. Shikotan and the Habomaiislets formed part of the Hanasaki district in Nemuro County, and Kunashiri andEtorofu were separate administrative districts.8 In the event that the NorthernTerritories, which the head of the Nemuro municipal government’s NorthernTerritories Countermeasures Office, Maruyama Kazuyuki, described during aninterview with the author (10 May 2000) as being akin to an ‘economic brother’to Hokkaido, are transferred to Japan, they would most likely be placed underHokkaido’s administrative control.9

The human tragedy of the Northern Territories dispute is evident in Hokkaidoto a greater extent than in any other Japanese region. According to officialJapanese figures, by 15 August 1945, the day Emperor Hirohito announcedJapan’s acceptance of unconditional surrender, there were 17,291 Japaneseresidents living on the four islands.10 Six months after the establishment of

26 Tokyo, Moscow and the disputed islands

Sakhalin oblast, the Soviet government decided to repatriate all remainingJapanese residents of the islands in July 1947. This process was completed by1949, with 80 per cent of those repatriated settling in nearby Hokkaido. Manycame back with shocking stories of theft, personal assault and depredation at thehands of Soviet troops, which would form the basis of distrust and enmitytowards the Soviets for many years to come. For many repatriates, Hokkaidoseemed a logical choice for resettlement; they thought their repatriation would bebrief and that they would be able to return to their former homes once thesituation had stabilised and the issue concerning the islands’ ownership wasresolved. In preparation for an early return, many even kept records of propertyand other assets they were forced to leave behind in the archives of the regionalbranch of the Justice Bureau in Kushiro (Hokkaid™ shinbun, 17 April 1989: 1).

The campaign for the Northern Territories’ return began as early as 1December 1945 when the Mayor of Nemuro, And™ Ishisuke, sent a petition to theSupreme Commander of Allied Powers (SCAP), General Douglas MacArthur,stating that the islands south of (and including) Etorofu had long been Japaneseterritory and appealing for SCAP to adopt measures to ensure the islands’Japanese residents could lead a safe life (Hokkaid™ S™mubu Hopp™ Ry™doTaisaku Honbu 1999: 8). Although MacArthur did not take up And™’s petition, itbecame the trigger for the establishment of an organisation in Nemuro centringon the Japanese repatriates, the Committee to Request the Reversion of theIslands Near Hokkaido (Hokkaid™ Fuzoku T™sho Fukki Konsei Iinkai) in early1946 (Arai S. 1983: 119). In addition to the barriers to returning home, the Sovietoccupation of the Northern Territories also meant the loss of rich fishing grounds,upon which the local economy was (and still is) highly dependent. As a result,citizens established organisations calling for the islands’ return and the irredentistcampaign gradually expanded. These organisations included the League for theDevelopment of the North Sea Fisheries (Hopp™ Gyogy™ Kaihatsu Kisei D™mei),based in Hakodate, and the League to Request the Return of Karafuto andChishima (Karafuto Chishima Henkan Konsei D™mei), which was established inSapporo.

In order to bring these disparate groups together into a unified and powerfulorganisation that could better present its case to the rest of the nation and theworld, the League for the Return of Chishima and the Habomai Islands (Chishimaoyobi Habomai Shot™ Henkan Konsei D™mei) was established in November1950. The League was renamed the Japan League for the Return of NorthernTerritories Inc. (Hopp™ Ry™do Fukki Kisei D™mei) in 1963. In 1965, the League,which also receives support from the Hokkaido City Mayor’s Association,Hokkaido Town and Village Mayor’s Association, business and academic groups,as well as the mass media, received approval from the MOFA to become anincorporated association (shadan h™jin), providing it with a legal basis andsubsequently an enhanced opportunity for social recognition (Shadan H™jinHopp™ Ry™do Fukki Kisei D™mei 1993: 10). Other groups centring on the formerJapanese islanders were also established. These united in 1955 to become the

Tokyo, Moscow and the disputed islands 27

League of Residents of the Chishima Islands (Chishima Rett™ Kyojuøsha Renmei),which also obtained the status of incorporated association in 1958 (Shadan H™jinChishima Habomai Shot™ Kyojuøsha Renmei 2000: 3).

There are numerous visible signs of support for the Northern TerritoriesReturn Movement in Hokkaido. A large banner over the entrance to the HPGbuilding urges visitors that ‘returning the four islands will build trust and peace’(shinrai to heiwa o kizuku yont™ henkan). A similar banner appears over theentrance of its Tokyo office. Several other municipalities in Hokkaido also featuresigns and banners calling on the Russians to return the four islands. Nemuro, thespiritual home and frontline in the Northern Territories Return Movement, isdotted with such adornments.

A Hokkaido governor often makes a public statement of support for the fourislands’ reversion soon after taking up office. In his first address to the HPA inJuly 1983 following his victory in the April gubernatorial election, making him,at the time, Japan’s youngest-ever governor, Yokomichi emphasised that hewould propose a four-island return, thus distancing himself from the JSP’sposition of demanding the return of the entire Kuril chain (Hokkaid™ shinbun,5 July 1983: 1). As his later acceptance of the hinomaru and kimigayo as Japan’snational flag and anthem demonstrates, Yokomichi would not be a prisoner tosocialist policies. D™gakinai Naohiro, who served as governor from 1971 to 1983,was particularly active in the irredentist movement, taking up an official positionin both the Japan League for the Return of the Northern Territories and the Tokyo-based Northern Territories Issue Association (Hopp™ Ry™do Mondai TaisakuKy™kai) after leaving office. He even wrote a book entitled Hopp™ Ry™do HenkanUnd™ to Watashi (The Northern Territories Return Movement and Me), whichdescribed his relationship with the return movement and his own theory forrealising a reversion of the Northern Territories (2000). Since 1947, the HPA hasconstantly appealed to the central government and the Diet by adopting a‘statement concerning the campaign for the reversion of the Northern Territoriesand the promotion of a resolution of the Northern Territories dispute’ and otherresolutions almost every year.

The HPG’s assistance to the Northern Territories Return Movement goesbeyond the boundaries of symbolism. Institutional support was first put in placewith the establishment of the Headquarters for the Return of the NorthernTerritories and North Sea Fisheries (Ry™do Fukki Hopp™ Gyogy™ Taisaku Honbu)located in the Department of General Affairs on 28 February 1956.11 The HPG’sdecision to establish the Headquarters was a response to positive signs emergingfrom the Soviet–Japanese peace treaty negotiations, which began in June 1955,of an early resolution to the territorial dispute. The Headquarters was chargedwith collecting and preparing data for the drawing up of regional constructionplans in the event the islands were returned to Japan. It was also tasked withstudying the situation pertaining to the islands’ former Japanese residents, as wellas fostering and guiding the organisations comprising the Northern TerritoriesReturn Movement. The Headquarters’ organisational structure was consolidated

28 Tokyo, Moscow and the disputed islands

in order to keep up with the changing situation surrounding the territorial disputeand in 1984, was renamed the Northern Territories CountermeasuresHeadquarters (Hopp™ Ry™do Taisaku Honbu). A Special Committee on theNorthern Territories (Hopp™ Ry™do Taisaku Tokubetsu Iinkai) was established inMarch 1968 and has been active in promoting the campaign for the NorthernTerritories’ reversion and in supporting former residents. The HPA also has aspecial Northern Territories Countermeasures Committee (Hopp™ Ry™do TaisakuTokubetsu Iinkai), which addresses various issues involving the territorial returnmovement.

The HPG constantly lobbies Tokyo to intensify diplomatic negotiations in abid to achieve the four islands’ return. The Hokkaido governor regularly heads adelegation comprising members of the Northern Territories Return Movement,which visits the prime minister to petition for the territorial dispute’s earlyresolution. However, as noted previously, being fully cognisant of the politicalbenefits derived from achieving the four islands’ return, a Japanese primeminister probably needs little prompting in this regard. Hokkaido’s efforts atarousing public interest in the Northern Territories dispute have not been confinedto domestic boundaries. Missions led by regional and municipal officials havebeen sent to the United States, United Nations, Europe, Southeast Asia and Russiain a bid to win international support for Japan’s position.

In addition to its demand that the Japanese government intensify diplomaticnegotiations for the territorial dispute’s early resolution, the HPG has alsodeveloped an internal variant of kanky™ seibi.12 An important part of this policyis to unite domestic public opinion around the claim for the four islands’ return.It has adopted several measures in order to achieve this. The HPG providesassistance and also lobbies Tokyo for additional financial support for the variouspublic relations activities conducted by the organisations comprising theNorthern Territories Return Movement. These activities include exhibitions,signature-drives (by June 1999, nearly 70 million had been collected) and a‘caravan force’ consisting of the descendants of the islands’ former residents andother young people, which travels throughout the country to enlighten peopleabout Japan’s claims to the Northern Territories and to recruit successors to thereturn movement (Hokkaid™ S™mubu Hopp™ Ry™do Taisaku Honbu 1999: 8). Thepreceding discussion illustrates Hokkaido’s attempts to influence the centralgovernment’s decision-making process from within – one of two forms ofdeliberate subnational government participation in international relationsoutlined in the introduction.

As the frontline in the campaign for the Northern Territories’ return, Nemuro’sfinancial viability has been an important issue for local, regional and centralauthorities who fear that an economically induced weakening of the localirredentist movement could have serious repercussions for the nationwidecrusade to regain the lost islands. These fears appear to be well founded. Publicopinion polls conducted in the past by the Hokkaid™ shinbun show that althougha majority of Hokkaido’s residents support the demand for the four islands’

Tokyo, Moscow and the disputed islands 29

return, over 10 per cent of respondents would renounce claims to the islands inreturn for fishing rights in the islands’ fisheries (cited in Wada 1990: 308).Surveys also reveal that although an overwhelming majority (80 per cent) ofHokkaido residents believed Japan should continue to demand the four islands’return, nearly half were in favour of a two-island solution if it left open thepossibility of a later return of Etorofu and Kunashiri (Hokkaid™ shinbun,1 January 1989: 1). Support for an initial return of two islands continued into theearly 1990s. By 1993, only 21.9 per cent of Hokkaido residents surveyedexpressed support for the four islands’ instantaneous return (Hokkaid™ shinbun,7 October 1993: 4). A similar poll conducted in Nemuro city shows that over halfthe respondents support a return of only two of the disputed islands (cited inWada 1990: 308). Moreover, officials from Nemuro’s fishing cooperatives have,in the past, made public calls for the Japanese government to be realistic andsettle for a return of only two islands (Habomai and Shikotan) as a way to breakthe impasse over the territorial dispute (Kurokawa 1980: 3). This would givelocal fishers access to the abundant marine resources in the islands’ fisheries.Indeed, it was a feeling of relief over the enhanced prospect of being able torecommence fishing operations in these abundant waters that was the prominentresponse among many Nemuro residents to news of the signing of the 1956 JointDeclaration (Hokkaid™ shinbun, 20 October 1956: 3). Local fishers’ calls for thegovernment to prioritise their plight over the four islands’ reversion under theslogan of ‘fish rather than land’ (ry™do yori sakana), which demonstrates that notall Japanese suffer from the ‘Northern Territories Syndrome’, have heightenedtensions with those groups devoted to lobbying for the four islands’ return.

It is largely for this reason that the HPG also lobbies Tokyo to expand andstrengthen support measures for the Northern Territories’ former residents,including arranging visits to ancestral graves on the islands and providingcompensation for former fishing rights lost as a result of the Russian occupation.The prefectural government, in close cooperation with the central government,also promotes various measures for economically developing the region adjacentto the disputed islands (one city and four towns in Nemuro County) andstabilising the residents’ living standards.13 Its location adjacent to the NorthernTerritories and subsequent role in the return movement has been described asNemuro’s ‘trump card’ for extracting financial assistance from the regional andcentral governments (Hokkaid™ shinbun, 2 February 1988: 2). Although thisassistance has been generous, it has proven to be insufficient for many localfishers, whose economic well-being depends on access to the islands’ fisheries,forcing them to engage in clandestine activities, discussed in greater detail inChapter 6, in order to earn a living.

30 Tokyo, Moscow and the disputed islands

Politics and economics: To link or to de-link

Seikei bunri

For resource deficient Japan, the abundance of natural resources in theneighbouring Soviet/Russian Far East has for decades served as a beacon toJapanese policymakers and the business community, underpinning argumentsabout the economic complementarity that exists between the two countries andthe subsequent calls for closer trade relations. Throughout the 1960s and 1970s,as with its foreign trade policy towards China, Japan attempted to sustain a formalseparation between politics and economics (seikei bunri). In fact, the impact of‘politics’, or more precisely the Northern Territories problem, on bilateraleconomic relations was quite minimal prior to the 1980s.14 Prior to PrimeMinister Tanaka Kakuei’s meeting with Soviet leader Leonid Brezhnev inMoscow in October 1973, both he and Foreign Minister ïhira Masayoshi madea special point of clearly separating the issue of Japanese participation in theTyumen oil development project from the question of the northern islands’ return(Curtis 1977: 157). The territorial dispute featured in discussions but took a backseat to the interest in oil development projects brought about by the first OilShock. The overriding importance attached to Siberian oil development projectsas a means of diversifying Japanese dependence on the Middle East and the‘majors’ for its oil supply is clearly evident in the decision to impose economicsanctions on the Soviet Union in the wake of its 1979 invasion of Afghanistan.Fearing it could adversely affect existing projects, the ïhira cabinet decided tocut funding to new projects only (Asahi shinbun, 7 January 1980: 2).

Seikei fukabun

From the mid- to late-1980s, in attempts to emerge from the economic stagnationand ‘technology gap’ of the Brezhnev era, the Soviet Union sought Westerntechnology, capital and intellectual know-how. The economic upheaval broughtabout by Gorbachev’s reform policies further strengthened the Soviet Union’sdesire for closer economic relations with the West. The hard-line MOFA saw thisas an opportunity and attempted to use this desire for economic cooperation as alever to extract Soviet concessions on the territorial dispute (Carlile 1994: 421).Japanese economic cooperation thus became contingent upon progress in theNorthern Territories dispute. The rationale behind the inseparability of politicsand economics (seikei fukabun) was that once Japan provided the Soviet Unionwith substantial economic aid and investment, the Soviets would have littleincentive to return the islands, thus making reversion virtually unobtainable.

Kakudai kink™

Adopting the seikei fukabun policy, however, did not improve Japan’s bargainingposition vis-à-vis the Northern Territories and only succeeded in raising tensions

Tokyo, Moscow and the disputed islands 31

with the Soviets. There was also opposition in Hokkaido to this policy. GovernorYokomichi spoke out against seikei fukabun, believing that, as far as creating anenvironment conducive to recovering the islands was concerned, stability inRussia and mutual trust and cooperation were far more important than adheringto this intransigent policy (Hokkaid™ shinbun, 7 August 1993: 4; Yokomichi1995: 204). Public opinion in Hokkaido supported Yokomichi’s position.15

Cognisant of the need to at least give the impression of a shift in its policytowards Moscow, in the late 1980s, the Japanese government announced it wouldpursue a policy of ‘enlarged balance’ or ‘expanded equilibrium’ (kakudai kink™).In the words of the person who is said to have coined the term, former Directorof the MOFA’s Soviet Desk, T™g™ Kazuhiko, the policy’s essence is: ‘Rather thanhaving a situation where, if there is no movement on the territorial issue, therewill be no movement in other fields (namely economics)’, a more positiveapproach is taken where, ‘there will be movement on the territorial issue and alsoin other fields’ (T™g™ 1993: 24). As T™g™’s description suggests, the primary aimof expanded equilibrium was a simultaneous improvement in both political andeconomic fields. It was seen as a sort of ‘middle way’ between the intransigententrance approach and exit approaches the Russians have espoused (Kimura1992: 82).16 In what is perhaps a more accurate and realistic description, the coreof ‘expanded equilibrium’ was that Japan would give humanitarian,technological, intellectual and financial aid to the Soviet Union in proportion tothe degree of settlement reached on the Northern Territories issue. Theimplication of this policy was that Tokyo would not provide massive financial aidto Moscow unless some sort of agreement on the territorial dispute was reached(Saito 1993: 285).

Despite the change in official policy, doubts emerged, particularly withinacademic circles, as to whether this really marked the beginning of a newapproach towards Moscow. Nobuo Arai and Tsuyoshi Hasegawa claimed that ‘Byadopting the policy of “expanded equilibrium”, the Foreign Ministry neverrepudiated the policy of the “inseparability of politics and economics”. Therefore,the demand for the return of the “Northern Territories” continues to be thefoundation of Japan’s Russian policy (1997: 176).17 Since the level of economiccooperation was still largely determined by the degree to which Russia respondedto the Northern Territories dispute, it would appear that the change to the policywas in name only. Tokyo loosened the linkage between politics and economics,but this was only a slight modification intended to fulfil the ultimate politicalobjective of recovering the Northern Territories (Kimura 1999: 234).

From ikkatsu sokuji henkan to nidankai henkanron

The Miyazawa administration showed some flexibility when it repudiated thetraditional approach of demanding ‘the immediate return of all [four] islands’(ikkatsu sokuji henkan) and announced it would accept ‘a two-stage formula’(nidankai henkan ron) for resolving the dispute: the initial return of two islands

32 Tokyo, Moscow and the disputed islands

(Shikotan and the Habomai islets), and then the remaining two at a later date(Kimura 1992: 81). Japanese acceptance of the two-stage approach, however, waspreconditioned upon Moscow’s initial recognition of Japanese sovereignty overthe four islands. This shift was prompted by changes in Moscow’s attitude andpolicy towards Tokyo. Important among these was Boris Yeltsin’s recognition ofthe territorial dispute’s existence, which was mentioned in his controversial ‘five-stage plan’, his calls for its resolution to be based on the principles of ‘law andjustice’ (zakonnost' i spravedlivost') and a number of other statementsproclaiming the importance of bilateral relations, as well as describing Japan as a‘de-facto ally’ (Williams 1998: 2). Since the Miyazawa government’s demise inJuly 1993, successive administrations have claimed that as long as Moscowconfirms Japanese sovereignty over all four of the disputed islands, Tokyo will beflexible over the timing, modalities and conditions of their return. Althoughdifficult and indeed politically courageous, a more flexible and compromisingapproach would be the Japanese government’s renunciation of its claims over twoof the islands (presumably Etorofu and Kunashiri). However, for the reasonsoutlined above, Japan’s political elite has never seriously contemplated this.

‘New Thinking’ emerging from within the MOFA

The MOFA’s former Soviet Desk (Sorenka) had been described as ‘the fortressfor opposing [former] Soviet designs on Japan’ and a site where ‘an intenselyadversarial relationship (with the [former] Soviet Union) has prevailed’ (Rozman1992: 30–1). Officials in the Sorenka were considered strong proponents of theYoshida Doctrine and had taken a hard-line stance towards the Soviet Union andits successor the Russian Federation, opposing the expansion of economic ties inthe absence of a settlement to the territorial dispute.

However, despite its long-standing recalcitrance, signs of an emergingmoderation began to appear within the MOFA in the mid-1990s. The continuingcycle of promotions and reassignments within the MOFA appeared to haveprovided an opportunity for a relatively reform-minded group to dominateRussian-related posts. In the latter half of 1996, T™g™ Kazuhiko was appointeddeputy director general (shingikan) in the Eurasian Department. Along with thethen Director of the Russian Desk, Shinoda Kenji, he made efforts to bring aboutchanges in Japan’s Russia policy (Wada 1998: 28). The first sign that the MOFAmight be softening its stance was seen in 1996, the fortieth anniversary of therestoration of diplomatic relations with the Soviet Union. To commemorate theoccasion, the MOFA published two pamphlets in Russian titled ‘Japan andRussia: For True Mutual Understanding’. The pamphlets referred to ‘the legacyof past losses’, but they did not mention the Soviet Union’s participation in thewar against Japan and also made no assertion that Etorofu and Kunashiri did notbelong to the Kuril Island chain (ibid.). These statements have consistentlyappeared in previous government publications relating to the territorial dispute.18

In a further reflection of the ‘new thinking’ emerging from within the MOFA, an

Tokyo, Moscow and the disputed islands 33

official, writing under the pseudonym X, wrote a series of articles in the right-wing Sankei shinbun. One of the articles stressed that the most important thingfor Japan to consider was not just regaining the Northern Territories, but how itwould associate with Russia heading into the twenty-first century. It also madethe point that the territorial dispute was just one problem requiring consideration(Sankei shinbun, 4 December 1996: 3).

Juøs™teki approach

The ‘new thinking’ that emerged from within the MOFA was soon reflected in amuch-touted policy shift. In belated recognition that a lack of progress on theNorthern Territories dispute need not hinder the development of bilateral relationsin other fields, in early 1997, the Japanese government decided to broaden thespheres of cooperation to be discussed and promote diverse negotiations with theRussians (Hasegawa 1998: 504). This became known as the ‘multilayered’(juø s™teki) approach. The seven areas of cooperation to be developed under thisnew approach included peace treaty negotiations focusing on the NorthernTerritories dispute, political dialogue between both countries’ leaders and cabinetministers, cooperation with Russia’s economic reforms, exchanges with theRussian Far East, security talks, international affairs and consultations overstability in Northeast Asia (Yomiuri shinbun, 4 January 1997: 1). Concerning thenew policy, Tsuneo Akaha noted that if the interpretation was correct,‘Russian–Japanese ties in economic and other fields may be allowed to growahead of progress on the territorial issue … it represents a paradigm shift inJapan’s policy towards Russia’ (1999: 71). Expanding cooperation would alsocontribute to reducing the animosity and distrust that has characterised relationsbetween the two peoples in the past and (for the Japanese) perhaps have the addedeffect of creating a favourable environment for resolving the territorial dispute.The explicit reference to promoting ties with the Russian Far East, in particular,should be seen in this light.19

Hashimoto’s three principles and border demarcation proposal

The multilayered approach was reinforced during a speech by Prime MinisterHashimoto Ryuø tar™ to the Keizai D™yuø kai (Japan Association of CorporateExecutives) in July 1997, in which he enunciated three new principles to governbilateral relations: trust, mutual benefit, and long-term perspective (Yomiurishinbun, 2 November 1997: 3). Some commentators in Russia interpretedHashimoto’s three principles as Japanese willingness to shelve the territorialdispute temporarily and give preference to economic cooperation (seeNezavisimaya gazeta, 12 August 1997: 5; Kondrashov 1997: 3). In order to dispelany Russian misunderstanding about the priority the Japanese placed on resolvingthe territorial dispute, Hashimoto made it clear that the Northern Territoriesshould not be left to the next generation (Kimura 1999: 246).

34 Tokyo, Moscow and the disputed islands

In fact, the Hashimoto administration’s eagerness to resolve the decades-longterritorial dispute was clearly evident in the former Prime Minister’s plan for anew border delineation between the two countries. The plan, unveiled during theApril 1998 Kawana talks, called for the border to be redrawn to the north of thefour disputed islands, thus effectively putting them under Japanese sovereignty.Japan would recognise Russian control of the islands until both sides resolved theissue of final ownership. This proposal was seen as a significant departure fromthe previous government strategy of simply demanding the Soviet/Russiangovernment return the disputed territory. It was thought that the aim ofHashimoto’s plan was to weaken the impression within Russia that it would haveto return the islands. By doing so, it was hoped that this would somehow placateRussian opponents of a territorial return, thus making it easier for PresidentYeltsin to accept (Asahi shinbun, 20 April 1998: 1).

The notion of trust – the first of Hashimoto’s three principles intended to guideJapan’s ties with Russia – developed, in recent years, in the personal relationsbetween the two countries’ then-leaders. Given the animosity and enmity that hascharacterised bilateral relations in the past, it should come as no surprise thatfeelings of distrust had filtered through to the elite level. The RussianAmbassador to Japan, Aleksandr Panov, remarked that previously Japanesediplomats would limit their contacts to the very narrow field of Soviet Japanspecialists and has noted that the Soviets used to consider Japanese diplomats tobe very dry and uptight (1992: 105, 110). The Japanese no doubt reciprocatedthese feelings. The issue of trust is particularly important as some consider thelack of this element in Japanese–Soviet/Russian relations and presence of it inSoviet–German relations as a key factor in explaining the subsequent politicalstalemate in the former relationship, compared to positive transformation that hasoccurred in the latter at the end of the Cold War (see Forsberg 1999). From themid-1990s, however, personal contacts going beyond official relations began todevelop. This was most evident in the relationship between Boris Yeltsin andHashimoto, which blossomed following the Denver G-7 summit in June 1997.Yeltsin made a positive impression on Hashimoto in Denver, confirming thevalidity of the 1993 Tokyo Declaration, endorsing Tokyo’s bid for a permanentseat on the United Nations Security Council, and proposing a ‘strategicpartnership’ between the two countries, as well as regular summit meetings(Sarkisov 2000: 231). The two leaders were on a first name basis and heldinformal ‘no-necktie’ summits in the eastern Siberian city of Krasnoyarsk inNovember 1997 and the Japanese resort town of Kawana in April 1998. This newatmosphere of trust and goodwill helped to deal with various bilateral problemsand even raised the possibility that Russia might return the disputed islands. TheKrasnoyarsk summit produced a somewhat unexpected result: both leadersagreed to boost efforts to conclude a peace treaty by the year 2000. Sections ofthe Japanese mass media proclaimed this agreement as the beginning of a new erain bilateral relations and the end of what has been described as a period ofstagnation since the end of the Cold War (Yomiuri shinbun, 28 October 1997: 1).

Tokyo, Moscow and the disputed islands 35

Hashimoto and Yeltsin reconfirmed this agreement and agreed to further expeditepeace treaty negotiations at Kawana. Yeltsin’s bold decision to agree to put atimetable on the conclusion of a peace treaty, which was reportedly made withoutconsulting those in the government involved in peace treaty negotiations (Asahishinbun, 4 April 1998: 4), highlights some of the advantages of developingrelations of trust.

Hashimoto’s successor, Obuchi Keiz™ sought to build on attempts at forgingpersonal relations with the Russian President. Obuchi visited Moscow inNovember 1998 for an official summit. This was the first visit to the Russiancapital by a Japanese prime minister in 25 years. At these talks, the Russian sidedelivered a response to Hashimoto’s border demarcation proposal that did notmeet Japanese expectations: counterproposing that border demarcation should beaccomplished through an agreement separate from a peace treaty. In addition,Yeltsin’s response called on both sides to establish a special legal system for jointeconomic assistance on the four islands and border demarcation conducted in amanner whereby joint economic assistance would not damage Russia and Japan’snational interests (Hakamada 2000: 247–8).

Since the mid-1990s, significant progress has been made in security dialogueand defence scholar exchanges. In April 1996, Usui Hideo, Director of the JapanDefence Agency (JDA), visited Russia for talks with Russian defence officials(Sankei shinbun, 17 July 1997: 4). This marked the first ever visit to Russia by aJDA Director. In June 1996, the Japanese naval vessel, Kurama, paid a goodwillvisit to Vladivostok for the Russian navy’s three hundredth anniversary. Usui’strip to Russia was followed in May 1997 by a return visit from the then RussianDefence Minister, Igor Rodionov. The following month a Russian navy vessel,Admiral Vinogradov, made a friendly port call in Japan, the first such visit in 103years (ibid.). In a further sign of increasing defence cooperation, Japanese,Russian and American naval forces conducted joint oil clean-up exercises inwaters just off the southern coast of Sakhalin Island in May 1998. At the DenverG-7 Summit, President Yeltsin, in a symbolic gesture, announced that Japanwould no longer be targeted by Russian nuclear forces (ibid.). Given itsopposition to transferring the disputed islands to Japan, fostering closer relationsand adopting confidence-building measures with the Russian military is thereforea prudent move by the JDA to help remove an important domestic obstacle inRussia to resolving the territorial dispute.

Defence is not the only area to benefit from the Japanese government’s‘multilayered’ approach. Russia and Japan also agreed to broaden the frameworkfor visa-less exchanges, discussed in greater detail in Chapter 3. After an October1991 Japanese Cabinet decision, only former islanders, reporters and thoseinvolved in the Northern Territories Return Movement were initially allowed tomake use of the non-visa visits. However, in an attempt to improve relationsbefore President Yeltsin’s visit to Japan in April 1998, the Japanese governmentresponded to a Russian request and expanded the visits to include professionalssuch as traders, technicians and language instructors (Asahi shinbun, evening,

36 Tokyo, Moscow and the disputed islands

3 April 1998: 1). Perhaps the most significant of these exchanges was the visit bythe Director of the Hokkaido Development Agency, Suzuki Muneo, to Kunashiriin June 1998 – the first postwar visit to the islands by a current Cabinet minister.

During their talks in Moscow in 1998, Obuchi and Yeltsin agreed to implementa programme of unrestricted visits (jiyuø h™mon) to the disputed islands for theformer Japanese residents, their spouses and children. Limits were applied to theduration and location of the previous arrangements for Japanese to visit theislands such as the visa-less exchange programme, visits to cemeteries andhumanitarian aid. This programme greatly simplifies the procedure for visitingthe islands. The Japanese government proposed establishing the unrestrictedvisits programme for humanitarian and political reasons. From a humanitarianperspective, because of the advanced age of the Northern Territories’ formerJapanese residents, the Japanese government appealed to the Russian governmentto agree to simplify the procedure for the visits, allowing them to visit theirhomes while physically possible. Politically, the Japanese government also hopedthat a strengthening of Russian recognition of the islands as a special region thatthe Japanese are able to visit freely might lead to a softer response from theRussians regarding the islands’ sovereignty and the Japanese attainment ofadministrative rights (shiseiken) (Yomiuri shinbun, 14 November 1998: 3). Thus,the Japanese government would employ the unrestricted visits programme for thepurpose of kanky™ seibi: a means of creating an environment conducive toresolving the Northern Territories dispute.

One final area that can be cited as an example of progress in Russo-Japaneserelations is the fishery framework negotiations. When Russia’s First DeputyPrime Minister Oleg Soskovets visited Japan in November 1994 for talks withForeign Minister K™n™ Y™hei, both sides agreed on the necessity of creating aframework to ensure a stable fishery order in the disputed islands’ territorialwaters (Yomiuri shinbun, 28 November 1994: 1). The establishment of a fisheriesframework was necessitated largely by a strengthening of measures againstpoaching by Japanese fishing vessels in what the Russians consider to be theirterritorial waters off the disputed islands. The most controversial of thesemeasures was the 1993 launch of a campaign by the Russian Border Guard toshoot suspected poachers (see Hokkaid™ Kaihatsu Mondai Kenkyøu Ch™sakai1994a: 11, 1994b: 14). Another important feature of the negotiations was thePokidin proposal. In April 1994, the chief administrator of the South KurilDistrict, Nikolai Pokidin, sent a telex to the Mayor of Nemuro, ïya Kaiji,proposing that the mayor permit Japanese fishermen to operate within Russianterritorial waters off the disputed islands in return for fishing fees (nyuø gyory™)(Arai and Hasegawa 1997: 177). Nemuro fishermen reacted enthusiastically,coming up with a counter-proposal to pay an estimated 4.2 billion yen in fees(ibid.: 178). The Ministry of Agriculture, Forestry and Fisheries and theHokkaido Development Agency were supportive of the intermediary role ïyaplayed during the negotiations (ibid.: 180). The MOFA, however, believing thatthe payment of fishing fees could be interpreted as tacit recognition of Russian

Tokyo, Moscow and the disputed islands 37

sovereignty over the disputed islands, expressed initial caution. On 30 December1997, after 13 rounds of negotiations, a somewhat scaled-down version of thePokidin proposal was agreed upon. Wada Haruki, an authority on Russo-Japaneserelations, hailed this agreement as ‘epoch-making’ and a ‘milestone’ in bilateralrelations (1998: 27).20

The Japanese government’s dilemma over the linking of politics andeconomics as a means to recover the Northern Territories is a salient feature ofdiscussions about Japan’s economic aid and cooperation policy towards Russia.The next section examines this aspect of Japan’s Russia diplomacy.

Economic aid and cooperation

Since the end of the Cold War, Japanese officials have struggled to formulate acomprehensive economic aid policy towards Russia. As Tsuneo Akaha states,‘Tokyo’s most pressing economic policy question vis-à-vis Moscow is how muchand what kind of economic assistance it should extend to Moscow in the absenceof an acceptable settlement of the Northern Territories problem’ (1993: 174).Japanese leaders have attempted to resolve the dilemma concerning economic aidpolicy towards Russia by following a two-track approach with an attempt to drawa distinction between multilateral assistance and bilateral aid (Gelman 1994:52–3). By adopting a dual approach, Japanese policymakers have sought tomaintain a link between economic assistance and the Northern Territoriesproblem, while at the same time defusing Western criticism of its aid policytowards Moscow.

It would appear that Japan has ostensibly made a genuine effort in assisting thereform process in Russia. In October 1992, Japan hosted the Tokyo Conferenceon Assistance to the New Independent States of the Former Soviet Union (Asahishinbun, 29 October 1992: 2). In April 1993, as chair of the G-7, Japan alsohosted the G-7 Joint Ministerial Meeting on Assistance to the Russian Federation(Asahi shinbun, evening 14 April 1993: 1). Japan also agreed to rescheduleRussian debt repayments in 1993 and 1994 totalling US$800 million and US$300million, respectively. Despite what would appear as examples of magnanimityand altruism, Japan was initially a reluctant donor in multilateral aid programmesfor Russia. This reluctance to extend substantial economic assistance caused acertain degree of friction with some of Japan’s G-7 partners. It has been arguedthat the announcement in October 1991 of a US$2.5 billion assistance packagewas an attempt by the Japanese government to placate its advanced industrialisedpartners before the upcoming G-7 meeting in Bangkok (Carlile 1994: 423). A fearof isolation appeared to be behind Tokyo’s reluctant agreement to participate inthe international rescue package. This participation did, however, come at a price.At the subsequent G-7 meeting in Munich, in exchange for contributing to themultilateral aid programmes, the Japanese government, much to the Russians’chagrin, received support for its position on the Northern Territories problem.

38 Tokyo, Moscow and the disputed islands

Nevertheless, despite some initial reluctance, the Japanese government hascontributed bilateral aid to Russia. This has taken the form of technical assistancesuch as dispatching experts to Russia and accepting Russian trainees,humanitarian assistance and cooperation with safety in the nuclear powerindustry. Japanese assistance in these fields was reconfirmed by theannouncement in Krasnoyarsk in November 1997 of an economic cooperationpackage known as the Hashimoto–Yeltsin Plan (Yomiuri shinbun, 2 November1997: 1).21 During Russian President Vladimir Putin’s visit to Japan in September2000, a new cooperation programme (the Mori–Putin Plan) was adopted in thetrade and economic fields to further develop the Hashimoto–Yeltsin Plan. Thenew programme outlined the basic direction for future cooperation in eight keyareas, among them establishing a favourable investment environment in Russiaand assistance for economic reforms (Nikkei shinbun, 5 September 2000: 7). Inrecent years, a number of Japan Centres have been opened in Russia, which aimto promote Japanese assistance to the regional governments in the Russian FarEast by promoting administrative reform, developing local industry andprivatisation as part of a broader framework of assistance to introduce a marketeconomy in Russia (Ogawa 2001: 227). Moreover, Japan is promoting small andmedium private-sector enterprises in the Far East region and eastern Siberiathrough the US$50 million Regional Venture Fund in conjunction with theEuropean Bank for Reconstruction and Development (Gaimush™ date unknown).

Japan’s early economic assistance towards Russia can be criticised onqualitative grounds. The large majority of Japanese aid consisted of non-grantassistance such as Export-Import Bank (now the Japan Bank for InternationalCooperation) loans and trade insurance, which promoted Japanese trade as muchas Russian development. For instance, the US$2.5 billion assistance packageJapan pledged in October 1991 consisted of US$500 million in Export-ImportBank loans for food, medicine and other humanitarian aid, US$1.8 billion in tradeinsurance to help reduce the burden of Japanese companies trading in Russia, andUS$200 million in Export-Import Bank trade credits for Russian exports to Japan(Gaik™ f™ramu, 1996: 36). However, it must be said that from the late 1990s, theJapanese government has steadily improved the qualitative aspect of its economicassistance programme. This improvement was particularly evident in the periodbetween the Krasnoyarsk and Kawana ‘no necktie’ summits when the Japaneseside had inflated expectations for the resolution of the territorial dispute. DuringForeign Minister Obuchi’s visit to Russia in February 1998, the two sides agreedon a US$1.5 billion untied loan from the former Export–Import Bank of Japan tobe co-financed with the World Bank, ostensibly to support Russian economicreforms. After its temporary suspension caused by the Russian financial crisis, theloan has been funded steadily, with approximately two-thirds of the agreed sumbeing disbursed as of May 2000 (Ministry of Foreign Affairs of Japan 2001).

The nature of Japanese economic cooperation in this region has also raisedsome concerns, particularly in the Russian Far East. Japan’s imports from Russiaare skewed towards raw materials such as timber, coal, scrap metal, oil, fish and

Tokyo, Moscow and the disputed islands 39

seafood products. The Russian Far East has traditionally supplied a highproportion of these. Japan’s principal exports are manufactured goods. Thepattern of bilateral trade is thus seen as contributing little towards the stimulationof indigenous industrial development or the development of infrastructure, whichwould stimulate the flow of foreign investment into the Russian Far East (Araiand Hasegawa 1997: 170).

In recognition of the potential role Japanese aid can play in cultivating Russianpublic opinion and establishing a favourable environment for a resolution to theNorthern Territories dispute, technical and humanitarian assistance, in particular,have been geared towards the Far East region (Gaik™ f™ramu, 1996: 50–61). TheJapanese government’s decision to open a representative office on SakhalinIsland in January 1998 can be seen as a means of countering local opposition toRussia returning the islands (Asahi shinbun, 4 April 1998: 4). Moreover, at theApril 1998 Kawana summit, Yeltsin and Hashimoto agreed to establish a jointinvestment company. Its basic aim was to use Japanese funds as a lever topromote development in the Russian Far East. However, the expectation that theJapanese private sector would contribute half of the funding at a time of economicstagnation cast doubts on the viability of the project. As long as the Japanesegovernment continues to leave the development of economic relations to theprivate sector, one cannot expect a significant improvement in bilateral trade andinvestment flows.

Joint economic activities on the Northern Territories

At the November 1998 Moscow summit, the Japanese side proposed theestablishment, within the existing framework of the Joint Committee on theQuestion of Concluding a Peace Treaty, of two new committees: a BorderDemarcation Committee and a Joint Economic Activities Committee. TheRussians accepted this proposal. Japan’s desire to push forward with peace treatynegotiations is believed to be behind this proposal. As Shigeki Hakamadaexplains, ‘the Japanese side … sought the establishment of the BorderDemarcation Committee to try to block a dilution of the peace treaty process. TheJoint Economic Activities Committee was a concession in order to get thedemarcation committee recognized’ (2000: 248).

The proposal for joint Russo-Japanese economic activities on the disputedislands was not a new one. It was first suggested in negotiations during MikhailGorbachev’s visit to Japan in April 1991 and the Russian side has raised the issuea number of times in the past. Apart from the limited framework of humanitarianassistance, visa-less exchanges and fishing zones, the Japanese government hasconsistently taken a negative stance towards Russian proposals for jointeconomic activities on the northern islands. First, it fears that joint economicactivities on the islands, which would essentially be unilateral Japaneseassistance given Russia’s inability to finance such projects, would lead to asignificant improvement in the current Russian residents’ living standards,

40 Tokyo, Moscow and the disputed islands

making them more inclined to stay and to oppose a territorial return to Japan.Second, as economic activity would be conducted under Russian law, it would betantamount to recognising Russian sovereignty over the islands (ibid.). As will bediscussed in greater detail in Chapter 3, the Japanese government’s opposition tojoint Russo-Japanese development of the Northern Territories has, on occasion,complicated Hokkaido’s relations with Sakhalin.

It would therefore appear that the Japanese government has not allowedeconomic ties, at least with the disputed islands, to proceed ahead of progress inthe territorial dispute, making the aforementioned paradigm shift in policytowards Russia appear more like a change in policy strategy designed to achievethe ultimate objective of recovering the Northern Territories. Meanwhile, theJapanese illusion, appearing after Krasnoyarsk, of the islands’ imminent returnchanged into a sense of disillusionment as bilateral relations cooled once againover a lack of progress in resolving the Northern Territories dispute, which wouldremove the biggest obstacle to finally concluding a peace treaty.22

Russia and the South Kuril IslandsUnder Mikhail Gorbachev’s leadership Soviet relations with the West, for themost part, moved from conflict to cooperation. However, relations with Japanremained stagnant because of the territorial dispute. At the time of his visit toJapan in April 1991 – the first by a Soviet leader – Gorbachev’s political strengthwas the weakest it had been since he took office. Gorbachev was aware thatshould he accede to Japan’s territorial demands during negotiations, it would beused as a weapon by his political rivals – chief among them Boris Yeltsin – tounseat him. On the Japanese side, Prime Minister Kaifu Toshiki, a member of asmall faction within the LDP whose elevation to the premiership was the result ofa compromise between larger, more powerful factions within the party, also hada weak political standing, which ensured he would remain within the policyparameters as defined by the MOFA. It is therefore not surprising thatGorbachev’s visit failed to achieve a breakthrough in the territorial dispute.Perhaps the only positive result the Japanese could take away from the summitwas the Soviet side’s agreement to specify that negotiations took placeconcerning the islands and to name them in the Joint Declaration (Gaimush™ andMID Rossiiskoi Federatsii eds 1992: 49–51). This contrasted with the previousSoviet approach of denying there was a territorial problem.

Gorbachev returned to a troubled Soviet Union without having madeunpopular territorial concessions, but also without the substantial economicassistance he so desperately needed from the Japanese. Gorbachev’s fears oflosing power were soon realised when he was placed under house arrest duringthe failed coup attempt in August 1991. The aborted coup and Yeltsin’s oppositionto it were to mark the beginning of the end of Gorbachev’s grip on power andindeed of the Soviet Union itself.

Tokyo, Moscow and the disputed islands 41

The rebirth of Russia: Initial signs of hope

The Soviet Union collapsed in December 1991 and the Russian Federationemerged onto the world stage, assuming responsibility for all the former’sinternational rights and obligations. For Japan, this meant that Russia had becomeits negotiating partner in the Northern Territories dispute.

Images beamed worldwide during the attempted coup of a defiant Yeltsin,standing atop a tank in front of the Russian Parliament building, certainly gavethe impression of a bold person strongly committed to democratic principles andmust have offered some hope in Japan that this commitment might be translatedinto Russian acceptance of the need to return the Northern Territories. An officialletter from Yeltsin, brought to Japan in September 1991 by the acting Chairmanof the Russian Parliament, Ruslan Khasbulatov, heightened expectations for aresolution to the territorial dispute. Yeltsin’s message stressed that the RussianRepublic would put an end to the Soviet doctrinaire approach of regardingrelations with Japan as those between victor and vanquished and that theterritorial dispute be resolved on the basis of ‘law and justice’ (zakonnost' ispravedlivost') (Gaimush™ 1994: 29). As the Soviet Union had long looked uponJapan as a defeated nation and upon the islands as war bounty, this represented adramatic shift in attitudes.

Also contained in the letter was a modification to the controversial ‘five-stageplan for resolving the territorial issue between Russia and Japan’. Initiallyproposed in January 1990 while on a visit to Japan as a Russian delegate to theSupreme Soviet, Yeltsin’s original plan called for: (1) Moscow’sacknowledgment of a territorial problem by the end of 1991; (2) the four islandsto be made a free enterprise zone open to the Japanese; (3) demilitarisation of theregion by 1998–2004; (4) conclusion of a peace treaty by 2005–10; (5) finalresolution of the territorial problem to be left to the next generation (ibid.: 80–1).Yeltsin’s plan was significant as it represented the first time a Soviet politicianhad officially recognised the existence of the territorial dispute with Japan.However, Japanese officials were sceptical of the plan’s fifth stage, fearing it wasan attempt to shelve the dispute indefinitely. Yeltsin’s subsequent modification ofthe plan called for the territorial problem’s resolution to be implemented in amore expeditious manner, as well as accelerating the islands’ demilitarisation(Nimmo 1994: 115).

Initial signs of impending progress in territorial negotiations soon after theSoviet Union’s collapse coincided with a pro-Western or ‘Atlanticist’ orientationin Russian foreign policy. According to this approach, Russia would seek apartnership with the so-called ‘civilised’ nations of the West with which it shares‘such values as a commitment to democracy, human rights, respect for theindividual, liberalism, and belief in a market economy’ (Kimura 2000b: 178).Russia’s transition to a market economy would require substantial economicassistance from the West, necessitating close relations, particularly with theUnited States, the EU and Japan.23

42 Tokyo, Moscow and the disputed islands

Foreign Minister Andrei Kozyrev was initially a leading proponent of thisapproach and under his leadership, the Russian Ministry of Foreign Affairs(Ministerstvo inostrannykh del or MID), which was responsible for the day-to-day coordination and implementation of foreign policy, was entrusted with thedifficult task of conducting territorial negotiations with Japan. In a move thatsuggested a possibly more conciliatory Russian approach towards Japan and theterritorial dispute, Georgi Kunadze, a Japan expert who joined the MID from theInstitute of World Economy and International Relations, replaced Igor Rogachev,a noted hardliner who claimed that Japan’s territorial demands were‘unwarranted’, as deputy foreign minister (Hara 1998: 205). Kunadze played akey role in the formulation of Russian policy towards Japan and set himself apartfrom the hardliners, arguing that Russia should acknowledge the 1956Japan–Soviet Joint Declaration, as well as allegedly being the one who devisedthe ‘law and justice’ formula (see Hasegawa 2000: 179; Kimura 2005: 215).Kunadze travelled to the South Kuril Islands with two members of the RussianParliament in September 1991 to meet the residents and inform them of thedispute in which they had inadvertently become embroiled. Kunadze’s party metwith a hostile reception from the islanders who were angry at the neglect theauthorities had shown, as well as the sudden revelation that Habomai andShikotan might be transferred to Japan in accordance with Russia’s legalobligations (Hasegawa 1998: 427; Kunadze 2000: 167).

The most significant sign of an initial Russian preparedness to compromisecame in March 1992 when Kozyrev, in a bid to force Yeltsin to commit to theplan, proposed a resolution of the territorial dispute based on the 1956 JointDeclaration and an agreement to continue negotiations over the sovereignty ofKunashiri and Etorofu (Hasegawa 2000: 183). The Japanese government,however, rejected the Russian proposal. The Japanese and Russian foreignministries also agreed to collaborate in collating and publishing a bilingual JointCompendium of Documents on the History of Japanese–Russian TerritorialQuestions that was released in September 1992.24 The compendium contains 35historical documents relating to the territorial dispute, including the 1855 Treatyof Shimoda, the 1875 Treaty of St Petersburg and the 1956 Japan–Soviet JointDeclaration. As these are legally binding documents which, particularly in thecase of the Shimoda and St Petersburg treaties, confirm Japanese sovereigntyover the four islands in the pre-war period, agreement to participate in this projectcould be interpreted as a further sign of the emerging moderation within theRussian government, although not as noteworthy as Kozyrev’s earlier offer.25

Certain sections of the mass media supporting the government also featuredarticles emphasising that ceding territory would be unavoidable in an attempt tochannel public opinion into accepting Russian concessions (Kozhevnikov 1994:122).

Tokyo, Moscow and the disputed islands 43

Domestic constraints and obstacles: The rise of nationalism

Despite early indications that Russia under Boris Yeltsin would be moreconciliatory than the Soviet Union with regard to the territorial dispute, until thelate 1990s, both sides made little visible progress towards a resolution. Strongdomestic constraints in Russia, in particular, limited policymakers’ freedom toseek a compromise with Japan over the territorial dispute. The transition from asocialist planned economy to a liberal democratic market economy resulted inwidespread poverty among Russian citizens. Economic impoverishment, coupledwith the humiliation many felt over the Soviet Union’s collapse, forfeiture of itsEast European empire and Russia’s loss of prestige in international affairsprovided a fertile environment for a rising tide of nationalist sentiment inpostcommunist Russia and emboldened Yeltsin’s opponents who were critical ofthe economic ‘shock therapy’ and Russia’s subservience to the West, which theybelieved had provided inadequate assistance with too many strings attached.

Yeltsin was forced to incorporate certain aspects of his opponents’ agenda intohis domestic economic and political reform programme in a bid to stabilise hisregime (Kimura 2000b: 181). By about mid-1992, Russian foreign policy alsotransformed from its previous focus on cooperative relations with the West to a‘Eurasianist’ approach, which emphasised deeper political, economic andmilitary ties with the countries of the Commonwealth of Independent States (the‘near abroad’), the Middle East, India and China, the pursuit of a more equalrelationship with the US and Europe and a greater assertion of the nationalinterest.26

The move away from its initial pro-Western orientation was also reflected inRussian policy towards Japan and the territorial dispute. For instance, just fourdays before he was scheduled to meet Japanese Prime Minister Miyazawa Kiichi,for talks in Tokyo in September 1992, Yeltsin caused a sensation by cancellingthe visit. In a further affront to the Japanese, the Kremlin launched a fiercediatribe against Tokyo. Yeltsin’s press secretary, Viacheslav Kostikov, claimedthat the embattled Miyazawa administration was trying to use the RussianPresident’s visit as a means of eliciting public support during the upcomingelection campaign (ïmuro 1992: 18). Yeltsin himself had told Miyazawa in theirtelephone conversation that ‘domestic circumstances’ in Russia were behind thedecision to postpone the visit (Asahi shinbun, 10 September 1992: 1), but duringa visit to the Chuvash Republic shortly afterwards, claimed that ‘Japan posed thequestion of the Kuril Islands too categorically’ (Frolov 1992 cited in The CurrentDigest of the Post-Soviet Press 1992: 7), suggesting that responsibility for thecancellation lay with Japan. Yeltsin was forced to cancel another visit that hadbeen rescheduled for May 1993 because of the ongoing conflict with theParliament. Although Yeltsin visited Japan in July 1993, he did so to attend theTokyo G-7 summit and therefore did not enter into territorial negotiations withthe Japanese. It was not until October 1993 – just after he ordered the shelling ofthe Russian Parliament building – that Yeltsin visited Japan for a summit meetingto discuss the territorial dispute.

44 Tokyo, Moscow and the disputed islands

Andrei Kozyrev, an initially reluctant follower of the ‘Eurasianist’ line, cameunder scathing attack from conservatives and nationalist forces in the Parliamentwho were critical not only of his diplomatic orientation, but also of his generalhandling of Russian foreign policy (Kimura 2000b: 132). Kozyrev’s lack ofauthority and prestige in the foreign policymaking community significantlydiminished the MID’s role, allowing other institutions and individuals to interferein decision-making and often bypass it (ibid.: 133). This is particularly evident inthe six-month period leading up to Yeltsin’s scheduled September visit to Japan.While talks were taking place between the two countries’ foreign ministries inearly 1992, articles began to appear in the Russian press, many penned by OlegRumyantsev, deputy of the Supreme Soviet and secretary of the ConstitutionalCommission, alleging that the MID was engaged in a secret deal with theJapanese government to sell the four islands (Edamura 2000: 143). Although, asoutlined above, Kozyrev had discretely proposed a two-island formula to theJapanese in March, there was no foundation to the rumours that a sale was beingnegotiated. Rumyantsev also organised parliamentary hearings in July 1992 intothe South Kuril issue and Yeltsin’s scheduled visit to Japan, effectively isolatingthe MID. Kozyrev, Kunadze and the rest of the MID became the subject ofinflammatory attacks by those opposed to any Russian surrender of the SouthKuril Islands.27 Meanwhile, in the face of intense domestic pressure, Yeltsinproved incapable of providing any clear directive, and the MID was unable tostrike any deal.28 Although Kozyrev soon adopted a more assertive andnationalistic foreign policy approach, it was not until his departure andreplacement by Yevgenii Primakov in January 1996 that the MID was able toassume any authority in Russian foreign policy decision-making.

A series of shooting incidents near the disputed islands following Yeltsin’svisit involving the Russian Border Guard is further evidence of a hardening ofpolicy towards Japan and the Northern Territories. Until mid- to late-1993, theBorder Guard adopted a fairly moderate approach to the problem of Japanesefishers operating ‘illegally’ in the disputed islands’ fisheries, which was mostlylimited to recording ‘violations’ (Williams 1996: 48). The number of Japanesefishers operating in the area, who were perhaps lulled into thinking they wouldnot be punished, increased sharply as a result. In response, the Border Guardbegan firing warning shots and when this failed to deter ‘poachers’, adopted anextreme policy, not seen even during the Soviet era, of firing at the fishingvessels, which resulted in several injuries and some deaths among Japanese crews(Sait™ 1995: 65). Several factors, including the adoption of legislation permittingthe use of force against border violators in March 1993, an upsurge in resourcenationalism linked to obtaining foreign capital and the personal ambition of thehead of the Border Guard, General Andrei Nikolaev, are believed to have beenbehind this hardline approach (ibid.).

As discussed previously, the Sea of Okhotsk served as a bastion for SovietSLBM submarines, protecting them against US antisubmarine warfareoperations. Despite arguments, such as those made by Geoffrey Jukes, that the

Tokyo, Moscow and the disputed islands 45

end of the Cold War, the conclusion of the START-2 Treaty and the reduction inRussian Pacific Fleet numbers, caused in part at least by Russia’s economicproblems, have combined to invalidate the arguments for a bastion in the Sea ofOkhotsk (1993), the Russian military, which still maintains some of its Cold Warcynicism (understandably so given recent US unilateralism), remains viscerallyopposed to the idea of returning the islands. In fact, Greg Austin and AlexeyMuraviev believe that Russia’s change in emphasis towards the defence of littoralwaters has resulted in Russian military planners paying greater attention to theSea of Okhotsk and the Sea of Japan (2000: 211). As it demonstrated during theattempted coup in August 1991 and again in October 1993, the Russian militaryis not a negligible force on the national political stage and makes its voice heardon issues it considers important – including the territorial dispute. The military isbelieved to have played a key role in obstructing Yeltsin’s scheduled visit toTokyo in September 1992 and the possible transfer of the islands to Japan(Kimura 2000b: 137). Moreover, the military, which provided importanthumanitarian support for the local residents such as emergency transport,communications and supplies (Kunadze 2000: 168), has also dragged its feet onwithdrawing its forces from the disputed islands. This is despite Yeltsin’s promiseto do so (leaving only a Border Guard detachment) during his state visit to Japanin 1993. The JDA estimates that approximately 3,500 Russian troops remaindeployed on the islands of Etorofu and Kunashiri (Boeich™ 2005). As will bediscussed in greater detail in Chapter 6, in addition to strategic concerns, there arealso important economic reasons behind the military and Border Guard’sopposition to transferring the islands to Japan.

Yeltsin’s postponement strategy

The upsurge in nationalism and the conservative opposition’s growing influencecertainly impacted upon Russian foreign policy decision-making towards Japanand the territorial dispute. However, as the President, Yeltsin’s own positionshould not be overlooked. Some observers note the President’s central role inforeign policy decision-making (Kimura 2000b: 224; Hara 1998: 207). In supportof this argument, the Constitution that was adopted in December 1993 followingthe forceful disbanding of the Russian Parliament formally gave the Presidentwide-ranging powers and confirmed his pre-eminent role in foreign policy – withthe government essentially reduced to the role of implementing Yeltsin’sdirectives. The Constitution also gave the President the power to decide thecomposition of the conservative Security Council, which was established in May1992 and had gained the ascendancy over the embattled MID in foreign policydecision-making (Administratsii Prezidenta Rossiiskoi Federatsii 1993: 35;Falkenheim Meyer 1993: 496). Yeltsin’s frequent use of Presidential Decrees tobreak political stalemates and his decision to move the ‘power organs’ (army,police and the Federal'roi sluzhby bezopasnosti (FSB) or Federal Security

46 Tokyo, Moscow and the disputed islands

Service) of the state under his own jurisdiction were indicative of the lurchtowards authoritarianism during his regime.

However, despite his formal authority, the President was limited in hisarbitrary powers. Although the Constitution afforded Yeltsin a primary role inpolicymaking, it also reserved sufficient powers for the legislature to complicatepresidential rule (Huskey 2001: 41). For instance, Article 106d recognised theState Duma’s right to ratify and denounce international treaties of the RussianFederation (Administratsii Prezidenta Rossiiskoi Federatsii 1993: 46). Given thedominance of conservative deputies in the Duma who were vehemently opposedto Russian territorial concessions, it was unlikely that any peace treaty stipulatingthe disputed islands’ transfer to Japan would be ratified. Archie Brown recognisesthat although Yeltsin could unquestionably impose his will on occasions, ‘[his]particular style of rule, in combination with his declining health, meant that thepowers he exercised on a day-to-day basis were less extensive than they mighthave appeared constitutionally’. Brown further speaks of ‘a gap between theimage of a “strong President” … which Yeltsin projected and reality’ (2001: 49).

Yeltsin was fully aware of this gap and of the limits his unstable politicalposition afforded, particularly when it involved making decisions regardinghighly emotional issues such as territorial disputes. According to Kostikov,Yeltsin understood that the four islands belong to Japan, but feared the islands’reversion would lead to his overthrow (cited in Saito 1999: 73). Yeltsin need onlylook at the low esteem in which former Soviet leader, Mikhail Gorbachev, seenas the man who forfeited the Soviet empire, is currently held by the Russianpublic to remind himself of the potential pitfalls of making territorial concessionsto the Japanese.

Yeltsin himself greatly contributed to the widening gap between his formaland actual powers. His penchant for ad hoc bargaining with his politicalopponents in an attempt to remain in power was partly responsible for the weakinstitutionalisation of the foreign policy decision-making process, which, inaddition to Russia’s economic difficulties, allowed ideas such as nationalism andits purveyors to exert considerable influence. Yeltsin’s health problems resultedin frequent absences from the Kremlin, encouraging infighting and jockeyingamong his aides who sought to exploit the territorial dispute for political gain(Kimura 2000b: 176). It is therefore not surprising that policy towards Japanduring Yeltsin’s regime was inconsistent.

In fact, Hiroshi Kimura argues that the only consistent aspect of Yeltsin’spolicy towards Japan and the disputed islands was his strategy to postponeresolution of the Northern Territories dispute for as long as possible (ibid.: 233).The final stage of Yeltsin’s five-stage plan for normalising relations with Japan,which called for resolution of the territorial dispute to be left to the nextgeneration (in the period 2005–10 after which Yeltsin would have presumably leftoffice), demonstrated a certain unwillingness to deal with the problem.

It appears that Yeltsin’s various promises to resolve the territorial dispute weretactical in nature (ibid.: 232), designed to achieve this broader strategic objective,

Tokyo, Moscow and the disputed islands 47

as well as other goals. For instance, his proposal for resolving the territorialdispute based on the principles of ‘law and justice’, which was seen in Japan asrepresenting a dramatic break with previous Soviet policy, does not necessarilyindicate a preparedness to accede to Japan’s full territorial demands (the return ofthe four islands). The concept of ‘law’ can be interpreted as referring to the 1956Japan–Soviet Joint Declaration, which stipulated that Shikotan and Habomaiwere to be handed over to Japan upon the signing of a peace treaty with furthertalks to determine the fate of the two remaining islands of Etorofu and Kunashiri.In 1960, after the Japanese Diet ratified a renewal of the US–Japan security treaty,Moscow declared that it would only hand over the two islands if all foreign troopswere withdrawn from Japan, thus effectively rescinding the offer. Yeltsinindirectly confirmed the 1956 Joint Declaration’s validity by signing the TokyoDeclaration, issued after his October 1993 visit to Japan, which stated that ‘alltreaties and international promises between Japan and the Soviet Union willcontinue to apply to Japan and Russia’ (Yomiuri shinbun, 14 October 1993: 2).Later in a press conference, Yeltsin declared that ‘We as the legal successor to theSoviet Union cannot run away from the obligation of fulfilling all internationalpromises. Of course, this Declaration is also included amongst these’ (ibid.).

The concept of ‘justice’ is, however, subjective and therefore open to differentinterpretations. Seeking to provide further support to Japan’s four-island claim,Kimura Hiroshi speaks of historical justice. According to this interpretation,Russia recognises the error of Stalin’s expansionism and agrees to discussions onthe sovereignty of Etorofu and Kunashiri (1993: 189). Yeltsin himself neverelucidated this concept as it pertains to the territorial dispute, making it difficultto grasp its intended meaning. However, in a special letter addressed to theRussian people in November 1991, he did refer to the principles of ‘justice andhumanism’ and the importance of defending the rights and dignity of Russians,beginning with the South Kuril islanders (Gaimush™ and MID RossiiskoiFederatsii eds 1992: 52–3). This could be interpreted as support for thoseislanders who wish to remain on the islands and under Russian sovereignty.Yeltsin’s unstable political position and fear of being overthrown as a result ofmaking territorial concessions prevented him from openly interpreting thisconcept in a pro-Japanese manner. ‘Law and justice’ was therefore not a clearsign of support for Japan’s claim for the four islands’ return.

There also appear to have been underlying motives behind Yeltsin’s agreementat Krasnoyarsk in late 1997 to boost efforts to sign a peace treaty by the end ofthe year 2000. As Japan’s longstanding precondition for concluding a peace treatyis Russia’s return of the Northern Territories, the Krasnoyarsk agreement wasinterpreted by many optimistic observers in Japan as signalling the RussianPresident’s preparedness to return the four islands. Others suggested thatgeopolitical considerations may have been at work. Russia has grownincreasingly uneasy over China’s rapid economic growth and particularly itsrising military power since the end of the Cold War. Ironically, its cash-starvedmilitary-industrial complex has contributed to the perceived threat by selling

48 Tokyo, Moscow and the disputed islands

high-tech military weapons and equipment to the Chinese. Aleksandr Tsipkosuggested that the anticipated rapprochement with Japan following the agreementwould ‘become a trump card for suppressing China’s projection’ (Yomiurishinbun, 11 November 1997: 2). It should be added that Russia has not onlysought to use the ‘Japan card’ against China, but despite its long-term concernsregarding China, has also attempted to deal the ‘China card’ against Japan’s majorally, the US, as a lever to attain a position where it can curb American power inAsia and regain its position as a great power (Walker T. 1997: 11).29 Russia’sability to engage in balance-of-power politics in Asia has, however, been severelyconstrained by its poor socio-economic conditions, which are most evident in itsFar Eastern regions.

There has also been an economic rationale behind Russia’s attempts atrapprochement with Japan, which is preconditioned upon resolving the territorialdispute. According to Mikhail Krupyanko, ‘The essence of the Kremlin’s policyis to extract the largest possible amount of material and technical aid in exchangefor vague promises of a resolution to the territorial problem’ (1993: 40). Japan’sYomiuri shinbun has made similar observations, noting that his (indirect)recognition of the 1956 Joint Declaration’s validity during his visit to Japan inOctober 1993 was aimed at extracting economic aid from Japan (14 October1993: 2). If Yeltsin had openly communicated to the Japanese that he wasviscerally opposed to transferring the islands to Japan, Tokyo would have seenlittle benefit in providing economic assistance as a possible means of attemptingto alter the Russian President’s thinking on the matter. For Yeltsin, obfuscationkept open the possibility of financial disbursements from Japan without having tomake territorial concessions. There is a certain irony in Yeltsin’s strategy as thereverse logic is said to apply to Japanese policy towards Russia. Harry Gelmanargues that ‘The Japanese position has always been to hold out vague prospectsof unspecified subsequent economic rewards in exchange for prior concreteconcessions on the territorial issue’ (1994: 51). Although, in quantitative terms,Japan has been quite generous in its disbursements of technical assistance andhumanitarian aid, criticisms of the qualitative aspects of Japanese largesse,coupled with continued calls by Russian officials during the past decade forfurther economic assistance, suggest that such a strategy has not been entirelysuccessful.

Russia’s attempts to extract economic aid from Japan can also be linked to itssecurity concerns in the Far East. There has been a rapid growth in Sino-Russianborder trade since the early 1990s. Despite the obvious benefits to thisrelationship for the residents of the Far East, who have been cut off fromtraditional markets in European Russia, in terms of, inter alia, access toinexpensive Chinese consumer goods, considerable strain has been placed on theregion’s social fabric. An enormous demographic imbalance and Russiansuspicion of true Chinese intentions are at the heart of the problem: thepopulation of the Russian Far East is estimated to be just over 7 million, whilethe population of China’s three northeastern provinces alone numbers about 100

Tokyo, Moscow and the disputed islands 49

million. An influx of Chinese citizens and goods into the sparsely populated FarEast has heightened local fears of a ‘silent invasion’. A concomitant exodus ofRussians from the Far East since the introduction of economic reforms over adecade ago and China’s historical claims to the Amur and Ussuri regions haveexacerbated these fears.30 Japanese aid and investment might stimulate the FarEastern economy, thereby curbing the mass exodus from the region, and possiblyeven raising migration levels, which would bolster Russia’s strategic position inthe Far East.

In contrast with Yeltsin’s earlier policy of resolving the territorial dispute withJapan on the basis of the principles of ‘law and justice’, there appears to be littleambiguity in his agreement reached at Krasnoyarsk to conclude a peace treaty bythe year 2000. Unfortunately for the Japanese, however, this appears to have beenpart of yet another tactical attempt designed to achieve his broader strategicobjective of postponing the territorial dispute’s resolution. During summit talkswith Obuchi Keiz™ in Moscow in November 1998, Yeltsin responded toHashimoto’s border demarcation plan raised at Kawana seven months earlier byproposing a two-stage resolution of the territorial dispute. According to theproposal, the two sides would conclude a Peace, Friendship and CooperationTreaty by the year 2000, containing a reference to a will to resolve the territorialproblem by this time, and the concrete details regarding the methodology wouldbe dealt with in a separate treaty (Yomiuri shinbun, 13 November 1998: 1). Forthose familiar with the history of Japan–Soviet/Russian relations, Yeltsin’sproposal was simply a rehash of Soviet attempts in the 1970s to conclude a treatyof good neighbourliness and friendship with Japan. Japan refused for the samereason it rejected earlier Soviet overtures: it feared that Russia would interpretsuch an agreement as having the same standing as a peace treaty and, havingtherefore accomplished its longstanding goal of concluding such an accord withJapan, would have little incentive to negotiate the islands’ ownership, therebyindefinitely shelving an acceptable resolution of the territorial dispute. Oddlyenough, however, the Moscow Declaration announced after the summit waspositive for Japan, referring to the need to expedite peace treaty negotiationsbased on the 1993 Tokyo Declaration, as well as the Krasnoyarsk and Kawanaagreements (Anzen Hosh™ Mondai Kenkyuøkai ed. 1999: 134).

Hiroshi Kimura notes that the theoretical justification for legitimising Yeltsin’sbasic postponement strategy rests on the core notion that attempts to resolve theterritorial dispute in one stroke will not be successful and that instead a step-by-step approach is necessary (2000b: 234). This gradual approach has, of course,been the rationale behind the policy of kanky™ seibi – an underlying principle ofHokkaido’s policy towards Sakhalin and also, within certain limits, a feature ofJapan’s recent Russia diplomacy. The theoretical justification behind Russia’spostponement strategy has found expression in the form of its specific proposalsfor joint Russo-Japanese economic activities on the disputed islands. FormerRussian Foreign Minister (and later Prime Minister until May 1999) YevgeniiPrimakov, revived this proposal when he suggested it to the Japanese during his

50 Tokyo, Moscow and the disputed islands

first official visit to Tokyo in November 1996. Yeltsin reiterated this during hisannual state-of-the-union address to the Russian Parliament in March 1997(Kimura 1997: 365). Like his boss, Primakov is alleged to have called for anofficial freeze on the South Kuril Islands dispute, leaving it to (wiser) futuregenerations to resolve (cited in Kimura 2000b: 195). His formal amendment ofthis approach in favour of joint economic activities should be seen merely as ‘anattempt to postpone the resolution of the territorial dispute, thereby effectivelyfreezing it’ (ibid.). It is therefore not surprising that the Japanese government,fearing that joint economic activities might have the unintended effect of actuallydelaying the territorial dispute’s resolution, has been cautious regarding theseproposals.

ConclusionFor most Japanese, the claim for the Northern Territories’ return is based onsymbolic rather than economic or strategic considerations. The continued Russianoccupation of the four islands serves as a painful reminder of the Soviet Union’sdeclaration of war against Japan and has left many Japanese with a strong feelingof victimisation. Japan’s demand for the Northern Territories’ return is rooted indeeply held beliefs about the injustice of the Russian occupation and thelegitimacy of the Japanese claim. These beliefs have been reinforced through asystematic process of public opinion mobilisation and socialisation in which theHPG, in close cooperation with the various groups that comprise the irredentistmovement, plays a significant role.

The desire to rectify the perceived injustice of the Russian occupation ofJapanese lands has made the Japanese political elite less willing to compromiseover the four-island claim. However, it must be noted that some politicians have,in the past, also seen the territorial dispute’s resolution as a means of raising theirpolitical capital during difficult times, resulting in greater flexibility regarding thetiming, modalities and conditions for the return of the four islands. Although mostJapanese citizens are able to adhere to the four-island claim without having to payany significant opportunity cost, this is not the case for an increasing number ofpeople in northeast Hokkaido, namely fishers, who have suffered economically asa result of the Russian occupation of the islands and the Japanese government’sadherence to the four-island claim. This has led to increasing support for Japan toaccept a return of two islands, either as an interim step or as a final resolution tothe dispute.

The Japanese government has adopted various principles in its policy towardsRussia in an attempt to recover the islands. An important element of these is thelinkage of politics and economics, which has influenced the level of economic aidand cooperation, including joint ventures on the disputed islands, which theJapanese government has provided to Russia. These two elements have beenloosened gradually, but not severed completely. In seikei fukabun, the two weretightly linked, with economic cooperation contingent upon progress in the

Tokyo, Moscow and the disputed islands 51

Northern Territories dispute (no islands, no substantial economic assistance). Thispolicy was also marked by an implicit ambivalence by the Japanese governmenttowards grassroots diplomacy between the two countries. This was replaced bythe policy of kakudai kink™, which called for a balanced expansion of politicaland economic relations with Russia. In belated recognition that a lack of progresson the Northern Territories dispute need not hinder the development of bilateralrelations in other fields, in 1997, the Japanese government decided to broaden thespheres of cooperation to be discussed and promote diverse negotiations with theRussians. Economic and cultural exchange with the Far East is an importantelement of this. In what was to become known as the ‘multilayered’ (juø s™teki)approach, this policy did not abandon the objective of resolving the territorialdispute and was even expected to contribute to it.

Despite early indications that Russia under Boris Yeltsin might be moreconciliatory than the Soviet Union regarding the territorial dispute, both sidesmade little visible progress during the decade following the Soviet collapse.Japan’s refusal to accept anything but the four islands (or at least Russianrecognition of Japanese sovereignty over them) contributed to the stalemate. Onthe Russian side, several domestic constraints and obstacles, notably the risingtide of nationalism fuelled by poor socio-economic conditions, were sufficient tocreate an environment that was not conducive to territorial concessions. It wasagainst this background that Yeltsin, who feared a backlash from conservativeand nationalist forces in the Russian Parliament, adopted the strategy ofpostponing the territorial dispute’s resolution. Most of his promises to Japan weretactical in nature, designed to achieve this broader objective as well as economicand geopolitical goals.

52 Tokyo, Moscow and the disputed islands

2 Determinants of Russian andJapanese subnational diplomacy and the rise of the‘Sakhalin factor’

IntroductionThis chapter examines the factors that have contributed to the increasedinternational presence of subnational governments as they apply to Sakhalin andHokkaido, as well as the development of relations between the two regions duringthe 1990s. These can be divided into systemic or external factors, and domesticfactors, which are interrelated at both levels. Systemic factors include the SovietUnion’s demise and the end of the Cold War, external actors’ involvement, andthe globalisation of production and economic interdependence, which have beenaccelerated by recent advances in transport and telecommunications technology.In a generic study, Panayotis Soldatos presents a typology of the domestic causesof subnational government diplomacy at the national and subnational levels.Soldatos’ study focuses on federal states, which are structurally more conduciveto the external activities of subnational governments. Therefore, many of thesefactors are more relevant to Sakhalin, which is a component of a federal state,than to Hokkaido, which is part of a unitary state.1

Examining these factors provides useful background information on Hokkaidoand Sakhalin and the socio-economic, political and institutional environments inwhich they operate. This chapter argues that, in the case of Russia, a combinationof these factors also contributed to the rise of the ‘Sakhalin factor’ – a term usedto denote the gradual elevation of Sakhalin oblast’s authority in matterspertaining to the dispute over the South Kuril Islands in the decade following theSoviet Union’s collapse in December 1991. It is the emergence of the ‘Sakhalinfactor’ that initially raised the possibility of subnational government relationscontributing to resolving the long-standing territorial dispute. In discussing thosefactors contributing to subnational government diplomacy by Sakhalin andHokkaido and the rise of the ‘Sakhalin factor’, particular attention is focused onthe nature of Russian federalism before the launch of Putin’s reforms in 2000.

Factors contributing to subnational diplomacy

External factors

Advances in transport and communication technology and globalisation

Advances in telecommunications technology have made access to informationmore affordable and easier to obtain. Not only has there been a rapid increase inthe global saturation level of telephones, considered the basic means ofcommunication, but also in facsimile machines and computers. For instance,according to data from the International Telecommunications Union, there wereabout 70 million telephones in use worldwide in 1950. By the mid-1980s, thisfigure had jumped to about 600 million (cited in Kaku 1995: 5). Computingpower has doubled every 18 months for the past 30 years making the cost ofcomputers less than 1 per cent of what it was in the early 1970s (Keohane andNye 1998: 83). Billions of dollars in stocks, bonds and futures are traded everyday between the world’s major financial markets with little more than the pressof a button. The rise in the number of people with access to the Internet is evenmore astonishing. In 1998, 100 million people used the Internet and some recentsources claim this figure has already reached 1 billion (see Internet World Stats2006). The information revolution has virtually broken central governments’monopolies on collecting and managing large amounts of information.

Improvements in transport technology have also enabled more people to travelgreater distances at faster speeds. Together, progress in the telecommunicationsand transport fields has accelerated the process of internationalising the globaleconomy. Often used interchangeably with the ubiquitous term ‘globalisation’,2the internationalisation of the world’s economy is characterised by the increase inthe flow of goods, services, money, information and people across nationalboundaries. This in turn has deepened the level of interaction andinterdependence of markets and production in different countries – particularlythe advanced, industrial countries – and contributed to what some scholars havereferred to as ‘penetrated’ or ‘perforated’ sovereignty where national borderscannot effectively protect subunits from economic, cultural and other influences,forcing them to establish direct links with foreign actors to protect and promotetheir own interests (Soldatos 1990: 48; Duchacek 1990: 1).

Geographic propinquity and economic complementarity are also conducive tosubnational government diplomacy. Trade in goods and services (political andeconomic barriers notwithstanding) is naturally much quicker and cheaper whentwo parties are in close geographic proximity and flourishes when the productsthey specialise in are in demand. At their closest point, Hokkaido and Sakhalinare separated by only a 43-kilometre stretch of sea known as the Soya Strait. Thedistance between Cape Nosappu in northeast Hokkaido and the Kaigara Islands,a group of islets comprising part of the Habomai group, is a mere 3.7 kilometres.In fact, with the aid of binoculars, on a clear day it is possible to see a Russianborder guard watching you. Needless to say, these factors alone do not

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automatically lead to close relations. Interstate conflict can also impede thedevelopment of subnational links.

The Soviet Union’s collapse and the end of the Cold War

The Soviet Union’s collapse and the end of the Cold War helped to alleviate boththe military threat Russian forces in the Far East posed and the tension in theborder zone. This removed a major obstacle to the development of subnationalgovernment relations. Although the Soviet government officially decided topartially lift the ban on the entry of foreigners into a few urban settlements inSakhalin in mid-1984,3 a traditional mistrust of foreigners kept the number oftourists to a minimum. It was not until the early 1990s that the mutual mistrusthad dissipated enough to permit both sides to agree to begin talks on establishingregular transport links between the two islands. After successful lobbying by bothregional governments, a regular air service between Hakodate and Yuzhno-Sakhalinsk was established in April 1994. The following year, ferry serviceslinking Korsakov with Wakkanai and Otaru were inaugurated in April and May,respectively. However, in an illustration of the lingering distrust thatcharacterised Cold War relations, the Japanese Air Self Defence Force objects toRussian aircraft being able to use the international airport at Chitose because aJapanese air base is located nearby.

The establishment of regular transport links has helped promote exchangebetween subnational government and private groups on both islands in a widevariety of fields including education, business, medicine, sports, culture and themedia. Of the 12 sister-city agreements between municipalities in Hokkaido andSakhalin, seven were concluded either immediately before or immediately afterthe Soviet Union’s collapse. There has also been an increase in mutual visitsbetween current Russian and former Japanese residents of the disputed islands,discussed in greater detail in Chapter 3.

Domestic factors

Economic asymmetry of subnational units arising from central government errors and inefficiency

RUSSIA

Economic asymmetry among Russia’s federal units, arising from a long historyof ill-conceived central government policies, has been the most significantcontributing factor to Sakhalin’s increased presence on the international stage.Sakhalin, like the rest of the Russian Far East, has a cornucopia of naturalresources including fisheries, forestry, non-ferrous metals, and oil and naturalgas. Although it is true that an abundance of natural resources does not guaranteedevelopment, Sakhalin, nevertheless, should be far more economically developedthan it is at present. One may lament the fact that the Russian Far East has not

Russian and Japanese subnational diplomacy 55

developed to the extent of other naturally endowed resource centres such asAustralia and Canada. It might well have done so had it not had the misfortune ofbeing part of the Soviet Union.

According to the principle of the ‘socialist location of productive forces’,production was distributed throughout the Soviet Union, with each region hometo a specialised industry that was designed to participate effectively in thenational economy (Huzinec 1983: 127).4 The Soviet Far East served almostexclusively as a supplier of natural resources for the country’s industrialisationand was drawn into a classic core–periphery relationship with European Russiathat has been described by one scholar as ‘parasitic’ (Dienes 1990: 277). The FarEast was heavily reliant on Moscow for subsidised food, energy and transport aswell as budgetary support for local administration, credits for enterprises, andstate purchases of the output from its military–industrial complex. Moscow’sperception of the Far East as a vulnerable frontier in perpetual need of protectionfurther distorted the region’s narrow and unbalanced industrial structure. This ledto a significant military presence in the region and blocked the development ofcloser economic ties between the Far East and its neighbours in the Asia-Pacific.The region’s manufacturing was geared towards supplying the military. It shouldbe noted that the Far East did engage in small-scale coastal trade. However, thisdid not substantially benefit the regions as it was fully controlled by Moscow,which saw it as part of a nationwide mechanism to earn hard currency, retainingup to 95 per cent of export earnings (Minakir 1994: 46). According to MichaelBradshaw, in some cases, Siberian resources were mortgaged to pay for Westerntechnology, which was used to modernise the European regions’ manufacturingbase, thereby perpetuating a core–periphery structure (1987: 126). Moscow’spolicy of administering the country by dealing individually with each province inthe region impeded the development of horizontal economic ties across theregion. The horizontal flow of goods and services that did take place was atMoscow’s behest.

The Soviet Union’s collapse removed a major obstacle to the development ofeconomic ties with the Asia-Pacific region. The (now) Russian Far East ceased tobe a closed military outpost and was given the opportunity to integrate with theworld’s fastest growing economic region. Radical economic reforms launched bythe Gaidar-led Russian government in early 1992 helped to push the Far East intowhat Robert Scalapino has termed a ‘natural economic territory’ (1997: xvi).5Price liberalisation triggered hyperinflation, sending the prices of basic food andgoods beyond the means of average citizens. It also sent transport costsskyrocketing, adding significantly to the real cost of sending goods by rail to theFar East from the major manufacturing centres in distant European Russia. Inresponse to pressure from the Far Eastern subregions, Moscow agreed in early1993 to reduce transport charges for goods sent to the Far East. However, becauseof a shortage of funds to subsidise this reduction fully, transport costs remainexcessively high. In an effort to stem the inflation caused by price liberalisation,the Chernomyrdin government adopted a series of austerity measures including

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limiting the expansion of credit and reducing budget expenditures, which led to acrucial loss of central investment, particularly in production and infrastructure(Minakir 1999: 53–5).6 According to Russian figures for capital investment inSakhalin from 1975 to 1993, investment peaked in 1990 at approximately 2.05million roubles, but dropped to 1.03 million in 1992 and to 730,000 in 1993(Goskomstat Rossii 1995: 723).

The substantial reduction in central investment was further compounded bythe failure to develop a workable and transparent tax system, which has severelyrestricted the government’s ability to generate revenue, and subsequently toredistribute funds in a fair and equitable manner. The command economy’scollapse and the failure to develop a consensus-based integrated financialframework have led almost every region to come to a special arrangement withMoscow regarding tax allowances and subsidies. The arrangements differ fromregion to region and depend on the provinces’ strategic importance to the centre,the value of their natural resources and regional politicians’ assertiveness(Kirkow 1998: 63; Treisman 1998: 896). A combination of these three factors –the strategic importance of Sakhalin as a ‘window’ for Moscow on the Asia-Pacific region, its enormous reserves of oil and natural gas, and theoutspokenness of former Governor Valentin Fedorov, who on a number ofoccasions threatened secession if Moscow made any territorial concessions toJapan over the Kuril Islands – appeared to have worked in Sakhalin’s favourwhen in August 1993 the central government announced a federal programme forthe Kuril Islands’ socio-economic development. Moscow pledged 100 billionroubles (US$35.7 million) in subsidies to Sakhalin, but by September 1994, hadprovided only 5 billion roubles (US$1.6 million) (Kirkow 1995: 945).7 This is notan isolated example of Moscow’s failure to make good its pledges of financialassistance to the regions. In fact, as Daniel Rosenblum observes, the problem ofnon-payment has become so deeply entrenched that the Russian Committee forStatistics (Goskomstat) reportedly keeps two sets of data – one for moniesallocated and one for those actually paid (cited in Alexseev and Vagin 1999: 177).

The lack of federal funding has had a severe impact on Sakhalin’s economyand its residents’ standard of living. Socio-economic conditions on the Kurilshave been even worse. However, it should be noted that the local economy wasin decline before the Soviet command economy’s collapse. The situation has beencompounded by the fact that as islands, Sakhalin, and particularly the Kurils, arehighly vulnerable to interruptions in the supply of essential goods and servicesfrom the mainland during periods of inclement weather. Despite sitting atop vastenergy reserves, Sakhalin and the Kurils have in recent years suffered severeenergy shortages. The federal government’s inability to pay wages on time meansthat consumers, both private and public, have been unable to afford to pay fortheir heating and electricity. This has left the power companies without thenecessary funds to pay coal suppliers, creating a kind of ‘vicious energy cycle’.The constant delays in payments and poor maintenance have also meant that oilextraction in Sakhalin has decreased to a level inadequate to meet its own oil

Russian and Japanese subnational diplomacy 57

requirements. As a result, during periods of severe shortages, most buildings andapartments received electricity and water for a maximum of only four hours perday.8 In a region where the average winter temperature can drop to below -20° C,insufficient heating can make living conditions unbearable. Energy shortageshave also adversely affected industrial production, particularly fishing – theisland’s biggest industry. According to a Sakhalin government official, lack offuel has, in the past, kept 60 per cent of the oblast’s fishing boats from operating(Suzuki 1992: 32).9

Food production also dropped, mainly as a result of the dismantling of theisland’s collective farms (kolkhozy) and early problems with the development ofprivate farms to replace them (Ikeda 1998: 30). The kolkhoz also used to provideimportant social services to the areas where they were located. Their privatisationled to a loss of these services. In addition to the structural difficulties caused bythe transition from a centrally planned to a market economy, unfavourable naturalconditions have also hampered agricultural development in the Sakhalin region.Land suitable for intensive agriculture occupies only 130,000 hectares, or 1.4 percent of workable agricultural areas (Vysokov 1998: 38), making it difficult tomeet the region’s requirements.10 The fall in agricultural production and thefinancial difficulties the island’s residents encounter in purchasing sufficient foodsupplies have led to a decrease in the per capita food consumption of meat, milk,eggs and fish (Ikeda 1998: 24). Given the decline in food consumption and thegeneral feeling of depression, it is not surprising that the average life expectancyof the island’s residents has decreased. What is alarming, however, is the rate atwhich it has dropped. In 1986–7, the average life expectancy was 68.3 years. By1995, this had fallen by over 10 years to 55.3 years (ibid.) – a figure analogouswith many developing countries.

JAPAN

As is the case with Russia, an economic core–periphery relationship is said toexist in Japan. Japanese postwar industrial and economic development has beenlargely concentrated within the metropolitan regions on the nation’s Pacific belt.Manufacturing on a wide scale never took root in Hokkaido. Instead it played thetypical role of a periphery, providing raw materials such as coal, timber and foodto the centre, which partly fuelled this development. In order to alleviate some ofthe problems caused by an overconcentration of industry and population in thePacific belt regions and to stimulate nationwide economic development,successive Japanese governments have attached great importance to regionalpolicy. Japanese regional policy has been undertaken within a frameworkspecified by two sets of plans: national development plans and industrial locationplans. Based on the National Land Comprehensive Development Law (Kokudos™g™ kaihatsu-h™), national development plans have resulted in a disproportionateshare of public works spending on poor, agricultural prefectures. Theseprefectures contribute relatively little to national coffers, but because of an

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electoral gerrymander, have been an important source of votes for successiveLDP governments (see Calder 1988). Since the early 1970s, the government hassupplemented these public works programmes with policies seeking to promotehigh-tech industry and regional development simultaneously (ibid.: 286).Japanese regional policy, at least until the early 1980s, was relatively effective instemming migration flows from rural to urban areas and in reducing regionalincome disparities between Tokyo and the poorest prefectures.

As comparatively underdeveloped regions (owing to their relatively shorthistory of development), Hokkaido and Okinawa differ from other prefectures inthat they fall under the jurisdiction of special central government agenciescharged with overseeing their development and providing them with specialeconomic assistance. Based on the Hokkaido Development Law, the HokkaidoDevelopment Agency (Hokkaid™ Kaihatsuch™) was established in 1950 as anextra-ministerial department of the Prime Minister’s Office. The Agency’s localbranch, the Hokkaido Development Bureau (Hokkaid™ Kaihatsukyoku), wascreated the following year. In January 2001, it was amalgamated with theMinistry of Land, Infrastructure and Transport (Kokudo K™tsuøsh™ ). The specificmeasures designed to promote Hokkaido’s economic growth and developmentare outlined in a number of development plans. The first Hokkaido DevelopmentPlan was launched in 1952. The sixth, and most recent, went into effect in 1998and concludes in 2007 (Hokkaid™kyoku date unknown).

An enormous amount of public money has been invested in Hokkaido. Thetotal cost of the first five development projects undertaken in accordance with theplans amounts to approximately 60 trillion yen (Nagai and ïba eds 1999: 327).Hokkaido has attracted a disproportionate share of the central government’spublic works spending – at one time receiving 15 per cent, despite having only 5per cent of the national population. By the late 1990s, this share had fallen toabout 10 per cent. The projects have focused on declining sectors of the economysuch as agriculture, forestry, fisheries and the coal industry, while the machineindustry and electronics have been concentrated on the Pacific belt. Thus, theseprojects can also be said to have perpetuated a core–periphery relationship,although not as pronounced as in Russia. There is no doubt the developmentprogrammes have greatly improved Hokkaido’s physical infrastructure,particularly its ports and highways. However, there is a negative aspect: the highshare of public works has impeded autonomous growth and engendered a highdegree of dependence on investment from Tokyo, making the Hokkaido economyparticularly vulnerable to shifts in central government development strategies.

The period of high economic growth in Japan from the Korean War until thefirst Oil Shock brought mixed results for the regional economy. Although slightlyunder the national average, Hokkaido recorded impressive growth. However, itwas also during this growth period that the economic gap between Hokkaido andthe nation’s industrial centres began to grow. Before this period, the Hokkaidoeconomy was referred to as the ‘5 per cent economy’ as its share of both nationalGDP and Japan’s total population was 5 per cent. The rapid growth of the

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Japanese economy saw Hokkaido’s share of domestic production gradually fallfrom 5.3 per cent in 1955 to 4 per cent in 1970 (ibid.: 333), making it moreappropriate to refer to it as the ‘4 per cent economy’ (Hokkaid™ Shinbun J™h™Kenkyuøjo ed. 1996: 79).11 Moreover, economic rationalisation led to the closureof many coalmines. The coal industry was an important part of the Hokkaidoeconomy and the pit closures led to an increase in local unemployment andsubsequent industrial disputes. Advances in agricultural technology made manyfarm labourers redundant, leading to a rural exodus as redundant workers soughtemployment opportunities in the cities.

The economic gap between Hokkaido and the major industrial centres on thePacific belt further widened from the early- to mid-1970s. After the first OilShock in 1973 and the subsequent recession, the Japanese economy moved fromhigh to stable growth. Japan’s industrial structure also began to shift away fromheavy, smokestack industries to light industry, reducing the domestic demand forcoal, which was further dampened by imports of cheaper, foreign coal. The 1985Plaza Accord caused a significant appreciation of the yen, which led to anincrease in domestic production costs. This reduced the number of firms seekingto relocate to Hokkaido and also led to a ‘hollowing out’ of existing industry asmany firms moved their operations offshore (mostly to Southeast Asia and China)to take advantage of the lower labour costs. Agriculture was also adverselyaffected by increasing foreign pressure on Japan to open up its markets to cheaperforeign imports. The Soviet Union’s establishment of a 200-mile EEZ in 1977restricted the access of local fishers to the rich fishing grounds located around thedisputed islands, particularly affecting the areas around Nemuro and Soya thatrely heavily on the fishing industry. The economic boom of the late 1980s offereda brief respite for the Hokkaido economy, which, like other parts of Japan, wasfed by speculative investments. The bubble economy’s collapse in the early 1990splunged Japan into its worst postwar recession. The collapse of Hokkaido’slargest bank, the Takushoku Gink™ in November 1997, was an enormous blow tothe regional economy. It added 5,200 people to the unemployment queues andaffected many of the region’s companies. The number of corporate bankruptcies,which had been rising steadily since the bubble’s collapse, jumped to 112 soonafter the bank’s insolvency (Zaidan H™jin Yano K™ta Kinenkai ed. 2000: 279).The economic and psychological impact of the bank’s failure was so great itprompted some to claim that ‘Japan as a whole is in recession, but Hokkaido’seconomy has been destroyed’ (Nagai and ïba eds 1999: 355).

To sum up, as frontier regions, both Sakhalin and Hokkaido were drawn intoa classic core–periphery relationship, providing natural resources used to fuelgrowth and industrial development elsewhere. However, this relationship wasmore pronounced in the Soviet Union than in Japan. Both peripheries becamedependent on their respective centres for investment, which impeded autonomouseconomic development. Recession in Japan and post-Soviet Russia’s troubledtransformation to a market economy have resulted in significant reductions infinancial support from the central governments. Both regions saw the promotion

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of external economic ties as a means to reduce the dependence on their respectivecentres and proceed along the path of autonomous development, thereby arrestingtheir economic decline. Sakhalin’s desire to develop economic relations withJapan, and particularly with neighbouring Hokkaido, also offered an opportunityfor Japanese negotiators to exploit by offering incentives in order to alleviateSakhalin’s opposition to Russia transferring the four islands to Japan. Itsperceived authority in matters pertaining to the territorial dispute was the reasonwhy Japanese negotiators began to pay attention to Sakhalin. Sakhalin’s authorityon this issue emerged partly as a result of the fallout from the Soviet Union’scollapse and Russia’s troubled attempts at state building.

Asymmetry of federated units and problems with the nation-building process

RUSSIA

Russia has been characterised not only by an economic asymmetry among theterritorial sub-units, but also by a difference in political status deriving fromMoscow’s attempts to satisfy the demands of various regions, while at the sametime maintaining national unity within a federal framework. For many regionalelites, rightly or wrongly, there has been a direct relationship between economicand political asymmetry, as they believe the federal republics receive greatereconomic benefits from Moscow than the regions do.

The Union of Soviet Socialist Republics (USSR) was a federation of 15 ethno-territorial Union Republics and 38 autonomous republics, oblasts and okrugs.Soviet federalism was unique in that it reflected Bolshevik views of national self-determination and the principle of territorial autonomy for specific ethnic groups,which allowed some to have a state in their name, while others failed to qualifyfor the honorific title of ‘nation’ and instead were called ‘nationalities’(narodnosti) (Sakwa 1996: 175–6). The Soviet claim that it was a truly federalstate is misleading as no segment of the polity was endowed with any significantdegree of decision-making autonomy under Communist Party rule. One scholarhas more aptly referred to it as a ‘pseudofederation’ (Duchacek 1990: 3–5).12

Russia’s position within the Soviet federation was anomalous. It was a UnionRepublic – RSFSR – and, at the same time, the centre of the USSR. However, theconflation of Russia within the Union, unlike the other Union Republics,deprived it of both the institutional and cultural attributes of nation-statehood(Lapidus and Walker 1995: 80), although it should be noted that Russians heldkey party and government posts throughout Soviet history. A strong belief thatRussia was sacrificing its own specific interests for the larger benefit of theunitary Soviet state was a significant cause of Russian nationalist dissent anddisaffection in the late Soviet period, triggering numerous separatist andsovereignty movements in the RSFSR (see Dunlop 1985: 9–10; 1993: 16–21).

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The Soviet Union collapsed in 1991 and the RSFSR, as the former centre,emerged onto the world stage, assuming responsibility for all the FSU’sinternational rights and obligations. The leaders of the newly independentRussian Federation soon began work on the difficult task of establishing a viablefederal structure. Fully aware of the secessionist campaigns that grew in theformer ethnically based Union Republics during the Soviet Union’s final years,which ultimately triggered its collapse, Russian President Boris Yeltsin sought toavoid the Soviet fate by pushing for a plan that would weaken the ethno-federalprinciple in favour of a non-ethnic-based federation.13 Yeltsin’s proposal wasadopted in the 1991 draft Constitution. This drew protests from the republics bythose who advocated maintaining the existing federal hierarchy with the ethno-federal units at the top. Yeltsin sought support from the republics in the strugglewith the Russian Parliament in 1993 and was forced into a compromise wherebythe national republics’ special status was retained, but the rights of Russia’sregions were enhanced (Sakwa 1996: 187). This agreement was enshrined in theFederal Treaty, which was signed on 31 March 1992. The Federal Treaty affirmedthe principle of ‘asymmetrical federalism’ as it recognised three different types offederal subjects: 21 national-state formations (formerly autonomous republics) assovereign republics within the Russian Federation; 57 administrative territorialareas (kraya, oblasti, as well as the cities of Moscow and St Petersburg); and 11 national-territorial areas (autonomous oblasti and autonomous okruga) (ibid.).

Although the Federal Treaty was successful in satisfying the republics’demands temporarily, thereby defusing to some extent the tension betweenMoscow and the republics and alleviating the threat of Russia breaking up, itcaused considerable resentment in the regions.14 Their dissatisfaction with thetreaty stemmed from the belief that republics should not have a higher politicaland economic status, particularly as a number of the titular nationalities did noteven constitute a majority in their own regions. The treaty granted the republicsthe attributes of statehood: their own constitution and laws, their own electedparliaments, supreme courts and presidents (ibid.). The regions, on the otherhand, were able to adopt only binding resolutions (resheniia or postanovleniia)and charters (ustavy) (Slider 1994: 247–8). However, from 1996, Russia’s regionswere also able to elect their own governors (often called the heads ofadministration or glava administratsii).15 A further source of contention was aclause in the treaty granting the republics sole ownership of their naturalresources, although the regions were not given equivalent rights (Hughes 1994:1146). Budget subsidies given to the republics by the federal government, whichderived from the tax transfers obtained from the regions, further compoundedregional resentment (ibid.).16

Emboldened by his success in disbanding the Russian Parliament in October1993, Boris Yeltsin took a more assertive line towards the regions and republics,reneging on many of the concessions he had been compelled to make in hisstruggle with that parliament (Sakwa 1996: 188). As the decision to send troopsinto the breakaway republic of Chechnya shows, he took a particularly tough line

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towards those regions that made assertions of independence. While reflecting theFederal Treaty’s provisions, the Constitution, adopted in December 1993, soughtto equalise the subjects of the Federation’s rights and make them subject tofederal laws and decisions. It abandoned the principle of asymmetricalfederalism, at least theoretically, instead regularising a hybrid mix of national andterritorial federalism (Sakwa 1996: 189). Despite accompanying declarations onthe equality of all the Federation’s subjects, the republics continued to enjoygreater rights than the regions. Moscow’s attempts to accommodate the regionsfurther by concluding a series of power-sharing agreements with them after theConstitution was adopted protected these rights and preserved the principle ofasymmetrical federalism (ibid.). These agreements diverged from theConstitution and suggested that the rules defining relations between the centreand the regions would not be based on a formal contract or carefully constructedconstitution, but rather on a series of politically expedient compromises, mostlyin the form of bilateral treaties or agreements.

JAPAN

Japan has a unitary form of government and, as discussed previously, has beendepicted, particularly in the early literature on local government, as beingextremely centralised. Japan has undergone campaign, electoral and financialreforms in the 1990s and, more recently, public sector and ‘trinity reforms’relating to financial relations between the central and local governments, whichhave significantly changed the political landscape. However, the Japanese havenot been compelled to undertake a process of nation-building as far-reaching asRussia’s since the end of the Cold War and have avoided many of the problemsassociated with this endeavour. The Constitution, rather than bilateral treaties,defines the demarcation of powers between Tokyo and the prefectures. Moreover,while most of Japan’s regions seek greater autonomy, there exist no seriousindependence movements, which might facilitate ad hoc bargaining between thecentre and the regions, and therefore there is no imminent threat of Japanbreaking up.

Constitutional uncertainties

RUSSIA

According to Martin Nicholson, ‘The [bilateral] treaties established the practiceof individual bargaining, often with Yeltsin himself, as the main vehicle for theconduct of regional relations with the centre’ (1999: 21). This obviated thenecessity of establishing a firm constitutional framework to governcentre–regional relations. Nevertheless, Article 71 of the Russian Constitutionappears to have been quite clear regarding the allocation of powers in the foreignpolicy field, stipulating that Russia’s international relations, international treaties,

Russian and Japanese subnational diplomacy 63

issues of war and peace, foreign economic relations, and defence and security,including the production, sale and purchase of weapons, are a federalresponsibility (Administratii Prezidenta Federatsii 1993: 27–8). Specifically, theConstitution confirmed the President’s pre-eminent role in foreign policy with thegovernment reduced to the role of doing little more than implementing thepresident’s policies.

However, it should be noted that federal supremacy in the foreign policy arenahas not been absolute. Article 72 of the Constitution specifies that thecoordination of international and foreign economic relations, as well as theimplementation of international treaties, falls under the joint jurisdiction of theFederation and its components. The issue of joint jurisdiction is considered bysome to be vague, leaving many details to be resolved by future negotiation andenacting legislation (Lapidus and Walker 1995: 93–101).17 Moscow failed to takethe initiative in clarifying jurisdictional competencies during the Yeltsin era.According to Alexander Sergounin, ‘Rather than taking the lead in defining andlimiting what the regions have the right to do, Moscow either has taken the wait-and-see attitude or simply reacted to what regions demand’ (1999: 3). Asdiscussed in the next section, this has implications for Sakhalin’s involvement inthe territorial dispute with Japan.

Apart from the Constitution, other mechanisms have attempted to define theregions’ rights in the foreign policy sphere. The Federal Law on State Regulationof Foreign Trade Activity, which was enacted on 13 October 1995, regulates theforeign economic relations of Russia’s regions. However, one Russiangovernment official sees this law as only partially and not always effectivelyregulating such activities (Kuzman 1999: 114). In a further attempt to establish alegal basis to regulate the foreign relations of Russia’s regions, President Yeltsinsigned an edict in March 1996 entrusting the MID with ensuring the coordinationof a unified foreign policy. However, the inability to define clearly themechanism of this coordination caused some subsequent foreign policydifficulties.18

In the absence of a firm constitutional framework, a number of subjects havesought to expand their autonomy through a variety of means. Many regionalcharters and republican constitutions contained articles that clearly contradictedfederal laws and the Constitution. In some regional statutes whole paragraphshave been lifted from the Russian Constitution which, as Peter Kirkow argues,‘could easily be an example of regional elites … claiming the primacy of regionallegislation over that of the [Russian Federation], for which [Primorskii krai] isprobably the best example’ (1998: 197). Sakhalin authorities, meanwhile, haveattempted to increase their autonomy through subtler means. A clause has beeninserted into the statutes of many regions stating the primacy of the RussianConstitution and federal laws over those of the subjects. Article 6 of the Sakhalincharter, however, stipulates that ‘the Russian Constitution and Federal laws mustbe observed’ (Nakamura 1998: 291). According to Nakamura Itsur™, there aretwo possible reasons why nothing has been mentioned regarding federal

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legislative supremacy. First, in the case of a conflict, it is natural that federal lawstake precedence in Russian territory, therefore making it unnecessary to insertsuch a clause. However, it is also possible that by adopting a vague position,Sakhalin is trying to leave room to expand the oblast’s autonomy as much aspossible (ibid.).

JAPAN

According to Article 73 of the Japanese Constitution, cabinet has the authority tomanage diplomatic relations (gaik™ kankei o shori suru koto) (Ropp™ Henshuø bued. 2000: 46). Most Japanese theories of public law confirm the centralgovernment’s monopoly of diplomatic powers, referring to diplomacy as a matterin which subnational governments cannot be engaged (ïtsu 1994: 40). Japanesepublic law is also negative towards the issue of subnational governments jointlypossessing diplomatic powers (jichitai ni yoru gaik™ken bunyuø ka) with the centralgovernment (ibid.: 49).

Although Japanese legal scholars often note the constitutional limitations onsubnational governments’ external activities, political scientists have begun toseek out legal loopholes permitting subnational government diplomacy.Matsushita Keiichi, an expert on Japanese subnational government, speaks of amultilayering (juøs™ka) of nation-state and subnational government diplomacy thatforesees the joint possession of diplomatic powers. Matsushita further argues thatwhen Article 73 of the Japanese Constitution entrusts the cabinet with diplomaticpowers, it actually means only coordination and leadership in the foreign policysphere (1988: 255–90). Implicit in this argument is Matsushita’s belief thatsubnational government diplomacy is not unconstitutional as long as the localitiesdo not seek a leadership or coordinating role in foreign policy. Ebashi Takashispeaks of a ‘theory of permission’ (kyoy™setsu) in which subnationalgovernments are allowed to do what is not banned by national laws (1997b: 41).Article 2, Section 10 of the 1947 Local Autonomy Law (LAL) established ‘stateaffairs’ (kokka no jimu) as an area in which subnational governments cannotintervene. However, despite the assertion made in Japanese public law theory,diplomacy is not mentioned. The reason is that at the time when the LAL wasadopted, no one envisaged that subnational governments would engage indiplomacy (Matsushita 1988: 269; ïtsu 1994: 40). In 1947, Japan was not asovereign state and was under the authority of SCAP. Many of the regions werestill recovering from the devastating effects of war and had little time or moneyto engage in international activities.

However, the present international situation is very different from the one inwhich policymakers operated over 50 years ago. The end of the Cold War,deepening interdependence among nations, and globalisation have led to anincrease in the flow of people, goods, services and information across nationalboundaries directly affecting subnational governments and the constituenciesthey represent. Subnational governments can no longer afford to hide behind state

Russian and Japanese subnational diplomacy 65

boundaries and are increasingly being forced to be more active in theinternational arena in order, inter alia, to secure foreign investment as a means ofimproving local economic living standards. If one considers that revitalising theregional economy is one of the key roles of subnational governments, it can beargued that local international exchange and cooperation are not banned by theLAL, as it has now become an important means of regional economicreinvigoration. The Ministry of Home Affairs (or MOHA, which, as a part ofcentral government reforms, merged with the Management Coordination Agencyand the Ministry of Posts and Telecommunications in January 2001 to become theMinistry of Public Management, Home Affairs, Posts and Telecommunications orS™mush™) actually tried to include international cooperation as a subnationalgovernment affair in an amendment to the LAL in 1990. However, it was forcedto back down following pressure from the MOFA. The qualitative andquantitative increase in the international activities of Japanese subnationalgovernments from the 1980s, in many instances, provided a challenge to thecentral government, necessitating a gradual institutionalisation ‘to maximize theministries’ capacity for assistance, regulation and influence’ (Jain 2005: 46). TheCouncil of Local Authorities for International Relations and the JapanIntercultural Academy of Municipalities are two of the newer bodies establishedto facilitate subnational governments’ positive contribution to Japan’s foreignaffairs (ibid.).

From the late 1980s, the MOHA began to promote subnational governmentinternational exchange and sought to establish a legal basis by issuing a numberof supporting guidelines. The first of these was the March 1987 ‘Guidelines forInternational Exchange in Local Public Bodies’ (Chih™ k™ky™ dantai ni okerukokusai k™ryuø no arikata ni kansuru shishin ni tsuite). This was followed in 1988by the ‘Guidelines for International Exchange Town Making’ (Kokusai k™ryuø nomachizukuri no tame no shishin ni tsuite) and the ‘Local Public Servants’Overseas Dispatch Law’ (Chih™ k™muin kaigai haken-h™), which was enacted inorder to enable Japanese subnational governments to send staff abroad. The latterwas an important move in allowing subnational governments a certain degree ofautonomy in their international activities. Previously the only available option forsubnational governments to send their staff abroad for training was to send themas Japan External Trade Organization (JETRO) officials, which left these staffmembers with little time to spend on their own work (Ebashi 1997b: 42). In 1989,the ‘Guidelines for Promoting Regional International Exchange’ (Chiiki kokusaik™ryuø suishin taik™ ni kansuru shishin ni tsuite) were also enacted. By issuingthese guidelines, the MOHA displayed a willingness to promote subnationalgovernment international exchange. However, as Matsushita notes, the MOHAdid not envisage the localities as separate policy subjects having an ‘internationalpolicy’ opposed to the state (1988: 256).

The former MOHA was not the only government department that sought toestablish a legal basis for the international activities of subnational governments.In 1992, the MOFA, softening its earlier opposition, released ODA Guidelines

66 Russian and Japanese subnational diplomacy

officially recognising for the first time the role of subnational governments in thisarea. A further evolution in central government acceptance of these activitiesoccurred when the MOHA issued the ‘Guidelines for Promoting LocalGovernment International Cooperation’ (Jichitai kokusai ky™ryoku suishin taik™)in 1995. As a result, 1995 is often referred to in the discourse on Japanesesubnational government diplomacy as ‘year one of subnational governmentinternational cooperation’ (jichitai kokusai ky™ryoku gannen) (Ebashi 1994: 46).19

Regionalism/nationalism

RUSSIA

From the period shortly preceding the Soviet Union’s dissolution in December1991 until the launch of President Putin’s federal reforms in early 2000, post-Soviet Russia experienced a regionalisation or decentralisation of political andeconomic power. There are a number of factors that led to this devolution ofpower from the centre to the regions. The first was the central government’sfailure to redistribute economic resources adequately, leaving many regions tofend for themselves. This led to resentment and distrust towards Moscow amongthe populace, which regional leaders frequently sought to exploit. Second, thefederal government failed to establish viable institutions in place of the formeradministrative-command system, creating institutional ‘gaps’. For instance, asdiscussed above, the Constitution was ambiguous regarding the division ofpowers and responsibility between Moscow and the regions and also howgovernment was to be exercised in the regions. Perhaps most importantly,regionalism in post-Soviet Russia was stimulated by Boris Yeltsin’s own quest forpower; first in 1990 when he encouraged the regions to ‘take all the sovereigntyyou can swallow’ in his campaign for the Russian Parliament’s chairmanship andagain as a quid pro quo when seeking the support of regional elites and theirconstituencies during his conflict with the Russian Supreme Soviet in 1992 and1993, and again in 1996 when seeking re-election as president.

Many regional elites took advantage of the confusion and disarray in the centreand Yeltsin’s own short-sighted exhortations, consolidating power in the regions– often with the support of local business and other vested interests. Manyregional elites were not only able to harness powerful centrifugal forces to buildup their own personal fiefdoms, but also sufficiently empowered to ignore andsometimes challenge the centre’s interests and orders (Friedgut 1994: 5).Relations between the centre and the regions during this period in post-SovietRussia were characterised by a great deal of manoeuvring and bargaining. Oftenunable to wield the stick, Moscow was left to dangle the carrot in an attempt togain regional compliance on key issues.

The regions were also not entirely bereft of political cards which they coulddeal to Moscow (Shlapentokh et al. 1998: 138). Regional elites found it in their

Russian and Japanese subnational diplomacy 67

interests to develop a local consciousness and articulate local interests as a meansof strengthening their bargaining position (Australian Government, Departmentof Foreign Affairs and Trade, East Asia Analytical Unit 1996: 14, hereafterEAAU). The seeds of a regional identity appear to have already been sown in theRussian Far East. According to Mikhail Alexseev and Tamara Troyakova, a regional identity distinguishes the Russian Far East from the rest of Russia. Thisregional identity rests on three conditions. First, local residents share a perceptionof great distance thousands of miles across eight time zones, separating themfrom the European heartland. Second, Russians in the Far East have a differentperception of Russian history than Russians in the European heartland – one thatis based on the Far East’s collective memory that is shaped by stories of frontiersettlement and resistance against external threats that echoed only distantly inMoscow. Third, because of remoteness and common experience on the frontier,residents tend to believe strongly in such social values as individual risk-takingand self-help (1999: 216). Despite threats by regional leaders in the past toestablish a Far Eastern Republic, most observers agree that this identity isinsufficient to generate aspirations for political separatism (see Valliant 1997: 16;Alexseev and Troyakova 1999: 219–22).

Regional leaders have also seen regional fora as vehicles to express theirinterests. In August 1990, the Far Eastern Association (FEA), a loose consultativebody initially comprising the representatives of the soviets in the provinces ofAmur, Kamchatka, Sakhalin, Magadan and Chita oblasti, Khabarovsk andPrimorskii kraya and the republics of Buryatia and Sakha, was established inorder to protect the regions’ interests and present a unified front to Moscow.20

However, far from presenting a common front, the FEA has been rocked byinternal divisions as each of the constituent regions competes for Moscow’spatronage.

For the Sakhalin regional administration, one such card was its positionregarding the South Kuril Islands’ future disposition. Most of the localpopulation, whose national pride has been severely wounded as a result ofRussia’s troubled transition to a fully functioning market economy and who havesought to overcome this by resorting to nationalism, support the regionalgovernment’s hardline position on the territorial dispute, described in greaterdetail in Chapters 4 and 5. The resurgence of nationalism as a force in post-SovietRussia is also a by-product of a weak and unstable politico-economic institutionalenvironment (Wallander 1996: 207–18).

JAPAN

It is tempting to draw a comparison between regionalism in Hokkaido and inSakhalin. On the surface, the conditions upon which Sakhalin and Hokkaido’sregional identities are based appear similar. However, in the case of Hokkaido,they are less salient. Hokkaido is considerably closer to Tokyo than Sakhalin is toMoscow (hundreds as opposed to approximately 10,000 kilometres). It is

68 Russian and Japanese subnational diplomacy

connected to the main island of Honshu by ferry and rail and is only a little over90 minutes by plane from Tokyo. Hokkaido is also not subject to the type ofweather-related transport disruptions that often affect Sakhalin and the KurilIslands. If there is a perception of distance among Hokkaido residents, it is minorcompared to that felt by the people of Sakhalin. It is difficult to ascertain whetherHokkaido residents have a different perception of Japanese history than the restof the nation. Hokkaido is unique in that it was a frontier region whose settlementwas necessitated by the perceived Russian threat from the north; if the region wasnot colonised by the Japanese, it was thought it would inevitably fall underRussian dominion. The colonisation of Hokkaido was, however, very muchdependent on the Japanese central government for finance and direction, and this,in turn, substantially weakened the region’s emerging identity. Hokkaido’s strong dependence on the central government has led some to doubt whether afrontier spirit (kaitakusha seishin), such as that eulogised in America’s westwardadvance, developed among Hokkaido’s settlers (Nagai and ïba eds 1999: 6;Iwasaki 2000: 17).

This is not to deny that a regional identity does exist in Hokkaido. Those whohave lived there for a long period are referred to as Dosanko – a term similar toEdokko, which is used for those who have lived in Tokyo for three generations.The lifestyles and cultures fuse the different manners and customs of the variousregions from which Hokkaido’s early settlers came. In particular, clothing, foodand housing are unique because of adaptations to the severe cold not experiencedin other parts of Japan. The cold climate is also a factor in Hokkaido’sinternational relations. The HPG has sought to overcome the negative image ofan icy, barren frontier by actively promoting international exchange with thosecountries and regions (Canada, Alaska, the Russian Far East, northern China andScandinavia) that experience similar climatic conditions to Hokkaido under theconcept of the Northern Rim Exchange (Hopp™ken k™ryuø).

Although there is widespread dissatisfaction among Hokkaido residents at thestate of the regional economy, there are few, if any, economic incentives to breakwith Tokyo. On the contrary, Hokkaido’s approach to resolving many of itseconomic problems has been to seek larger injections of public funds from thecentral government. The prolonged recession in Hokkaido has been a factor in thedevelopment of economic ties with Sakhalin. However, it is certainly notsufficient to give rise to a separatist strategy. The indigenous Ainu make up lessthan 1 per cent of Hokkaido’s population, virtually eliminating any ethnic basisfor independence. Despite its economic woes, nobody in Hokkaido seriouslyentertains the idea of seceding from Japan.

This section has examined the systemic and domestic factors that contribute tosubnational diplomacy as they apply to Hokkaido and Sakhalin. The next sectionanalyses how some of these factors also led to the gradual elevation of Sakhalin’sauthority in matters pertaining to territorial dispute over the South Kuril Islands.

Russian and Japanese subnational diplomacy 69

The rise of the ‘Sakhalin factor’Sakhalin’s influence on domestic policy-making in the period immediatelypreceding the Soviet Union’s collapse was first brought to the attention ofJapanese and Western scholars through the writings of Yakov Zinberg. He coinedthe term ‘Sakhalin syndrome’ to describe a situation in which ‘the Sovietleadership cannot decide a position on the “Northern Territories” problem whileignoring the position of Sakhalin oblast deputies and local public opinion’ (1991:136). In the late Soviet period, the democratisation of Soviet foreign policy andthe conflict between the republics and Moscow over concluding a Federal Treaty,which was designed to keep the Union together in a looser federal structure,provided a fertile environment for the emergence and subsequent growth of the‘Sakhalin syndrome’. For the Japanese, Sakhalin’s involvement in the territorialdispute not only presented obstacles by essentially complicating and pluralisingdiplomatic channels, but also offered advantages if properly linked with offers ofside-payments and other benefits (Zinberg 1995: 92).

The growing importance of the ‘Sakhalin factor’ in Soviet domestic policy-making regarding the territorial problem was initially reflected in a visit toSakhalin and the disputed islands in August 1990 by the newly elected Chairmanof the RSFSR Congress of People’s Deputies, Boris Yeltsin. Yeltsin’s visit waspart of his ‘trans-Russia marathon’ to mobilise regional support in his strugglewith the central government. He had planned to tour all of the islands, butinclement weather restricted his visit to Kunashiri. It was here that Yeltsin madethe statement ‘this is a place that should not be given up’ (cited in Zinberg 1991:136). He continued with the rhetoric during a visit to the Sakhalin port-city ofKorsakov. In an address to local residents, who wanted to know what he thoughtabout the Kuril Islands issue, Yeltsin cried out ‘Kurily nashi’ (the Kurils areours!), to which the crowd cheered (Stewart date unknown). The realisation ofYeltsin’s three-day visit to the region contrasted with the actions of Gorbachevand his Foreign Minister, Eduard Shevardnadze, both of whom allegedly pledgedto visit the islands, but failed to carry out their promise (Zinberg 1991: 136).

The salience of the ‘Sakhalin factor’ during the Yeltsin presidency can belinked to the domestic factors mentioned above that contribute to subnationalpublic authorities’ greater international presence. First, concerning theasymmetry of federated units and problems with the nation-building process inRussia, Yeltsin’s penchant for establishing a series of politically expedientcompromises to govern relations between the centre and the regions in favour ofa formal contract or carefully constructed constitution was especially conduciveto centre–periphery bargaining. It also compelled Russia’s regional elite – whofaced the challenges of promoting economic reform and stimulating growth,extracting tax and budgetary concessions from the federal government tofacilitate this, and otherwise establishing legitimacy in order to stay in power – tosearch for any means to assist in fulfilling these objectives. For the Sakhalinregional administration, one such card was its position regarding the South KurilIslands’ future disposition.

70 Russian and Japanese subnational diplomacy

Second, constitutional ambiguities – a by-product of the preference forbilateral treaties and agreements defining centre–periphery relations – alsobolstered Sakhalin’s authority over the disputed islands. For instance, if thefederal government were to conclude a peace treaty with Japan that obliged it totransfer the South Kuril Islands to the Japanese, Sakhalin would be involved inthe logistics of implementing such an agreement. As Sakhalin regional elites,backed by local public opinion, are vehemently opposed to Russian territorialconcessions, it is possible that they could complicate and delay treatyimplementation, particularly in the absence of significant economic and politicalconcessions from Moscow. It can be argued that joint jurisdiction betweenMoscow and the regions over issues relating to the ownership, use and disposalof natural resources – particularly relevant for Sakhalin, which sees thedevelopment and export of its vast oil, natural gas and fisheries resources as vitalfor its economic revitalisation – also contributed to the ‘Sakhalin factor’. It isquite possible that the Sakhalin regional government could use joint jurisdictionof natural resources as a political card to ensure that the federal government takesinto account its position regarding the disputed islands.

Constitutional ambiguities also left open the possibility of Sakhalin mountinga legal challenge should the federal government decide to transfer the disputedislands to Japan after concluding a peace treaty. According to Article 3 of theSakhalin charter adopted by the oblast Duma in December 1995, ‘Sakhalin oblastconsists of Sakhalin Island and the Kuril Islands, including the MalaiaKuril'skaya gryada (Lesser Kuril Islands comprising Habomai and Shikotan),and oblast boundaries prescribed by international treaties that the RussianFederation concludes, as well as the Russian Constitution and federal laws’(Dewa 2001). This is congruent with Article 15 of the Constitution, whichstipulates that laws and other legal enactments adopted in the Russian Federationmust not contradict the Constitution (Administratsii Prezidenta RossiiskoiFederatsii 1993: 8). This can be interpreted as meaning that any internationaltreaty concluded between the Russian and Japanese governments is legallybinding concerning decisions pertaining to Sakhalin’s boundaries.

However, it should be added that even if a change in oblast boundaries can bebrought about by an international treaty, the charter preconditions this upon theconsent of the residents, stipulating that ‘concerning a change in its boundaries,the consent of Sakhalin oblast shall be expressed by conducting a regionalreferendum’ (Dewa 2001). In this regard, Article 131 of the Constitution lendssupport to the Sakhalin charter by specifying that ‘Changes to the border ofterritories where local self-government is exercised are permitted with dueconsideration for the opinion of the relevant territories’ (AdministratsiiPrezidenta Rossiiskoi Federatsii 1993: 57). Leaving aside the ambiguity of theexpression ‘with due consideration’, the problem is, as discussed in greater detailin Chapter 5, that public opinion polls conducted in Sakhalin have consistentlyshown that oblast residents are strongly opposed to Russia transferring the SouthKuril Islands to Japan. Therefore, a Russian government decision to conclude a

Russian and Japanese subnational diplomacy 71

peace treaty obliging it to return the islands to Japan in the face of localopposition raised the possibility that the treaty could become entangled in aprotracted constitutional debate.

Third, as outlined above, the Soviet Union’s collapse and the subsequentregionalisation or decentralisation of political power during the 1990s allowedregional elites increased autonomy and transformed the regions into powerfulactors that were able to confront the centre on many issues. The territorial disputewith Japan was one such issue in which the Sakhalin regional elite feltsufficiently empowered to complicate and challenge Moscow’s authority.

Finally, the weak and unstable politico-economic institutional environmentdescribed above also contributed to the resurgence of nationalism as a force inpost-Soviet Russia (Wallander 1996). As discussed in greater detail in Chapter 5,most of the local population, whose national pride has been severely wounded asa result of Russia’s troubled transition to a fully functioning market economy,have sought to overcome this by resorting to nationalism. Nationalism has notonly become the motivating factor behind many Sakhalin residents’ opposition totransferring the South Kuril Islands to Japan, but, on a broader level, hasinfluenced government decision-making on a range of domestic and foreignpolicy issues.

As will be discussed in greater detail in Chapter 4, a combination of GovernorFedorov and Farkhutdinov’s high-profile campaigns against Russian territorialconcessions, and Moscow’s receptiveness towards rather than censuring ofSakhalin’s position created a strong perception in Japan that the ‘Sakhalin factor’was an important element in Russian decision-making regarding the NorthernTerritories dispute. For instance, the Asahi shinbun reported that ‘the NorthernTerritories are under Sakhalin’s administration. [Gaining] the oblast’sunderstanding is indispensable (fukaketsu) for resolving the territorial dispute’(14 December 1997: 2). An editorial in the Hokkaid™ shinbun commented thatone ‘cannot treat lightly the role of the Sakhalin oblast administration which hasseized the Northern Territories problem by the neck’ (16 September 1995: 2).Saharin to Nihon (Sakhalin and Japan), the weekly newsletter of theJapan–Sakhalin Society, remarked that ‘In Japan there is deepening recognitionthat a “Sakhalin policy” is one of the keys for predicting the success or failure of[concluding] a peace treaty’ (2 February 1998: 2).21 The regular stream of officialJapanese delegations to Sakhalin to discuss the territorial dispute and gauge localpublic opinion is but one example of Japanese sensitivity towards the ‘Sakhalinfactor’.

ConclusionDrawing on Panayotis Soldatos’ earlier study of the causes of subnationalgovernment diplomacy, this chapter first examined the external and domesticfactors that have contributed to Sakhalin’s and Hokkaido’s greater presence onthe international stage. These factors have also prompted subnational public

72 Russian and Japanese subnational diplomacy

authorities in Sakhalin and Hokkaido to establish what has become a burgeoningtransnational relationship – the qualitative and quantitative aspects of which areworthy of academic research.

The chapter then argued that among the generic causes of subnationalgovernment diplomacy, the Soviet Union’s collapse, the asymmetry of federatedunits and problems with the nation-building process, constitutional uncertaintiesand growing regionalism and nationalism during the 1990s contributed to thegradual elevation of Sakhalin’s authority in matters pertaining to the South KurilIslands’ future ownership. Japanese perceptions of the salience of the ‘Sakhalinfactor’ in the Russian decision-making process during the Yeltsin regime madethe oblast a target of Tokyo’s and the HPG’s transnational lobbying attempts thataimed to minimise local opposition to a possible transfer of the disputed islandsto Japan. Alleviating Sakhalin’s opposition would make it easier in theory for theKremlin to accede to Japan’s territorial demands.

Russian and Japanese subnational diplomacy 73

3 Hokkaido–Sakhalin transnational relations

IntroductionThe introduction of parliamentary and, from late 1995, gubernatorial elections inRussia’s provinces made it theoretically necessary for all candidates for politicaloffice to be cognisant of how the electorate views the dispute over the South KurilIslands. Clauses in both the Sakhalin and the South Kuril Districts’ charters,which emphasise the consent of oblast residents as a precondition for any transferof the islands to Japan, further underscored the importance of local publicopinion. This was not lost on practitioners of subnational government diplomacyin the HPG, or indeed on the Japanese government. Moreover, Hokkaido emergedas an important economic partner for Sakhalin and a vehicle in its attempts tointegrate into the Asia-Pacific region. In addition to promoting autonomousdevelopment, practitioners of subnational government diplomacy and otherobservers in Hokkaido believed that developing cultural and economic ties mightcreate interest groups in Sakhalin cognisant of the benefits of, and dependent on,cooperative relations, which would help to alleviate local opposition to Russiatransferring the South Kuril Islands to Japan and, in the process, contribute tocreating an environment (kanky™ seibi) at the subnational level conducive toresolving the territorial dispute.1

This chapter examines the Hokkaido and Sakhalin administration’s efforts topromote cultural and economic relations between the two regions. Afterconsidering the legal provisions in Russia contributing to the increasingimportance of public opinion as a factor in the territorial dispute, it outlines fourforms of international exchange activities carried out between Hokkaido andSakhalin oblast: Dialogue ’92, the visa-less exchange programme between theformer Japanese and current Russian inhabitants of the disputed islands,humanitarian exchanges and sister-city relations. The chapter then identifies thekey factors facilitating the development of economic ties between Hokkaido andSakhalin and the attempts by both administrations to utilise these and promotetrade and investment linkages. The analysis also pays particular attention to theextent to which these modes of exchange have accorded or conflicted with therespective central government policies.

Cultural and humanitarian exchange

The salience of local public opinion: An opportunity for Japanese transnational lobbying?

The necessity of the Soviet leadership taking public attitudes into considerationwhen formulating policy was formally recognised in article nine of the 1977Constitution, which called for a ‘constant responsiveness to public opinion’ (citedin Wedgwood Benn 1992: 12). However, this article was merely a statement ofone of the goals and principles of the Soviet system of government. In reality,public opinion as an independent social institution that affects the politicalprocess did not exist in the Soviet Union (or in any other communist country)(Wyman 1997: 4). The limited survey research that was conducted, particularlybefore the Gorbachev era, was either heavily politicised or focused on mundaneaspects of Soviet life such as leisure activities (ibid.: 5).

The Soviet Union was already in considerable economic and social decline bythe time Gorbachev rose to power in March 1985. By the early to mid-1980s, theSoviet leadership had come to recognise that the tight censorship enforced duringthe Brezhnev era was a factor contributing to the malaise of Soviet society (Smith1992: 186). As Gordon Smith aptly remarked, social problems could hardly beaddressed in an effective manner when the leadership denied their existence(ibid.). Gorbachev therefore introduced a policy of glasnost or openness, which,inter alia, aimed to stimulate a much broader range of acceptable publicdiscussion of various problems and issues (ibid.: 185).

Gorbachev’s glasnost policy led to the gradual removal of the physical andideological constraints that had prevented the comprehensive study of Sovietpublic opinion (Wyman 1997: 5). As part of the new infrastructure designed tosupport a more systematic study of public attitudes, the All-Union Centre forPublic Opinion Research (VTsIOM according to its Russian acronym) wasopened in March 1988, with the prominent sociologist Tatyana Zaslavskayanamed as its director (White et al. 1993: 181). A large number of private pollingorganisations were also established. VTsIOM’s early studies were on relativelynon-controversial areas, but paralleling the process of glasnost, the areas ofinvestigation were gradually broadened (Wyman 1997: 6). By 1991, formally atleast, there was no issue that could not be studied (ibid.).

One such issue that was no longer outside the boundaries of acceptable publicdiscussion and sociological research was the territorial dispute with Japan. UntilGorbachev’s state visit to Japan in April 1991, the Soviet leadership had claimedthat the territorial dispute had been resolved according to the Yalta Agreement inwhich US President Franklin D. Roosevelt promised Stalin the Kuril Islands inexchange for Soviet participation in the war against Japan. It therefore did notexist. Soviet citizens had long been indoctrinated with the belief that the islandswere historically and legally an inalienable part of the Rodina (Motherland) andwere oblivious to Japan’s territorial claims. Because of Gorbachev’s glasnostpolicy, not only were Soviet citizens slowly becoming aware that a territorial

Hokkaido–Sakhalin transnational relations 75

problem with Japan existed, but they were, for the first time, being asked for theiropinion on this dispute. The Sakhalin oblast Communist Party Committeeconducted one of the earliest known surveys of Soviet citizens’ attitudes towardsthe territorial dispute in March 1990 (cited in Fujimori 2001: 7). The SovietUnion’s collapse and the subsequent emergence of the Russian Federation, a newnation ostensibly committed to democratic principles, raised Japaneseexpectations that Russian public opinion would play an increasingly importantrole in determining the disputed islands’ fate.

During Yeltsin’s term in office, a link between public opinion and themaintenance of Russia’s territorial integrity existed. The Russian Republic’s June1990 ‘Declaration of Sovereignty’ requires that all territorial changes beapproved in a national referendum (Argumenty i fakti, 16–22 June 1990: 1). Morepertinently, article 131 of the 1993 Russian Constitution stipulates that ‘Changesto the border of territories where local self-government is exercised are permittedwith due consideration for the opinion of the relevant territories’ (AdministratsiiPrezidenta Rossiiskoi Federatsii 1993: 57).

The relationship between public opinion and changes to Russia’s borders wasalso consolidated at both the regional and local levels through the Sakhalin oblastand South Kuril District charters. According to article three of the Sakhalin oblast charter adopted in December 1995, ‘Sakhalin oblast consists of SakhalinIsland and the Kuril Islands, including the Malaia Kuril’skaya gryada, and oblastboundaries are prescribed by international treaties that the Russian Federationconcludes as well as the Russian Constitution and federal laws’ (Dewa 2001).This can be interpreted as meaning that any international treaty concludedbetween the Russian and Japanese governments is legally binding concerningdecisions pertaining to Sakhalin’s boundaries. However, even if an internationaltreaty can bring about a change in oblast boundaries, the charter preconditionsthis upon the residents’ consent, stipulating that ‘concerning a change in itsboundaries, the consent of Sakhalin oblast shall be expressed by conducting aregional referendum’ (ibid.). Nakamura Itsur™ argues that this clause was insertedin order to prevent the oblast’s boundaries from being unilaterally amended byany international treaty between Russia and Japan (1998).2 Ronald Hill andStephen White argue that in a federal state such as Russia, in which at least someof the constituent republics have ambitions that challenge the federation’sintegrity, ‘the referendum is, in turn, an instrument their leaders can use tolegitimate a declaration of sovereignty or even independence’ (1995: 21). If theRussian government were to decide to transfer the disputed islands to Japan, onecould expect that the Sakhalin regional government, which is steadfastly opposedto Russia relinquishing control over the South Kuril Islands, would seek to use alocal referendum to counter-legitimate the islands remaining a part of Russia.

The South Kuril District charter was adopted in October 1996 and contains anumber of clauses that reflect the raion’s ongoing struggle with the regionaladministration in Sakhalin to increase its local autonomy. The charter designatesthree land categories: (1) federal lands; (2) South Kuril District lands and;

76 Hokkaido–Sakhalin transnational relations

(3) private land. A notable omission from this categorisation is any reference tooblast lands. Nakamura sees this as an attempt by the South Kuril authorities tolink up with the federal government and not have the initiative taken away byregional authorities in territorial negotiations with Japan (1998: 290). Moreover,the South Kuril District charter does not mention that the raion is a part ofSakhalin oblast and there is also no reference to a division of powers withSakhalin (ibid.). It is thought that the reason why the charter did not clarify theissue of legal relations vis-à-vis Sakhalin derives from a fear that were it do so,the district’s drive for greater local autonomy would be suppressed by Sakhalin(ibid.: 295–6). Obfuscating the division of powers with Sakhalin was therefore asurreptitious attempt at greater freedom.

Regarding a change in the South Kuril District’s boundaries, article nine of thecharter states that any such decision ‘must definitely consider the residents’ willwhich is to be expressed directly’ (ibid.: 296). A boundary change can be carriedout if both of the following conditions are met: first, if more than two-thirds ofSouth Kuril District Assembly members agree during a session, and; second, if itis requested by more than 2 per cent of residents who posses the right toparticipate in a referendum (ibid.). Authorities from the South Kuril District,which has only a tiny percentage of the total oblast population (1–2 per cent),have sought to increase the significance of a referendum by expanding the rangeof people who can participate. Current residence is not a precondition for votingin a referendum as long as one owns real estate, pays property tax, applies toparticipate in the district’s administration, has citizenship from one of themembers of the Commonwealth of Independent States (CIS), owns a house, rentsa property, lives in housing or is a member of the family of someone who does(ibid.). Even if one is not a CIS citizen, the opportunity to participate still existsas long as one applies to do so and the South Kuril District Assembly adopts asupporting resolution (ibid.). Theoretically, at least, if a Japanese citizen were tomeet any of the preceding conditions, he or she could vote in a referendum totransfer the South Kuril Islands to Japan. Whether the charter was drafted withthe issue of Japanese participation in mind is an open question, but nevertheless,such a possibility remains.

The Russian Constitution stipulates that the legislative acts of Russia’ssubjects should not contradict the Constitution or federal laws. Regional and localcharters (ustavy) are therefore subordinate to the Constitution. However, givenMoscow’s (or more precisely Boris Yeltsin’s) penchant for ad hoc bargaining withthose regions it saw as important in keeping the Federation together, as thenumber of bilateral agreements between the federal government and the regionsdemonstrates, it is not surprising that constitutional uncertainties have existed.There is a certain constitutional ambiguity concerning the question of whetherany border demarcation would require the Sakhalin oblast administration’sseparate consent (Solnick 1999: 2). As one observer has noted, ‘the RussianConstitution requires regional governments to consent to any border changeswithin the federation, but is not explicit about international borders’ (ibid.). As

Hokkaido–Sakhalin transnational relations 77

long as any constitutional uncertainty remained regarding the status of theboundary between Sakhalin oblast (and the South Kuril District as well) andJapan pertaining to the issue of whether due consideration for the views of localresidents should be applied, local public opinion could not be entirely ruled outas a factor in any decision to transfer the South Kuril Islands to Japan.

Dialogue ’92

During talks in November 1991 with his Sakhalin counterpart Valentin Fedorov,Governor Yokomichi proposed that a joint symposium to discuss the territorialdispute be held in Sakhalin sometime in the spring of 1992 (Hokkaid™ shinbun,25 November 1991: 1).3 The principal aim behind the proposal was to acceleratediscussions on the territorial dispute at the subnational level, which Yokomichiconsidered to be an important means of making Sakhalin residents aware ofJapan’s historical and legal claims to the islands and thereby lessening theiropposition to Russia surrendering the islands. Issues of pride and electoralpolitics are also believed to be behind the proposal. Arai Nobuo notes thatYokomichi was also eager to show local residents and Tokyo that a regionalleader was capable of organising such a serious dialogue (personalcorrespondence, 22 May 2000).

This was not Yokomichi’s first foray into the foreign policy arena. As governorof a region that had a reputation for being politically ‘progressive’, that is, aregion in which parties on the left of the Japanese political spectrum, particularlythe JSP, enjoyed considerable support (Nagai and ïba eds 1999: 310; Iwasaki1986: 47–57), Yokomichi had visited the Soviet Union on several occasions.Many on the Japanese left believed that Japan’s entry into the US-led ‘capitalist’camp in the Cold War would only exacerbate tensions with the Soviets. In orderto diffuse this tension and the military threat, the sense of which was especiallyacute in this frontier region, they instead proposed that Japan reach peace with allthe powers it fought against in the Second World War, not just the communistcountries (zenmen k™wa).4 Hokkaido’s ties with the Soviet Union were, in asense, the practical application of these beliefs.

Nevertheless, Yokomichi was never hesitant to put forward Japan’s claims tothe Northern Territories during meetings with Soviet and Russian Republicanleaders who, it was rumoured, saw the renowned anti-nuclear peace-lover as apossible future leader of the JSP and thus may have been attempting to ‘buyfutures’ (sakimonogai) in the promising young governor and use him as a conduitto further Soviet foreign policy objectives towards Japan (Hokkaid™ shinbun,29 April 1985: 2).5 It would also not be Yokomichi’s first visit to Sakhalin. InFebruary 1991, he headed a 16-member Hokkaido delegation (Saharin Yuø k™H™mondan), which travelled to Sakhalin to promote friendly interregionalrelations. Yokomichi appeared on local television where he called the territorialdispute ‘the greatest unresolved postwar problem’ and indicated that when it wasresolved the great harm caused by the dispute ‘will be cleared away by way of

78 Hokkaido–Sakhalin transnational relations

expanding cooperation’ (Zinberg 1995: 89). He also described in detail Japan’sofficial position regarding the Northern Territories, limiting the scope of territoryJapan claimed to the four islands only, and made it known that over 50 millionJapanese supported the claim (ibid.). Fedorov, who was also eager to demonstratethat his talents were not restricted to launching verbal barrages at anyone inRussia he saw as sympathetic to Japan’s territorial claims (or the ‘fifth column’as he referred to them) and was more than capable of organising a constructivedialogue, responded positively to Yokomichi’s proposal and a date was set in Juneof the following year.

Dialogue ’92 was a three-day cultural event held in the oblast capital ofYuzhno-Sakhalinsk. The first two days featured various cultural displays andexhibitions and provided an opportunity for many in the large Hokkaidodelegation, which included members of the HPA’s Northern TerritoriesCommittee,6 the head of the HPG’s Northern Territories Headquarters, membersof the Northern Territories Return Movement, the mayors of Nemuro andSarufutsu and other regional and local government officials, to meet and talk withlocal residents for the first time. Representatives of the indigenous Ainu, theoriginal inhabitants of the islands, also participated in the symposium atFedorov’s request.7 The Japanese MOFA, which wanted prefecturalrepresentatives to be actively involved in the campaign for the NorthernTerritories’ return, but, at the same time, did not want them to act independently(Arai, personal correspondence, 22 May 2000),8 was represented by the head ofthe Legal Department of its Treaties Bureau, It™ Tetsuo (Hokkaid™ S™mubuHopp™ Ry™do Taisaku Honbu date unknown: 3). Indeed, Tokyo was faced withthe dilemma of choosing between principle and pragmatism: the Japanesegovernment did not recognise Russian sovereignty over the Northern Territories– let alone Sakhalin’s jurisdiction over the islands. It was therefore extremelycautious regarding any event that might be construed as recognising Russiancontrol over the islands. Moreover, Tokyo at this stage did not formally recogniseRussia’s sovereignty over South Sakhalin – a strategy it believed might also helpit extract concessions from Moscow over the Northern Territories. This caution,however, was somewhat tempered by a reluctant recognition of the growingsalience of the ‘Sakhalin factor’ in matters pertaining to the territorial dispute.Pragmatism won out and It™ was sent to keep Tokyo posted on events. Heremained in the background, which allowed Tokyo to distance itself somewhatfrom the event, thereby ensuring that the symposium did not in any wayundermine Japan’s position on the Northern Territories.

While in Sakhalin, Yokomichi was given the opportunity to address studentsof the Yuzhno-Sakhalinsk Pedagogical Institute where he stressed that the 1956Japan–Soviet Joint Declaration was the starting point for territorial negotiationsand that Japan had no intention of driving the Russian islanders away in the eventthe islands were returned to Japan. Local politicians in Sakhalin have in the pasttried to use the issue of forced repatriation, a fate experienced by the formerJapanese inhabitants, to stir up opposition to Russia returning the islands.

Hokkaido–Sakhalin transnational relations 79

Yokomichi’s emphasis on joint residency can be seen as an attempt to alleviatethe islanders’ concerns.

The dialogue itself was the culmination of the three-day event. Just prior to thefive-hour debate, co-chaired by the two governors, HPG officials were somewhatcircumspect when considering the chances of success for Dialogue ’92. Oneofficial remarked that ‘if we can directly state our opinion to the Sakhalin public,it will be a success’ (Hokkaid™ shinbun, 10 June 1992: 4). For the majority ofSakhalin residents attending the debate, it would be their first exposure to Japan’shistorical and legal claims to the islands. It would therefore have been unrealisticto expect anything more from the event. Given the territorial dispute’scontroversial and highly emotional nature, Hokkaido and Sakhalin organisers ofDialogue ’92, fearful that the debate could degenerate into an endless processionof claims and counterclaims, thereby spoiling the friendly atmosphere both sideshad endeavoured to create, pre-selected speakers from among the audience.9Yokomichi did, however, take the opportunity to appeal to Fedorov and thepeople of Sakhalin to support Yeltsin should he make a decision regarding theNorthern Territories (presumably to return the islands) (Hokkaid™ S™mubuHopp™ Ry™do Taisaku Honbu date unknown: 38). It was therefore not aspontaneous debate or discussion and ended with both sides merely repeatingtheir respective historical and legal claims to the islands. The Hokkaid™ shinbun,which covered the three-day event, likened it to a ceremony where everythingwent according to plan (13 June 1992: 1).10

Whether Dialogue ’92 was a success or not is an open question. If oneconsiders the HPG’s primary objective – to convey to Sakhalin residents thehistorical and legal arguments underpinning Japan’s claim to the islands – theHokkaido delegation could gain some satisfaction from the event. Dialogue ’92also had a broader significance. Its success or failure was seen as a litmus test ofGovernor Yokomichi’s subnational government diplomacy, which partly derivedfrom the underlying belief that promoting friendly relations with theneighbouring Russian Far East, especially Sakhalin, could help accelerate thelong-standing territorial dispute’s resolution (Hokkaid™ shinbun, 10 June 1992:4). Dialogue ’92 was also significant as it was the first time that residents (andimportantly voters) of both regions met to discuss the territorial problem at anopen forum. The event’s significance was not lost upon Minagawa Shuø go, thenDirector of Hokkaido University’s Slavic Research Center and a keynote speakerat the symposium, who referred to it as an ‘epoch-making event with no historicalprecedents where local governments discuss a territorial problem involving statesovereignty’ (Hokkaid™ shinbun, 14 June 1992: 30).11

Overall, both sides were satisfied with the event. They were able to state theirrespective cases for maintaining (Russia) or regaining (Japan) sovereignty andcontrol of the disputed islands in a generally friendly environment. Fedorov evensuggested that both regions continue with the dialogue concept on one of thedisputed islands themselves (Hokkaid™ shinbun, 13 June 1992: 1). However, with

80 Hokkaido–Sakhalin transnational relations

the beginning of the visa-less exchange programme in April, the necessity ofholding further symposia diminished and the concept was discontinued.

Visa-less exchanges

The agreement to conduct visa-less exchanges (biza nashi k™ryuø in Japanese orbezvizovye obmeny in Russian) was reached during Soviet President MikhailGorbachev’s visit to Japan in April 1991. Under the programme, current Russianresidents of the disputed islands (except the Habomai islets, which areuninhabited apart from a small Border Guard detachment) are permitted to visitparts of Japan (mainly Hokkaido) without having to apply for entry visas.Similarly, the obligation for the islands’ Japanese former inhabitants, many ofwhom live in Hokkaido, their dependents, members of the Northern TerritoriesReturn Movement and journalists, to carry a valid Russian visa has also beenwaived. Previously, the only way the Japanese former residents could visit theislands, primarily to tend ancestral graves (an important Buddhist custom), wasas members of special missions. These visits, however, were rather sporadic asthey were dependent upon Soviet goodwill and influenced by the general state ofSoviet–Japan relations.12

The Soviet government was not totally opposed to visits by Japanese formerresidents to the islands. In fact, the Soviets were quite receptive to the idea – buton one condition: Japanese citizens carry a valid Soviet tourist visa. The Japanesegovernment considers the islands to be Japanese territory and the Sovietoccupation illegal, thereby obviating the necessity for Japanese citizens to applyfor Soviet visas in order to visit the islands. It feared that if they did so, this couldbe construed as tacit recognition of Soviet sovereignty over the islands. As aresult, the Japanese authorities prohibited citizens of their country from visitingthe islands. Thus, the natural desire to visit one’s ancestral homeland had becomeentangled in and frustrated by the delicate issue of territorial sovereignty.

The visa-less exchange agreement was beneficial to both sides. By the time ofthe April 1991 summit, Gorbachev’s economic reform programme wasfloundering and subsequently his political position became extremely unstable.Gorbachev was fully aware that should he accede to Japan’s territorial demands,his political rivals, among them Boris Yeltsin, would use any suggestion of theSoviet Union surrendering the islands as grounds for his removal from office(Tarlow 2000: 134). The agreement was therefore, according to one Japanesescholar, ‘in a way, a concession by the Gorbachev administration that, its grip onpower slipping, could not take any decisive action toward handing over theislands’ (Kimura 2000a: 18). The agreement absolved Gorbachev of theresponsibility of deciding the islands’ fate and importantly removed the threat ofhaving the territorial dispute used against him by his political opponents.

For the islands’ Japanese former inhabitants, the visa-less exchange agreementsimplified travel to the islands, allowing them to visit their homeland and tendancestral graves without being embroiled in the complexities of the territorial

Hokkaido–Sakhalin transnational relations 81

dispute.13 For those involved in the Northern Territories Return Movement, itprovided an opportunity to redirect their public opinion mobilisation campaignand enlighten the islands’ current Russian residents about the ‘correct’ historicaland legal arguments underpinning the Japanese claim to the Northern Territories,in the process alleviating the islanders’ opposition to handing over the islands.Some also saw the agreement as a test case for future models of Russo-Japanesecooperation at the grass-roots level. According to Hiroshi Kimura, it is a pilot-study ‘to sort out the question of whether both sides were able to build arelationship based on peaceful coexistence and good neighbourly cooperationprior to reversion of the islands’ (ibid.).

From the programme’s inception in April 1992 until February 2000, 3,380Japanese visited the Northern Territories and 3,117 Russian islanders travelled toJapan. The introduction of a programme of ‘unrestricted visits’ (jiyuø h™mon) inSeptember 1999, which allows the Japanese former inhabitants to journey to theislands without the need for reciprocal visits by the Russian islanders to Japan,has simplified travel procedures. Over two-thirds of the Japanese participants inthe programme hail from nearby Hokkaido, primarily because, after beingexpelled from the islands shortly after the end of the Second World War, most ofthe former islanders settled there, in the hope that they would soon be able toreturn to their homes. Hokkaido has also hosted most of the Russian visits(Hokkaid™ S™mubu Chijishitsu Kokusaika Roshiashitsu 2000: 35).

Hokkaido is more than just an arrival and departure point for the visa-lessexchange programme. Although this programme is based on anintergovernmental agreement, municipal and regional governments in Hokkaidoand Sakhalin, in cooperation with a variety of foundations and privateorganisations, play an important role in coordinating and organising the visits andalso contribute financial assistance. The HPG has provided institutional supportfor the visits through the establishment in February 1992 of a Hokkaido NorthernTerritories Exchange Promotion Committee (Hopp™ Yont™ K™ryuø Hokkaid™Suishin Iinkai) which meets four-times a year to discuss details concerning thevisits. The Committee is made up of the Chishima Rett™ Kyojuø sha Renmei, theHopp™ D™mei (Northern Alliance – a key group in the Northern TerritoriesReturn Movement), the Nemuro county municipal government (Hanasaki port inNemuro is the primary arrival and departure point for the visits) and the HPG.

Governors Yokomichi and Hori were also active participants in theprogramme. Yokomichi visited the islands in August 1993 (the first time for aHokkaido governor). Hori, who was born in 1935 in southern Sakhalin – then theformer Japanese colony of Karafuto – and fled by ship to Hokkaido with hisfamily just days before advancing Soviet troops captured the capital, Toyohara(now Yuzhno-Sakhalinsk), did so in May 1997. Sakhalin Governor IgorFarkhutdinov, who believed the Hokkaido Governor’s visits placed unnecessarystrains on interregional relations, attacked Hori for participating in theprogramme. As domestic political considerations, namely the presence of thesmall, but vocal Northern Territories Return Movement, compelled Hori to visit

82 Hokkaido–Sakhalin transnational relations

the Northern Territories, participation in the programme had the potential todamage the otherwise close personal relationship the two governors strove toestablish.

The visa-less exchange programme’s official aim is to promote mutualunderstanding and friendship between its Russian and Japanese participants.However, given the territorial dispute’s delicate nature, it is perhaps unavoidablethat politics do on occasion cast a shadow over the visits. A Japanese foreignministry official is required to accompany the Japanese delegation on board theship bound for the islands. He gives a formal lecture on the Japanesegovernment’s official policy on the Northern Territories and is obliged to protestat the customs declaration before landing on the islands (Arai and Hasegawa1997: 177).14 In a report by authorities from the South Kuril and Kuril Districtsto a public hearing on the territorial dispute organised by the Sakhalin oblastDuma in September 2001, it was claimed that an official Japanese delegationvisiting the islands attempted to persuade the South Kuril District administrationto send a petition to the Russian government to expedite the conclusion of a peacetreaty. If they did not petition the Russian government, the Japanese delegationreportedly threatened to discontinue humanitarian aid to the islands (cited inSaharin to Nihon, no. 245, 20 September 2001: 2).15 Prior to visiting the islands,Japanese participants in the programme are required to attend meetings andworkshops, which, in addition to discussing travel details, are used to remindthose who may have forgotten the arguments underpinning the government’sclaim to the Northern Territories. Symposia to discuss the territorial dispute arealso held on the islands. The participants also receive materials outlining aspectsof the visit to which they need to pay particular attention. Reflecting Tokyo’sconcern that the visits have a positive impact in helping to create an environmentconducive to resolving the territorial dispute, these materials include a detailedlist of statements that may imply Russian sovereignty over the NorthernTerritories which the Japanese should refrain from making when visiting theislands.16

There is no denying that the visa-less exchange programme has contributedgreatly to improvements in mutual perceptions among the programme’s Russianand Japanese participants. During the Cold War, Hokkaido, Sakhalin and theKuril Islands were frontlines in the respective national defences of Japan and theSoviet Union. The large-scale military build-up on both sides of the disputedborder created enormous tension in the region. Residents of both regions livedunder the mutual perception of a constant military threat. In light of this, it isremarkable that so soon after the Soviet Union’s collapse and the end of the ColdWar, the programme’s Russian and Japanese participants now invite each otherinto their homes as friends, not enemies.

Despite the new-found feelings of trust and friendship that have beenestablished at the grassroots level, the visa-less exchange programme has, onoccasion, created problems in interregional relations. One problem is that Russianparticipation in the programme is limited to the disputed islands’ current

Hokkaido–Sakhalin transnational relations 83

residents. Any Sakhalin resident wishing to visit Japan must apply for a Japanesevisa. However, in theory, any Japanese citizen can visit the islands without a visa.As a result, Governor Farkhutdinov voiced his dissatisfaction at this situation toHori and also threatened to cancel the visa-less exchange programme should thisperceived imbalance remain unrectified (Borisova 1998: 1; Gubernskievedomosti, 2 April 1998: 1).17 Hori promised to act as an intermediary and passon Farkhutdinov’s concerns to the Japanese government, but Russianparticipation in the programme is still restricted to the South Kuril islanders.Given Russian constitutional provisions and the Sakhalin charter, which stipulatethat oblast residents must approve cession of Russian territory via a referendum,and also that the visa-less exchanges’ primary goal is to promote mutualunderstanding, thereby alleviating local opposition to Russia surrendering thedisputed islands, it is puzzling that neither Tokyo nor the HPG has given seriousconsideration to including Sakhalin proper in the programme.

Moreover, problems have emerged in recent years regarding the intentions ofthe Russian participants in the visa-less exchange programme. As mentionedpreviously, for the Japanese, the programme’s purpose is to promote mutualunderstanding and cultivate public opinion among the Russian islanders in favourof the Northern Territories’ return. However, by 2001, the tenth year of theprogramme, there have been no visible signs that it has produced, from theJapanese perspective, the desired political and diplomatic results. Instead, thereare criticisms within Japan that the programme’s original aim has beenundermined and that the visits have become nothing more than sightseeing toursfor the Russian islanders (Yomiuri shinbun, 23 April 2001: 34). The originaldestinations for the Russian visitors, mainly eastern Hokkaido (which is thefrontline in the Northern Territories Return Movement and is dotted withbillboards and other displays of government propaganda) and Tokyo, have beenexpanded in recent years to incorporate 16 Japanese prefectures – includingOkinawa, which is as far removed from the home of Japanese irredentism as canpossibly be. This has led to calls from those in the Northern Territories ReturnMovement for the programme to revert to its starting point (ibid.).18 In fact, thevisa-less exchange programme may be having the opposite and unintended effectof delaying the territorial dispute’s resolution, thereby making it more difficult forJapan to recover the islands (Kimura 2000a: 18). This is because many of theRussian islanders have grown accustomed to the economic and cultural linksarising from the visits and are increasingly unconcerned with the delicate issue ofterritorial sovereignty as long as these ties are suitably maintained.

The discussion has thus far focused on two forms of cultural exchange that areclosely linked with the Northern Territories dispute. However, not all ofHokkaido’s transnational linkages with Sakhalin are solely devoted to resolvingthe territorial dispute. As outlined in the introduction, a vast range oforganisations in Hokkaido and Sakhalin including cultural groups, schools andbroadcasters, to name a few, have entered into cooperative arrangements.

84 Hokkaido–Sakhalin transnational relations

Humanitarian exchanges have also become a salient feature of the burgeoningtransnational relationship between Hokkaido and Sakhalin.

Humanitarian exchanges

The need for humanitarian links between the two subregions first arose in August1990 following an accident in which a 3-year-old Sakhalin boy named Konstantinwas severely burned. A call was placed to the head of the HPG’s InternationalAffairs Division, Miyata Shigeo, by a Japanese businessman in Sakhalin actingon behalf of the boy’s mother, seeking medical assistance. Miyata was perplexedby the call, coming as it did from a stranger, and was unsure about its authenticity.Nevertheless he relayed it to the MOFA’s Soviet Desk. Officials from the SovietDesk were also uneasy at the fact that it involved Sakhalin. Their feelings wereunderstandable: just seven years earlier a Soviet fighter had shot down a Koreanairliner (KAL 007) for straying into airspace over Sakhalin, resulting in the deathsof all passengers – including 28 Japanese. Tensions were subsequently high in theborder zone, as were Japanese anti-Soviet sentiments. An hour after the call,another call came from Sakhalin with grave news: without adequate treatment,which local doctors in Sakhalin were not equipped to perform, Konstantin hadabout three days to live. Realising that he had to act, Miyata advised the Sakhalinauthorities to make a formal request for medical assistance. This came fromGovernor Fedorov and was circulated within the HPG, which began makingpreparations to accept the young burns victim, locating a doctor from SapporoMedical University (SMU) who was willing to fly to Sakhalin to collectKonstantin. The Soviet Desk’s Kasai Tatsuhiko began coordinating the visit withthe relevant ministries, receiving special permission from the Ministry of Justicefor a ‘provisional landing’ and arranging for the use of a plane from the CoastGuard to fly directly to Sakhalin. This undertaking was more complex anddangerous than it appeared. At that stage, there were no direct flights betweenSakhalin and Hokkaido. Japanese wishing to fly to Sakhalin needed to take acircuitous route via Khabarovsk. Konstantin’s condition did not allow for this.Moreover, unidentified foreign aircraft flying near Soviet borders could expect areception from scrambled MiG or Sukhoi fighters which, as the KAL 007incident clearly demonstrated, were not averse to firing at aircraft violating Sovietairspace. In order to avoid repeating the tragedy of 1983, an official in the SovietConsulate in Sapporo notified Moscow and the Border Guard of the impendinghumanitarian mission (asahi.com Maitaun Hokkaid™, 31 May 2004).

In a testament to how quickly humanitarian goodwill was able to turn thewheels of Japan’s famously fractious and slow-moving bureaucratic machinery,just 17 hours after the first plea for help, a 13-member team took off from Chitoseairport for the mercy mission to Sakhalin. This marked the first flight from Japanto Sakhalin since the end of the Second World War. The rescue team broughtKonstantin and his father, Igor, safely back to Japan where there was anoutpouring of emotional and financial support for the young burns victim, belying

Hokkaido–Sakhalin transnational relations 85

Japanese anti-Soviet feelings. In another act of compassion, Miyata, sensing thatthe presence of Konstantin’s mother, Talina, might aid his recovery, lobbied theSakhalin administration to allow her to travel to Hokkaido. Konstantin’s skingraft surgery at SMU was successful and he was able to return home with hisparents 87 days after the emergency flight to Hokkaido. Japan’s humanitarianefforts had a profound effect on Konstantin’s family. Recalling the dramatic event10 years later, Talina spoke of wanting her son to find work linked to Japan as itwas his ‘second homeland’ (NHK Project X 2000).

This humanitarian incident further highlighted the benefits for Sakhalin fromactively engaging its technologically advanced southern neighbour and becamethe trigger for closer cooperation between medical communities in Hokkaido andSakhalin. A portion of the approximately US$1 million in donations collected inJapan for Konstantin’s treatment and funding from the HPG was used to create apublic trust called the Hokkaido–Russian Far East Medical Exchange Fund in1992. In 1997, the Hokkaido–Japan-Russia Association established another fundfor Sakhalin residents to receive medical treatment in Hokkaido (Akaha 2003:110). Natural disasters in Sakhalin have also led to outpourings of Japanesehumanitarian goodwill. When a large earthquake devastated the Sakhalin oil townof Neftegorsk in May 1995, municipal authorities and civic groups in Hokkaidojoined Japanese government relief efforts, providing medicine, blankets,footwear, food and wheelchairs. Hokkaido residents again demonstrated theiraltruism, sending humanitarian assistance to victims of large-scale forest firesthat swept through northern Sakhalin in May 1998 (ibid.).

Sister-city relations

Another mode of exchange generally divorced from the territorial dispute issister-city links – perhaps the most common form of subnational governmentdiplomacy. By November 2005, 10 municipalities in Hokkaido had establishedsister-city relations with their counterparts in Sakhalin (see appendix). Wakkanai,which has dubbed itself ‘the city at the forefront of friendship between Japan andRussia’ (Nichiro yuøkø™ saisentan toshi), has established sister-city relations withthree Sakhalin municipalities. Four of the agreements were concluded during thelate 1960s and early 1970s when Tokyo–Moscow relations were far fromharmonious: Asahikawa and Yuzhno-Sakhalinsk (November 1967), Kitami andPoronaisk (August 1972), Wakkanai and Nevelsk (September 1972) and Kushiroand Kholmsk (August 1975).19 Although these agreements lacked any realsubstance and were essentially exchanges between regional elites to discuss waysof expanding citizen exchanges and coastal trade (so-called kanpai or ‘cheers’diplomacy), they did, on occasion, carry political overtones. For instance, the‘Joint Declarations’ between Kitami and Poronaisk and between Wakkanai andNevelsk both mentioned ‘promoting the conclusion of a Japan–Soviet PeaceTreaty’ through the development of friendship and exchange activities betweenthe respective subnational governments (ïtsu 1994: 42).20 The conclusion of both

86 Hokkaido–Sakhalin transnational relations

agreements came just before the first round of peace treaty negotiations betweenSoviet Foreign Minister, Andrei Gromyko, and his Japanese counterpart ïhiraMasayoshi held in Moscow in October 1972. Until the ïhira–Gromyko meeting,peace treaty negotiations between the two countries had encountered a 16-yearhiatus. One can surmise that these ‘Joint Declarations’ were timed to pressureboth the Japanese and Soviet governments to conclude a peace treatysuccessfully.

Five agreements were concluded in the period immediately before and afterthe Soviet Union’s collapse: Sarufutsu–Ozersky (February 1990),Monbetsu–Korsakov (January 1991), Nayoro–Dolinsk (March 1991),Wakkanai–Korsakov (July 1991) and Teshio–Tomari (July 1992). It was duringthis period that Moscow’s grip on the regions began to slip and local and regionalauthorities sought to take advantage of their growing, newly acquired autonomyby seeking to establish foreign relations. The remaining three sister-cityagreements between Nemuro–Severo-Kurilsk, Hakodate–Yuzhno-Sakhalinskand Wakkanai–Yuzhno-Sakhalinsk were concluded in January 1994, September1997 and September 2001, respectively (Hokkaid™ Chiji Seisakubu ChijishitsuKokusaika 2005).

Geographic propinquity, the lifting of interregional travel restrictions and thesubsequent establishment of a regular air service between Hakodate and Yuzhno-Sakhalinsk in April 1994 and ferry services linking Korsakov with Otaru andWakkanai in 1995, have led to both qualitative and quantitative improvements insister-city relations. In addition to the more orthodox ‘cheers diplomacy’ betweenregional elites, Hokkaido–Sakhalin sister-city relations are conducted in a broadrange of fields including cultural, sports, music, educational, medical and youthexchanges. A number of universities, high schools, primary schools and even pre-schools in Hokkaido and Sakhalin have also entered into sister-school exchangeagreements in recent years. Youth and school exchanges are an importantinvestment in the future of Russo-Japanese relations as they allow young peopleto gain first-hand knowledge of life in each country. The growing mutualunderstanding resulting from these exchanges is insurance against a possibledeterioration in bilateral relations in the future and government propaganda thatmay follow from this. Past generations of Soviet/Russian and Japanese citizenswere largely ignorant of each other and, as a result, were easily influenced by thenegative misinformation their governments often peddled.

In addition to being neighbours and to the obvious desire for harmoniousrelations this often brings, there have also been economic and politicalconsiderations behind the establishment of some of the sister-city exchanges.Economic and political considerations were also behind the decision to concludethe Hokkaido–Sakhalin Friendship and Economic Cooperation Agreement inNovember 1998 – essentially a peace treaty at the regional level – and also acooperation agreement concluded between the two regional legislatures in May2000 (see Saharin to Nihon, no. 187, 1 June 2000: 3). For Sakhalin’smunicipalities, which have been virtually cut off economically from the rest of

Hokkaido–Sakhalin transnational relations 87

the country by skyrocketing transport costs, caused by price liberalisation, and asignificant drop in federal funding and investment, neighbouring Hokkaido hasloomed as an attractive economic partner. Subnational governments in Hokkaido,which have suffered from the unprecedented postwar economic downturn inJapan, also see potential benefits from establishing closer economic relationswith municipalities in Sakhalin. Monbetsu fishers have benefited by being able topurchase marine products directly in Korsakov (Monbetsu Shi 2000). In this case,sister-city relations have provided a channel for the flow of goods and servicesbetween the two municipalities. Hakodate and Wakkanai have also engaged incompetition to become the primary support and supply base for Sakhalin oil andnatural gas development projects (Hakodate Shi 2000; Hokkaid™ Shinbun J™h™Kenkyuøjo ed. 2001: 24, 52). In this regard, both have sought to take advantage ofthe recent transport and administrative links they have established with Sakhalin.

Municipalities in both regions have sought to deepen mutual understanding bydeveloping autonomous links free of the troubles that have plagued relationsbetween the two central governments. However, Hokkaido’s role as the northernbase for the Northern Territories Return Movement and Sakhalin’s jurisdictionover the islands have not made this easy. At a meeting of Russo-Japanese sister-city mayors in Yuzhno-Sakhalinsk in August 1995, primarily convened to discussissues relating to the promotion of cultural and youth relations, cooperation insolving economic problems and the development of sports and tourism, Japanesemayors insisted on mentioning the Northern Territories problem in a jointcommuniqué, creating tensions with their Russian hosts (Svobodnyi Sakhalin,18 August 1995: 2).21 Along with the desire to set up fisheries joint ventures inorder to obtain access to quotas, the Northern Territories problem has also been afactor in the establishment of Nemuro’s sister-city relations with Severo–Kurilsk.Arai Nobuo who also advises the Nemuro municipal government on Russianaffairs, revealed in a discussion with the author (22 August 2001) that authoritiesin Nemuro were cognisant of the possibilities for future exchanges with Russianresidents of the disputed islands and saw relations with Severo–Kurilsk (onParamushir Island in the northern Kurils – to which Japan does not lay claim) asa test-case for these exchanges. The Japanese government prohibited theestablishment of sister-city relations with municipalities on the four disputedislands as these ties are designed to promote exchanges between subnationalgovernments of different countries. As the Japanese government and Nemuromunicipal authorities consider the Northern Territories to be Japan’s inalienableterritory, they feared that Russia could construe the establishment of sister-cityrelations with the disputed islands as Japan’s tacit recognition of Russiansovereignty over the islands.

Conflict and cooperation

Regarding the extent to which subnational government diplomacy has beencongruent or conflicted with central government policy, Dialogue ’92 and sister-

88 Hokkaido–Sakhalin transnational relations

city relations were based on the initiatives of regional and municipal governmentsin Sakhalin and Hokkaido and conducted relatively independently of theirrespective central governments. However, because Tokyo at this stage did notformally recognise Russia’s sovereignty over South Sakhalin, which, as discussedpreviously, it sought to use as a lever to extract concessions from Moscow overthe Northern Territories, Dialogue ’92 did have the potential to complicate centralgovernment policy. This concern most likely explains the Japanese MOFA’sdecision to include an official in the Hokkaido delegation. The visa-less exchangeprogramme is based on intergovernmental agreements and is characterised by theclose cooperation of regional and local governments with their respective centralgovernments. The humanitarian incident involving Konstantin was characterisedby close coordination between the HPG and the relevant central governmentministries in Japan, occurring, as it did, at a time when bilateral relations were outof step with the Soviet Union’s general rapprochement with the West. Sister-cityrelations and medical exchanges are the most autonomous of Hokkaido andSakhalin’s interregional ties and have generally been seen in a favourable light byboth Moscow and Tokyo as a means of promoting mutual understanding. In fact,although they predated the MOFA’s policy shift in the late 1990s, these exchangeswould become congruent with Tokyo’s ‘multilayered approach’, which calls forpromoting exchanges with the Russian Far East as one of its seven designatedareas of bilateral cooperation, as well as the Moscow Declaration on Building aCreative Partnership signed by Prime Minister Obuchi and President Yeltsin on13 November 1998.

Economic ties

Opportunities for developing economic relations with Sakhalin

In addition to the Soviet Union’s collapse and the subsequent relaxation ofmilitary tension in the region, the lifting of most trade restrictions and radicaleconomic reforms, all of which stimulated the Russian Far East’s desire tointegrate economically with the Asia-Pacific region, there are a number of otherfactors that appear to have provided Hokkaido firms with opportunities todevelop trade and investment linkages with Sakhalin. The first of these isgeographic; Hokkaido and Sakhalin are territorially contiguous regions. At theirclosest point they are separated by only a 43-kilometre stretch of the Soya Strait.A regular ferry service established in 1995, linking Korsakov with Otaru andWakkanai, has turned the Soya Strait into a transport corridor that is used to movegoods and people between the two islands. The establishment of a regular airservice between Hakodate and Yuzhno-Sakhalinsk in April 1994 means the twocities are now separated by a short three-hour flight. Shrinking distancesgenerally means cheaper transport costs. This has given companies in Hokkaidoan advantage over competitors both in North America and on the Japanese mainisland of Honshu.

Hokkaido–Sakhalin transnational relations 89

As territorially contiguous regions, Sakhalin and Hokkaido are affected bysimilar climatic conditions. Both are known for their cold, relatively long wintersand heavy snowfall. As a result of the need to adapt to such harsh conditions,housing architects in Hokkaido have created a unique concept known as‘Northern houses’, which are notable for their high degree of airtightness and heatinsulation (Lee 1999: 67). Firms in Hokkaido have developed expertise inmanufacturing furniture, heating valves, floor heating and public utilities, all ofwhich are considered to be internationally competitive, particularly in coldcountries such as Russia (ibid.). Three developments in the mid- to late 1990s inthe Russian housing industry offered opportunities to small and medium-sizedconstruction companies in Hokkaido. First, in June 1996, the Russiangovernment announced the ‘My Home Recommendation Plan’ and provided 400million roubles in 1997, of which 39 million were distributed to Sakhalin, toupgrade the quality and quantity of houses in Russia. Second, there was anincrease in the demand for housing for foreign workers employed in Sakhalin’soil and gas development projects. Third, the Sakhalin regional governmentintroduced large subsidies to support housing construction (365 billion roubles in1997, 370 billion roubles in 1998 and 440 billion roubles in 2000). However,because of Russia’s economic downturn following the 1998 financial crisis, onlya fraction of this was actually disbursed (ibid.: 64–6).

Writing before the Soviet Union’s collapse, Arai Nobuo saw Hokkaido and theSoviet Far East as good partners that would be able to stimulate mutual economicgrowth. In addition to identifying cold climate housing, Arai noted theopportunities for the export of Hokkaido processing technology for primaryresources, particularly agriculture, forestry and fisheries (cited in Hokkaid™shinbun, 5 May 1990: 7).22 The Sakhalin administration’s stated goal of movingaway from exporting raw materials, which it fears will turn it into a raw materialsappendage, to producing and trading value-added goods is expected to stimulatedemand for this technology. Exporting such technology also has environmentalimplications. Poor timber-processing capabilities in the former Soviet Far Eastgenerated a tremendous wastage of resources. It is estimated that only about 25per cent of felled trees were processed into usable timber products (ibid.). Thesubsequent extensive felling of trees caused pollution in rivers and streams wheresalmon and trout spawn. Importing efficient timber-processing technology fromHokkaido would therefore reduce wastage and over-felling.

As discussed in Chapter 2, food production in Sakhalin declined mainly as aresult of the dismantling of the island’s kolkhozy and early problems with thedevelopment of private farms to replace them. Structural difficulties resultingfrom the transition from a centrally planned to a market economy, as well asunfavourable natural conditions, have also hampered agricultural development inthe Sakhalin region, making it difficult to meet the region’s requirements. Foodsupplies were traditionally brought in from distant markets in European Russiaand Central Asia. However, the command economy’s collapse and thedismantling of the highly centralised and hierarchical administrative structure

90 Hokkaido–Sakhalin transnational relations

upon which agriculture was based have made such imports problematic. GivenSakhalin’s low food self-sufficiency, imports from Hokkaido, which is home to arelatively robust food-manufacturing industry and serves as Japan’s food supplybase, seemed logical (Hokkaid™ shinbun, 16 March 2000: 4; Inoue 1999).

Administrative attempts to create a framework for economic exchange

Postwar Hokkaido–Sakhalin economic relations date back to the early 1960s.This mainly took the form of coastal and cooperative trade23 and was conductedon a barter-exchange agreement between various Japanese companies orprefectural and local trading cooperatives and the Soviet Far East Trade Office(Dal'intorg), which was established in Nakhodka in 1965.

The HPG’s administrative efforts to promote trade relations with the SovietFar East were intensified after Yokomichi was elected governor in April 1983.Yokomichi’s early aims were modest. As governor, he believed it was his job tocreate a peaceful environment around Hokkaido (interview, 21 February 2001).Trade relations were a means of achieving this. The 1983 KAL 007 incidentamply demonstrated just how volatile and dangerous this environment couldbecome.

One of the HPG’s early achievements under Yokomichi was an agreementreached in Khabarovsk in February 1984 to conduct periodic economicexchanges between local government officials in Hokkaido and five regions inthe Soviet Far East. Based on this agreement, the first Japan–Soviet FarEast–Hokkaido Friendship Exchange Conference was held in Khabarovsk inApril 1984. At this conference the Hokkaido delegation lobbied their Sovietcounterparts for the establishment of a Dal'intorg representative office inHokkaido (Hokkaid™ shinbun, 24 April 1984: 4). These attempts, however,ultimately proved unsuccessful. In August 1987, Yokomichi led a delegationincluding the heads of the regional administration’s agriculture, fisheries andforestry departments who attended the third conference in Khabarovsk to discussways of expanding barter trade. The Japanese side was particularly interested inbartering agricultural produce for Soviet marine products (Hokkaid™ shinbun,16 July 1987: 1; Hokkaid™ shinbun, 31 July 1987: 3). In comparison with theprevious two meetings, there was a heightened awareness among delegatesattending the third conference of increasing economic autonomy from Moscowand Tokyo (Hokkaid™ shinbun, 10 September 1987: 4). The Hokkaido delegationreached an agreement with Khabarovsk officials to expand economic and culturalexchanges and exchanged memoranda to this end. The Hokkaido delegation thentravelled to Nakhodka and Yuzhno-Sakhalinsk and also exchanged memorandawith Sakhalin (Hokkaid™ shinbun, 26 August 1987: 3; Hokkaid™ S™mubuChijishitsu Kokusaika Roshiashitsu 2000: 21). In June 1988, a Hokkaidodelegation led by the vice governor, aiming to flesh out proposals aired duringYokomichi’s visit to the Soviet Far East the previous year, travelled toKhabarovsk and Sakhalin and reached agreement on establishing a mechanism to

Hokkaido–Sakhalin transnational relations 91

expand economic relations in the four fields of agriculture, forestry, fisheries andcommerce. Both sides also agreed to establish a marine products economicexchange council that would meet periodically and commence exchangesbetween forestry researchers from the two regions (Hokkaid™ shinbun, 19 June1988: 4).

By 1988, regional officials and academics in the Soviet Union were claimingthat the authority to engage in foreign trade had passed from the centre to theregions (Hokkaid™ shinbun, 27 September 1988: 7). A stream of joint ventureproposals and appeals for technical cooperation, sometimes up to 30 per month,from regional officials in the Far East to their Hokkaido counterparts soonfollowed. Sakhalin regional officials’ proposals included timber processing andwoodchip joint ventures, the building of a hotel in Yuzhno-Sakhalinsk andestablishing fisheries joint ventures. Hence, they sought to take advantage of aperceived economic complementarity between the two regions by combiningSoviet marine resources and Japanese fishing technology (Hokkaid™ shinbun, 26April 1988: 4; Hokkaid™ shinbun, 1 March 1989: 4; Hokkaid™ shinbun, 19 April1989: 4; Hokkaid™ shinbun, 23 November 1989: 4).

Valentin Fedorov’s arrival in Sakhalin was a further boost to interregionaleconomic relations. Fedorov came to Sakhalin from the Plekhanov Institute inMoscow with the aim of turning the island into an ‘experiment for marketreforms’. He believed that greater autonomy from the Soviet Union’s overbearingcentral ministries was necessary in order for his ‘experiment’ to be successful.Although Fedorov sought to avoid an over-reliance on foreign capital, which hefeared would turn Sakhalin into an economic colony (Fedorov 1991: 13), he waseager to develop trade and investment links with Japan, especially withneighbouring Hokkaido. Yokomichi was keenly aware of the mutual benefits tobe derived from developing economic relations with the increasingly assertiveRussian Federation and the Far East. In June 1990, he led a local delegation to theSoviet Union, visiting Moscow, Khabarovsk, Vladivostok and Yuzhno-Sakhalinsk. While in Moscow, Yokomichi signed a seven-point agreement withhis Russian hosts to develop mutually cooperative relations in the fields ofeconomics, science, technology and culture (Hokkaid™ S™mubu ChijishitsuKokusaika Roshiashitsu 2000: 21). This ‘Agreement for a Friendly Partnershipbetween Hokkaido and the Russian Republic’ (Hokkaid™ to Roshia Renp™Ky™wakoku to no yuø k™ tekina p‰ton‰shippu ni kansuru g™i) was the first of itskind between a Japanese regional government and a constituent republic of theSoviet Union. It remains the only one between a regional government in Japanand the present-day Russian Federation. In December 1990, Hokkaidoestablished a council to promote economic exchange with the Russian Republic(Tai Roshia Renp™ Ky™wakoku Keizai K™ryuø Suishin Kaigi) and also set up a jointworking group, which meets regularly to discuss ways to promote economicrelations (ibid.).

The Soviet Union’s collapse in December 1991 further stimulated the level ofadministrative activity between Hokkaido and the (now) Russian Far East. In

92 Hokkaido–Sakhalin transnational relations

September 1992, regional authorities from Hokkaido, Sakhalin, Khabarovsk andPrimorskii krai established the Joint Standing Committee for EconomicCooperation between Hokkaido and the Russian Far East. At the Committee’sfirst meeting in Sapporo the two sides formulated an economic cooperationprogramme (ibid.: 22). The programme was revised at the fifth meeting of theCommittee in Sakhalin in September 1997. This is a five-year programme callingfor a broadening of contacts between private business enterprises, establishing atransport network, stepping up exchanges between residents of the two regionsthrough tourism, exchanging economic delegations, conducting seminars on tradeand investment as well as trade fairs, creating a mechanism to deal with problemsthat may arise, collecting information and cooperating so that both regions’ firmscan participate in the Sakhalin oil and gas development projects.24 TheCommittee and its secretariat meet every year (though not in 1995) (ibid.). The Committee is another example of the HPG’s trailblazing role in promotingeconomic relations with the Russian Far East. Some observers in Russia havenoted its special contribution to overall Russo-Japanese cooperation (Rodionov1999: 229).

The establishment of a trade office in Yuzhno-Sakhalinsk in July 1994 is afurther manifestation of Hokkaido’s desire and commitment to promote economicrelations with the Russian Far East, and particularly with Sakhalin. Regionalauthorities in Hokkaido originally intended it to be a representative trade officeof the HPG. They believed that establishing a base in Sakhalin was necessary inorder to expand interregional exchanges, which would contribute to resolving theterritorial dispute (Hokkaid™ shinbun, 9 June 1990: 4; Hokkaid™ shinbun,18 September 1990: 1). Although such an objective was congruent with the ultimate political aims of Japan’s Russia diplomacy, this decision had thepotential to complicate the Japanese government’s policy towards Sakhalin,which was based on the premise that, as a result of the Soviet Union’s refusal tosign the San Francisco Peace Treaty, sovereignty over the southern part ofSakhalin had not been legally resolved. The issue of South Sakhalin’s legalownership was linked to the Northern Territories dispute. From a Japanesegovernment perspective, the Soviet Union’s decision not to sign the SanFrancisco Peace Treaty was one of the factors that invalidated its claim tosovereignty over the disputed islands. Although the Japanese government nevermade an official claim for ownership, it feared that any activities that could beconstrued as formally acknowledging Russian control of South Sakhalin couldalso possibly be interpreted as recognising its sovereignty over the disputedislands.

Because of the MOFA’s opposition to opening an official trade office inSakhalin, the HPG was forced to transfer formal control of the office to an extra-governmental organisation – the Hokkaido International Trade and IndustryPromotion Association (Hokkaid™ B™eki Bussan Shink™kai) (interview withYokomichi Takahiro, 21 February 2001). It provided funding for the office’sconstruction and also dispatched officials to serve as staff. The office’s major role

Hokkaido–Sakhalin transnational relations 93

is to collect and supply a wide range of information about the Russian Far East tolocal residents and to introduce various aspects of life in Hokkaido to Russiancitizens (Hokkaid™ S™mubu Chijishitsu Kokusaika Roshiashitsu 2000: 4). TheJapanese government’s decision to open a branch of its Khabarovsk consulate inYuzhno-Sakhalinsk in January 1998, which was subsequently upgraded to thestatus of official consulate in March 2001, opened the way for the HPG to assumeofficial control of the office. It did so in January 2001.

The issue of joint Russo-Japanese economic development of the disputedislands has also complicated Hokkaido’s relations with both the Japanese centralgovernment and Sakhalin. Governors Hori and Yokomichi were generallypositive about the idea of economic exchange with the islands, believing it to benecessary in order to prevent foreign capital inflows, as well as strengtheningrelations of trust with the islanders that would lead to a resolution of the territorialproblem (Hokkaid™ shinbun, 6 February 1993: 4). When Hori visited Sakhalin fora meeting of the Hokkaido–Russian Far East Joint Standing Committee inSeptember 1997, he met Farkhutdinov and agreed to explore the possibility ofjoint economic development of the disputed islands (Hokkaid™ shinbun,3 September 1997: 1; Hokkaid™ shinbun, 30 May 1998: 4). The Sakhalingovernment’s strong desire for joint economic activities, which was explicitlymentioned during these talks, is believed to have prompted a positive response onthe part of Hori (Hokkaid™ shinbun, 3 September 1997: 4). Given its oppositionto joint economic activities on the islands, the MOFA was not impressed byHori’s agreement with Farkhutdinov and dispatched an official in early Octoberin order to convey its displeasure and bring the Hokkaido Governor back into line(see Mochizuki 1998: 1–2). Thereafter, Hori appeared to have taken the MOFA’sadvice about not straying too far from the prescribed policy line.25 This particularincident highlighted the dilemma for both regional governments of balancing thedesire for closer economic relations with the concern that this be conducted in amanner that does not undermine each party’s claim to the disputed islands.

In April 2001, the Hokkaido–Sakhalin Business Exchange SupportAssociation – a private body comprising local companies – established theHokkaido Business Centre in Yuzhno-Sakhalinsk (Hokkaid™ Saharin BijinesuK™ryuø Shien Ky™kai Jimukyoku date unknown). The Centre functions as a‘window’ for Hokkaido in the Far East and aims to strengthen informationcollection and administrative negotiating capabilities. There are high expectationsthat the Hokkaido Business Centre will assist local companies wishing to investin Sakhalin to negotiate Russia’s complex legal system.

The signing of an Agreement on Friendship and Economic Cooperation (Yuøk™keizai ky™ryoku ni kansuru teikei) in Yuzhno-Sakhalinsk in November 1998 is themost symbolic move to date by the regional administrations in Sakhalin andHokkaido to promote economic relations. Governor Farkhutdinov made theproposal for an interregional agreement to Hori while on a visit to Hokkaido fora meeting of the Northern Rim Forum in September 1995. Farkhutdinov believedthat the time had arrived for Sakhalin and Hokkaido to conclude a sister-region

94 Hokkaido–Sakhalin transnational relations

agreement given the number of municipalities that had concluded similar pacts(Hokkaid™ S™mubu Chijishitsu Kokusaika Roshiashitsu 2000: 4). Hori agreed inprinciple, but did not immediately commit to an agreement, preferring to holdfurther discussions on the issue. It was not until September 1997, while on a visitto Sakhalin for a meeting of the Hokkaido–Russian Far East Joint StandingCommittee, that Hori declared he would begin efforts towards concluding anagreement (ibid.: 5). Once he had decided to commit formally to the agreement,Hori sought to bring about its rapid conclusion, believing that it would play asignificant role in creating a propitious environment for concluding a Russo-Japanese peace treaty (Hokkaid™ shinbun, 21 April 1998: 3).26 At the pressconference after signing the agreement, both governors emphasised the positiveimpact it would have on bilateral relations. Farkhutdinov stated that‘Demonstrating an intention to develop friendly and mutually beneficialeconomic cooperation today, the Sakhalin region and Hokkaido will play animportant role in the process of political dialogue between Russia and Japan’(Vladivostok News, no. 180, 24 November 1998; Bayandin 1998: 2). An editorialfrom the Hokkaid™ shinbun also commented that ‘Hokkaido’s building of “closeneighbourly relations” with Sakhalin, which has jurisdiction over the NorthernTerritories, as an element of local government diplomacy, has great significancefor attempting to establish an environment for a territorial return’ (23 November1998: 2).27

The protocol is a seven-point agreement, of which three address the issue ofeconomic cooperation. According to these three items, first, in addition to makingefforts towards creating a favourable environment for promoting trade andinvestment between the two regions, both sides will strive to build a cooperativesystem to facilitate the participation of both regions’ companies in projects relatedto the Sakhalin shelf oil and gas development projects. Second, cooperativerelations for the rational use of marine resources will be strengthened and willinclude exchanging information about catches unloaded by vessels in eachregion’s ports. Third, in order to develop both regions’ industries, both sides aimto strengthen mutually beneficial cooperative relations in all fields includingtrade, finance, management, transport, communications, travel, agriculture, themarine products industry, forestry, the timber industry and infrastructure based onthe revised 1997 economic cooperation programme between Hokkaido and theRussian Far East. Both sides also agreed to establish a consultative council,comprising the relevant administrative departments and private economic groupsthat would meet regularly to discuss the agreement’s implementation (Hokkaid™S™mubu Chijishitsu Kokusaika Roshiashitsu 2000: 7).

A notable omission from the Agreement was any direct reference to theNorthern Territories problem. This, however, did not mean that the territorialdispute was completely removed from the minds of those drafting it. It is believedthat the HPG did not push for reference to the Northern Territories to be includedin the Agreement because it sought to promote successful intercultural exchangewith Sakhalin independently of the politically tainted visa-less exchange

Hokkaido–Sakhalin transnational relations 95

programme and, in doing so, alleviate opposition to a territorial return amonglocal residents (Hokkaid™ shinbun, 19 November 1998: 4). In the end, both sidesdisplayed considerable skill in finalising a mutually acceptable document wordedin a way that was sensitive to both Hokkaido and Sakhalin residents’ emotions.28

To commemorate the first anniversary of the signing of this historicagreement, ‘Sakhalin Week’ was held in Hokkaido. Among the events was agovernors’ meeting to discuss various problems associated with private levelexchanges. At the meeting the governors signed a provisional memorandum tocooperate in minimising the adverse effects of environmental disasters (Hokkaid™S™mubu Chijishitsu Kokusaika Roshiashitsu 2000: 8). Hori and Farkhutdinovwere joined by the Governor of Alaska in signing a formal memorandum inAugust 2000. Environmentalists and local fishers have raised concerns about thepotential for a major oil spill from the Sakhalin shelf development projects. Sucha spill would be difficult to combat given the harsh weather conditions in the Seaof Okhotsk, which washes the shores of both Sakhalin and Hokkaido. It wouldcause irreparable damage to the region’s fragile ecosystem, in particular marineresources, upon which both economies are highly dependent. This agreement isanother example of regional governments in Japan and the Russian Far Easttaking the initiative to address issues of mutual concern. Sakhalin and Hokkaidoalso held a symposium, co-sponsored by the MOFA and the HPG, to discussproposals to promote economic exchange (ibid.).

In addition to the HPG’s efforts, a number of municipal governments inHokkaido have also sought to promote economic ties with Sakhalin. Sister-cityrelations have often acted as an institutional vehicle for this purpose. Nemuro,however, is an exception. Municipal authorities have found it difficult toformulate a positive economic exchange policy with its sister-city, Severo-Kurilsk, out of concern for the feelings of many of the former islanders who livein Nemuro, although the local chamber of commerce did establish a division tomanage economic exchange with Russia (Hokkaid™ Shinbun J™h™ Kenkyuøjo ed.2001: 59–60). Joint efforts on the part of municipal governments include theCouncil for the Promotion of the Sea of Japan Region (Nihonkai Chiiki Shink™Suishin Iinkai), comprising six government branch offices (shich™) and 49 cities,towns and villages, which formulated a plan to promote the Sea of Japan region(Nihonkai chiiki shink™ k™s™), in particular to promote economic exchange withSakhalin in fields relating to fishing and tourism (Hokkaid™ shinbun, 26 January1991: 4). In 1997, a number of towns and private business groups in Soya Countyestablished a council whose members regularly travel to Sakhalin and meet cityofficials and business leaders to promote trade and investment ties with Sakhalin.In May 2001, the city of Wakkanai opened its own representative office inYuzhno-Sakhalinsk – the first municipal government in Japan to establish such abase in the Russian Far East. Previously (from 1998), it had sent an official towork in the Hokkaido office whose tasks included collecting information,searching for opportunities for local companies to invest in Sakhalin andconducting surveys on Sakhalin’s infrastructure (Hokkaid™ Shinbun J™h™

96 Hokkaido–Sakhalin transnational relations

Kenkyuøjo ed. 2001: 19). A number of municipalities also have their own staff whospecialise in and manage trade and cultural relations with Russia.29

The Sakhalin oil and gas development projects, in particular, have become thefocus of attention for municipalities in Hokkaido that are competing to becomethe major support and logistics base for these projects. Municipal authorities inIshikari, Otaru, Wakkanai and Hakodate, in conjunction with local businessgroups, have established councils and provided other administrative support forthis purpose (ibid.: 24, 34 and 40). As an outgrowth of a joint declaration signedby Hori and Farkhutdinov in September 1997, nine municipalities, the HPG,Hokkaido Development Bureau, five major trading houses and 14 industrialassociations joined together to form the Sakhalin Project Hokkaido ConsultativeCouncil. The Council works in close cooperation with its counterpart in Sakhalin(Belozyorskikh 2000: 2).

Conflict and cooperation

Sakhalin’s attempts to develop closer economic and cultural relations withHokkaido and to integrate successfully into the Asia-Pacific region shouldgenerally be welcomed by Moscow. First, as Moscow has limited financialresources with which to help the embattled Far Eastern economy satisfactorily,Sakhalin’s attempts to attract overseas investment and develop trade relationswith its neighbours theoretically assist the central government as they lessen theneed to provide subsidies and transfers for the region’s socio-economicdevelopment. Second, Sakhalin’s attempts to reinvigorate its economy also havethe potential to bolster Russia’s strategic position in the Far East by helping tocurb the mass exodus of people from the region. Regional leaders’ participationin government-led economic missions to Japan and the establishment of a FarEast Subcommittee within the framework of the Japan–Russia IntergovernmentalCommittee on Trade and Economic Affairs are just two examples of Moscow’ssupport for its far eastern provinces’ drive to promote trade and investmentrelations with Japan, in particular, and integrate generally with the Asia-Pacificregion.

Similarly, Hokkaido’s efforts to reduce its economic dependence on Tokyo byseeking to stimulate autonomous growth through foreign trade and investmentties resonated with a central government unable to provide previous subsidylevels as a result of continued economic stagnation. However, as the casesinvolving the opening of a representative trade office in the mid-1990s and Hori’sexpression of support for Farkhutdinov’s proposal for Russo-Japanese jointdevelopment of the disputed islands illustrate, Hokkaido’s attempts to promotecloser economic ties with Sakhalin on occasion conflicted with the principles ofTokyo’s Russia policy, which resulted in the HPG having to revise its approachtowards its northern neighbour.

Hokkaido–Sakhalin transnational relations 97

ConclusionThe introduction of parliamentary and gubernatorial elections, as well as clausesin the Russian Constitution and the Sakhalin and South Kuril District charters,contributed to the rise of local public opinion as a factor in Russian decision-making regarding the disputed islands. Officials in the HPG were cognisant ofthis and sought to diminish opposition in Sakhalin to Russian territorialconcessions by promoting the twin transnational processes of cultural andeconomic exchange. Four cases of exchange activities involving the two regionsof Hokkaido and Sakhalin oblast were Dialogue ’92, the programme for visa-lessexchanges, humanitarian exchanges and sister-city relations. Dialogue ’92 was apublic symposium held in Yuzhno-Sakhalinsk in June 1992 that was based on theinitiative of Governors Yokomichi and Fedorov. The event was significant as itwas the first time residents of the two regions met in a forum, provided by theSakhalin and Hokkaido regional governments, to discuss such a delicate issue asthe Northern Territories problem. However, because Tokyo at this stage did notformally recognise Russia’s sovereignty over South Sakhalin, which it sought touse as a lever to extract concessions from Moscow over the Northern Territories,Dialogue ’92 did have the potential to complicate central government policy. Thevisa-less exchange programme between the former Japanese and current Russianinhabitants of the disputed islands is based on a Russo-Japaneseintergovernmental agreement, but is mainly carried out by subnational publicauthorities in close coordination with the central government. The HPG was alsoinvolved in frequent deliberations with the relevant central government ministrieswhen formulating a response to the emergency calls from Sakhalin to saveKonstantin’s life, and the ensuing humanitarian exchanges between the twosubregions invoke little intervention from either of the national governments.Sister-city exchanges, which, with the exception of Nemuro, are not closelylinked with the Japanese campaign for the Northern Territories’ return, are, for themost part, conducted independently of both Tokyo and Moscow.

The Soviet Union’s collapse and the dismantling of the command economyremoved major obstacles to the expansion of economic ties between the RussianFar East and the Asia-Pacific region. The subsequent ending of the Russian FarEast’s role as a closed military outpost, the lifting of most foreign traderestrictions and radical economic reforms launched by the Russian government inearly 1992 essentially cut the region off from traditional markets in EuropeanRussia, thereby necessitating integration with the Asia-Pacific region.

In close geographic proximity to Sakhalin, Hokkaido emerged as an importantpartner for Sakhalin. Like the Far East, Hokkaido was drawn into an economiccore–periphery relationship, although regional income disparities have not beenas pronounced in Japan. A number of factors including geographic propinquity,similar climatic conditions, the anticipated housing boom in Sakhalin, andHokkaido’s expertise in processing technology for primary resources appear tohave provided Hokkaido firms with opportunities to develop trade andinvestment linkages with Sakhalin. In order to take advantage of this perceived

98 Hokkaido–Sakhalin transnational relations

economic complementarity, regional governments in Hokkaido and Sakhalinhave made considerable efforts to construct a framework for economic exchange.

Issues surrounding whether subnational public authorities’ external activitiesare in harmony or disharmony with nation-state diplomacy also raise importantquestions concerning central governments’ responses to subnationalgovernments’ greater international presence. In this context, Soldatos dividesparadiplomacy into two broad categories: cooperative or supportive action andparallel or substitutive action. According to Soldatos:

Co-operation [sic] (supportive) action in foreign policy is possible whensubnational actions on the part of federated units are co-ordinated [sic] bythe federal government … or developed in a joint fashion. …Parallel(substitutive) action … can be developed in a harmonious climate, where thefederal government accepts the rationality of a federated unit’s independentaction in external relations, with or without federal monitoring …[S]uchaction can [also] be in conflict with the federal government, the latteropposing such an action or its content or form.

(1990: 37–8)

The cooperative processes and structures that the Hokkaido authorities soughtto establish with their counterparts in Sakhalin are a hybrid mix of cooperativeand parallel actions. For instance, the visa-less exchange programme representscooperative action that is developed in joint fashion between Tokyo andmunicipal and regional authorities in Hokkaido. This conceptualisation alsoextends to the Japanese humanitarian response to the Konstantin incident. On theother hand, Dialogue ’92 can best be described as a parallel action developed ina harmonious climate with the Japanese MOFA providing a monitoring role. Thesame can be said of sister-city exchanges, although, for the most part, Tokyo doesnot monitor or convey instructions to those municipalities in Hokkaidomaintaining these relations.30 Hokkaido’s decision to open a representative officein Sakhalin in the early 1990s, and Governor Hori’s agreement to examine thepossibility of developing the disputed islands with Sakhalin also exemplifies aparallel action, but these cases conflicted with Tokyo’s approach towards Russiaand the Northern Territories. In both instances, the MOFA conveyed itsdispleasure to Hokkaido through inter-governmental channels, forcing the latterto back down.

Sakhalin’s general attempts to develop closer commercial relations withHokkaido and integrate more fully with the Asia-Pacific region represent bothcooperative and parallel actions. In the case of the former, these attempts havebeen coordinated by the federal government and also developed in a joint fashion.Concerning the latter, they have mostly developed in a harmonious climate withfederal authorities, including the MID, Ministry for Economic Development andTrade, State Committee for Fisheries and the presidential representatives,providing a monitoring role. Sakhalin’s foreign trade and investment strategies

Hokkaido–Sakhalin transnational relations 99

have been broadly congruent with federal policies, but regional elites have provedto be less cooperative in matters pertaining to the territorial dispute with Japan.This issue is addressed in the next chapter.

100 Hokkaido–Sakhalin transnational relations

4 The Sakhalin political elite and the South Kuril Islands

IntroductionIn the former Soviet Union, foreign policy decisions were made largely at thediscretion of the General Secretary of the Communist Party, although otherPolitburo members also had some input. Generally speaking, public opinion andpressure were not important factors in the policy-making process (Kanet andBigerson 1997: 335). However, with the introduction and advancement ofpolitical liberalisation in Russia, the leadership increasingly began to depend onpublic support in both the domestic and foreign policy spheres. This introduced alimiting effect on the government’s ability to set foreign policy goals andimplement these decisions. Pressure from domestic forces, in particular,prevented the leadership from making concessions to Japan over the disputedislands during the 1990s. Prominent among these domestic forces was theposition of the Sakhalin leadership and local public opinion regarding theterritorial dispute: the ‘Sakhalin factor’.

In order for Hokkaido’s subnational government relations with Sakhalin tocreate, at the subnational level, an environment conducive to resolving theterritorial dispute, it was necessary to alleviate the Sakhalin political elites’ andlocal residents’ opposition to transferring the South Kuril Islands to Japan. Thischapter examines the first element of the ‘Sakhalin factor’, Sakhalin politicalelites,1 and elucidates their relationship with the Russo-Japanese territorialdispute. It explores why the Sakhalin political elite maintained firm opposition toRussian territorial concessions. The chapter argues that, a genuine desire tomaintain Russia’s territorial integrity notwithstanding, the fundamental reasonbehind this opposition lies in the Sakhalin political elites’ perception of theterritorial dispute as an important weapon to be exploited for political andeconomic gain. The disputed islands’ value for the Sakhalin political eliteescalated as a result of Russia’s troubled attempts at state-building, whichfacilitated centre–periphery bargaining and the struggle for power between theexecutive and legislative branches of government throughout the country.

The chapter then addresses whether the Sakhalin leadership’s positionregarding the territorial dispute complicated Russian policy towards Japan, and,if so, how Moscow in turn responded to this. It demonstrates that if Sakhalin’s

stance in any way caused problems for the Kremlin, it was by threatening tocomplicate Boris Yeltsin’s strategy for dealing with the territorial disputedescribed in Chapter 1. Nevertheless, Moscow responded to this aspect of the‘Sakhalin factor’ mainly by adopting coordinative measures and seeking toestablish consultative channels to allow Governor Farkhutdinov, in particular,input into federal government decision-making regarding the South Kuril Islands.

Elites in postcommunist RussiaRussia’s transition from communism to a liberal democratic market economy hasbeen characterised by considerable continuity in many aspects of political,economic and social life. This was also evident with Russian elite structures,particularly during the early post-Soviet period, which resulted from ‘the secondechelon of office-holding nomenklatura … turning themselves into capitalists andofficials of the new order’ (Sakwa 1996: 160–1; see also Tucker 1995: 10). Thesereformed elites proceeded to dominate many of Russia’s regions and republicsduring the Yeltsin presidency (Sakwa 1996: 161).

While there was a certain degree of continuity in elite structures, regionalpolitical leaders’ significance, roles and relationships with the federal centrechanged in varying degrees. In the Soviet Union, regional elites (party officialsand enterprise directors) viewed the central government as being immenselypowerful and the dispenser of limitless resources. They were therefore compelledto defer to the centre in order to survive (McAuley 1997: 18). The devolution ofpower from Moscow to the regions during the 1990s, however, changed thesituation, emboldening regional elites and giving them the opportunity torenegotiate their relationship with the centre. A fair and equitable redistributionof tax revenues, subsidies and state investment was the item often at the top ofthe agenda for regional elites who were now not only increasingly responsible fortheir region’s economic welfare, but were also accountable to the electorate forpolicy choices. If the leading officials of the party and state at the centre were thekey element in understanding the Soviet socio-political system, thepostcommunist regional elites became an important dimension for evaluating thetransition to a market economy and democracy in a decentralised Russia.

In his classic work The Soviet Prefects, Jerry Hough (1969) noted howregional Communist Party bosses performed numerous functions, few of themdirectly connected with politics, but mostly associated with lobbying forresources, getting supplies for local enterprises, and in general managing locallabour and wage funds. There appears to have been a certain degree of continuityin the self-perceived role of regional elites in Russia today. Vera Tolz and IrinaBusygina argue that governors were careful to emphasise their role as economicmanagers (khozyaistvenniki) and as far as most are concerned, economic intereststook precedence over political issues (1997: 405). Such economic interestsincluded demanding that regional leaders acquire at least the same amount ofcontrol as their counterparts in the ethnic republics over natural resources and

102 The Sakhalin polital elite and the South Kuril Islands

economic assets in their territories, control over export quotas, licences andforeign trade and participating in working out federal programmes affectingregional economic development (ibid.: 405–6).

Although the regional political elite may have seen themselves as performingmainly an economic role, this did not prevent many from seeking to use politicalweapons in their struggle with Moscow over control of natural resources andother economic assets. Moreover, their electoral accountability also requiredregional elites to establish a new and stable basis for legitimacy in the eyes of thepopulation – a task made difficult by poor socio-economic conditions in Russia’sregions. The twin challenges of bargaining with the centre and establishinglegitimacy in order to remain in power compelled Russia’s regional elite to searchfor any viable means that would assist them to fulfil these objectives. For theregional political elite in Sakhalin, one such weapon was their interference inRussia’s territorial negotiations with the Japanese over the South Kuril Islands.

Sakhalin’s political elites

Valentin Fedorov

The emerging salience of the ‘Sakhalin syndrome’ became synonymous with thethoughts and actions of one individual – Valentin Petrovich Fedorov – the firstGovernor of Sakhalin. Fedorov was born in 1939 in a small village near the cityof Yakutsk in the region of Yakutia (now the Sakha Republic). A gifted student,he entered Moscow’s Plekhanov People’s Economic Institute upon completingschool. After graduating, he returned to Yakutia as a Gosplan official and workedthere for a number of years. A desire to pursue his studies brought him back toMoscow where he entered the Graduate School of the Institute of WorldEconomy and International Relations (Institut Mirovoi Ekonomiki iMezhdunarodnykh Otnoshenii or IMEMO). He maintained links with a numberof authoritative research institutes, receiving a PhD in economics in 1976. In1978 he was sent by the Soviet Academy of Sciences to West Germany as ascientific representative, where he remained until 1984, studying marketeconomics. After his six-year stint in West Germany, he returned to Moscow andtook up a position as Vice-Chancellor of his alma mater, the Plekhanov Institute(see Zinberg 1992b: 9).

Fedorov came to Sakhalin with the aim of turning the island into an‘experiment for market reforms’. He was elected as a member of the RussianCongress of People’s Deputies on 18 March 1990 (Verkhovnyi Sovet/RSFSR1991). The following month he was elected chair of the oblast Soviet ExecutiveCommittee (Ispolkom). He was initially seen as a radical reformer in theeconomic field with a particularly keen eye on pursuing relations withneighbouring Hokkaido. The local Hokkaid™ shinbun even called Fedorov‘Sakhalin’s Yeltsin’ (2 May 1990: 8). The important question for those involved

The Sakhalin polital elite and the South Kuril Islands 103

in the Japanese irredentist movement was whether Fedorov’s ‘radical’ viewswould be limited to economics or would apply to the political sphere as well.2

The Fourth Way

This question was soon answered in Fedorov’s controversial proposal of a‘Fourth Way’ (chetvertii put') to resolve the territorial dispute with Japan. Theplan, announced while he was on a visit to Hokkaido in August 1990, called forturning the four disputed islands, along with Sakhalin and part of Hokkaido(presumably the northern part adjacent to the Sea of Okhotsk), into a freeeconomic zone and developing them jointly with Japan (Sovetskii Sakhalin, 29August 1990: 1). Fedorov initially hoped that the establishment of a free tradezone would lead to an influx of foreign, mainly Japanese, capital, which wouldimprove the regional economy and, as a result, strengthen Russia’s control overthe islands.3 The proposal was unacceptable to the Japanese as it called for theislands to remain under Soviet sovereignty. Fedorov was critical of the ‘ThirdWay’ of resolving the territorial dispute, put forward by Aleksandr Yakovlev, aCentral Committee secretary and one of the architects of perestroika, during avisit to Japan in November 1989. The ‘Third Way’ was not a choice betweenreturning the four islands (‘Second Way’) or a continuation of the status quo (noislands or ‘First Way’), but called for the two sides to reach a compromise – eitherselling the islands to Japan or joint administration. Fedorov, on the other hand,stressed that a lesson must be learnt from tsarist Russia’s sale of Alaska (to theUnited States in 1867 for US$7.2 million), which brought Russia littleeconomically and also failed to secure peace with the United States. According toFedorov, if Russia were to receive billions of dollars from Japan for the islands,‘that would be a drop of freshwater in the saltwater sea of our problems. Ourinefficient system will consume the money, and in a couple of years Russia willhave neither money nor islands’ (1996: 115).

The Fourth Way: For local consumption?

Fedorov’s ‘Fourth Way’ proposal was unique and certainly contrary to thecommon practice of Soviet regional elites toeing the party line and refrainingfrom becoming involved in foreign policy matters, and particularly issues ofterritorial sovereignty. Fedorov’s initial – and, as it turned out, not the last – forayinto a policy area commonly perceived as the state’s exclusive preserve may wellhave been a politically calculated move. Kimura Hiroshi suggests that Fedorovmade this proposal in response to one his rival Vitalii Gulii, a journalist andmember of the USSR Congress of People’s Deputies representing South Sakhalinand the Kuril Islands, put forward. Gulii’s proposal called for joint managementof the islands in order to create a favourable environment for resolving theterritorial dispute (Kimura 1990: 29). Gulii even went so far to say that both theSoviet Union and Japan had a strong legal claim to the disputed islands (Valliant

104 The Sakhalin polital elite and the South Kuril Islands

1997: 4). Gulii’s political credentials were earlier boosted by winning a landslidevictory over the oblast’s First Secretary V. Bondarchuk4 in local elections in 1989,running on a platform of creating a ‘salmon-trout kingdom’, which opposed theunchecked development of Sakhalin. Gulii reportedly received 90 per cent of thevote on the disputed islands (Nagoe 1989: 71–2). Yeltsin later appointed him aspresidential representative (predstavitel' prezidenta) for Sakhalin.5 As apolitician, it was necessary for Fedorov to be cognisant of and responsive to anyproposals put forward by his political opponents regarding the South KurilIslands. As will be discussed shortly, Fedorov’s less than comprehensive victoryin the March 1990 elections to the Russian Congress of People’s Deputiesheightened his awareness of the territorial dispute’s political value.

A conspicuous thorn in Moscow’s side

Not content simply with making proposals for resolving the territorial disputewith Japan, Fedorov soon began to show he was also a man of action. Fedorovwas a member of a group of 12 specialists who had arrived in Japan just prior toMikhail Gorbachev’s historic visit to Japan. He was not part of the officialentourage and thus did not participate in the territorial negotiations. The purposeof his visit was to have talks with Governor Yokomichi, meet the Japanese mediaand promote his own views on the territorial dispute (Hokkaid™ shinbun, 11 April1991: 2). In an interview during his visit Fedorov stressed the importance ofexpanding regional trade ties and also delivered a warning to Gorbachev,declaring that any decision by the Soviet leader to return the islands to Japanwould result in his downfall (Hokkaid™ shinbun, 16 April 1991: 2). Fedorov hadintended to remain in Japan for three days, but caused quite a stir when heabruptly cut short his visit and returned home. Regarding his unexpected andearly departure from Japan, an uncommon contravention of diplomatic protocol,Fedorov declared it was a protest against the central government as he believedthat Gorbachev was being too conciliatory towards the Japanese.

Despite Fedorov’s protestations, a specific reference to the fact thatnegotiations had been conducted regarding the four islands of Etorofu, Kunashiri,Shikotan and Habomai was inserted in the Joint Declaration issued after thebilateral summit. For the Japanese, this concession was certainly a step forwardwhen compared with the previous Soviet position of flatly denying the existenceof a territorial dispute. However, it should also be noted that Gorbachev displayedsome fortitude, refusing to bow to pressure from Japanese Prime Minister KaifuToshiki to confirm the 1956 Joint Declaration’s validity, which promised thereturn of Shikotan and Habomai after the conclusion of a peace treaty andcontinued negotiations over the fate of the remaining two islands. Fedorov alsorevealed that he was dissatisfied at not being included in the official negotiatingparty (Hokkaid™ shinbun, 17 April 1991: 1).

Upon his return to Sakhalin, Fedorov maintained the polemic, calling forGorbachev’s resignation. He also argued in a local radio interview that the Soviet

The Sakhalin polital elite and the South Kuril Islands 105

leader’s recognition of the existence of the Northern Territories problem in theJoint Declaration was a considerable retreat from the previous Soviet position andcalled returning the islands to Japan an act of betrayal (Hokkaid™ shinbunevening, 22 April 1991: 1). Fedorov also explained in more detail the reasons forhis early departure, stressing three points in particular. First, the Soviet Union wasforced to make concessions and he requested to be included in the official party.He should not have come in the first place because he was not among itsmembers. Second, regarding the visa-less exchange programme agreed to at thesummit, he claimed Gorbachev knew that Sakhalin residents were in favour ofmutual visits, but they were not included in the programme. Third, Fedorov couldnot understand unilateral Soviet troop reductions on the islands, which he saw asa baseless concession, damaging the Soviet people’s patriotism. He had to take anopposing stance as the boundary could be decided under conditions unfavourableto the Soviet Union (ibid.). Others suggested that personal pride may have beena factor behind Fedorov’s abrupt departure. The head of the State Television andRadio Broadcasting claimed that Fedorov was an emotional person and wasangered that his proposal for a free trade zone incorporating the South KurilIslands and Hokkaido was not considered (Hokkaid™ shinbun evening, 17 April1991: 2).

As socio-economic conditions in the region deteriorated further, Fedorovbegan taking drastic measures in an attempt to maintain Russian sovereignty overthe South Kuril Islands and, perhaps more importantly, to revive his own saggingpolitical fortunes. In late 1991, he even threatened to create a separate Far EasternRepublic should Moscow consider returning the islands to Japan (Hokkaid™shinbun, 11 October 1991: 3). Principal among his moves was the plan toestablish Cossack settlements on the islands.

The Cossacks were skilled horsemen and warriors who establishedindependent communities along the fringes of the former Russian Empire,providing a reliable buffer against encroachment by foreign powers. Cossackrevival is part of a broader movement within Russia’s vast borderlands to reachback in time for old ideologies to sustain the people during a time of diminishingstate authority (Quinn-Judge 1992b: 46–8). Under Fedorov’s plan, the Cossackswere to be given plots of land to work and were expected to perform border guardduties in order to defend the islands against possible Japanese encroachment.6This plan was reportedly met with fierce opposition, in particular from manyKunashiri residents who sent a telegram to Yeltsin demanding that he protect theresidents’ rights and territory by repelling the Cossacks’ territorial demands asthey would ‘threaten the peace of the island’, remove Fedorov and put the SouthKuril Islands under direct presidential control (Hokkaid™ shinbun, 27 March1992: 5; Hokkaid™ shinbun, 31 March 1992: 7). The Cossack plan’s potentialimpact on the territorial problem and, subsequently, on relations with Japan wasnot lost upon the Russian government. An official from the Russian MID arguedthat ‘if the Cossacks manage defence of the border, it can only have an influenceon the agreement with Japan regarding visa-less exchanges’ (Hokkaid™ shinbun,

106 The Sakhalin polital elite and the South Kuril Islands

1 April 1992: 5). The same official questioned the real motives behind the plan,declaring ‘Governor Fedorov is intentionally using the Cossack card in order todivert the attention of residents away from [Sakhalin’s] economic and socialproblems’ (ibid.). Despite the criticisms, the plan was implemented – albeit withsome changes. There are Cossacks on the islands today who are engaged infishing and farming, but they do not appear to be performing any borderprotection duties.7

Faced with a dramatic decrease in federal investment and credits, and strongJapanese government opposition to Japanese companies investing in the disputedislands, the Sakhalin administration began to seek foreign investment to help inits plans to develop a free economic zone in the South Kuril Islands. Theannouncement in September 1992 that a Hong Kong company, Carlson-Kaplan,had signed a US$7.8 million contract with the regional administration to build aresort and casino complex on 278 hectares of Shikotan Island drew an immediateprotest from the Japanese government. Cabinet spokesman Kat™ K™ichi declared‘We cannot accept a third nation entering a contract with Russia to lease part ofour islands because it will render Russia’s illegal occupation a fait accompli’(Asahi shinbun, 16 September 1992: 2). Moscow was not informed in advance ofthe negotiations by the Sakhalin authorities and was therefore caught as much bysurprise as the Japanese. After pressure from the Japanese and Russiangovernments, Carlson-Kaplan announced that it would not go through with thedeal.8 There also may well have been more than economic motivations behind thedevelopment deal. In an interview in April 1994, Fedorov said the Carlson-Kaplan deal was organised and timed so as to prevent Yeltsin from handing overthe islands during his planned visit to Japan.9

The Sakhalin administration’s announcement of the deal could not have comeat a worse time for Yeltsin who was preparing for a visit to Japan. Prior to thevisit, scheduled to take place in September 1992, Fedorov stated publicly that hethought Yeltsin should postpone the visit, contending that he would benegotiating from a position of weakness because of Russia’s economic problems.Fedorov undoubtedly believed that Yeltsin’s visit would inevitably lead toRussian territorial concessions. If the visit were to go ahead, Fedorov vowed thathe would travel to the South Kuril Islands and take action to stir up anti-returnsentiments among the islanders.10 He also sent two memoranda to Yeltsinrequesting that he postpone the visit, reminding the Russian President that‘Sakhalin residents have not forgotten the promise (made in August 1990) to keepthe South Kurils under Russian control’ (Hokkaid™ shinbun, 15 August 1992: 5).Fedorov’s rhetoric revealed both an air of confidence and defiance. Heemphasised that even if the Russian leadership yielded to Japanese pressure anddecided to hand over the islands, ‘patriots will overthrow the government andblock the return’ (Hokkaid™ shinbun, 3 August 1992: 3). As is well known, Yeltsinwas forced to cancel his visit to Japan at the last minute when the Russian militaryjoined forces with the ‘anti-return’ lobby led by the fishing industry, Fedorov andother leading conservatives.

The Sakhalin polital elite and the South Kuril Islands 107

During his term as governor, Fedorov not only directly lobbied the Kremlin,but also made efforts on Sakhalin’s behalf to seek the support of other regions inthe Russian Far East in its bid to maintain Russian sovereignty over the islands.In an address to the Far East and Trans-Baikal Inter-regional Association inOctober 1991, Fedorov requested that it pass a resolution opposing transferringthe islands to Japan, as well as repeating earlier arguments that Japan and theSoviet Union should develop the islands as an FEZ. He further emphasised that‘We in the Sakhalin leadership, by removing the Kurils boundary and havingJapan and the Soviet Union jointly develop the islands, are preparing to proceedalong the path of mutual benefits’ (Hokkaid™ shinbun, 22 October 1991: 7).

Not all the Association’s delegates, however, accepted Fedorov’s calls.Participants from Primorskii krai, which at the time was under the stewardship ofthe democratic Governor, Vladimir Kuznetsov, believed the territorial problemshould be resolved on the basis of the 1956 Joint Declaration (ibid.). This drew asharp response from Fedorov which appealed to the delegates’ patriotic anddemocratic sentiments: ‘the majority of the residents of the South Kurils believethey cannot sell the Motherland’ (ibid.). It was also at this gathering of regionalpolitical leaders that Fedorov suggested a Far Eastern Republic be established asa pressure group vis-à-vis Moscow. Other participants backed away from thisproposal, fearing it could precipitate the disintegration of the Russian Republic.In the end, after the draft was amended slightly in order to alleviate internalopposition, the Far Eastern Association adopted a declaration opposing the returnof the South Kuril Islands.11 Fedorov was able to use the unanimous support ofthe Association, known for its often-deep internal divisions, as a weapon tothwart any possible moves to return the islands to Japan. While the differencesbetween Sakhalin oblast and Primorskii krai over the South Kurils were resolvedfor the time being, they would soon resurface.

The South Kurils as a tool in the political struggle in Sakhalin

Fedorov’s opposition to Yeltsin’s proposed visit to Japan and other attempts tocomplicate Russian policy towards Japan regarding the territorial disputecontrasted with the position of the chairman of the Sakhalin People’s DeputiesCouncil, Anatolii Aksenov. In the early post-Soviet period, many regions hadbecome arenas in the struggle for power between Yeltsin-appointed executives(Heads of Administration or glava administratsii) and the regional legislatures.Perceptions of popular legitimacy were at the root of this conflict. The regionallegislatures believed they had been given popular mandates as a result of the 1990elections, in contrast to the glava administratsii whose power derived fromMoscow’s or, more precisely, Yeltsin’s fiat. While Fedorov was trying to arouselocal opposition to any territorial concessions and refused to participate in anydiscussions where Russian jurisdiction over the South Kurils was questioned,Aksenov, on the other hand, displayed a willingness to cooperate with centralauthorities. After visiting the Tatar Republic in July 1992 for a meeting of

108 The Sakhalin polital elite and the South Kuril Islands

regional parliamentary leaders hosted by the Chairman of the Russian SupremeSoviet, Ruslan Khasbulatov, Aksenov travelled on to Moscow to participate in theBurbulis Commission (chaired by the then State Secretary and former FirstDeputy Prime Minister Gennadii Burbulis) which was preparing for Yeltsin’svisit to Japan (Hokkaid™ shinbun, 9 September 1992: 3).

Signs began to emerge of a difference of opinion among the Sakhalinleadership regarding the South Kuril problem. This was highlighted in aninterview Fedorov and Aksenov gave to the Hokkaid™ shinbun in Yuzhno-Sakhalinsk after Fedorov’s tour of the disputed islands. In the interview Fedorovrepeated earlier assertions that a territorial problem did not exist in Russia, whichwas reminiscent of the Soviet attitude during the Brezhnev period, and also thatthe 1960 Gromyko memorandum had put an end to any discussions regarding the1956 Japan–Soviet Joint Declaration. Aksenov disagreed, stating that theterritorial problem did exist and if a special decision was given concerning theJoint Declaration, the territorial problem could be resolved (Hokkaid™ shinbun,13 October 1991: 1). However, he did not elaborate on what such a ‘special’decision would entail. If any difference of opinion between the regional executiveand legislative branches regarding the territorial dispute existed at this time, itwould soon disappear. Both branches of government remained vehementlyopposed to Russia transferring the South Kuril Islands to Japan until Putin’sfederal reforms led to a softening of the Sakhalin executive’s stance in late 2004.

According to Gulii, Aksenov, seen by many as a reformer, was attempting togather the support of anti-Fedorov deputies in the regional legislature to put anend to the governor’s recklessness and strengthen his own power base (ibid.).Aksenov was thus trying to distance himself from Fedorov’s hardline positionand present himself as a reasonable and rational alternative to the fiery Sakhalingovernor. The South Kurils issue was becoming a tool in the political struggle inSakhalin. Later, however, Aksenov, perhaps sensing the prevailing political tonein the region, was not prepared to go any further than to recognise the existenceof the territorial dispute, agreeing that Yeltsin should not hurry a resolution(Hokkaid™ shinbun, 24 August 1992: 5).12 Aksenov’s position within the Sakhalinleadership did not go unnoticed in Japan’s ruling LDP. In March 1991, the LDPdispatched a four-member delegation to Sakhalin to meet Aksenov. Led by Sat™Takayuki, the acting LDP Secretary-General, who was often dispatched abroad toconduct delicate diplomatic assignments, the delegation’s primary purpose was tochange Aksenov’s position regarding the territorial dispute, thereby neutralisingthe Sakhalin administration’s negative pressure upon Gorbachev in the lead-up tothe Soviet–Japanese summit in April 1991 (Zinberg 1995: 94–5). However,Fedorov’s actions during and after Gorbachev’s visit to Japan suggest thedelegation was unable to achieve its objective.

The Sakhalin polital elite and the South Kuril Islands 109

Fedorov: Sincere patriot or opportunist?

Astrid Tuminez argues that elites, in general, are likely to resort to the use ofnationalistic propaganda if they believe there are benefits to be derived from suchan undertaking (1996: 44; see also Snyder 1991). Before arriving on Sakhalinwith a pledge to carry out a ‘market experiment’, Fedorov gave few indicationsof the vitriolic, nationalistic campaign upon which he was about to embark.Indeed, the first item of Fedorov’s five-point proposal to conduct an ‘experiment’on Sakhalin called for all state authority, except in the areas of diplomacy anddefence, to be transferred to Sakhalin (Arai 1991: 123, italics added).13 Moreover,Fedorov was reported to have proposed the islands’ partial return at an economicforum held in Tokyo in January 1991 (Japan Times, 5 February 1991: 1; Rowley1991: 11). This suggests that at this stage Fedorov was not cognisant of theperceived gains to be made by exploiting the territorial dispute. Nevertheless, itis difficult to argue that Fedorov was not a sincere patriot deeply committed tomaintaining Russian territorial integrity. Fedorov certainly went to extremelengths to display his patriotic credentials, which led to a de facto pluralisationand localisation of diplomatic channels and complicated Soviet and later Russianpolicy towards Japan vis-à-vis the territorial dispute. He even became a memberof the ultranationalist People’s (or National) Patriotic Party of Russia (Narodno-patrioticheskaya partiya Rossii).14

At the same time, however, there also appear to be economic and politicalconsiderations underpinning his campaign to maintain Russian sovereignty overthe South Kuril Islands. Fedorov initially began opposing Moscow on purelyeconomic grounds (Zinberg 1995: 91). Upon arriving in Sakhalin, Fedorov begancalling for more economic autonomy from Moscow. In order to implement hisplan to develop the South Kurils economy, it was vitally important to control theislands and subsequently the rich fishing grounds located in their EEZ. As will bediscussed in Chapter 6, the prospect of returning the islands to Japan raised fearsthat the inevitable increase in Japanese fishing activities in the South Kurils EEZwould result in a reduced catch for local fishers.

With the failure of his ‘experiment’ to deliver the promised results and theeconomic crisis that had befallen the island, Fedorov came under increasingattack from his political opponents in the regional legislature and from Moscow(Odajima 1993: 5). As was suggested earlier by an official in the Russian MID,stirring up nationalist opposition to a transfer of the disputed islands to Japanbecame a convenient tool to divert attention from Fedorov’s failing economicprogramme and to strengthen his political position vis-à-vis his local and federalopponents. As mentioned previously, Fedorov was elected by his peers in theregional soviet as chairman of the oblast Ispolkom in April 1990. Boris Yeltsinlater appointed him to the post of glava administratsii in October 1991 – thusessentially transforming Fedorov from an elected official to an appointed one. Asa result, he became vulnerable to dismissal by the capricious Russian Presidentwho, throughout his period of office, would display a proclivity for sackingpolitical appointees.

110 The Sakhalin polital elite and the South Kuril Islands

Moreover, although Fedorov was elected as one of Sakhalin’s five deputies tothe Russian Congress of People’s Deputies in March 1990 – his only opportunityto receive a direct mandate from the people – the election result was not entirelyclear-cut. As Yakov Zinberg notes, Fedorov finished only second out of ninecandidates in the first round of voting, receiving a mere 12.57 per cent of thevotes, compared with Bok Zi Kou, an economics professor of Korean descent atthe Yuzhno-Sakhalinsk Pedagogical Institute, who received 17.65 per cent(1992b: 10; see also Odajima 1992: 5). Although Fedorov was victorious in therun-off, he reportedly did not obtain an absolute majority and finished only ninepoints clear of his challenger Bok (Zinberg 1992b: 10).15 It is worth noting thatduring the election campaign to the Russian Congress, the territorial problem washardly raised. Fedorov mostly emphasised the economic reform programme hehad planned for Sakhalin, and Bok spoke of ‘sincerely hoping for thedevelopment of the homeland’ (ibid.). The reason why the territorial dispute wasnot a major topic during the election campaign was because the seeds of theconflict between the Russian Republic and the federal government over the‘Kurils problem’ had not yet germinated (ibid.: 12). At this stage, the territorialdispute had not presented itself as an opportunity for Fedorov to exploit.

Fedorov’s outspoken criticism of the government’s economic reformprogramme, his interference in territorial negotiations with Japan and, perhapsmost importantly, the failure of his own ‘experiment’ with the Sakhalin economyled to calls from within and outside the region for his dismissal. Whether he wascompelled to or not is unclear, but on 2 April 1993 Valentin Fedorov resigned(Nimmo 1994: 171).16 Yeltsin nominated Yevgenii Krasnoyarov, the generalmanager of the Russo-Japanese fisheries joint venture, Pilenga G™d™, asFedorov’s successor.

Yevgenii Krasnoyarov

Krasnoyarov was initially known as someone who avoided political strugglesand, generally speaking, his brief tenure as Governor of Sakhalin was notparticularly significant – at least as far as trying to complicate Russo-Japaneseterritorial negotiations was concerned.

Unlike his predecessor, Valentin Fedorov, Krasnoyarov admitted the territorialdispute existed, but ruled out transferring the islands to Japan until the domesticeconomy stabilised and there was parity in Russian and Japanese living standards(Kyodo 13 April 1993). Given the already vast gulf between the two countries’living standards and the Russian economy’s downward spiral during the 1990s,this was akin to shelving resolution of the territorial dispute indefinitely.Krasnoyarov made grandiose plans to establish a South Kurils Investment Bankwhich, not surprisingly, failed to materialise because of insufficient capital and,in December 1994, tried to strengthen Sakhalin’s control of the South Kurils byreorganising the regional government’s administrative system so that all theKurils were to come under a newly created Department of the Kurils (Hasegawa

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1998: 493). Krasnoyarov also demonstrated that, when necessary, he too wasprepared to adopt a hardline stance on border-related issues. Concern over anescalation of ‘illegal’ Japanese fishing in the disputed islands’ EEZ led to theestablishment of a 5-kilometre security zone along the maritime border in January1994. Krasnoyarov also tightened foreign access to the area and expressedsupport for the continued deployment of Russian forces on Sakhalin and theSouth Kurils later the same month (Hokkaid™ shinbun, 29 January 1994: 5;Interfax cited in FBIS/SOV 1994: 38).

As far as the South Kurils are concerned, perhaps the most significant aspectof Krasnoyarov’s governorship, or at least the most documented, was the disputewith Primorskii krai Governor, Yevgenii Nazdratenko, over control of thedisputed islands. In April 1994, Nazdratenko announced that he wanted controlof the Kuril Islands to be transferred to Primorskii krai. In addition, he promisedincreased investment in the islands’ fishing enterprises and claimed that Sakhalinwas unable to support them (see Wade 1996: 55). Nazdratenko’s proposal wasroundly criticised by Sakhalin authorities who believed, quite understandably,that the Primorskii krai governor had no right to meddle in Sakhalin’s internalaffairs. In response to the outcry from Sakhalin, Nazdratenko argued thatincorporating the Kurils into Primorskii krai was not a political move and not aterritorial claim, but was motivated by the desire to recreate the single economiccomplex which existed earlier in the Far East.17 He also fired a broadside atSakhalin authorities claiming that the residents of Iturup’s (Etorofu) appeal to theJapanese government, and not the Sakhalin administration, for economicassistance was a national disgrace (Tass cited in FBIS/SOV 1994: 37–8).

Despite Nazdratenko’s claims to the contrary, the proposal was a politicallycalculated move designed to appeal to local fishers, who would benefit fromintegrating the Kurils into Primorskii krai, ahead of the first gubernatorialelections to be held the following year. As his very public campaign to oppose the1991 Sino–Russian border demarcation agreement demonstrates, Nazdratenkonever hesitated to exploit nationalist sentiments for political gain. The Kremlin’sinitial response to the proposal was not to reject it outright. Rather, itrecommended that the government, Federation Council and Federal Counter-Intelligence Service examine the question. If all parties agreed, a referendumwould be held. If two-thirds of the residents of Primorskii krai and the Kurils, inaddition to a two-thirds majority of the Federation Council agreed, a transfercould be carried out (Ostrovskaya 1994: 2). It has been suggested that theproposal might not have been a complete surprise to the federal government.According to Venevtsev and Demkin, Moscow’s preoccupation with maintainingthe state’s territorial integrity was believed to be behind Nazdratenko’s proposalas it would not only strengthen Russia’s political assets against Japan, but alsoallow Moscow to make cuts in previously promised subsidies to these territories(cited in Kirkow 1995: 935).18

Nazdratenko’s proposal had the additional effect of signalling to the Japanesethat the authorities in Sakhalin were not alone in their opposition to surrendering

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sovereignty over the disputed islands. This gave further credence to Russiangovernment claims that powerful domestic factors, notably public opinion, werestanding in the way of Russian territorial concessions. If the Russian governmentthought that transferring the islands to Primorskii krai’s jurisdiction wouldalleviate the burden of its expected financial assistance, it was mistaken. Theeconomic situation in Primorskii krai was just as severe as, if not worse than, inSakhalin oblast. As a result, the Kuril authorities and the embattled islanderscould expect little in the way of financial assistance from Primorskii krai.Nazdratenko’s proposal was not implemented and was quietly shelved.

Despite weathering Nazdratenko’s challenge, Yevgenii Krasnoyarov’s tenureas governor was to be relatively short. He was forced to resign on 24 April 1995because of health problems, a desire to take up alternative employment, as wellas criticism of his lack of leadership in formulating a reconstruction package forthe South Kurils after the devastating earthquake that struck the islands inOctober 1994 (Saharin to Nihon, no. 37, 25 April 1995: 1).

Igor Farkhutdinov

Yeltsin chose as Krasnoyarov’s successor Igor Pavlovich Farkhutdinov, themayor and chairman of the Yuzhno-Sakhalinsk Ispolkom. Farkhutdinov was bornon 16 April 1950 in the Siberian city of Novosibirsk. Upon graduating from theKrasnoyarsk Polytechnic Institute as an engineer-economist in 1972,Farkhutdinov moved to Sakhalin where he became an engineer, shift-head andthen head of shop at the Tymov power station. He worked at the power stationuntil 1977 before becoming the first secretary of the Tymov district committee ofthe Sakhalin oblast Komsomol – a position he held for three years. After a shortstint in 1980–1 as head of the Department of Working and Village Youth of theoblast CPSU Committee, Farkhutdinov served as an instructor for the departmentof party-organisational work for the Sakhalin oblast CPSU Committee until 1985.From 1985 until 1991, he was the chair of the Nevelsk city executive committeebefore taking up the position as mayor of Yuzhno-Sakhalinsk in 1991(Natsional'naya sluzhba novostei date unknown; Orttung et al. 2000: 482).

Soon after taking over the gubernatorial reins, Farkhutdinov, in an interviewwith the Hokkaid™ shinbun, signalled he would follow Krasnoyarov’s basicapproach of seeking to delay a resolution to the South Kurils dispute until theeconomic disparity between Japan and Russia was eliminated, after which he wasprepared to examine the issue (8 May 1995: 4). He was, however, more explicitthan his predecessor in his expectations that Japan might contribute to reducingthis gap through joint development, arguing ‘the most important thing is Japanesecooperation for the economic development of the islands. We welcome theadvance of Japanese companies’ (ibid.). Although far from a declaration ofsupport for transferring the islands to Japan, Farkhutdinov’s announcementoffered a glimmer of hope as it identified the necessary preconditions for Russiato reconsider its position regarding the disputed islands. For Japan, some solace

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could be gained from the fact that Farkhutdinov, at least for the time being, didnot regress to Fedorov’s unrealistic position of refusing to recognise the territorialproblem’s existence and to take part in any discussions to decide the issue of theislands’ ownership. The idea of jointly developing the islands was, in fact, not anew one, having been first proposed in negotiations during Gorbachev’s visit toJapan in April 1991.

If Farkhutdinov was initially seen as having moderate views on the territorialdispute in Japan, he soon moved to dispel this notion. In the lead-up to the first-ever gubernatorial elections scheduled to be held on 20 October 1996,Farkhutdinov found it necessary to pander to the nationalist vote when he asserted in an article in Sovetskii Sakhalin that ‘all the Kuril Islands have been and will remain Russian territory’ (cited in Hokkaid™ shinbun, 19 October1996: 5). A further hardening of Farkhutdinov’s position was reflected in anarticle in Rossiiskaya gazeta: ‘The Kuril problem does not exist. The Kurils, byrights of the first settlers and the results of the Second World War, are Russianterritory from a long time ago’ (ibid.). This comment clearly contradicted anearlier statement by Boris Yeltsin, contained in an official letter brought to Japanin September 1991 by Ruslan Khasbulatov, that relations between Russia andJapan would no longer be perceived in terms of victor and vanquished.

Farkhutdinov went on to win the election, but did not obtain an absolutemajority, receiving only 39.47 per cent of the vote – a little more than 10 pointsclear of his closest rival, the chairman of the Sakhalin Centre for Standardisationand Meteorology, Anatolii Chernyi (Orttung et al. 2000: 479). The extent towhich Farkhutdinov’s hardline stance on the territorial issue contributed to hiselection victory is unclear. In the harsh economic climate that made the strugglefor survival a priority for local residents it would be an exaggeration to sayFarkhutdinov’s position regarding the territorial dispute was a contributing factor.In fact, just before the gubernatorial elections, he travelled to Moscow to meetPrime Minister Viktor Chernomyrdin, and head of the presidential administration,Anatolii Chubais, and extracted a promise of 60 billion roubles in central fundingfor Sakhalin’s development – a move which is thought to have boosted hiselection chances (Saharin to Nihon, no. 77, 23 October 1996: 1). However,fishers, whose livelihood would be threatened as a result of transferring theislands to Japan, and other social groups who have a vested interest in Russia’scontinued control of the South Kurils would have taken careful note of thegovernor’s comments. Despite obtaining a popular mandate, which theoreticallyincreased his powers within the region and vis-à-vis Moscow and made him nolonger indebted to the President for his position, Farkhutdinov backtrackedsomewhat from his pre-election rhetoric and displayed a preparedness to followthe Kremlin’s line by at least recognising the existence of the territorial dispute(Hokkaid™ shinbun, 25 October 1996: 3).

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Reinforcing Sakhalin’s presence

Despite his somewhat reluctant and belated recognition of the territorialproblem’s existence, Farkhutdinov showed that the Sakhalin administration wasunwilling to stand idly by and watch Moscow negotiate with Tokyo over theislands’ fate. Although certainly not as pugnacious and critical of the federalauthorities as Fedorov, Farkhutdinov also demonstrated an ability to complicatematters involving the South Kuril Islands. He actively sought to introduce foreigncapital for the reconstruction and development of the disputed islands. Therationale behind this plan was simple: developing the South Kuril Islands andimproving living standards would stem the flow of people leaving the region,heighten the emotional attachment to the islands and maintain opposition to theirtransfer to Japan. If the Japanese refused to invest in the islands, Sakhalin had nochoice but to seek other foreign partners.

As far as attempting to reaffirm its position regarding the South Kuril Islandswas concerned, the period immediately before and after the November 1997Hashimoto–Yeltsin ‘no-necktie’ summit turned out to be a busy one for regionalauthorities in Sakhalin. In response to a proposal by the Society for the Researchof Security Issues (Anzen Hosh™ Mondai Kenkyuø kai) – a Japanese think-tank,established in 1968, which exerts a considerable influence on Japan’s domesticand foreign policies – the Sakhalin regional government agreed to host aconference to discuss various issues in Japan–Sakhalin relations. An internationalsymposium The Sakhalin Region–Japan: Problems and Prospects ofCooperation was held subsequently in Yuzhno-Sakhalinsk on 10–11 October1997 (Elizar'ev 1999: 124). The territorial dispute was at the top of the agenda.

For a while, the Russian MID had been working on ways to resolve theterritorial dispute. In November 1996, it entrusted a team of experts fromIMEMO headed by Valeriy Zaitsev, its vice-director and chief of the JapanSection, to tackle the problem surrounding the disputed islands’ sovereignty. Theresults were summarised in a paper entitled Possibilities of Joint Russo-JapaneseDevelopment of the Southern Kuril Islands, which Zaitsev had intended to deliverat the Sakhalin symposium (Zinberg 1997–98: 92). In order to facilitate theislands’ joint development and alleviate Japanese opposition to any proposal thatimplied Russian sovereignty over the islands, the IMEMO paper called for ‘theterritory of the four islands [to be] removed from the existing framework of theadministrative division of the Russian Federation (RF) and function as a specialregion, based upon the principles of local self-government and controlled directlyby the administration of the President of the RF’ (ibid.: 93).

The IMEMO proposal caused a furore in Russia. On 30 October 1997, a groupof State Duma deputies issued a declaration entitled To Secure [the] TerritorialIntegrity of Russia!, which criticised IMEMO for preparing a paper on theRussian MID’s behalf, causing direct damage to Russian sovereignty (ibid.).Regional authorities in Sakhalin, who correctly feared the plan marginalisedthem, launched a furious protest, refusing to allow Zaitsev to present the paper atthe symposium (Mainichi shinbun, 30 October 1997: 3). In the face of these fierce

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protests, the MID was forced to distance itself from Zaitsev’s proposal. Russia’sDeputy Foreign Minister, Grigoriy Karasin, sent a letter addressed toFarkhutdinov, indicating that the MID did not support the proposal to establishdirect presidential rule over the disputed islands. Specifically, Karasinemphasised that the plan conveyed only its authors’ (IMEMO) views and was notthe result of prior consultations with the Ministry (Asahi shinbun, 31 October1997: 9).19

Moreover, immediately after the Hashimoto–Yeltsin summit, Farkhutdinovauthorised and financed the joint construction with the Orthodox Church of across on Ostrov Tanfileva in the Malaia Kuril’skaya gryada (which the Japanesecall Suish™ Island – part of the Habomai islets) to commemorate the deeds ofRussian settlers who first discovered the islands 300 years ago. The timing of themove, immediately after the Yeltsin–Hashimoto meeting, was no accident; it wasan attempt by the Sakhalin administration to emphasise its claims of sovereigntyover the islands and remind both Tokyo and Moscow of Sakhalin’s presence(NHK News, Tokyo, 11 November 1997).20 Sakhalin’s cooperation with theOrthodox Church in this matter is also noteworthy given the latter’s increasingauthority and influence on people’s lives during a period of socio-economicdisillusionment in post-Soviet Russia. Finally, among the more innovative ofFarkhutdinov’s attempts to maintain Russian sovereignty over the South KurilIslands was his proposal, sent to the MID, to put Kunashiri and the Lesser Kurilson the World Heritage List. The move, ostensibly to preserve the islands’ uniqueand precious natural environment, provoked a protest from the Japanesegovernment, which saw it as a violation of its claimed sovereignty over theislands.21

Farkhutdinov’s motives in preventing resolution of the territorial dispute

There appear to be two fundamental reasons why Farkhutdinov sought to blockany moves by the Russian government to hand the disputed islands to Japan.According to Steven Solnick, he appears to have been ‘using the populist issue ofRussian sovereignty over the territories to solidify his domestic political basewithin the oblast’ (1999: 3). As discussed previously, although Farkhutdinov wonSakhalin’s first gubernatorial elections in October 1996, his total share of the votewas just under 40 per cent – sufficient to defeat his closest challenger, butcertainly not enough to warrant any complacency. Farkhutdinov was re-elected inOctober 2000, receiving approximately 57 per cent of the vote (Bayandin 2000:2).

In particular, the position of the Sakhalin oblast Duma vis-à-vis the territorialdispute compelled Farkhutdinov to adopt a hardline response (Solnick 1999). Theregional Duma has consistently taken an uncompromising stand over the SouthKuril Islands. It has protested against foreign companies using maps that showthe disputed islands to be Japanese territory and has also lobbied Moscow and theFar East and Lake Baikal Interregional Association for Economic Cooperation to

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take steps against any further ‘cartographic expansion into Russian territory’. Forinstance, in September 2001, the Sakhalin Duma asked Sakhalin EnergyInvestment Corporation (hereafter, Sakhalin Energy) to rectify an error in a mapin the company’s promotional daily planner in which half of the Kuril Islands andthe southern half of Sakhalin were shown in the same colour as Japan, indicatingJapanese sovereignty over these lands. The CEO of Sakhalin Energy, SteveMcVeigh, apologised to the Duma and promised to take the offending plannersout of distribution (The Sakhalin Times, no. 10, 11 October 2001).22 Ostensibly,this incident appears to be minor, but it has the potential to become a seriousissue. Sakhalin Energy is a four-member consortium consisting of Marathon Oil,Shell and two Japanese companies, Mitsubishi and Mitsui, which are jointlydeveloping oil and natural gas fields off the eastern coast of Sakhalin (known asSakhalin II). Mitsubishi and Mitsui have a combined 37.5 per cent stake inSakhalin II and may come under pressure from the Japanese government, whichhas a penchant for using propaganda in the dispute, to use promotional materialsthat support Japan’s claims to the disputed islands. This could put the twoJapanese companies in a difficult position and cause problems within theconsortium. Thus, as far as Japan is concerned, politics is never completelydivorced from economic issues.

Moreover, in September 2001, the regional Duma organised a publicparliamentary hearing to discuss the territorial dispute. The recommendation ofthe two-day hearing, made to the Russian government, State Duma and PresidentPutin, held no surprises: do not return the Kuril Islands to Japan (The SakhalinTimes, no. 10, 11 October 2001). As will be discussed in a later section, therecommendation did not prompt the type of response from the federalgovernment that Sakhalin officials were counting on. It was also the regionallegislature that adopted the oblast charter (ustav), which made any transfer of theislands subject to the result of a referendum and, in May 2001, had been debatingwhether to propose a revision of the federal Constitution that would makerelinquishing the disputed islands legally impossible (Kyodo, 11 July 2001).Moreover, as will be discussed in greater detail in Chapter 6, powerful regionalinterest groups in the form of the military and the fishing industry, which areviscerally opposed to Russia transferring the South Kuril islands to Japan, havealso acted as an impediment to the regional political elite adopting a moreconciliatory position on the territorial dispute. As Solnick further argues,adopting ‘[a] nationalist stand against return [sic] of the islands allow[ed] him toemerge as the leader of this crusade, rather than a target of it, and also offer[ed]a useful anti-Moscow plank for domestic political consumption’ (1999: 4). Therising tide of nationalism that swept the region, and indeed most of Russia, duringthe 1990s made for a receptive audience for any anti-return propaganda circulatedby political elites.

In addition, driven by motives analogous to those of the regional authorities inPrimorskii krai campaigning against demarcation of the eastern Russo-Chineseborder (Lockwood 2001: 24–7), Farkhutdinov has also used his outspoken

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opposition to Russian territorial concessions as an important means of extractinggreater economic resources or privileges from Moscow (Solnick 1999: 4). Asdiscussed in Chapter 2, the command economy’s collapse and the failure todevelop a consensus-based integrated financial framework led to a large numberof regions concluding special arrangements with Moscow regarding taxallowances and subsidies. Moreover, Russia’s inchoate constitutional frameworkprovided an environment conducive to inter-federal bargaining during the Yeltsinera. In this context, Sakhalin oblast, as a whole, benefited in the past with theannouncement of a number of multi-million dollar federal programmes for theKuril Islands’ socio-economic development, although Moscow’s failure to makegood most of its financial pledges raised doubts about the financial gains to bemade from pursuing such a strategy. Exploiting the territorial dispute also provedbeneficial in other ways. Farkhutdinov signed a power-sharing agreement withPrime Minister Chernomyrdin in May 1996 between Sakhalin oblast and theRussian Federation which covered, among others, areas such as land use,education and international economic ties (Orttung et al. 2000: 481).

According to Arai Nobuo, Farkhutdinov, who had over 20 years’ experience inlocal politics and was an astute politician, adopted a ‘third position’ (dai-san notachiba) on the territorial dispute in order to maximise Sakhalin’s influence. This‘third position’ was ‘not fixed, but fluid and was regulated by many variablesincluding the Russian federal government’s Japan policy, the Japanesegovernment’s Russia policy, the will of the islanders expressed through variouselections and Sakhalin public opinion’ (2000: 51). Contrary to Japanese mediareports, Arai doubts that Farkhutdinov was a ‘simple hardliner’ (tanjun ky™k™ha),for if he was, he would have refused Japanese aid and opposed the visa-lessexchange programme. One will recall from the preceding chapter thatFarkhutdinov did, in fact, threaten to cancel the visa-less exchanges in the past.However, this was in response to what he correctly perceived as Japanese effortsto link cross-cultural exchange with the movement to demand the NorthernTerritories’ return (see Williams 2003). Farkhutdinov was not opposed to theprogramme per se. On the contrary, he would like to have seen it expanded toinclude Sakhalin residents. Such a ‘hardline’ approach – if one were tohypothesise that for the Russian government, improving relations with Japan is asufficiently high priority – would have led the Kremlin to ignore Sakhalin andpress ahead in negotiations with Japan, thereby reducing Sakhalin’s influence. Onthe other hand, if Sakhalin handed the Russian government ‘blank power ofattorney’ (hakushi inin) in matters pertaining to the territorial dispute, Araibelieves Moscow would not have taken into account Sakhalin’s position (2000:51). Here it is necessary to re-emphasise that the political and economic benefitsregional elites derived from exploiting the territorial dispute virtually assured thatSakhalin would not be prepared to hand the federal government any of itsperceived rights over the islands.

Sakhalin’s position regarding the South Kuril Islands has not only complicatedRussian territorial negotiations with Japan, but is also believed to have the

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potential to cause difficulties for the federal government concerning the massiveoffshore oil and gas development projects around Sakhalin. Steven Solnick(1999: 4) suggests Sakhalin might be tempted to use its potential veto over anydeal to resolve the territorial dispute as a bargaining chip to readjust thefederal–regional revenue split from the projects or reinterpret Product SharingAgreements (PSA).

Regional authorities have been critical of Moscow, in particular the formercommunist-dominated State Duma, for blocking the necessary legislationdesigned to protect foreign investment in the region. As will be discussed inChapter 6, the lack of such legal provisions is one of the main factors that havelimited foreign investment in Sakhalin during the first decade of post-Sovietreforms. The expected wealth generated from the oil and gas developmentprojects will benefit Sakhalin enormously. Indeed, the tax revenues from theseresource projects have enabled the regional administration to increase investmentin public utilities in recent years, which has contributed to a reduction in both thefrequency and duration of power blackouts in Sakhalin. These projects representan important opportunity for Sakhalin to emerge from its long-standing economicmalaise. There must be some doubts as to whether regional authorities woulddeliberately destabilise the economic environment by seeking to readjust thefederal–regional revenue split from the projects or alter the PSA in order to thwartany resolution of the territorial dispute. Nevertheless, one must also notunderestimate the irrationalism that emotional attachments to territory can inducein some.

Opposition to transferring the South Kuril Islands to Japan has been Sakhalin’s‘political card’. This card was used not only against Moscow, but also against theJapanese. According to one official from the HPG, the regional authorities inSakhalin sought to exploit the territorial dispute in order to attract economic aidand cooperation from Japan (Yokoi and Shiroi 1998: 1). From the Japaneseperspective, economic cooperation has been one means of trying to alleviateSakhalin’s opposition to Russian territorial concessions, although of course thishas not been the sole reason for Japanese investment in Sakhalin. Sakhalin’sstrategy had some positive results. In September 1996, the Japanese governmentopened a Japan Centre in Yuzhno-Sakhalinsk. In January 1998, the Japanesegovernment opened a branch of the Khabarovsk consulate in Yuzhno-Sakhalinsk.This move, a manifestation of the importance Japan places on Sakhalin, markeda fundamental departure from previous Japanese policy, which was based on thepremise that sovereignty over the southern part of Sakhalin had not been legallyresolved as a result of the Soviet Union’s refusal to sign the San Francisco PeaceTreaty (Asahi shinbun, 14 December 1997: 2). Despite local claims to thecontrary, Japan has never made any official claim for ownership of SouthSakhalin, although a strict interpretation of international law sufficientlychallenged Russian control. Tokyo withheld formal recognition of the SovietUnion/Russia’s control over South Sakhalin in a bid to extract concessions fromMoscow over the Northern Territories. The recalcitrant MOFA, despite the recent

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thaw in bilateral relations, was able to claim this did not amount to tacitrecognition of Russia’s sovereignty over South Sakhalin as the Yuzhno-Sakhalinsk office was not an official consulate – only a branch of the Khabarovskconsulate. The office’s upgrading to official consulate status in March 2001marked the end of any Japanese ambiguity regarding the legal ownership ofSouth Sakhalin.

Given the federal government’s inability to make good on its promises offinancial assistance to the region, one might argue that it would have been betterfor the regional authorities in Sakhalin to come out in support of Russiatransferring the islands to Japan, or at the very least stifle their own opposition toterritorial concessions. Such a move would unleash a wave of much-neededJapanese financial support for Sakhalin. The political value regional elites saw inexploiting the territorial dispute is one reason why such a strategic shift was notseriously considered. Moreover, there were probably reduced expectations inRussia that a decision to return the islands to Japan would result in a substantialbonus in terms of Japanese economic assistance for its embattled economy.Economic assistance of this magnitude would have been dependent uponimproved Japanese sentiments towards Russia and Japan’s own ability to fundsuch a package. One cannot discount the possibility that Japanese gratitude for apossible Russian return of the Northern Territories might have been short-lived,in a manner akin to the appreciation for America’s return of Okinawa in 1972 andthe ‘China euphoria’ following the signing of the Sino–Japanese Peace Treaty in1978 (Kimura 1998: 19–20).

For many Japanese, the Russian occupation of the Northern Territories is bothunjust and illegitimate. They would therefore probably have considered anyRussian decision to return the islands as being a matter of course. Any ‘Russiaeuphoria’ that might have followed a decision to return the islands would havebeen relatively small in scale and short-lived. Moreover, the poor state of theJapanese economy and Russia’s unstable investment environment during the1990s further reduced the likelihood of a subsequent economic assistancepackage for Russia. Political leaders in Russia were more than likely to becognisant of the limits of Japanese largesse.

South Kuril authorities

The majority of regional and local leaders were united in their opposition toRussia transferring the South Kuril Islands to Japan in the period immediatelyfollowing the Soviet Union’s collapse. However, they quickly experiencedtensions in other aspects of their relationship. The relationship between Sakhalinand the South Kuril Islands was in many ways a microcosm of Sakhalin’srelations with Moscow. The very factors that contributed to the conflict betweenthe centre and the regions – Yeltsin’s attempts to centralise power nationally andshortfalls in budget subsidies – led to an increasingly adversarial relationshipbetween local officials and regional governors (see Evans 1999). Regional

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governments attempted to centralise authority within their territories, sparking apower struggle between them and local governments. This struggle wascompounded by the structure of budgetary relations between the two lower tiersof government. Just as regional governments were reliant on Moscow forbudgetary payments, local governments were highly dependent on regionalgovernments for financial assistance. With the federal budget in chronic shortageduring the 1990s, the federal government transferred smaller amounts to theregions, which in turn passed down even less to the locales, leaving them withinadequate money to carry out their ever-increasing responsibilities (ibid.). As aresult, many local governments were forced to appeal both to Moscow and to theregional governments for assistance. When this was either insufficient or notforthcoming, they were forced to look elsewhere.

Local authorities in the Kuril and South Kuril Districts confronted thissituation by seeking outside assistance and formulating proposals in an effort toraise the islanders’ living standards. In January 1992, the Kuril Soviet, inresponse to a citizen-initiated signature collection drive, urged the UN to take theKurils under its aegis (Hokkaid™ shinbun, 6 January 1992: 3). Moreover, in orderto resolve the territorial dispute, the soviet proposed the construction of aninternational park to attract tourists and an environmental protection travellers’centre. During the same period, the chief executive (mayor), Nikolai Pokidin, andbusiness leaders from the South Kuril District proposed to turn the islands into afree economic zone. Sakhalin officials could not consent to this proposal as itcalled for the islands to be initially separated from Sakhalin. It also called for thepresident to appoint the local administration (the regional governor appointed theheads of local government until 1996–7), which would be responsible to him andthe parliament (Interfax cited in FBIS/SOV 1992: 19).

As the closest neighbour and the country in which many of the embattledislanders placed their hopes for an improved standard of living, Japan was oftenembroiled in these developments. For instance, as discussed in Chapter 1, in April1994, Pokidin sent a fax to his counterpart in Nemuro, ïya Kaiji, proposing thatthe mayor permit Japanese fishers to operate within Russian territorial waters offthe disputed islands in return for fishing fees. The proposal’s aim, made over theheads of both the Sakhalin government and the Federal Fisheries Commission,was to secure the fees paid by the Japanese fishing companies as an independentsource of revenue for the district (Arai 2000: 47). An intergovernmentalagreement was reached in October 1998 on ‘safe fishing’ in the disputed islands’EEZ. Unfortunately for the South Kuril District, it was unable to secure thesefunds as an independent source of revenue. Following the October 1994earthquake that devastated the islands of Shikotan and Kunashiri in particular,deliveries of Japanese humanitarian aid to the islands were carried out inaccordance with an intergovernmental agreement, which was based on a requestby the South Kuril authorities. These actions stung the Sakhalin administration,leading to criticism of its administrative capabilities.23

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The dispute over the right to be the negotiating partner, or point of contact,with the Japanese for the visa-less exchange programme added a furtherdimension to the conflict between Sakhalin and the South Kuril District overJapanese humanitarian aid. This was highlighted during a visit to Kunashiri bythe Director of the Hokkaido Development Agency, Suzuki Muneo, in July 1999.Vladimir Zema, who defeated Pokidin in the 1997 mayoral elections, wasexpected to meet Suzuki as he disembarked at the island’s port. Zema wasformerly a captain in the Border Guards who was posted to Kunashiri in 1987. Herose to political prominence by heading a local campaign to pursue administrativeofficials, including Pokidin, over misappropriating humanitarian aid from Japan(Hokkaid™ shinbun, 27 March 1997: 5). While Zema had a reputation as ahardline opponent of Russian territorial concessions, like Pokidin, he didindependently suggest leasing the disputed islands as a means of attaining normalliving standards (Myre 1999). Zema appeared to have earned the ire of regionaladministrative officials and, despite initial plans, was excluded from thewelcoming party. Suzuki was instead greeted by the Deputy Governor ofSakhalin, Vladimir Godunov and the head of the regional administration’s KurilIslands Department, Mikhail Tereshko – the former chairman of the South KurilDistrict soviet. Tereshko had in the past made statements opposing the transfer ofthe disputed islands to Japan (Hasegawa 1998: 380; Arai 2000: 47) based on thebelief that the economic loss this would bring to Sakhalin would outweigh theexpected benefits resulting from a normalisation of relations (interview, 22August 2001). The South Kuril District’s attempts to establish independentrelations with Japan not only challenged the Sakhalin Governor’s authority, butalso undermined Sakhalin’s own strategy of exploiting the territorial dispute toattract economic aid and cooperation from Japan.

Sakhalin’s governors: Complicating Russia’s Japan policy?

The territorial dispute as a tool in the Yeltsin–Gorbachev power struggle

It will be recalled that, during Mikhail Gorbachev’s visit to Japan in April 1991,Valentin Fedorov, at the time the recently elected Chairman of the Sakhalin oblastexecutive committee, had accompanied the Soviet leader (though not as amember of the official delegation) and caused a stir when he cut short his stay andflew back to Moscow in protest at what he saw as ‘the capitulating tendencies ofthe Soviet president and of his closest advisors’ (Fedorov 1996: 107). Thisuncommon breach of diplomatic protocol did not go unnoticed in Japan,highlighting that subnational interests were also caught up in the territorialdispute. The position of Fedorov and the Sakhalin administration was a newfactor of which the Soviet leader needed to be cognisant when formulating anypolicy concerning the South Kuril Islands. However, in the period leading up to

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Gorbachev’s visit, it was probably not the most significant. As Lisbeth Tarlowargues, ‘Of all the factors constraining Gorbachev, most people who were close to the scene assert with confidence that Yeltsin was the most important’(2000: 136).24

At the time of his visit to Japan, Gorbachev’s political strength was at itsweakest since he took office. He came under attack from opponents who were attwo ends of the political spectrum: on the right, the military-industrial complex,KGB and Party hardliners; on the left, the new democrats led by Boris Yeltsin(ibid.: 134). Yeltsin and Gorbachev were engaged in a bitter political struggle forpower over the slowly crumbling Soviet state. This struggle was increasinglyleaning in Yeltsin’s favour. Recovering from his humiliation by Gorbachev at theParty Plenum in 1987, Yeltsin was elected as a People’s Deputy to both the Sovietand Russian Parliaments and then Chairman of the Supreme Soviet of the RSFSRin May 1990. He was elected President of the RSFSR in June 1991 – then the only leader in Russian history ever to stand for and be elected in a popularvote (this was in stark contrast to Gorbachev who was elected to the presidencyof the USSR by the Congress of People’s Deputies in March 1990) (see White2000: 70–8).

The South Kurils problem had essentially become a tool in the politicalstruggle between Gorbachev and Yeltsin. Yeltsin was determined to block any ofGorbachev’s proposals regarding the territorial dispute that might strengthen theSoviet leader’s political position. He challenged Moscow’s legal authority totransfer the islands’ sovereignty and asserted that any agreement Gorbachevnegotiated would not be acceptable without the Russian Republic’s participation(Tarlow 2000: 136). Gorbachev sought to accommodate Yeltsin by inviting theRussian Foreign Minister Andrei Kozyrev and four other Russian Republicofficials to accompany him to Tokyo (ibid.).

In order for the Russian Republic to be treated as a serious player in anynegotiations and to demonstrate his own stature as a statesman of internationalstanding by addressing the territorial problem, Yeltsin formulated his ownproposal to resolve the dispute. This was his five-stage proposal outlined inChapter 1. Rumours surfaced in the Japanese and Soviet press in March 1991 thatGorbachev was close to making a deal with the Secretary-General of the rulingLDP, Ozawa Ichir™, for the islands’ sale to Japan for US$260 billion. Fearing thatan infusion of aid might stabilise the economy and shore up Gorbachev’s ailingposition, Yeltsin embarked on a campaign to enflame nationalist sentiments withstatements exposing the Soviet leader’s intention to ‘sell Russian territory’ (ibid.).If Yeltsin needed any assistance in arousing opposition to Russia transferring theislands to Japan, Fedorov proved to be more than capable of the task as he lobbiedextensively for local and regional support to block any territorial concessions.

During the tumultuous period leading up to the Soviet Union’s collapse,Fedorov had become the target of widespread criticism, particularly from theRussian Federation’s Deputy Foreign Minister, Georgi Kunadze, who questionedthe Sakhalin leader’s emotional and psychological stability. For his part, Fedorov

The Sakhalin polital elite and the South Kuril Islands 123

launched a fierce and racially inspired diatribe against Kunadze, calling for hisdismissal and declaring that the deputy foreign minister, who is of Georgianorigin, ‘does not have the right to settle the issue of ancient Russian land’(Buszynski 1992: 492). Ruslan Khasbulatov also promised to have Fedorovrecalled from Sakhalin. Nevertheless, despite calls for his dismissal, Yeltsinappointed Fedorov as the oblast’s Head of Administration in presidential decreeno. 139 on 8 October 1991 (Zinberg 1992a: 10). There were several possiblereasons behind Yeltsin’s decision to install Fedorov as the head of executiveauthority on Sakhalin. First, Fedorov had shown loyalty to the Russian President,supporting his anti-Gorbachev stance and also resolutely opposing the Augustcoup attempt. Fedorov’s appointment was therefore a reward for his loyalty.Second, as the elected head of the Sakhalin Ispolkom, Fedorov was a naturalcandidate for the position. These are plausible reasons. However, according toYakov Zinberg, the most valid reason for the appointment was that ‘due to theposition Fedorov took regarding the “Kurils problem”, he had found favour witha majority of the oblast’s residents’ (ibid.). By appointing Fedorov, Yeltsin wasabout to, perhaps knowingly, snare himself in a trap that was very much of hisown making.

As argued above, Yeltsin was able to harness nationalism in order tostrengthen his political position in the tumultuous period shortly prior to andimmediately following the Soviet Union’s collapse. Fedorov’s outspokenopposition to the Soviet Union relinquishing control of the South Kuril Islandspartly reflected the emergence of nationalist sentiments within the country andSakhalin served as a focal point and symbolic centre of the national movementfor opposing Japanese designs on the disputed islands. Sakhalin’s stance on theterritorial problem is significant given its jurisdictional authority over the SouthKuril Islands, and its opposition to Russia transferring the islands to Japan hasunderpinned conservative forces throughout the country that oppose any Russianterritorial concessions. If the Sakhalin leadership, which serves as an articulatorof the interests of domestic economic constituencies, were to have remainedsilent on the issue, or even (unlikely, given the gains to be made by exploiting thedispute) had come out in support of Russia handing over the islands to Japan, itwould have seriously undermined the broader anti-return movement. Yeltsinidentified the ‘Sakhalin factor’ as a possible weapon to be used in the powerstruggle against Gorbachev. However, by seeking to play the nationalist card andexploit the territorial dispute, Yeltsin was to help remove the lid on a force thathe would no longer be able to control.

In fact, it is possible to argue that the vocal campaign that local authorities inSakhalin mounted in order to block Russian territorial concessions could, intheory, have been a positive for the Kremlin. First, as Brian Hocking argues,‘stressing domestic uncertainty created by [non-central government] interests andinvolvement may be one way of encouraging a negotiating partner to modify itsdemands’ (1993: 42). However, the reality is that although the Japanesegovernment has shown a degree of flexibility regarding the timing, modalities

124 The Sakhalin polital elite and the South Kuril Islands

and conditions of the islands’ return in an attempt to placate conservative andnationalist forces in Russia, it has not abandoned its basic objective of ultimatelyseeking the return of all four islands. Although the possibility of territorialconcessions is likely to create a domestic political storm, a compromiseagreement to transfer only two islands to Japan may be more palatable toRussians. However, the Japanese government has thus far not given anyindication that it would settle for control of only two islands.

Second, Sakhalin’s position may, ironically, have been convenient for Yeltsin,helping to provide him with further grounds for not surrendering the South KurilIslands. This would relieve him of the fear and pressure of possibly beingoverthrown by powerful conservative and nationalist forces as a result ofsurrendering the islands and having his name recorded in history as someone whoforfeited lands won with the blood of Russian soldiers. Yeltsin needed only tolook at the low public standing of his predecessor, Mikhail Gorbachev, tounderstand these fears. Moreover, Sakhalin’s anti-return campaign would haveaccorded with Yeltsin’s basic strategy of postponing the territorial dispute’sresolution until the next generation (after he would have presumably left office).

One way in which the Sakhalin regional elite can be seen to have causedproblems for policymakers in the Kremlin, particularly Yeltsin, was in theirdemands for the Russian President to declare the islands to be an integral andcontinuing part of Russian territory. As discussed in Chapter 1, an importantcomponent of Yeltsin’s strategy towards the Japanese was to offer vague promisesof resolving the territorial dispute in an attempt to extract economic concessions.Seeking confirmation and clarification from the President that he was not goingto transfer the islands to Japan threatened to complicate Yeltsin’s obfuscationstrategy.

Among Russia’s central government institutions, Sakhalin’s campaign againstterritorial concessions, above all, conflicted with the MID’s position. As notedabove, the MID was eager to resolve the territorial dispute at an early stage. Tofacilitate this, it backed the two-island formula in negotiations with Japan in early1992, which called for Russia to hand over the islands of Shikotan and Habomai,leaving the sovereignty of Kunashiri and Etorofu undecided. The MID wasanxious to commit Yeltsin to this compromise solution (Hasegawa 2000: 175),but with nationalist sentiment raging throughout the country, the RussianPresident could not provide any clear directive and, as a result, the MID was unable to strike any deal with Japan. It will also be recalled that the MID wasinvolved in the 1997 Zaitsev proposal to establish the South Kuril Islands as aspecial region, from which it was later forced to distance itself in the wake ofvocal criticism for regional authorities in Sakhalin.

Moscow’s response

According to Ivo Duchacek, ‘One possible measure of the importance ofsubnational foreign policies are the reactions of the national governments to them

The Sakhalin polital elite and the South Kuril Islands 125

and measures proposed or adopted to deal with them’ (1984: 20). In order togauge the significance of the ‘Sakhalin factor’ in Russian decision-makingregarding the South Kuril Islands, this section will examine how Moscowresponded to Sakhalin’s campaign to obstruct progress towards resolving theterritorial dispute.

The relationship between Fedorov and Moscow, particularly the MID, can bedescribed as fairly acrimonious. Fedorov criticised the Russian governmentbecause of a perception that the MID in particular was engaged in a deal totransfer the disputed islands to Japan and also generally because of the Gaidargovernment’s ‘shock therapy’ programme of economic reform, which hadbrought poverty and misery to many Russians, particularly the elderly and otherson fixed incomes. Moscow’s response to Fedorov’s meddling ranged fromdisregard to criticism. Fedorov’s ‘Fourth Way’ proposal to resolve the territorialdispute did not elicit an official response from the Russian government. In fact, itprobably caused more of a sensation in Japan than it did in Russia. As discussedpreviously, his plan to establish Cossack settlements on the islands drew criticismboth from the islands’ residents and from the MID, which saw it as a means ofdiverting local attention away from Sakhalin’s deepening socio-economicproblems – partly the result of Fedorov’s mismanagement.

During the early post-Soviet period, not all of Sakhalin’s political elite were inopen conflict with the federal government. Although Fedorov was trying toarouse local opposition to any territorial concessions and refused to participate inany discussions where Russian sovereignty over the South Kurils was questioned,his rival Anatolii Aksenov was willing to cooperate with central authorities byparticipating in the Burbulis Commission. Aksenov’s participation in theCommission can be seen as an indicator of the importance Moscow placed on thenewly emergent ‘Sakhalin factor’.

Despite his outspoken opposition to the federal government transferring theSouth Kuril Islands to Japan, Farkhutdinov, in contrast to Fedorov, generallysought cooperative relations with Moscow. This was evident in his partyaffiliations. Farkhutdinov was on the party list for ‘Our Home is Russia’ (Nashdom – Rossiya), the ‘party of power’ until Prime Minister Viktor Chernomyrdin’sdismissal in March 1998, for the 1999 State Duma elections – the only FarEastern Governor on the list.25 In the October 2000 gubernatorial elections he wassupported by the most recent ‘party of power’, Unity (Yedinstvo). Farkhutdinovwas not an isolated example of a regional governor changing political partyaffiliations in order to ally himself with the ‘party of power’, which, as DarrellSlider observes, was a ‘way to enhance [his] lobbying effectiveness with thecentral government’ (2001: 226).26

For its part, Moscow adopted cooperative measures in order to accommodatethe Sakhalin administration and allow the governor, in particular, input intoRussian decision-making regarding the islands’ fate. For instance, Farkhutdinovand the chairman of the oblast Duma, Boris Tretyak, participated in parleys of theRusso-Japanese Border Demarcation Committee, which was established in 1998

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(Kyodo, 18 March 1998). Farkhutdinov accompanied the then Prime Minister,Sergei Kirienko, on a visit to Japan in July 1998 and was also an official memberof President Vladimir Putin’s entourage in Japan in September 2000. The lattermarked the first time a Sakhalin governor was included in the official party for apresidential visit to Japan and was seen by some sections of the Sakhalin massmedia as a show of support for Farkhutdinov by the Russian President (SovetskiiSakhalin, 31 August 2000: 1).27 Although the 1998 visit’s emphasis was onstrengthening economic relations, Farkhutdinov used the occasion to touch uponthe issue concerning the South Kurils, suggesting joint residency – albeit underRussian sovereignty – as a means to resolve the dispute (Hokkaid™ shinbun,10 July 1998: 3). Although Moscow’s efforts to establish high levels ofconsultation with Sakhalin improved the channels of communication between thefederal and regional governments, they did not completely remove some ofFarkhutdinov’s doubts that the MID and other state organs were conductingclandestine territorial negotiations with the Japanese government (TsoiBesedovala 2001: 1–2).

Moreover, in what may be seen as an example of the Kremlin’s sensitivitytowards Sakhalin’s position, Boris Yeltsin requested that Farkhutdinov come toMoscow urgently in order to participate in talks between Japanese Prime MinisterObuchi Keiz™ and Yevgenii Primakov in November 1998 (Hokkaid™ shinbun, 13November 1998: 2). The reasons behind Farkhutdinov’s participation in the talkswere ostensibly to ensure the peace treaty negotiations went smoothly and toallow the Sakhalin governor to have his views reflected in the discussions. Justhow smoothly the talks would be expected to proceed with the participation of aregional political leader who was resolutely opposed to Russian territorialconcessions remains an open question. However, it also served to highlight to theJapanese Prime Minister the domestic constraints in Russia to returning thedisputed islands.

The importance of the ‘Sakhalin factor’ was also evidenced by Moscow’speriodic dispatch of government officials to Sakhalin in order to assuage localconcerns about a possible transfer of the South Kuril Islands to Japan. On his wayback from the Kawana talks in April 1998, Yeltsin’s Press Secretary, SergeiYastrzhembsky, met regional officials in Yuzhno-Sakhalinsk to inform them ofthe details of the summit. After the meeting he told local journalists that ‘inRussia there exists a Constitution to guarantee the inviolability and integrity ofRussian territory and the guarantor is the President. The government does notintend to operate behind the backs of Sakhalin and Kuril residents’ (SovetskiiSakhalin, 22 April 1998: 1).28 Similarly, in a manifestation of what one Japanesescholar called the ‘“Sakhalinization” of Russia’s policy towards Japan’, RussianForeign Minister Igor Ivanov was sent to Sakhalin in February 1999 to discusswith regional officials Moscow’s policy regarding the disputed islands (Saito1999: 74).29

The Sakhalin polital elite and the South Kuril Islands 127

ConclusionThis chapter examined an important component of the ‘Sakhalin factor’ –regional political elites – and outlined their positions on the dispute over theSouth Kuril Islands. It considered why Sakhalin’s political elites adopted anuncompromising stance in opposition to Russian territorial concessions. Thechapter argued that the regional political elite in Sakhalin, particularly Fedorovand Farkhutdinov, sought to exploit the South Kuril Islands dispute for politicaland economic gain by adopting very public, and sometimes innovative,campaigns to prevent the federal government from transferring the disputedislands to Japan. The South Kuril Islands dispute proved to be a useful tool forboth governors, who played the nationalist card, in order to strengthen theirsometimes unstable domestic political bases. As the case of former Primorskiikrai Governor, Yevgenii Nazdratenko, demonstrates, Fedorov and Farkhutdinovwere not the only embattled Russian regional leaders to wrap themselves in thenationalist cloak in order to divert attention and criticism away frommismanagement and corruption. Local opposition to Russian territorialconcessions also enabled Sakhalin to extract economic concessions and benefitsfrom both the Russian federal government and Japan where the ‘Sakhalin factor’was seen as an important element in Russian domestic affairs pertaining to theSouth Kuril Islands. However, the former’s inability to make good most of itspromises of support casts some doubts on the economic value of such a strategy.It is for these reasons that the political elites in Sakhalin, a genuine desire tomaintain Russian territorial integrity notwithstanding, were unwilling to take aconciliatory stand on the territorial dispute. This is one reason whyHokkaido–Sakhalin subnational government relations failed to create, at thesubnational level, an environment conducive to resolving the territorial dispute.

The Sakhalin political elites’ involvement in the territorial dispute with Japanchallenges one assumption within the discourse on subnational governments asinternational actors outlined in the introduction: subnational public authorities’external activities are primarily confined to the realm of ‘low politics’. Althoughevidence suggests this is probably true in most situations, Sakhalin’s highlyvisible campaign to block Russian territorial concessions underscores the meansto which some subnational actors will resort when they feel their interests arethreatened.

Regarding whether the Sakhalin regional elites’ campaign to block anySoviet/Russian territorial concessions has been a nuisance for the Kremlin, inparticular Boris Yeltsin, it should be emphasised that the Russian Presidentidentified the ‘Sakhalin factor’ as a weapon to be used in the political struggle forpower against Gorbachev over the gradually crumbling Soviet state. In fact, it ispossible to argue that the vocal campaign that local authorities in Sakhalinmounted in order to block Russian territorial concessions, buttressed byconstitutional and regional charter provisions stipulating that a cession of Russianterritory must first be put to a referendum, ironically, might have been convenientfor Yeltsin; it helped to relieve him of the fear and pressure of possibly being

128 The Sakhalin polital elite and the South Kuril Islands

overthrown as a result of surrendering the South Kuril Islands and having hisname recorded in history as someone who betrayed the national interest by givingaway Russia’s primordial territory. Moreover, under different circumstances,Sakhalin’s involvement in the territorial dispute might have encouraged theJapanese government to modify its demands. If Sakhalin’s position on the SouthKuril Islands in any way caused problems for Yeltsin, it was probably bythreatening to complicate the President’s strategy of offering vague promises ofreturning the disputed islands in an attempt to extract economic concessions fromJapan. Nevertheless, Fedorov’s vocal campaign probably created more headachesfor the Russian MID, which was eager to resolve the territorial dispute at an early stage.

The preceding discussion also highlights two specific issues of which onemust be cognisant when discussing whether paradiplomacy is congruent with orchallenges central government foreign policy. First, it is sometimes useful todisaggregate the central government because various ministries, agencies anddepartments may well have diverging views on a particular issue. Subnationalpublic authorities’ external activities may therefore accord with one governmentbranch’s policy, but may clash with another’s. Second, it is sometimes necessaryto be cognisant of the differences between government strategy and tactics. As thecase of the Sakhalin political elite illustrates, it is possible for paradiplomacy tobe congruent with one and not the other.

Despite his outspoken opposition, Farkhutdinov’s relationship with Moscowwas certainly more cooperative than Fedorov’s. For its part, Moscow adoptedcoordinative measures and sought to establish consultative channels in order toaccommodate the Sakhalin administration and allow the governor, in particular,input into Russian decision-making regarding the islands’ fate. This wasevidenced by Farkhutdinov’s participation in parleys of the Russo-JapaneseBorder Demarcation Committee, his accompanying Russian leaders to Japan andalso Moscow’s periodic dispatch of government officials to Sakhalin in order toassuage local concerns about a possible transfer of the disputed islands to Japan.

While focusing on the political elite component of the ‘Sakhalin factor’, thischapter did not address the other aspect of the ‘Sakhalin factor’: local publicopinion. Sakhalin oblast residents’ perspectives on the South Kuril Islandsproblem are addressed in the next chapter.

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5 Sakhalin public opinion and the South Kuril Islands

IntroductionThe efforts by regional and local administrations in Hokkaido and Sakhalin tofoster closer interregional relations, outlined in Chapter 3, led to theestablishment of ‘pipes’ or channels for private-level exchanges. The growth ofcross-cultural relations between both regions’ citizens resulting from theseexchanges have undermined outdated perceptions and propagated previouslyunimagined levels of goodwill. However, at the same time, these exchangesfailed to induce attitudinal changes towards the territorial dispute amongSakhalin oblast residents.1 This chapter examines why this is the case. Itevaluates two factors: school history education and nationalism – the latterdefined in this context as ‘the making of combined claims on behalf of apopulation, to identity, to jurisdiction, and to territory’ (Hearn 2006: 11) – saidto be behind the majority of Sakhalin residents’ opposition to Russia transferringthe South Kuril Islands to Japan. The chapter argues that, although historyeducation and other forms of government propaganda can partly explainSakhalin residents’ perceptions of the territorial dispute, nationalism, which islargely derivative of the region’s poor socio-economic conditions, is a moreplausible reason for their opposition to surrendering the South Kuril Islands. Theimprovement in mutual perceptions and newfound feelings of trust andfriendship between the peoples of the two regions, fostered by subnationalgovernment cultural exchange, has not been sufficient to alleviate thisopposition.2

Surveys of Sakhalin oblast residents’ territorial perceptions

Sakhalin residents

One may query the reliance on public opinion polls to analyse subnational viewsof the territorial dispute. Of course, surveys and public opinion are notnecessarily the same thing; public opinion can take many forms – for instance,via the media, through election results or behaviour such as petitioning the

government and staging mass rallies. However, polls probably remain the mostreliable way to gauge public opinion among large groups in society (Mickiewicz1981: 2). Although the territorial dispute’s controversial nature could result inbiased surveying methods and interpretation of results, the author shares the viewof Matthew Wyman that there are no compelling reasons to mistrust the honestyof responses to Soviet or post-Soviet surveys (1997: 9). Strong anecdotalevidence also supports the poll data. Moreover, the conclusive results of thesesurveys, at least in the case of Sakhalin residents, should dispel doubts regardingtheir legitimacy.

According to a survey conducted in Sakhalin oblast in 1991, only 2.7 per centof respondents as a whole and 6.6 per cent of Kuril Island residents favoured a‘handover of four islands to Japan’. Conversely, 66.4 per cent and 42.1 per centof Sakhalin and Kuril Island residents, respectively, believed ‘the Soviet Unionand Japan [should] conclude a peace treaty based on the status quo’ (cited inItahashi 1999: 18). It is not surprising that a majority of Sakhalin and Kurilresidents were initially opposed to the Soviet Union handing over the South KurilIslands to Japan. Throughout the postwar period, Soviet citizens were ingrainedwith the belief that the islands were an inalienable part of the Rodina and that theentire Kuril archipelago was discovered, settled and developed by Russians. Overforty years of indoctrination and propaganda are difficult to undo.

In fact, Sakhalin residents’ opposition to handing over the South Kuril Islandsto Japan has proved to have deeper roots than initially expected – despite thequantitative and qualitative improvements in subnational government relations.According to a survey carried out from 27 March to 8 April 1995 in Sakhalin,84.8 per cent of respondents believed that the ‘islands are Russian territory andshould not be returned to Japan’. Moreover, a mere 7.5 per cent thought a‘decision should be made depending on the development of friendly andcooperative relations’. Only 2.2 per cent believed ‘Russia should promptly returnthe islands as there is a basis to the Japanese claim’ (Borovskoi 1995: 24). Thepassage of time has done little to alleviate this opposition. In a joint surveyconducted by the Asahi shinbun and ITAR-TASS in September and October 1998of 3,000 Japanese and Russian citizens, only 3 per cent of Sakhalin respondentsbelieved the best method to resolve the territorial dispute was the ‘simultaneousreturn of the four islands’ (cited in Itahashi 1999: 18).3

More recently, the Yuzhno-Sakhalinskaya gazeta published results of a surveyof Yuzhno-Sakhalinsk residents conducted in July 2000 by Sakhalin StateUniversity’s Socio-Economic Research Centre, in which only 11.7 per cent ofrespondents thought the Japanese claim for handing over the four islands waslegal. Conversely, 77.6 per cent argued that Japan has no right to claim the fourislands. Further, 85.2 per cent thought that whatever happens, Russia should nothand over the islands. It is worth noting that those respondents who recognisedJapan’s claims to the islands did not necessarily support Russian territorialconcessions. In what perhaps demonstrates the futility of Japanese attempts tomake legal appeals for the return of the Northern Territories, the newspaper

Sakhalin public opinion and the South Kuril Islands 131

argued that those who replied that Japan has a right to the islands did not believe‘Russia should return the islands’. In other words, while some people thought‘Japan has a right to bring it [the territorial dispute] up, Russia should not carryit [handing over the islands] out’. Only 4.5 per cent of respondents replied thatRussia should hand over all the islands that Japan demands, and 6.1 per centthought that Russia should hand over only Habomai and Shikotan (cited inSaharin to Nihon, no. 237, 18 July 2001: 4).4

Kuril Islanders

The disputed islands are divided into two administrative districts or raiony: theKuril District, which comprises Etorofu, and the South Kuril District, whichencompasses the islands of Kunashiri, Shikotan and the unpopulated (except fora Border Guard detachment) Habomai islets. As the Japanese government’sterritorial claims are limited to these four islands, this section will examine onlysurvey data of the residents of these islands.

As in the case of Sakhalin, over 40 years of Soviet indoctrination was reflectedin public opinion polls of the disputed islands’ Russian residents conductedaround the time of the Soviet Union’s collapse; there was opposition to the thenSoviet Union handing over the islands to Japan.5 An examination of schoolhistory textbooks, discussed in greater detail in the next section, alsodemonstrates the influence of Soviet propaganda. In post-Soviet Russia therehave been significant advancements in human rights issues, including freespeech, although Russian President Vladimir Putin’s new restrictions on themedia and attacks on media magnates, such as Vladimir Gusinsky and BorisBeresovsky, whose television channels or newspapers were particularly critical ofstate authorities, have raised fears that these rights are being eroded. Thecorollary of these new-found rights is the upsurge in the conducting of publicopinion polls regarding a broad range of issues in post-Soviet Russia. A largenumber of polls and surveys gauging the Kuril Islanders’ perceptions of theterritorial dispute have been conducted both by Russian and by Japanese pollstersin recent years; in fact, so many that it might be appropriate to refer to it as acottage industry.

There is diversity among the Kuril Islanders’ views of the territorial dispute.Some discrepancies and contradictions have appeared occasionally in surveyresults. In some cases, this can be explained by changing climatic conditions. Onestudy revealed that the islanders’ opinions vary according to the season; insummer when food is abundant, many people are opposed to the ‘radical plan’(the 1956 Joint Declaration), but in winter when food is scarce and the climateespecially harsh, they want to be under Japanese rule (Kimura et al. 1993: 186).The territorial dispute’s controversial nature has also led to accusations of biasedpolling in the past.6 This is also evident in the Sakhalin mass media. According toAleksandr Tatarchuk, then head of the television studio on Shikotan, there werecontradictions in the reporting of Gubernskie vedomosti, published by the

132 Sakhalin public opinion and the South Kuril Islands

Sakhalin regional administration, and Svobodnyi Sakhalin. For instance,Gubernskie vedomosti reported that 66 per cent of the islanders were opposed toa transfer of the islands to Japan, whereas Svobodnyi Sakhalin reported that 30per cent were opposed, 30 per cent in favour and 30 per cent had no opinion.Tatarchuk believed that Svobodnyi Sakhalin correspondent Oleg Bondarenko wasfighting for a return of the islands to Japan (Svobodnyi Sakhalin, 15 August 1992:3). Given that Bondarenko published a book entitled Neizvestnye Kurily:Ser'eznye razmyshleniia o statuse Kuril'skikh ostrovov (Unknown Kurils: A Serious Reflection of the Status of the Kuril Islands), which called for Russia to return the islands to Japan, Tatarchuk might have been justified in making this claim.7

In addition, there is a tendency among academic and government officials inboth Japan and Russia to make sweeping generalisations regarding the Russianislanders’ opinions. For instance, in an article in the English-language JapanTimes, Hiroshi Kimura, a leading authority on Russo-Japanese relations, claimsthat ‘the majority of Russians living there [on the disputed islands] are notopposed to the handover of the islands to Japan; they even harbor a secret desirefor it’ (2000b: 18).8 However, Rimma Rudakova, head of the Kurilskadministration’s (on Etorofu) social protection department and local organiser ofthe visa-less exchanges with Japan, completely contradicts Kimura, arguing, ‘TheJapanese do the polls every year, and the figures are more or less the same eachyear … In Shikotan they get 40 per cent for returning the islands to Japan and 60against. On the rest of the islands, it is always 70 against’ (The Sakhalin Times,no. 13, 22 November–6 December 2001).

In an attempt to reconcile these differences, it is useful to disaggregate theterritorial perceptions of the residents of the three islands of Etorofu, Kunashiriand Shikotan. Doing so reveals that there are broad, inter- (and intra-) islanddifferences in the residents’ views. Generally speaking, the residents of Etorofuhave consistently expressed opposition to Russia handing over the islands toJapan, whereas Shikotan residents are in favour of this. Kunashiri residents, onthe other hand, have displayed mixed emotions, voicing both support andopposition on different occasions.

According to a survey conducted by the Hokkaid™ shinbun in conjunction withthe Hokkaido Information Research Institute of 300 residents of the three islandsfrom December 1997 to January 1998, 36 per cent, 48 per cent and 53 per cent ofthe respondents from Shikotan, Kunashiri and Etorofu, respectively, replied thatRussia ‘absolutely should not return the islands’ (Hokkaid™ shinbun, 16 April1998: 1). This survey closely reflected the results of an earlier survey conductedin July 1992 by the Shikotan Social Research Association, which revealed that onShikotan those favouring returning the islands to Japan greatly outnumberedthose against a return, and on Kunashiri and Etorofu those opposed to a territorialreturn slightly outnumbered those in favour (Hokkaid™ shinbun, 5 September1992: 3). Similarly, a smaller survey carried out by Japanese journalistsaccompanying a group of former residents visiting the islands under the visa-less

Sakhalin public opinion and the South Kuril Islands 133

exchange programme showed that slightly fewer than 60 per cent on Shikotan, 10per cent on Kunashiri and 1–2 per cent on Etorofu supported returning the islandsto Japan (Hokkaid™ shinbun, 29 June 1993: 3).9

If one compares the results of these these surveys made between 1991 and2000, there has been no significant change in Sakhalin residents’ territorialperceptions. The majority (apart from the inhabitants of Shikotan) has remainedvehemently opposed to a handover of the South Kuril Islands to Japan, despitethe new-found reservoirs of friendship and goodwill existing between the twopeoples.

Factors in Sakhalin residents’ opposition to transferring the South Kuril Islands to Japan

School history education

An article in the Hokkaid™ shinbun, which examines why there has been noalleviation in Sakhalin residents’ opposition to returning the four islands to Japan,identifies problems associated with history curricula. It claims that until 1993,history textbooks in use mentioned neither the 1941 Neutrality Pact nor the 1956Joint Declaration. Moreover, as John Stephan, an expert on the history of Russo-Japanese relations, observes, a tenth-grade history textbook in the Soviet Unionwas unequivocal in its assertion of Soviet sovereignty over the islands: ‘[The RedArmy] … returned to the Soviet motherland primordially (iskonno) Russian lands– southern Sakhalin and the Kuril Islands – which had been seized in the past byJapan’ (cited in Stephan 1982: 138). As Stephan further notes, ‘However one-sided this assertion, such sweeping claims appear to [have] enjoy[ed] broadpopular support within the USSR, a tribute to the effectiveness of massindoctrination and confirmation of how deeply run the roots of Russianpatriotism’ (ibid.). Accusations of a residual classroom bias towards Russianarguments and problems of insufficient time being devoted to the teaching of thehistory of Japan–Soviet relations led the article’s author to conclude that themajor reason for Sakhalin residents’ ‘low historical understanding’ of theterritorial dispute is insufficient history education (Hokkaid™ shinbun, 16 June1998: 3). Thus, when notable figures such as the Sakhalin governor make publicstatements claiming that the Kurils were discovered by Cossacks 300 years ago,temporarily became Japanese territory, and then ‘were returned to the homelanddue to the struggle of our grandfathers’, Sakhalin residents, who have beeneducated to believe this, naively agree (ibid., italics added).

However, recently, some of the balance to the local discourse on the territorialdispute has been restored, through the work of a team of historians from theCentre for Modern History Documentation in Yuzhno-Sakhalinsk, headed byMikhail Vysokov (who is now director of Sakhalin State University’s Institute ofHistory, Sociology and Management). In 1995, they completed a book entitledIstoriya Sakhalinskoi oblasti s drevneiskikh vremen do nashkikh dnei (The

134 Sakhalin public opinion and the South Kuril Islands

History of Sakhalin Oblast: From Ancient Times to Our Day), which is asupplementary reader for local high school students and is also the first textbookon the region’s history for use in colleges (NHK (ETV) 1995; Morris-Suzuki1998: 537). The book has been described as a part of a growing sense of regionalidentity (Morris-Suzuki 1998: 537). Its narrative includes details of both the earlyRussian and Japanese exploration of Sakhalin and the Kuril Islands and followsthe orthodox view that the first European to visit (pobivat) South Sakhalin and theKurils was the Dutch navigator Maarten Gerritsen Vries on 13 June 1643(Vysokov et al. 1995: 50–1). Regarding the contentious issue of whether it wasthe Japanese or the Russians who first discovered the Kurils, the argument usedto assert historical rights to the islands, the monograph is open to interpretation.It would appear that the writers have accorded Japan its due when they mentionthat the first Japanese map of Sakhalin and the Kurils was produced in 1644.However, they qualify this by arguing that the mapping of the Kurils is extremelyvague, suggesting it was based on an oral description given by Hokkaido’sindigenous Ainu (ibid.: 62). Moreover, in what may indeed be a claim to ‘firstdiscovery’, the book asserts that Russian explorers visited the shores of Urup,Iturup (Etorofu), Kunashir (Kunashiri), Shikotan and other islands for the firsttime in 1738–9, which predates the journeys of Japanese traveller MagamiTokunai who landed on Etorofu in 1786 (ibid.: 66–8).10

Meanwhile, from an international law perspective, the authors acknowledgeboth the 1855 Shimoda Treaty and the 1875 Treaty of St Petersburg. The formerdetermined that all the islands to the south of, and including, Etorofu belong toJapan, and that the islands from Uruppu northward extending to the KamchatkaPeninsula would be Russian territory. The parties could not resolve the issue ofSakhalin’s ownership so they decided on joint settlement. According to the 1875treaty, Japan ceded the southern part of Sakhalin to Russia in exchange forpossession of the entire Kuril chain. Maps highlighting the borders, as defined bythe two treaties, are also included (ibid.: 84, 87). The book thus recognisesJapan’s legal rights to the Kuril Islands in the prewar period. However, wheresome parts of the narrative appear to accord Japan its due in the territorial dispute,others seem to tip the interpretive balance back in Russia’s favour.

First, in a subsection of the book entitled ‘The Liberation of South Sakhalin’(Osvobozhdenie Yuzhnogo Sakhalina), the narrative overlooks the Soviet Union’sviolation of the still valid 1941 Neutrality Pact when it declared war on Japan. Itrefers to the Pact, but notes only Japanese plans to violate it and occupy largeparts of the Soviet Far East and Siberia. It also details a number of provocativeacts towards the Soviets including the inspection and hindering the passage ofSoviet commercial shipping and threatening the security of the crews (ibid.: 135).These plans were aborted only because of the rapid deterioration in Japan–USrelations, which underscored the importance to the Japanese of maintainingstability in the north and avoiding a disastrous two-front war. Moreover, thenarrative also includes the 1904–5 Russo-Japanese War, the loss of SouthSakhalin, which resulted from tsarist Russia’s defeat in that war, and the Japanese

Sakhalin public opinion and the South Kuril Islands 135

occupation of North Sakhalin from 1920 to 1925. Russia’s humiliating defeat inthe Russo-Japanese War (the first by an ‘advanced’ Western power to a non-Western state in modern times) and the subsequent loss of South Sakhalin was aparticularly heavy psychological burden for many Russians. This burden waslifted to some extent by the Soviet victory over Japan in the Second World War .

Second, the term ‘liberation’ (osvobozhdenie) is used to describe the Soviettroop landings on South Sakhalin and the Kuril Islands during the closing stagesof the war (ibid.: 135–51).11 The term ‘liberation’ implies that South Sakhalin andthe Kuril Islands were Soviet territory and the Red Army was freeing these landsfrom unjust foreign rule. This is only partly true. Although according to the termsof the 1905 Treaty of Portsmouth, tsarist Russia formally ceded South Sakhalinto the Japanese, Russian sovereignty over Sakhalin was recognised by the Meijigovernment’s signing of the 1875 Treaty of St Petersburg. This treaty was not aconsequence of any armed conflict between the two countries; both sides wantedto resolve peacefully the issue of Sakhalin’s ownership, which was obfuscated bythe 1855 Shimoda Treaty stipulating joint possession of Sakhalin. The Treaty ofPortsmouth, on the other hand, formally ended a short but bitter armed conflict.Thus, in the eyes of many Russians, the Treaty of Portsmouth was unjustly thrustupon the tsarist regime during a time of socio-economic stagnation and weakness– not dissimilar to what Russia experienced during the 1990s. However, asdiscussed previously, Japan’s rights to the Kuril Islands were legally recognisedby both the tsarist and the Soviet governments in the prewar period.12 Therefore,although it may be appropriate to refer to the ‘liberation’ of South Sakhalin, theterm is not applicable to the Kuril Islands.

Third, this section of Istoriya Sakhalinskoi oblasti meticulously details thebattles that were fought between Soviet and Japanese troops and particularlyemphasises the self-sacrifice and heroics of Soviet troops during the landingcampaign. It also features a large number of photographs (14 in all) of those whowere awarded the prestigious ‘Hero of the Soviet Union’ (Geroi SovetskogoSoyuza) decoration. However, it must also be noted that despite these appeals toRussian patriotism, the book correctly notes (on page 148) that there were noshots fired between Japanese and Red Army troops during the latter’s landing onthe South Kuril Islands (as opposed to the bloody conflict on Shumshu Island andSakhalin) as the Japanese stationed on these islands surrendered peacefully. Thisundermines the arguments made by some who argue against Russian territorialconcessions because of the blood of Soviet soldiers that was shed in the strugglefor these islands (see Vasil'ev et al. 2000: 1; Itahashi 2001: 3).

To sum up, the book does not support unilaterally either the Russian or theJapanese claim to the South Kuril Islands. It recognises Japanese historicalarguments in some areas while interpretively favouring Russia in others. It issignificant that some scholars are attempting to provide an objectivehistoriography of the territorial dispute and that the book is actually used in localschools. These are certainly progressive steps for the future. Nevertheless, itwould be misleading to assume that this text, or history education in Sakhalin in

136 Sakhalin public opinion and the South Kuril Islands

general, is the sole reason for the opposition of Sakhalin residents to transferringthe disputed islands to Japan, although what is learnt at school can certainlyinfluence one’s views of a particular issue. Mikhail Bugaev, deputy editor of theregional newspaper Svobodnyi Sakhalin, revealed during an interview with theauthor in Yuzhno-Sakhalinsk (22 August 2001) that the mission to convey theJapanese government’s views on the territorial dispute has been successful, andmost Sakhalin residents are aware of the arguments underpinning the Japaneseclaim to the disputed islands. Thus, history taught in schools can be said to be afactor, but not the primary or sole cause behind Sakhalin residents’ opposition totransferring the South Kuril Islands to Japan.

Sakhalin’s socio-economic environment: A hotbed for xenophobic territorial perceptions

It would be reasonable to expect that the failure of radical economic reforms andthe subsequent impoverishment of the Russian people might leave them withlittle passion for concerns of territorial gains and loss (Kimura 2000b: 133). Onecould even suggest that Russia’s poor socio-economic conditions might make itspeople more receptive to the notion of transferring the South Kuril Islands toJapan, particularly if such a move included a quid pro quo of considerableeconomic compensation and other benefits. However, events in post-SovietRussia have not transpired in such a manner (ibid.).

Poor socio-economic conditions in the region triggered nationalist sentimentsamong Sakhalin residents and a concomitant opposition to Russia transferring theSouth Kuril Islands to Japan. Economic reforms impoverished Sakhalin (as wellas much of the Russian Far East) during the 1990s, creating socio-economicconditions that have been so abysmal as to lead Tessa Morris-Suzuki to describeYuzhno-Sakhalinsk, the regional capital, as ‘modernity in ruins’ (1998: 533). The‘ruins’ have turned out to be a fertile environment for extremist political forces.

In the December 1993 elections to the State Duma, Vladimir Zhirinovsky’smisleadingly named Liberal Democratic Party gained the largest share of theproportional (party list) votes at 36.86 per cent – more than three times that of thesecond highest vote-getter, Women of Russia, which received 10.43 per cent(cited in Lester 1995: 270). The flag of the former Soviet Union still flies abovemany of the crumbling blocks of flats in Yuzhno-Sakhalinsk, built in the 1960sand 1970s, which have lost large chunks of their concrete cladding – amanifestation of nostalgic feelings for a time when life did not seem so harsh. Anumber of apartment blocks have also been daubed with graffiti showing aneight-point star embossed with a swastika – the symbol of the militantultranationalist organisation, Russian National Unity. It can be surmised thatsupport for these parties, which are vehemently opposed to any Russian territorialconcessions, probably reflects a general disenchantment with the socio-economicproblems that reforms have caused, and perhaps also, to a lesser extent, decliningenthusiasm for the style of democracy practised in post-Soviet Russia. At the

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same time, however, the underlying feelings of disenchantment and subsequentrise in patriotic and nationalistic passions have been easily transformed into astrengthened emotional attachment to the Rodina and opposition to Russiatransferring the South Kuril Islands to Japan.13 It is worth noting that the SouthKuril Islands has been important enough as an issue for some seeking publicoffice in Sakhalin to mention it in their election platforms (personalcorrespondence with Sakhalin Duma deputy Vladimir Gorshechnikov, 10 April2003; see also Sidorenko 2000: 2; Ponomarev 2000: 2).14 The correlation betweeneconomic struggle and territorial attachment in Russia can be summed up in thewords of Ronald Hingley, ‘The poorer the mother and the harsher her conditionsof life, the greater the devotion of her sons’ (1977: 132).

Although a salient feature in the post-Soviet era, especially in the Far East, theeconomic difficulties–nationalism nexus appears to have a historical precedent inRussia. Referring to the early eighteenth century, Charles Ruud (1974: 276)observed that ‘a general sense of lagging behind the West’ prompted the firststirrings of Russian nationalism. It was during this period in history that Peter theGreat looked to the West as a model for Russia’s imperial development. It is easyto draw a comparison with the situation facing Russia since the collapse ofcommunism. Ironically, however, for many Russians, it has been thegovernment’s adoption of radical Western-style market reforms – commonlyreferred to as ‘shock therapy’ – with its emphasis on the rapid liberalisation ofprices, removal of subsidies, expenditure cuts and severe reductions in the moneysupply that has led to their impoverishment and subsequently increased theeconomic disparity between Russia and the West.

Closely associated with economic instability is identity flux, which manyobservers see as a salient characteristic of Russians today (see Rancour-Laferriere2000: 29–36; Sakwa 1996: 38; Theen 1999: 43). The Soviet Union’s collapse hadnot only socio-economic and political repercussions, but also a profoundpsychological impact on Russians as their former belief systems were discredited,resulting in an acute identity crisis (Kimura 2000b: 129). George Breslauer noteshow Russians were being asked for the first time in their modern history toconstruct a new identity for themselves – a difficult task further complicated bythe loss of empire and subsequent great power status (1995: 227). Whilerecognising the limits to psychoanalysing an entire region, there is evidence tosuggest that Russia’s loss of empire may have also manifested itself in heightenedopposition among Sakhalin residents to transferring the disputed islands to Japan.If we accept the notion that territory forms an integral component of nationalidentity, surrendering the South Kuril Islands would therefore place greater strainon the sense of security Sakhalin residents experience in terms of identity (seeTake 2001). Sakhalin residents’ strident opposition to Russian territorialconcessions over the South Kuril Islands can be seen, in a sense, as a means ofstaving off a further assault on their already crisis-stricken identity.

Similarly, according to Mikhail Bugaev, there is a feeling among manyordinary Russians that giving up territory is a sign of weakness (interview,

138 Sakhalin public opinion and the South Kuril Islands

22 August 2001). It can be argued that by forfeiting lands – most recently toChina in the disputed eastern border region – Russia has already displayedsufficient infirmity and its people have reached an emotional saturation point thatmakes any further territorial concessions difficult. As Vladimir Solovyov andElena Klepikova argue:

The Kurils were the last straw for Russians, whose national pride wasalready wounded. With the Kurils they were compensating for what they hadlost in the Caucasus, Central Asia, the Baltic and Ukraine – getting theiremotional revenge for their national humiliation.

(1995: 113)

Feelings of trust and friendship established at the grassroots level during the1990s have not been enough to replace the emotional sustenance derived frommaintaining Russian sovereignty over the South Kuril Islands.

It should be noted that although Sakhalin’s socio-economic environmentgreatly intensified Russian nationalist fervour for territorial attachment,nationalism has also been stimulated by other factors – chief among themwartime memories. Writing in the mid-1970s, Pulitzer Prize-winning journalistHedrick Smith observed that for many Russians, ‘World War Two was onlyyesterday’ (1976: 402). More than 25 years have elapsed since Smith penned hisseminal book, yet the Soviet Red Army’s victory in what is referred to in Russiaas the Great Fatherland War (Velikaya Otechestvennaya Voina) still remainsfirmly etched in the national psyche. Smith further adds that the war, which hasa great mystique in Russia, ‘is a primary source of the unblushing patriotism theyfeel today’ (ibid.: 404). Practically no city in Russia is without a war memorial,which is a conspicuous feature of most local landscapes. Sakhalin is no differentand is dotted with monuments commemorating the war. Sakhalin’s warmemorials have become a fixture of important festive occasions; the warmemorial in Yuzhno-Sakhalinsk, in particular, is a popular place for newlymarried couples to come and place their flowers. These memorials are easilyrecognisable, with many featuring Soviet tanks and artillery pieces that were usedin the conflict. They have been described by one scholar as ‘nothing other thanan expression of the oft-heard argument that “South Sakhalin and the KurilIslands are land that has been returned to Russia as a result of the blood spilt byour predecessors”’ (Itahashi 2001: 3, italics added). Thus, as long as the warenters into the picture, it is difficult for most Sakhalin residents (and indeed mostRussian citizens) to make concessions regarding the South Kuril Islands.Sacrifice and victory in the Great Fatherland War are also remembered by anumber of settlements in Sakhalin, which have been named after and immortalisethe fallen heroes in the Soviet liberation of South Sakhalin.15

In addition, the Sakhalin leadership has sought to tap the wellspring of theGreat Fatherland War in order to maintain feelings of patriotism, in the processstrengthening local residents’ attachment to the South Kuril Islands. Annual

Sakhalin public opinion and the South Kuril Islands 139

Victory Day celebrations on 9 May to commemorate the Soviet Red Army’scritical role in turning back and defeating the invading German Wehrmacht andto honour the approximately 20 million Soviet citizens who died in the war are asignificant event in post-communist Russia. For most Russians, Nazi Germany isthe despised and vanquished opponent, the principal object of Victory Daycelebrations. However, in Sakhalin and the rest of the Russian Far East, whichwas under martial law as a result of repeated acts of armed provocation andviolations of its land and maritime borders and air space by Japanese imperialforces during the ‘undeclared war’, there is an added dimension to celebrationsfor victory in the campaign of the Red Army in the Far East, which was ‘part andparcel of the Great Patriotic War’ (Gareyev 2000). In the Soviet Far Easterncampaign, victory was achieved not over the much-despised German army, butover the ‘Japanese militarists’. Governor Farkhutdinov, along with the visitingRussian President, Vladimir Putin, featured prominently in the fifty-fifth annualcelebrations, held on 3 September 2000, to commemorate those who shed bloodfor the liberation of Sakhalin and the Kuril Islands and gave their lives for victoryin the war against Japanese militarism (see Vasil’ev et al. 2000: 1).16

Explaining the Shikotan anomalyThe previous sections have offered an explanation as to why residents ofSakhalin, Etorofu and Kunashiri have been opposed to Russia transferring theSouth Kuril Islands to Japan. Given the apparently similar socio-economicconditions on the three islands, one would expect that Shikotan residents wouldalso oppose Russian territorial concessions. However, public opinion polls haveshown this has not been the case.

In addition to the survey data, support on Shikotan for transferring the islandto Japan has manifested itself in many different, often desperate and unusualways. At the same time as the Russian referendum held on 25 April 1993 todecide, in the words of Stephen White, ‘who rules Russia’ (2000: 80), localauthorities in the village of Malokurilsk on Shikotan held a referendum on the1956 Joint Declaration. The results indicated that 52.4 per cent of the village’sresidents (1,098 out of 2,094) voted, and that 83 per cent of those who votedexpressed support for it (Hokkaid™ shinbun, 26 April 1993: 2).17 The villagerswere also dissatisfied with the uncertainty regarding the whole issue, sending apetition to both the Japanese and Russian governments to ‘resolve the issue of ownership [of the islands] as soon as possible’ (Hokkaid™ shinbun, 28 April1993: 5). The Sakhalin regional government was rather indifferent about thewhole event. In what is a reflection of the neglect and lack of interest they haveshown towards the South Kuril Islanders’ plight, the regional authorities declaredthat although the act was not illegal, they would simply ignore the result (ibid.).

A number of Shikotan residents, who favoured returning the islands to Japan,also established a group called Zemlyak (fellow countryman) in order to presenta unified front to the local and regional administrations. The group received a

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boost when its leader, Mikhail Luk'yanov, was elected to one of seven seats onoffer in the South Kuril District elections held on Kunashiri in March 1994(Hokkaid™ shinbun, 31 March 1994: 5). Luk'yanov later became chairman of theSouth Kuril District Assembly. Although the clear subordination in power oflegislative chiefs to district mayors allowed little scope for Luk'yanov toinfluence matters pertaining to the territorial dispute greatly, it did provideZemlyak with a forum in which to air its views. Any hopes the dwindling numberof pro-return islanders had of maintaining an avenue to legislative powerevaporated with Luk'yanov’s dismissal in 1997 as the result of a conflict withZema over the allocation of fishing quotas (discussion with Arai, March 2001).The group has since been disbanded, with most of its members resettling on themainland (Watanabe 1997: 125) – part of a broader wave of out-migration thathas seen the South Kuril Islands’ population decline from about 24,000 at thetime of the Soviet Union’s collapse in December 1991 to approximately 14,000at present.

Moreover, in October 1998, Shikotan residents started gathering signatures fora petition to lease the island to Japan for 99 years after a power plant caught fire.18

Shortly after this, Shikotan residents thought it necessary to seek a national stageupon which to air their frustrations and publicise their plight. In early January1999, NTV, Russia’s only independent television network until its closure in2001, broadcast a mock court programme concerning the disputed islands withpro-return Shikotan residents as the plaintiffs and Boris Yeltsin as the defendant.Representing Shikotan was Vera Sadovnikova, a fish-processing worker from theisland. Sergei Samolev, who headed the section in the Presidential Administrationresponsible for South Kurils-related matters, appeared on behalf of the Presidentwho was, not surprisingly, absent from proceedings.

The plaintiffs presented as evidence a video highlighting the Russiangovernment’s neglect of the island and featured people claiming that life wouldimprove under Japanese rule. They also called as a witness Konstantin Sarkisov,a researcher at the Institute of Oriental Studies, Russian Academy of Sciences,who supports Japan’s territorial claims. Sarkisov asserted that an examination ofinternational law and history shows that the islands should be returned to Japan(Sarkisov was in turn criticised by the defendant’s witness who called him anagent for the Japanese Embassy). After hearing further arguments from bothsides, the jury, consisting of people from the audience, not surprisingly, ruled inthe defendant’s favour, claiming that handing over the islands to Japan wassimply not possible (Hokkaid™ shinbun, 11 January 1999: 3).

The government’s neglect of the islands (alluded to above) was evident when,in October 1994, an earthquake measuring 8.1 on the Japanese scale inflictedheavy damage on the three islands in the South Kuril District. More than 60 percent of residential buildings on Shikotan and the water, sewage, and heatingsystems were completely destroyed, and all diesel generators on Kunashiri andShikotan ceased functioning (see Arai and Hasegawa 1997: 181). Moreover, sinceall the bakeries were destroyed, the South Kuril District had to be supplied by

Sakhalin public opinion and the South Kuril Islands 141

bread baked on fishing vessels.19 Newspapers reported that the earthquakedestroyed 40 per cent of the buildings on Shikotan belonging to Ostrovnoi, thelargest fish-processing enterprise in the Russian Far East (ibid.). AlthoughOstrovnoi had only been operating at 30–50 per cent of capacity since early 1992due to a steep rise in the price of fish and a lack of fuel (NHK 1993: 153–4), thedamage was nevertheless a blow to such a vital component of the local economy.Iturup did not remain unscathed; a military hospital collapsed, killing fifteensoldiers (Hasegawa 1998: 489). To add further insult to injury, it was alsorevealed that the three seismological centres in the South Kuril District had beenforced to stop their operations during the previous year due to a lack of funds andthat many of the collapsed buildings had been hastily constructed in violation ofbuilding codes (Arai and Hasegawa 1997: 181). The earthquake turned the trickleof residents leaving the hardship of life on the islands into a flood, therebyvirtually halving the population of the South Kuril District (Williams 2003: 119).Residents of the islands have understandably been dismayed and angry at theneglect shown by the authorities in Moscow and Yuzhno-Sakhalinsk during thistime of crisis.

A number of theories have been put forward explaining why some Kurilislanders favour transferring the islands to Japan, while others have opposedreversion. The prominent anti-return campaigner Valentin Fedorov even admittedthat ‘about 5,000 of the 25,000 residents of the [South] Kurils are not opposed tohanding over the four islands to Japan’. However, he did qualify this statement byarguing that most of those in favour were contract labourers from the mainlandwho leave the islands after their contracts have expired (Hokkaid™ shinbun, 30October 1991: 1).20

Moreover, as noted above, the islanders’ receptiveness to transferring theislands to Japan can vary according to the season. Watanabe K™ichi, from Japan’sNHK International Broadcasting, has also noted the relationship betweeneconomic conditions and receptiveness to transferring the disputed islands toJapan. He has divided the islanders into positive and negative migration groups.The former are pensioners and educators and the like, people on relatively lowwages, who would want to leave the islands if better prospects presentedthemselves elsewhere. Many of these people, according to Watanabe, agree withreturning the four islands to Japan. The negative migration group, comprisingtraders, businessmen and leading administrative officials, on the other hand,receive relatively higher wages, are fairly satisfied with their lifestyles and arethus against surrendering the islands (Watanabe 1997: 123). This is also reflectedin the views of one Hokkaid™ shinbun reporter who covers the islands: ‘There isa conspicuous tendency to make hardline comments about the territorial problem,the longer one stays on the islands’ (Hokkaid™ shinbun, 16 April 1998: 2). Unfortunately, an absence of data showing on which of the South KurilIslands seasonal workers (predominantly employed in the islands’ fishingindustry) were employed and lived, as well as whether the majority of Shikotan’spopulation falls under the category of the positive migration group, makes it

142 Sakhalin public opinion and the South Kuril Islands

difficult to assess accurately whether these claims can explain the Shikotananomaly.21

It should be noted that the support among some of the South Kuril residentsfor transferring the disputed territories to Japan does not necessarily mean theirabandonment of the islands. There are some who would rather relocate to theRussian mainland by taking advantage of the generous economic assistanceJapanese officials have suggested the government would provide to coverresettlement costs should Moscow decide to transfer the islands to Japan (Hopp™Yont™ K™ryuø Hokkaid™ Suishin Iinkai ed. 1998: 37, 53). However, there are alsothose who, having experienced the material comforts of Japan’s cosmopolitancities under the visa-less exchange programme, perhaps see a better life forthemselves under Japanese rule and, therefore, wish to remain on the islands afterreversion (Hokkaid™ shinbun, 6 July 1992: 1; Hokkaid™ shinbun, 10 August 1993:4).22 To this end, Japanese officials participating in the visa-less exchangeprogramme have taken the opportunity afforded by the programme to issue publicstatements purporting to guarantee the rights of the Kuril Islanders choosing toremain on the islands (Hopp™ Yont™ K™ryuø Hokkaid™ Suishin Iinkai ed. 1998: 37, 53). Support among the South Kuril residents, particularly those onShikotan, for joint Russo-Japanese development is also indicative of a desire toremain on the islands (ibid.).

ConclusionEfforts by regional and local governments in Hokkaido and Sakhalin to fostercloser interregional relations have led to the establishment of conduits for private-level exchanges. The growth of cross-cultural relations between citizens of thetwo regions has led to a breakdown of outdated perceptions and propagatedpreviously unimagined levels of goodwill. Drawing upon public opinion polldata, the discussion then highlighted how, despite the goodwill and mutualunderstanding mentioned above, Sakhalin oblast residents have still maintained astrong attachment to the disputed islands.

It argued that harsh socio-economic conditions on Sakhalin, mainly the resultof the failure of early radical economic reforms, have resulted in a rise ofnationalist sentiments among residents, which emphasises protecting territorialintegrity. This is the major factor behind opposition to territorial concessions,although history education and other forms of government propaganda may alsohave been partly responsible. However, for reasons that may be linked tooccupational background, residents of Shikotan, and to a lesser extent those ofKunashiri, do not appear to have been highly resistant to the idea of transferringthe islands to Japan. Nevertheless, it should be added that as these two islandshave only 1–2 per cent of the total oblast population, this view is notrepresentative of popular opinion in Sakhalin as a whole.

This discussion has focused only on what may be called the intangible reasonswhy the majority of Sakhalin residents are opposed to Russia transferring the

Sakhalin public opinion and the South Kuril Islands 143

islands to Japan. It has not mentioned the economic basis behind this opposition.The islands’ EEZ is blessed with abundant marine resources. As industry basedon the extraction of marine resources is the mainstay of the Sakhalin economy,there are also compelling economic reasons behind Sakhalin’s opposition toRussian territorial concessions. This aspect of Hokkaido–Sakhalin subnationalgovernment relations will be discussed in the next chapter.

144 Sakhalin public opinion and the South Kuril Islands

6 Sakhalin’s commercial environment and local trade

IntroductionAs Chapter 3 illustrates, the HPG and municipal authorities have providedenormous institutional support for local companies wishing to do business withSakhalin and the Russian Far East. It should also be noted that a vast range ofprivate and public bodies such as the Ministry of Economy, Trade and Industry(METI and its predecessor the Ministry of International Trade and Industry orMITI), the Japan Association for Trade with Russia and Central-Eastern Europe,JETRO, the Sapporo Trade and Industry Bureau, Hokkaido University’s SlavicResearch Centre and Otaru University of Commerce have also providedHokkaido firms with reliable information concerning trade and investmentconditions in Russia.

The framework the HPG has put in place is outstanding, but it has not led to alarge-scale expansion of trade and investment ties between the two regions.Uchiyama K™hei, a Sapporo-based Russian trade and investment consultant, haslikened this situation to ‘a pipe through which no water flows, or a highway onwhich no cars travel’ (2001) – a painful analogy given that Hokkaido’s economyhas been burdened by high cost, under-utilised and debt – accumulating publicworks projects. Uchiyama cites two reasons for Hokkaido’s lack of investment inRussia: first, Hokkaido companies have been unable to produce items that areinternationally competitive; second, Hokkaido does not have trading companieswith experience in dealing with Russia (ibid.). These are valid reasons. However,Uchiyama’s first point, in particular, overlooks Hokkaido firms’ trade andinvestment activities in other parts of the world. Although not exhaustive, asurvey conducted by JETRO in 2001 revealed that 47 per cent of Hokkaido firmsinvesting overseas were based in East Asia, including China, 22 per cent werebased in North America, 14 per cent in Southeast Asia and 8 per cent in Europe.Only 5 per cent of Hokkaido firms engaging in international trade and investmentwere based in Russia (Nihon B™eki Shink™kai Hokkaid™ B™eki J™h™ Sent‰ 2001:4, hereafter JETRO Hokkaid™). This comparison suggests that another morepressing factor has limited Hokkaido–Sakhalin economic exchange.

This chapter then considers why attempts to promote Hokkaido–Sakhalineconomic relations have not contributed to creating an environment at thesubnational level conducive to resolving the dispute over the NorthernTerritories/South Kuril Islands by alleviating opposition in Sakhalin to Russianterritorial concessions. In order to answer this question, the chapter sheds light onSakhalin’s commercial environment and, using a case study of the Santa ResortHotel ‘hijacking’ incident, emphasises how it has acted as an impediment to thedevelopment of Hokkaido’s trade and investment ties with Sakhalin. The chapterconcludes with another case study examining the only area in which interregionaleconomic relations have flourished: the trade in fish and marine products, whichis, in many ways, a by-product of Russia’s troubled transition to democracy anda market economy. It argues that not only has this commerce been infiltrated byorganised crime, but it has inadvertently complicated attempts to resolve theterritorial dispute by creating and sustaining powerful societal forces in Sakhalinthat have a vested interest in continued Russian control over the islands. Thisrepresents a case of substate actors impeding attempts at subnational governmentdiplomacy.

Sakhalin’s commercial environment

The government–business nexus

Until it was acknowledged in a US government announcement in June 2002,Russia was not considered to have a fully functioning free market economy,despite the Russian government’s dismantling of the command economy(Sivkova 2002). Post-Soviet Russia had been described as a ‘semi-closedcorporate state in which government and business have a close alliance’ (EastAsia Analytical Unit 1996: 19; hereafter EAAU). In many regions, the stronggovernment–business nexus was formed during the late Soviet era in a processdescribed by Richard Sakwa: ‘the old elite transformed itself by shifting overfrom party to state posts, creating economic structures subordinate to the party,and by joining emerging independent commercial organizations where theyexploited personal contacts and knowledge of the system’ (1996: 159).

As discussed in Chapter 4, despite the collapse of communist rule in 1991,much of the existing elite structures remained in place. The lines of authorityseparating government and business have been blurred and ‘the concept of“conflict of interest” as it applies to western political and business culture iscompletely lacking’ (EAAU 1996: 19). In some regions, the government–business relationship has been closer than in others. Perhaps the most commonlycited example, at least in the Russian Far East, of this fusion of public and privatespheres has been in Primorskii krai where former Governor Nazdratenkoreceived the backing of an association of major local enterprises (PAKT) in returnfor various economic concessions. The elite structures proved to be more resilientthan many people, particularly the early wave of democratic governors in Russia,

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expected. Among the many promises Valentin Fedorov made when he arrived onSakhalin was to crush the communists. However, he underestimated the power ofthe reorganised communist nomenklatura and was forced to retain them inpositions of power in his administration, as well as in Sakhalin’s new businessenterprises (Quinn-Judge 1992a: 16). Governor Farkhutdinov, who was a formerfirst secretary of the Tymov district committee of the Sakhalin oblast Komsomol,an instructor for the department of party-organisational work for the oblast CPSUCommittee, and a former mayor and chairman of the Yuzhno-SakhalinskIspolkom, typified the durability of the former communist nomenklatura.

The entrenchment of the former communist elite in Sakhalin’s powerstructures has led many potential Japanese investors to adopt a wait-and-seeapproach. These investors believe that once the former nomenklatura membersretire and are replaced by a younger generation who are more attuned to theworkings of a market economy, investing in Sakhalin will become much easier(Nihon Keizai Shinbunsha 2000: 101–2). Hokkaido firms wishing to invest insmall and medium-sized projects in the Russian Far East require some form ofgovernment assistance. Given the penetration of the regional elite in Russia bymajor industrial and financial groups (EWI Russian Regional Report, 16 January2002, hereafter RRR), it is feasible that government backing will continue toremain an important factor in any decision to invest in the near future.

Regulatory framework and regulation of foreign investment

The Russian government established a basic commercial framework coveringlaws related to taxation, foreign investment, bankruptcy, customs and propertyrights. However, these improvements appear to have been more quantitative thanqualitative. Pavel Minakir and Gregory Freeze note that Russia’s regulatoryframework had ‘many laws but no rule of law’ (1994: 129). Laws on foreigninvestment in the Russian Federation were promulgated in July 1991. However,they failed to provide foreign businesses with clear guidelines in this area andsubstantial legislative gaps remained unfilled (EAAU 1996: 21). Manycontradictions existed in a large number of business-related laws that wereestablished. When these inconsistencies were discovered, they were commonlyamended by presidential decree, on many occasions only to be overruled by newparliamentary laws, which further complicated the legal system (JETROHokkaid™ 2001: 28). Although a number of steps have been taken to fill thesegaps – this legislation was re-written in 1995, a new foreign investment law waspromulgated in July 1997 and a Russo-Japanese Investment GuaranteeAgreement was signed in May 2000 – Japanese investors generally haveremained cautious about investing in Russia.

Russia’s unstable and contradictory business-related laws have made itparticularly difficult for retailers to establish themselves in the local market. InApril 1998, Cowboy, a Sapporo-based company which owns a chain of discountstores and sells mostly fresh food, opened a store in Yuzhno-Sakhalinsk called

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Sakhalin Cowboy. It was a discount store, selling miscellaneous goods, mainlyplastic items – something of a novelty in Russia – for 10 roubles each and alsoclothing, which it sold for 100 roubles (JETRO date unknown). In February 1999,the store also announced plans to sell food. If customer numbers were anyindication, Sakhalin Cowboy was initially a remarkable success with long linesof people queuing outside the store every day. It even received an award from theSakhalin administration for its contribution to the local economy (JETROHokkaid™ 2001: 19). Sakhalin Cowboy was probably Hokkaido’s only genuine,visible presence in Sakhalin. However, despite its initial success, Sakhalin’sunstable commercial environment proved to be too large an obstacle for thisambitious enterprise. Frequent delays and changes in customs procedures forcedSakhalin Cowboy to scale back its operations. The store is now sub-let to localbusinesses (discussion with Arai, 22 August 2001).

According to Philip Hanson, ‘the centre is in no shape to do anything to helpthe regions, but can and does limit quite drastically their ability to helpthemselves’ (2000: 25). The federal government’s meddling in regional affairshas been most evident in natural resource developments. For instance, inDecember 1995, a new law on production sharing of natural resources, whichcontained a number of elements discouraging some foreign companies frominvesting in Sakhalin’s oil and gas development projects, was passed by bothchambers of Russia’s Federal Assembly and signed into law by President Yeltsinat the end of the month (EAAU 1996: 17; Murakami 1997: 114; Bradshaw 1999: 17). Federal intervention in resource development projects has beenmotivated by suspicions (not entirely unfounded) that unscrupulous foreignbusinesses are trying to take advantage of Russia’s weakness and turn it into a rawmaterials appendage to fuel economic growth elsewhere. The Director of theSakhalin Department for Offshore Oil Development, Galina Pavlova, has ventedher frustrations over federal intervention in the regional economy, claiming that‘instead of working together, the Duma obstructs everything … as a result, weare, with our own hands, destroying our own capabilities’ (Fossato 1998). Itshould be noted that by unilaterally seeking to overturn federal legislation andfailing to clamp down on corruption, the regions have also acted to scare off manypotential investors.

The lack of clear division of powers between the federal and regionalgovernments also created uncertainty for foreign investors with decisions madeat one level of government often challenged and overturned by another. ValentinFedorov demonstrated that his ability to complicate federal policy was notconfined to the territorial dispute with the Japanese. In the early 1990s, heattempted to control the tendering process for Sakhalin’s oil and gas developmentprojects by concluding his own arrangements with foreign firms, whichchallenged agreements prepared by the federal government. The Sakhalinadministration has insisted that foreign firms wishing to invest in these projectscontribute to a Sakhalin Development Fund that will be used to upgrade theisland’s crumbling physical infrastructure. This fund and another for the royalties

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Sakhalin will receive from these projects amounts to hundreds of millions ofdollars. In recent years, monies from this fund have generated incrementalimprovements in Sakhalin’s infrastructure. Establishing the fund was a sensiblemove on the Sakhalin administration’s part given that the island’s poorinfrastructure is widely considered to be a factor restricting the inflow of foreigninvestment into the region. However, considering the amount of funds earmarkedfor the fund, the infrastructure is not as developed as one might expect – certainlycompared with Khabarovsk and Vladivostok – leading to speculation that someof the money may have ‘gone somewhere’.

Taxation system

Russia’s confiscatory tax system has also acted as an impediment to foreign directinvestment as well as to the growth of the private sector. One study revealed that,in the past, Russian entrepreneurs have had as many as 50 different taxes to pay,the full amount of which often exceeds their total profits (EAAU 1996: 22).1 Thishas not only pushed many Russian firms into debt, making them unattractive jointventure partners, but also tends to breed criminal activity as Russianentrepreneurs have often been forced into illegal activities to stay financiallyviable (ibid.). Tax laws have also been subject to sudden change. For instance, taxpreferences for foreign capital firms granted in 1991 were withdrawn in 1992,only to be reintroduced in 1994 for enterprises with more than US$10 million inforeign investment (ibid.: 23). Apart from the oil and gas development projects,this is above the size of most foreign investment in Sakhalin, particularly byHokkaido-based firms. A tax was also suddenly introduced in February 1999 onthe export of timber products, which added to the production costs of a numberof joint ventures with Japanese capital operating in Sakhalin (Nihon KeizaiShinbunsha 2000: 102). Some foreign capital firms have been forced to pay taxesunilaterally levied by regional and local governments, in addition to federal taxes.

Law and order

The Russian Far East has earned a reputation for being a lawless region.Organised crime is reported to be influential in most aspects of economic life,particularly in the major industrial centres. Geography is a major factor behindthe mafiya’s rise in the Russia Far East. Sakhalin is about 10,000 kilometres andeight time zones from Moscow. This vast distance has provided criminalorganisations with refuge far away from central authorities in Moscow. Sakhalinis also on the rim of the economically vibrant Asia-Pacific region, which permitsthe easy traffic in narcotics from Southeast Asia and the Pacific regions, as wellas the laundering of money from the oil and gas development projects in Sakhalin(Frisby 1998: 35). As suggested above, the tax system has created an incentivefor business to operate outside the law, exposing them to pressure from criminalelements in the form of loan-sharking and the like. The criminal threat is so

Sakhalin’s commercial environment and local trade 149

pervasive in Sakhalin that in a survey conducted by the local newspaper,Svobodnyi Sakhalin, asking ‘who today, to the greatest degree, influences thedevelopment of events in your oblast’, more respondents cited the mafiya thangovernment officials (1 July 1992: 2).

It is debatable whether organised crime exercises such an influence onSakhalin’s political and economic life. Johan Bäckman suggests the mafiya mayindeed be a psychological construct derived from the disappointment Russiansfeel over the failure of economic and social reforms. This is ‘often projected toan external entity called the mafia, which is believed to be persecuting politics,society and the economy’ (2001).2 The mafiya do in fact exist in Russia, althoughtheir influence can often be overstated. Nevertheless, a strong perception, fuelledby the mass media, also exists in Japan that the mafiya are involved in manybusiness dealings in the Russian Far East. There are numerous cases in whichcriminal groups have targeted Japanese businessmen. The problem of organisedcrime and the perceived ease with which the mafiya can infiltrate the servicesector are considered to be major reasons why many Hokkaido companies in theservice industry (finance, insurance etc.) have been reluctant to invest in theSakhalin economy.

Russia’s legal system has created an environment in which organised crimehas been allowed to flourish. It is also the root cause of a number of unsavouryincidents involving Russo-Japanese joint ventures, some of which have beeninfiltrated by criminal elements, where Russian business partners have attemptedto take advantage of the legal deficiencies and to appropriate these enterprises.The Santa Resort Hotel project illustrates the problems Japanese investors face.Although this incident did not directly involve a Hokkaido company, jointventures with Hokkaido capital have also experienced similar problems. The casewas well publicised in Japan where it has served as a warning to potentialinvestors of the pitfalls of doing business in Russia and the need to find reliableand trustworthy partners.

Joint venture problems: The Santa Resort Hotel ‘hijacking’

The Russo-Japanese joint venture Saharin Tairiku (also known as SANTA) wasestablished in 1989 by two Japanese companies, Tairiku B™eki and TairikuToraberu, and two Russian companies, Sakhalin Shipping (also known asSASCO) and a fishing kolkhoz. Saharin Tairiku began as a fishing joint venturewith both sides contributing 50 per cent of the enterprise’s starting capital.However, the Russian and Japanese investors sought to expand the scope of thecompany’s operations and in 1993 built the Santa Resort Hotel in Yuzhno-Sakhalinsk. Tairiku B™eki and SASCO each contributed US$18 million(Sakamoto 1999). Although the business was initially sluggish, the situationbegan to improve in 1997 as a result of progress in the Sakhalin offshore oil andgas development projects. Soon afterwards a monetary dispute between the jointventure partners emerged.

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SASCO took issue with the way in which its Japanese partner was managingthe fishing joint venture and the hotel. According to SASCO’s manager, YakupAlegedpinov, Tairiku B™eki was unfairly buying low-cost marine products,claiming sole ownership of the goods brought into Japanese ports and then sellingthem at an inflated price, thereby independently profiting from the sales (ibid.).Some observers in Japan saw nothing wrong with Tairiku B™eki’s actions,claiming the company was only acting in accordance with the agreement, whichallowed it to recover its initial investment. As fishing was a major part of the jointventure’s operations, it was only natural that the Japanese partner would seek todo this by selling marine products it bought from Santa (ibid.). Alegedpinov wasunhappy with the flow of profits from the hotel. He claimed that although eachside contributed half of the start-up capital, the Japanese side was able to recoverits costs because the construction work was sub-contracted to a Tairiku B™eki-affiliated firm. Alegedpinov was also unsure about the hotel’s total constructioncosts and was suspicious that it was built with only SASCO’s money. Moreover,he believed that the Japanese partners took most of the hotel’s profits bymonopolising its patronage and charging handling fees for customers it did noteven bring in (ibid.). According to information received by SASCO, the Japanesewere planning to sell their share of the joint venture and were conductingnegotiations with an American company to this end. SASCO feared that once theJapanese sold their share of the enterprise, it would not be able to recover itsinvestment in the hotel. This led the company to launch legal proceedings.

The case was heard in the St Petersburg Arbitration Court, which ruled thatSASCO could take 137 million roubles from Santa’s account. However, becauseinsufficient funds were in the account, the court instead issued a ruling thatrecognised the transfer of the hotel and several ships to SASCO (VladivostokNews, 23 October 1998). The decision sent shockwaves through the Japanesebusiness community and the incident was well publicised in Japan where thehotel was emotively described as having been ‘hijacked’ (nottorareta).3 Forsomeone who had actively sought to promote economic ties with the Asia-Pacificregion and had often bemoaned the low levels of foreign investment, particularlyfrom Japan, Igor Farkhutdinov took a surprisingly hands-off approach to theincident, declaring in a local newspaper interview that although not impressed bySASCO’s actions, he would not get involved and make an issue of it (cited inSaharin to Nihon, no. 127, October 1998: 2.).4 Tairiku B™eki first appealed thedecision in the Sakhalin Arbitration Court, which upheld the ruling by the St Petersburg Court (Vladivostok News, 23 October 1998). Undeterred, theJapanese continued the fight all the way to the Supreme Arbitration Court inMoscow, which ruled in December 1998 that the property be returned to jointownership (Medetsky 2001). SASCO initially refused to accept the decision andhad to be forcefully evicted from the premises.

Alegedpinov portrayed himself and SASCO as victims in the whole affair andsought to enflame nationalist sentiments among the local population. Accordingto Sakamoto, his appeals went beyond the commercial boundaries of relations

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between two business enterprises and were couched in terms of defendingRussian state interests from unscrupulous foreign investors (Sakamoto 1999).Alegedpinov found an ally in the journal Ekonomika i zhizn', which not onlypublished SASCO chairman Mikhail Romanovski’s account of the dispute, butalso featured an emotional editorial, playing on Russian people’s sense ofdisillusionment and distrust of foreigners: ‘Many joint ventures are lending ahand in the plundering of our natural resources by unscrupulous foreignbusinesses. A lack of legal knowledge by the Russian side has contributed to this’(Ekonomika i zhizn', no. 7, February 1999: 28). Sakamoto questions the Russianclaim of insufficient legal knowledge, arguing that, on the contrary, they knewevery aspect of the contract and themselves tried to take advantage of thedeficiencies in Russia’s legal system (Sakamoto 1999).

In a knee-jerk and hastily prepared response, the Sakhalin Duma passed a ‘lawon foreign investment in Sakhalin’ in late 1998, designed to prevent a recurrenceof these types of incidents (Saharin to Nihon, no. 129, 18 November 1998: 2). Ata conference of Hokkaido–Sakhalin sister and friendship cities in Yuzhno-Sakhalinsk in July 1999, Japanese delegates called on their Russian counterpartsto ‘establish a legal system that eliminates unscrupulous partners’ (Hokkaid™shinbun, 29 July 1999: 4). The damage, however, had already been done.Although the most prominent, the Santa Resort Hotel ‘hijacking’ is just one of aseries of unsavoury incidents that have occurred in the past between Russian andJapanese business partners. Such incidents soured economic relations betweenJapan and Sakhalin and made many Japanese businesses reluctant to invest in theregion (Hokkaid™ shinbun, 23 November 1998: 1; The Sakhalin Times,26 October–9 November 2001). In fact, it has been argued that similar problemsover profit distribution were a significant cause of the dormant state of many Russo-Japanese joint ventures during the 1990s (Nihon Keizai Shinbunsha2000: 100).

Given the difficulties that have arisen in the past between Russian andJapanese business partners, the logical approach for Japanese companiesinterested in investing in the region would be to eschew joint ventures and insteadestablish sole-ownership enterprises. However, two factors have made such anapproach problematic. First, despite the unscrupulous nature of many Russianentrepreneurs and their rudimentary understanding of operating a business in amarket economy, having a Russian partner familiar with the commercialenvironment still offers advantages. Second, legal obstacles have been put inplace for foreign companies wishing to participate in the anticipated constructionboom that the oil and gas development projects are predicted to generate. A ‘localcontents law’ stipulates that the federal government give priority to Russiancompanies when awarding any construction contracts relating to the energyprojects, making joint ventures the only really feasible vehicle for foreigninvestors (Hokkaid™ Saharin Bijinesu K™ryuø Shien Ky™kai Jimukyoku dateunknown: 8).

152 Sakhalin’s commercial environment and local trade

Frustration over Sakhalin’s unstable commercial environment therefore ledJapanese business circles to adopt a cautious approach to developing trade andinvestment linkages. They opted for a strategy of building up business contacts –which they hope to utilise after Sakhalin’s investment environment stabilises –without making substantial commitments. A large number of Hokkaido and otherJapanese business delegations visit Sakhalin each year. However, much to thechagrin of regional government officials and businesses, the majority of thesevisits have not led to the signing of business contracts.5 Meanwhile, by the late1990s, Japan lost its position as the leading investor in and trading partner ofSakhalin. In 1992, Japan accounted for just over half of Sakhalin’s foreign trade,but by 1999, this had dropped to about 20 per cent (Elizar'ev 2001: 122). SouthKorea had become Sakhalin’s largest trading partner, although most of Sakhalin’sexports continued to go to Japan. American companies became now the largestinvestors in the Sakhalin economy, accounting for about 98 per cent ofinvestment inflows in 1999 (ibid.: 182). Japan, on the other hand, accounted for0.3 per cent, which was even less than Cyprus and the Bahamas (ibid.). Apartfrom the endless procession of business delegations and the second-hand cars thatply Sakhalin’s streets, the Japanese did not really have a visible economicpresence in Sakhalin in the 1990s.

As we have seen, Sakhalin’s unstable commercial environment generally hada limiting effect on both interregional and Japan–Sakhalin trade and investmentties. However, there is one area of Hokkaido–Sakhalin economic relations inwhich economic relations, at least in quantitative terms, flourished.

The local trade in fish and marine products

The joint venture boom

The command economy’s collapse, the dismantling of the highly centralised andhierarchical administrative structure upon which the Soviet fishing industry wasbased, and privatisation led to an explosion in the number of independentcommercial fishing companies (which co-existed with restructured former stateenterprises and kolkhozy) in the fishing industry in the 1990s. One author, writingin 1996, cites an ‘incomplete assessment’ that found over 1,000 firms active inthe Far Eastern fishing industry (Minakir 1996: 112). About half of theseindependent fishing firms are located in Sakhalin. Official Goskomstat fisheriesdata from 1999 indicate that some 598 enterprises, employing 28 per cent ofSakhalin’s workforce, were active in the fishing industry, a ten-fold increase since1990 (cited in Allison 2001: 75). No longer able to rely on central governmentsubsidies and cut off from traditional markets in European Russia by rising fueland transport costs, these new enterprises were left to fend for themselves in thenew, chaotic environment that was post-communist Russia. Developing newproducts and finding new markets, in particular, became imperative if the localfishing industry was to survive.

Sakhalin’s commercial environment and local trade 153

As the geographically closest region of a nation renowned for its consumptionof fish and marine products, Hokkaido emerged as an attractive market andimportant partner for fishing enterprises in the Russian Far East, which wereeager to take advantage of their new-found freedom and establish commercialrelations. Because the Hokkaido fishing industry was in decline for a number ofreasons, significant among which were Soviet and later Russian restrictions onaccess to what the Japanese considered to be traditional fishing grounds, this wasa mutual embrace. Soviet and Russian governments offered access to thesefisheries under a quota system and also in return for the payment of fishing fees.However, mainly for political reasons that will be discussed shortly, the Japanesegovernment either rejected or scaled these down, forcing many local fishers toadopt more clandestine measures in order to supplement their insufficientcatches. Fishing cooperatives in Hokkaido responded positively to these earlyovertures.

In the early 1990s, there was a boom in joint ventures involving Japanese andSakhalin businesses, mainly concentrated in the raw materials sector (fishing,timber and timber processing). Among the Japanese companies that entered theSakhalin market during this early period about 70–80 per cent were thought to beHokkaido-based firms, most of which established joint ventures in the fishingindustry.6 Some in Sakhalin such as former head of the regional administration’sDepartment of International Affairs and Foreign Economic Relations, VitaliiElizar'ev, who had expectations that Hokkaido firms would invest more broadlyin the regional economy, did not look favourably upon this narrow focus on thefishing industry (interview, 23 August 2001). It is difficult to give a precise figureon the number of Hokkaido firms active in the Sakhalin market as many areregistered with the Sakhalin administration but, because of the unstableinvestment environment, are ostensibly commercially dormant (so-called ‘papercompanies’). Elizar'ev claims that by 1992 over 100 economic ‘structures’ inSakhalin had established business contacts with Hokkaido (2001: 60). However,by 1999, the number of registered enterprises with Hokkaido capital had droppedto 53 (Elizar'ev 1999: 66).

Fishing joint ventures have served as a vehicle for local fishing cooperativesand trading companies in Hokkaido to obtain access to Russia’s marine resourcesand supply seafood products to the Japanese market. Joint ventures are certainlya much safer alternative than the approach adopted by a number of local fishers,which is to operate clandestinely in the disputed islands’ fisheries. This exposesthem to the risk not only of being apprehended and subsequently imprisoned, butalso of being fired upon by the trigger-happy Border Guard.7 Although theSakhalin and Hokkaido regional governments do not provide statistics oninterregional trade, it is believed that the trade in fish and marine productsconstitutes a significant share of Sakhalin–Hokkaido trade. In 1999, about 80 percent of Hokkaido’s imports from the Russian Far East were fish and marineproducts (60 per cent of these imports were crabs) (Hokkaid™ Shinbun J™h™

154 Sakhalin’s commercial environment and local trade

Kenkyuøjo ed. 2001: 13). Fishing nets and packing materials for fish and marineproducts comprised about 40 per cent of Hokkaido’s exports (Belov 1997a).

A significant relaxation of military tension in the Far East following the SovietUnion’s collapse, the easing of Japanese restrictions on the entry of Russiancitizens into the port cities of northern and eastern Hokkaido, and thederegulation of the Russian fishing industry and foreign trade have allowedRussian trawlers from Sakhalin, as well as other Far Eastern regions, to dock inHokkaido’s fishing ports to sell their catch. In 1989, only 262 Russian trawlersdocked in Hokkaido’s five main ports (none in Nemuro, Monbetsu or Ishikari).This number increased, reaching a peak of 8,980 in 1997, before droppingslightly to 8,525 in 1999 – a 34-fold increase in 10 years (Hokkaid™ Shinbun J™h™Kenkyuøjo ed. 2001: 7). The number of Russian sailors disembarking at theseports mirrors this trend, peaking at 175,390 in 1997, before dipping to 154,393 in1999.8 While ashore, most Russian sailors purchase large quantities of consumergoods to take back home and have become a highly visible presence in these portcities. For instance, in 1999, 61,987 Russian sailors disembarked at Wakkanai,which is over 10,000 more than the town’s population (ibid.: 9).

The criminalisation of local trade

Under normal circumstances, such a flurry of interregional economic activitywould be seen as a welcome development in an otherwise stagnant Russo-Japanese economic relationship. Indeed, one Russian correspondent considers thelocal trade in fish and marine products to be the most effective achievement ineconomic relations between Japan and Russia. What a pity, he laments, ‘that it isabsolutely illegal and of a criminal nature’ (Golovnin 1997: 5). One respectedAmerican scholar has even described the criminal nature of local trade as ‘acancer threatening the very health of Russo-Japanese relations’ (Rozman 2000:211). These are not isolated views. The Russian and Japanese press, often usingpolice sources (particularly in Sakhalin and Hokkaido), describe fishing as a‘criminal industry’ and the trade in fish and marine products at the regional levelas ‘mafiya controlled’. These views are also reflected in scholarly research.

A number of unusual incidents have occurred since the dismantling of thecommand economy, suggesting that criminal groups have infiltrated local tradenetworks. In February 2001, a Russian Border Guard patrol plane fired warningshots at a Russian fishing vessel suspected of smuggling crabs near Rebun Island,west of Hokkaido. The vessel responded by raising the Japanese hinomaru flagand, citing engine trouble, sought refuge in Wakkanai harbour in northernHokkaido (Murayama and Takeyama 2001: 33). In June 2001, in what is believedto be a gangland murder, a Russian employee was shot dead on the premises of atrading company in Wakkanai after a fishing-related dispute (ibid.). In the city ofKushiro in eastern Hokkaido, municipal authorities began an investigation intoviolations of foreign trade laws and uncovered local firms with joint ventures inthe Russian Far East that were cooperating in concealing funds and laundering

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them for use by Russians in Japan (Rozman 2000: 207). A comparison of Russianand Japanese customs statistics for the trade in crabs and shellfish also reveals theillegal nature of this commerce. According to Russian statistics, in 1994, exportsof crabs and shellfish earned revenue of US$90.4 million, while Japanesestatistics indicated imports of these products amounted to US$510.9 million(Belov 1997b: 77). Moreover, as Rozman notes, over the next two years theJapanese numbers continued to increase and the gap in both countries’ recordsgrew to about 9:1 (2000: 206).

Perhaps the most detailed account of the nature and scope of this illicit tradeto date is a three-part exposé published in Izvestiya in October 1997. Based on anextensive eight-month investigation in both the Russian Far East and Hokkaido,journalists Boris Reznik and Vasilii Golovnin uncovered a complex web of fraudlinking both sides of the disputed Russo-Japanese maritime border, which hasdeprived Pacific Russia of $2 billion a year in terms of unreported exports of fishand marine products, mostly smuggled to Japan through ports in Hokkaido(Golovnin 1997: 5; Reznik 1997a: 1, 5; 1997b: 5; 1997c: 1, 5). On the Russianside, operations were centred upon a fishing enterprise in Sakhalin, which issuedinstructions (ukazaniya) to Russian fisheries inspectors to overlook cases ofoverfishing and poaching or to falsify records. The necessary bribes to ensurecompliance by ‘good’ inspectors appear to have been channelled, either directlyfrom fishing cooperatives in Hokkaido, or indirectly via the fishing enterprise inSakhalin. There is even a suggestion that money from this illegal trade may haveflowed to the State Committee for Fisheries and the Governor of Sakhalin.9

The participants in this commerce are not only Russian and Japanese fishersand fishing enterprises. An uncounted armada of conspirators on the Russian side,including customs officials, fisheries inspectors, procurators and border guards,are also believed to have been actively involved (Reznik 1997c: 5). The potentialmaterial benefits (cash, alcohol, women and valuable seafood products) fromparticipating in this trade have proved to be too tempting for many in the armedforces and law enforcement agencies who are dependent on the state for financialsupport and have arguably borne the brunt of Russia’s economic reforms. Giventhe wealth derived from this trade, it is not surprising that criminal organisationsin Japan and Russia, often working in cooperation with each other, have also beenactively involved.10 The Russian mafiya is said to be influential in the entireprocess, from the distribution of quotas, the sale of fish and marine products inJapan and the distribution of earnings from the sale of these products, whileJapanese organised crime groups make advanced payments for quotas, forinstance, and establish bank accounts to launder profits (ibid.). Without hard datait is difficult to quantify just how pervasive criminal organisations’ influence inthis commerce actually is. However, it is reasonable to argue that organisedcriminal groups in Russia and Japan are involved – sometimes operating incoordination with fishers and sometimes independently.

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It should also be noted that, despite the aforementioned evidence, not all theexports of fish and marine products from Sakhalin and the rest of the Russian FarEast to Hokkaido are illegal. Only those fish and marine products either caughtby Russian fishers over their prescribed quota limits and then smuggled intoJapanese, mainly Hokkaido ports, or those ‘poached’ by Japanese fishers in thedisputed islands’ fisheries and smuggled into Hokkaido ports should be classifiedas illegal. However, the latter, in particular, is a contentious issue as the Japaneseconsider the Northern Territories and their fisheries to be Japan’s inherentterritory. Strictly speaking, they do not therefore consider Japanese fishingvessels’ operations in these waters to be ‘illegal’,11 although the government hashalf-heartedly appealed to local fishers to refrain from venturing into these watersfor fear of exacerbating tensions with the Russians.

Regional attempts to address this problem

The Sakhalin administration has not been a bystander and, in coordination withlocal enforcement agencies, has adopted a number of measures to fight thepoachers (brakon'ery) and smugglers (kontrabandisty). In May 1992, itannounced the establishment of customs posts in Kurilsk (Etorofu) and Yuzhno-Kurilsk (Kunashiri), the former to be shared with the Border Guard.12 In March1995, the Sakhalin Branch of the Federal Department for Protection andReproduction of Fish Resources and Fisheries Regulations (Sakhrybvod)announced the establishment of three inspection facilities on the Habomai isletsin order to stem the flow of illegal crab exports to Hokkaido (Hokkaid™ shinbun,9 March 1995). The Sakhalin administration has also sought federal governmentsupport in the fight against this illicit trade.13

Authorities in Hokkaido have also adopted a number of independent measuresto prevent the poaching and smuggling of fish and marine products. A specialland-based oversight division of the Hokkaido police force was established in1991, the staff of which was increased in 1994, and in 1992 the water policereceived two high-speed patrol boats to bolster its existing two-boat structure(Hokkaid™ Suisan Rinmubu Gyogy™ Kanrika date unknown). During his visit tothe Soviet Union in June 1990, Governor Yokomichi was harshly criticised by hishosts for the large number of ‘violations of Russian territorial waters’ committedby special high-speed fishing boats (tokk™sen) based in Hokkaido’s eastern ports(mainly Nemuro). In an attempt to assuage Russian concerns ahead of MikhailGorbachev’s scheduled state visit to Japan the following year, the HPG, incooperation with the Coast Guard, initiated a campaign in September 1990 todestroy these vessels, many of which were operated by criminal organisations(P”su B™to Hopp™ Yont™ Shuzaihan ed. 1993: 248). This virtually eliminated thenumber of Japanese fishing vessels entering the disputed islands’ fisheries.However, shortly after Gorbachev’s April 1991 visit to Japan, the campaignended and the tokk™sen recommenced operations. For the remainder of the yearthe Soviets recorded 8,000 ‘violations’ (ibid.: 249). In order to create a favourable

Sakhalin’s commercial environment and local trade 157

environment ahead of Yokomichi’s visit to Sakhalin in June 1992 for Dialogue ’92, the HPG once again cracked down on the tokk™sen (ibid.),demonstrating the regional government’s ability to deal successfully withpoachers and smugglers – at least those operating from Japanese ports – when ithas the will to do so.

On a private level, Hokkaido fishing cooperatives have established aCommittee to Promote the Prevention of Poaching (Mitsury™ Mizen B™shiSuishin Iinkai) operating under the slogan ‘We will not send poachers from ourshores’ (Jibun no hama kara wa mitsury™sha o dasanai) (Hokkaid™ SuisanRinmubu Gyogy™ Kanrika date unknown). This is akin to putting the foxes incharge of the hen house. The campaign is particularly well publicised. In additionto the billboards calling on the Russians to return the Northern Territories, theroad linking the town of Nemuro to Cape Nosappu is also dotted with signsurging local fishers not to succumb to the urge to poach and smuggle fish andmarine products. Under difficult economic conditions, such pleas have largelyfallen on deaf ears.

Although the growth in the illegal trade of fish and marine products is mainlyderivative of Russia’s troubled transition to democracy and a market economy,the bulk of these products are unloaded in the ports of eastern and northernHokkaido. Independent initiatives by regional governments in the Russian FarEast and Hokkaido are therefore insufficient when dealing with this problem. Itrequires a coordinated response by authorities on both sides of the maritimeborder. Regional authorities in Sakhalin, in particular, have long been cognisantof the necessity of establishing cooperative mechanisms with the Japanese at boththe regional and state levels and have lobbied the HPG for support. However,until quite recently, the Japanese response to these overtures has been passive. Ata meeting with his Hokkaido counterpart in the early 1990s, Governor Fedorovproposed to establish contacts between law enforcement agencies in Hokkaidoand Sakhalin. Yokomichi verbally agreed to the plan, but nothing eventuated(Yupychev 1994: 2).14 In addition, Vitalii Elizar'ev claimed in an interview withthe author (23 August 2001) that in the past the Russian side put forward aproposal to track fishing vessels by satellite, but this only drew a lukewarmresponse from the Japanese.

During a visit to Sakhalin in July 1994, Yokomichi reached an agreement withhis Sakhalin counterpart, Yevgenii Krasnoyarov, to establish a Sakhalin–Hokkaido Fisheries Cooperation Council (Arai and Hasegawa 1997: 180). Adelegation of Hokkaido fishing representatives and regional officials visitedSakhalin in September to work out concrete details for the Council. Discussionscontinued throughout the early part of 1995, but because of a number of factorson the Russian side, including delays arising from the devastating earthquake thatstruck Sakhalin in May, an unstable social environment and dramatic changes tothe oblast fishing industry, no substantial progress has been achieved (personalcorrespondence with Nagashima Masayuki, 22 May 2002).

158 Sakhalin’s commercial environment and local trade

This is not to say, however, that regional authorities in Sakhalin and Hokkaidohave not attempted to create an administrative framework to improveinterregional relations in fisheries. The June 1990 Hokkaido–Russian Far EastEconomic Cooperation Programme discussed above also outlined joint fisheriesinitiatives by regional authorities in Hokkaido, Sakhalin, Primorskii krai andKhabarovsk. The five-point agreement concluded with Sakhalin called forexchanges of fishers to promote mutual understanding and the establishment ofan interregional cooperative council, exchanging fisheries-related informationand regional officials, private-level cooperation in the joint development ofunexploited marine resources, harvesting, processing and storage, scientific andtechnological exchanges and sending and hosting fisheries specialists for researchand training (Hokkaid™ S™mubu Chijishitsu Kokusaika Roshiashitsu dateunknown [b]). This framework, however, has proved to be inadequate inaddressing the problems faced by Hokkaido and Sakhalin fishers. One of themajor problems is rational managing of fisheries, which have yielded decliningoverall catches in recent years, and have subsequently been substituted byconnections between illegal fishers and organised crime groups.

Barriers to establishing effective interregional cooperative mechanisms

Initial Japanese reluctance to address seriously the issue of illegal Russian fishand marine product exports to Hokkaido stemmed partly from a belief thatpoaching and smuggling fish and marine products by Russian vessels isessentially a Russian problem that could be resolved immediately if a suitableregulatory framework was established (Hokkaid™ shinbun, 11 April 1997: 19).15

Such views conveniently overlooked the dimensions of marine contraband andthe Japanese involvement in this.16 More importantly, however, early Japanesereluctance to address this issue appropriately can be attributed to economic andsymbolic factors – the latter linked to the Japanese government’s positionregarding the Northern Territories dispute.

The Japanese government, ostensibly backed by domestic public opinion,claims the Northern Territories are Japan’s ‘inherent territory’ (koyuø no ry™do). Ittherefore officially recognises neither the international maritime border drawnbetween Hokkaido and the disputed islands, nor the islands’ fisheries as Russianterritorial waters. Moreover, the Japanese government does not consider theactivities of Japanese fishing vessels operating in these waters to be ‘poaching’.In order to avoid unnecessarily antagonising the Russians, Japanese authoritieshave had to walk a delicate tightrope by promising to adopt measures to curtailthese operations, without acknowledging the fisheries as Russian territorialwaters. The manner in which the Japanese and HPG have gone about this has onlyfurther compounded the problem.

It will be recalled from Chapter 1 that evidence suggests many, if not most,fishers in Nemuro favour a return of only two of the four islands (presumablyHabomai and Shikotan). This would give them access to the islands’ rich fishing

Sakhalin’s commercial environment and local trade 159

grounds, thereby substantially alleviating the problem of dwindling catches. Inorder to halt the spread of such ideas and maintain national unity around the claimto all four islands, the Japanese government, through the Hokkaido DevelopmentAgency, has provided special extra-budgetary funding to the region. The HPG notonly lobbies Tokyo for this assistance, but also formulates and subsidises its ownpolicy to promote public works programmes to stimulate the Nemuro regionaleconomy. However, at a time of recession-induced government cutbacks, thisfinancial support has also proved insufficient to keep Hokkaido fishers out ofthese waters.

In addition to Tokyo’s position regarding the Northern Territories, there havealso been compelling economic factors that can explain Japan’s initial reluctanceto address this problem seriously. The port cities of northern and easternHokkaido, where the bulk of illegal fish and marine products are unloaded, are insevere economic decline. The shockwaves resulting from the collapse of the‘bubble economy’ in the early 1990s have been felt throughout the Japanesearchipelago. Apart from Okinawa and, to a lesser extent, the prefectures on theSea of Japan seaboard, arguably no other region has been as adversely affectedby the recession as Hokkaido, which, as discussed in Chapter 2, has furthersuffered as a result of government cuts in public works programmes and otherinvestments, upon which it has been heavily dependent. For the port cities ofnorthern and eastern Hokkaido, these cuts in public expenditure have beencompounded by a decline in the industries that have traditionally formed the backbone of the local economies: agriculture, fishing and (in the case ofKushiro) coal.

The large number of Russian sailors disembarking at Hokkaido’s northern andeastern ports has proved to be a blessing for these socio-economically depressedregions. The economic impact is two-fold: first, monies derived from the sale offish and marine products brought in by these vessels; and second, the economicstimulus derived from industry support activities such as ship repairs,provisioning, and crew rest and recreation. Russian sailors’ purchases ofconsumer goods such as electrical appliances and second-hand cars are alsosignificant.17 In Wakkanai, direct purchases of consumer items are estimated at8.3 billion yen and the subsequent spill-over effect to be in excess of 10 billionyen. The direct economic impact of Russian visits to Nemuro is estimated at 1.9billion yen and it is thought to be indirectly worth 7.5 billion yen. The estimatedvalue of these visits for the Monbetsu economy is significantly less than for theeconomies of Wakkanai and Nemuro, but at 200 million yen has still been animportant boost to the local economy (Hokkaid™ Shinbun J™h™ Kenkyuøjo ed.2001: 10).

Local recognition of the economic value of this trade is reflected in a numberof local retail outlets’ efforts to attract Russian customers by employing Russian-speaking staff and displaying Russian-language advertising signs. The‘Russification’ of a number of retail outlets and establishments in the port citiesof northern and eastern Hokkaido is a rather incongruous sight for travellers from

160 Sakhalin’s commercial environment and local trade

other parts of Japan accustomed to displays of Western pop culture. At the sametime, however, there is no denying that these visits have caused some socialproblems. For instance, a small hot-spring resort in the city of Otaru madeheadlines in 1999 after it was revealed that it had posted a sign written inJapanese, English and Russian prohibiting the entry of foreigners after a numberof incidents involving loutish behaviour by Russian sailors. Moreover, about halfof the 200 members of the local restaurant association in Monbetsu erectedsimilar signs declaring they were ‘only for Japanese’ (Magazin tol'ko dlyaYapontsev) (ibid.: 73). These problems derive partly from cultural differences anddemonstrate that despite the economic benefits and Hokkaido’s own reputationfor openness, the traditional mistrust of Russia and Russians is still deeply rootedin the Japanese psyche.

Given both direct and indirect economic benefits derived from the visits byRussian sailors, it is little wonder that many Japanese in these port cities haveturned a blind eye to the illegal nature of much of this commerce. Border tradehas become an indispensable element in the economic life of many municipalitiesin northern and eastern Hokkaido. Japanese consumers, who are renowned fortheir love of seafood, particularly the king crab brought in by Russian fishingvessels, have also benefited from the dumping of marine products at reducedprices. It is their demand for these products that has fuelled this trade. A viciouscycle has developed in which the flood of illegal crab imports has created excesssupply, which, economic theory tells us, leads to a drop in prices. Thissubsequently leads to more poaching as the participants in this commerce seek tomaintain profits.

Local trade complicating resolution of the territorial dispute

This trade has also had the unintended consequence of complicating attempts toresolve the territorial dispute. First, regional authorities in Sakhalin, as well as thefederal government, have made numerous appeals to their Japanese counterpartsin the past to provide information regarding the names of the vessels docking inJapanese ports and their catches (type and volume) in order to ascertain whetherthey are operating according to their prescribed quotas. The Japanese side’s initialreluctance to cooperate fully has frustrated the Russians. During a visit toSakhalin in August 2000 for ‘Hokkaido Week’ – a series of events introducingvarious aspects of Japanese life to the Sakhalin people – Governor Hori caused astir when he claimed he did not know, or could not confirm, whether smuggledfish and marine products were being brought into Japan. Refusing to take anyresponsibility for the issue, Hori argued that customs, which might know aboutthe problem, was under the Japanese government’s jurisdiction and the regionalgovernment had no right to get involved in these affairs. Governor Farkhutdinovwas quick to respond to Hori’s comments, claiming the Hokkaido Governoreither said this in consideration of Tokyo, or simply did not think it was possible

Sakhalin’s commercial environment and local trade 161

for smuggled goods to be circulating in Japan (see Saharin to Nihon, no. 199, 7September 2000: 6).

Hori’s comments are problematic in several ways: first, it is difficult to believethat a prefectural head of administration could not to be sufficiently aware of aserious problem occurring within his/her territorial jurisdiction – one that hadbecome an open secret among local academic, business and government circles.Moreover, Article Five of the 1998 Hokkaido–Sakhalin Agreement for Friendshipand Economic Cooperation explicitly mentions a commitment to ‘strengthencooperative relations for the rational use of marine resources, includingexchanging information concerning catches unloaded in the ports of both regions’(Hokkaid™ S™mubu Chijishitsu Kokusaika Roshiashitsu 2000: 15). It is the largedisparity in Russian and Japanese customs statistics concerning the trade in crabsand shellfish discussed above that underscored the illegal nature of thiscommerce. Moreover, Hori was a signatory to the 1998 agreement. Second, theregional government does have the right to involve itself in such an issue. Indeed,as discussed previously, it has on occasion attempted to tackle this problem –albeit only half-heartedly.

The illegal importation of fish and marine products is very much an economicissue and, because of an early initial reluctance to address it, the problem has nowspiralled out of control. Indeed, given the fallout from Hori’s September 1997agreement with Farkhutdinov to examine the possibilities of Hokkaido firmsinvesting in the disputed islands, which contradicted government policy banningsuch investments and required a quick volte face by the Hokkaido Governor(Mochizuki 1998), Farkhutdinov may have been correct in believing Hori’scomments were borne out of consideration for the Japanese government. In anycase, the illegal importation of fish and marine products and an initial Japanesereluctance to address this issue adequately have become irritants in elite-levelinterregional relations, which is ironic when one considers that subnational tieswere intended to serve as a catalyst for improved Russo-Japanese relations.

The criminalisation of Russo-Japanese border trade has also complicatedresolving the territorial dispute at the societal level. Local trade was intended notonly to bring the two regions closer together economically, but also to makeSakhalin residents cognisant of the benefits of developing such links, therebyalleviating their opposition to Russia transferring the South Kuril Islands toJapan. However, local-level trade relations, which are most developed in thefishing industry, have not achieved this. Apart from local media reports on theendless procession of business delegations from Japan that are mostly related tothe oil and gas development projects and the large number of second-handJapanese cars on the roads, most Sakhalin residents have been oblivious to thescope of interregional trade relations. First, much of the fishing industry’sactivity, including substantial amounts of financial compensation to individualsinvolved in the fishing industry, has taken place offshore, away from the pryingeyes of regional authorities and law enforcement agencies (Allison 2001: 78).There is, therefore, little obvious physical evidence onshore of the development

162 Sakhalin’s commercial environment and local trade

of the trade in marine products, apart from new or refurbished offices and fishingfirms’ expensive foreign cars. Second, the illegal sale of fish abroad has starvedthe Sakhalin fish-processing industry of fish to process and, importantly, ofprofits to reinvest (Bradshaw 2001), depriving regional and local governments inSakhalin of important tax revenues that could be used for social developmentprogrammes to alleviate hardship. Many Russians believe unscrupulous foreigninvestors have been seeking to take advantage of the country’s present weaknessand fear that Russia is becoming a raw materials appendage to fuel economicgrowth elsewhere. They of course overlook the fact that Russian law enforcementpersonnel and many in the local fishing industry have been active participants inthis commerce. Nevertheless, such views exist, and do little for the developmentof relations of trust and friendship between Russians and foreigners. In fact,revenue leakage from the fishing industry has reached such a level as to promptone scholar to claim it is far more significant than the potential revenue lostduring the 1990s as a consequence of delays in the oil and gas projects (ibid.).

Moreover, it can be argued that this commerce has had the unintended effectof creating and sustaining societal forces with a vested interest in continuedRussian control over the South Kuril Islands: local fishers, the armed forces andlaw enforcement agencies. According to calculations by the Russian StateFisheries Committee, the fishing industry in the Russian Far East stands to loseUS$1–2 billion a year if the South Kuril Islands are transferred to Japan (cited inSarkisov 1997: 359). Given the projected losses to the industry in the event of atransfer, fishing interests, not surprisingly, have been adamantly opposed toRussian territorial concessions. Economic factors have featured alongsidenationalism in debates regarding the islands’ future disposition. The industry’scontribution to regional coffers has made it a voice to be heard on mattersregarding the islands’ future ownership. In Sakhalin, fishing industryrepresentatives have been elected to the oblast Duma, providing them with aforum to voice their opposition to surrendering control of the disputed islands(Saharin to Nihon, no. 78, 31 October 1996: 1). The fishing industry has activelylobbied the regional and central governments, the State Duma and thePresidential Office in a bid to prevent a pro-Japanese settlement to the dispute.The industry has also been active in the public relations sphere, paying for thepublication of a book that distorts the historical and legal facts about the islands(Sarkisov 1997: 359). Returning the islands to Japan would inevitably lead to anincreased presence in the area of Japanese law enforcement agencies and tighterfishing controls. This would severely impact on these criminal activities.

As noted above, Russia’s armed forces and law enforcement agencies havebeen hit very hard by economic reforms. The chronic federal budget deficit hasled to significant delays in wage payments. Under such difficult economicconditions, the potential material benefits (cash, alcohol, women and valuableseafood products) derived from participating, either actively or passively, in thisillicit trade have proved to be too tempting for the struggling members of Russia’sarmed forces and law enforcement agencies, as well as fisheries scientists.

Sakhalin’s commercial environment and local trade 163

According to Greenpeace Russia, the Russian military has becomeorganisationally involved in the poaching and smuggling of fish and marineproducts (cited in Hokkaid™ shinbun, 1 October 1999: 9).18 In October 1999, itwas revealed that Russian border guards had been cooperating with fishsmugglers for over two years by leaking information about the times and zonesin which patrols were to take place (Japan Sh” Nettow‰ku 1999).19 Wage arrearshave caused general resentment within the ranks of Russia’s armed forces andsecurity organs. The government has attempted to address this problem in amanner that should perhaps not come as a total surprise to students of post-SovietRussian politics. As Allison notes, some industry observers portrayed the BorderGuard’s 1998 takeover of the Federal Department for Protection andReproduction of Fish Resources and Fisheries Regulations’ enforcementfunctions ‘as an effort to find a source of unofficial revenue in the form of bribesto appease the Border Guard whose troops are usually asked to serve in difficultand remote areas of the Russian borderlands with little recompense’ (2001: 75).If this is indeed the case, it reveals a disturbing preparedness on the part of theRussian government to resort to unlawful practices that can only furtherexacerbate the problem of poaching and smuggling. It is not surprising, therefore,that Russia’s military and law enforcement agencies, the former in particular,which is an important component of powerful conservative and nationalist forces,have been opposed to transferring the disputed islands to Japan. Their economicwellbeing relies, to a considerable degree, on Russia’s continued occupation ofthe islands and the trade in fish and marine products, both legal and illegal, thatthis fosters.20

In the absence of firm data, it is difficult to determine whether the Russianmilitary and law enforcement agencies have sought to have their views heard atthe regional level on specific issues such as the territorial issue, particularly viathe ballot box, and, if so, whether this has had any impact on subnational politics.The substantial reduction in personnel and decline in prestige of air, land andmaritime forces in the Far East since the Soviet Union’s collapse haveundoubtedly curbed their influence in regional politics. Nevertheless, this doesnot necessarily mean the military and law enforcement agencies are completelypowerless. Like any interest group, they can exert influence by seeking to keepissues alive in people’s minds and ensure legislators are aware that segments ofthe public are concerned about specific issues. For instance, members of thearmed forces and security organs have issued public declarations in Sakhalinopposing any Russian territorial concessions over the South Kuril Islands(Zilanov et al. 2002: 234).21 Moreover, in what can be seen as an overt display ofsupport for maintaining Russian sovereignty over the South Kuril Islands, severalmembers of the armed forces participated in the ceremony to erect a cross on oneof the disputed islands in November 1997, outlined in Chapter 4. However,regional elites in Sakhalin, who have used the territorial dispute for economic andpolitical gain, need little prompting from the military.

164 Sakhalin’s commercial environment and local trade

ConclusionSakhalin’s unstable commercial environment – the result of Russia’s troubledtransition to a market economy – is the major reason why administrative effortsto promote subnational trade and investment linkages have not led to a significantexpansion of economic relations and the creation of an environment at thesubnational level conducive to resolving the territorial dispute. Specifically, theclose alliance between government and business, frequently changing and often-contradictory business-related laws, the lack of clear division of powers betweenthe federal and regional governments, a confiscatory tax regime and the RussianFar East’s own reputation for lawlessness have created uncertainty for foreigninvestors and introduced a limiting effect on the growth of interregionaleconomic relations. The Santa Resort Hotel incident, which this study introducedinto the English-language academic discourse for the first time, highlights thelimiting effect of Sakhalin’s commercial environment on foreign trade andinvestment ties.

However, there has been one area of Hokkaido–Sakhalin economic relationsthat has flourished: the trade in fish and marine products. Russian fishing boatsfrom Sakhalin, as well as other Far Eastern regions, fully loaded with fish andmarine products, mainly crab, dock every day in Hokkaido’s ports to unload theircatches. Such a flurry of interregional economic activity would normally be seenas a welcome development in an otherwise stagnant Russo-Japanese economicrelationship. Unfortunately, however, it has become an open secret in localacademic, business and government circles that these fishing activities constitutea criminal industry. Authorities in Sakhalin and Hokkaido have adopted a numberof independent measures to combat the problem of poaching and smuggling offish and marine products, but, for the most part, these have been unsuccessful. Itis a transborder problem and as such requires a coordinated response byauthorities on both sides of the disputed maritime border. Authorities in Sakhalinhave long been cognisant of this and have lobbied their counterparts in Hokkaidoto establish an interregional cooperative mechanism. However, until quiterecently the Japanese response to these overtures has been passive. The Japanesegovernment’s position regarding the Northern Territories and the substantialeconomic benefits that the port cities of northern and eastern Hokkaido derivefrom this commerce can explain Japan’s initial reluctance to address this issueseriously. The lack of an adequate administrative framework to manage fishinghas subsequently been substituted by connections between illegal fishers andorganised crime groups.

The local trade, both legal and illegal, in fish and marine products has had theunintended consequence of complicating attempts to resolve the territorialdispute. The Japanese side’s initial reluctance to establish an interregionalcooperative mechanism has frustrated the regional elite in Russia. At the societallevel, much of the fishing industry’s activity has taken place offshore and, as aresult, there is little physical evidence in Sakhalin of the development of the tradein fish and marine products. The illegal sale of fish abroad not only starves the

Sakhalin’s commercial environment and local trade 165

local fish-processing industry of fish to process and profits to reinvest, but alsodeprives regional and local governments of tax revenues that could be used forimportant social development programmes to alleviate the hardship manySakhalin residents are experiencing. Many believe unscrupulous foreigninvestors are seeking to take advantage of the country’s present weakness andturn Russia into a raw materials appendage. Local trade was intended to bring thetwo regions closer together economically and make Sakhalin residents cognisantof the benefits of expanding such links, thereby alleviating their opposition toRussia transferring the disputed islands to Japan. Not only has it failed to do this,it has also had the unintended effect of creating and sustaining societal forceswith a vested interest in continued Russian control over the South Kuril Islands,consisting of local fishers, the armed forces and law enforcement agencies.

166 Sakhalin’s commercial environment and local trade

ConclusionYeltsin, Putin and the ‘Sakhalin factor’

The Soviet Union’s collapse and the subsequent emergence of the RussianFederation – a state ostensibly committed to democratic principles – raised thepossibility that Russian public opinion, particularly in Sakhalin and the SouthKuril Islands, would play an important role in deciding the islands’ futureownership. In addition to their economic impoverishment, local residents’ initialignorance of the islands’ history led to expectations in Japan that exposure to thehistorical and legal arguments underpinning Japan’s territorial claims, throughvarious forms of exchange, might create an opportunity for resolving theterritorial dispute at the subnational level by generating support among Sakhalinresidents for, or at least diminishing opposition to, transferring the islands toJapan. Home to several outspoken irredentist groups, Hokkaido was active in thetransnational lobbying campaign aimed at mobilising Sakhalin public opinioninto accepting a pro-Japanese resolution to the territorial dispute. These efforts,however, have generally not been successful.

It was argued that this is because Russia’s troubled transition to a liberaldemocratic market economy during the 1990s manifested itself in ways thatincreased the South Kuril Islands’ intrinsic and instrumental value for theSakhalin regional elite and public. Subsequently, this limited the impact of thetwin transnational processes of cultural and economic exchange ex ante onalleviating their opposition to transferring the disputed islands to Japan.

Specifically, Russia’s transition process resulted in an environment that wasconducive to bargaining as a means of conducting centre–periphery relations andalso one in which the regions themselves became arenas in the struggle for powerbetween the executive and legislative branches, necessitating the search forvarious tools that could be used to secure any possible advantage. Against thisbackdrop, the regional political elite in Sakhalin, particularly Valentin Fedorovand Igor Farkhutdinov, sought to exploit the territorial dispute for political andeconomic gain by adopting very public, and sometimes innovative, campaigns toprevent the federal government from transferring the disputed islands to Japan.The territorial dispute proved to be a useful tool for both governors, who playedthe nationalist card in order to consolidate their domestic political positions.Local opposition to Russian territorial concessions also enabled Sakhalin to

extract economic concessions and benefits both from the Russian federalgovernment and from Japan, the latter of which, in particular, has considered the‘Sakhalin factor’ to be an important element in Russian domestic affairspertaining to the South Kuril Islands. However, the former’s inability to makegood on most of its promises of support cast some doubts on the economic valueof such a strategy. It is mainly for these reasons that the political elite in Sakhalin,a genuine desire to maintain Russia’s territorial integrity notwithstanding, wereunwilling to take a conciliatory stand on the territorial dispute.

The introduction of parliamentary and gubernatorial elections in Russia’sprovinces lends itself to the generalised assumption that politicians need to becognisant of the public’s position on the South Kuril Islands. Theoretically, if thepublic were to express support for transferring the islands to Japan, this mightengender a change in the regional political elites’ position on the territorialdispute. It was argued that harsh socio-economic conditions on Sakhalin, mainlythe result of the inability to move smoothly towards a fully functioning marketeconomy, have led to a rise of nationalist sentiments among residents, whichemphasises protecting territorial integrity. Efforts by regional and localgovernments in Hokkaido and Sakhalin to foster closer interregional relationshave led to a breakdown of outdated perceptions and propagated previouslyunimagined levels of goodwill, but this has, for the most part, not been enough todiminish the emotional sustenance derived from maintaining Russian sovereigntyover the South Kuril Islands at a time when many are faced with the difficult taskof constructing a new national identity following the traumatic loss of empire.

Sakhalin’s unstable commercial environment was another manifestation ofRussia’s troubled transition to democracy and a fully functioning marketeconomy during Yeltsin’s regime. Certain features of this environment, includingthe close alliance between government and business, frequently changing andoften contradictory business-related laws, the lack of clear division of powersbetween the federal and regional governments, a confiscatory tax regime and theRussian Far East’s own reputation for lawlessness, introduced a limiting effect onthe growth of Hokkaido–Sakhalin economic relations, despite regionalgovernment attempts to create a framework for exchange.

Although Sakhalin’s commercial environment may have impeded thedevelopment of most forms of interregional trade and investment relations, itparadoxically contributed to a flourishing trade in commodities and goods whichhad long been the mainstay of both economies: fish and marine products.Unfortunately, however, it was an open secret in local academic, business andgovernment circles that this trade had become heavily criminalised. This illicitcommerce is detrimental to Hokkaido’s attempts to use economic relations as ameans of alleviating local opposition to Russian territorial concessions. Thus, itcan be argued that a deviant form of kanky™ seibi has had the unintended effectof further complicating attempts to resolve the territorial dispute. If Chapter 5underscored how humans are creatures who do not always act solely according to

168 Conclusion

economic interests (Kimura 2000b: 133), Chapter 6 demonstrates that, in somecases, economic considerations can be a driving force for human behaviour.

The factors described in the preceding chapters that have raised the intrinsicand instrumental value of the South Kuril Islands for the Sakhalin regional elite,for the public, and for economic interests to a point where they remain opposedto transferring the islands to Japan are largely the result of post-Soviet Russia’sdifficult transition to democracy and a market economy. However, it should beadded that this does not mean they are exclusively derivative of Russia’s attemptsat state-building. First, perhaps apart from highly centralised federations such asthe former Soviet Union,1 it can be argued that a certain degree ofintergovernmental bargaining is characteristic of many federal states.2 Thebargaining dimension of federal states is highlighted in one generic definition offederalism: ‘a kind of political order animated by political principles thatemphasise the primacy of bargaining and negotiated coordination among severalpower centers as a prelude to the exercise of power within a single politicalsystem’ (Sills ed. 1968: 354). Moreover, the often-tense relationship evidentbetween the executive and legislative branches of government in Russia is afeature of democracies. In fact, as John Kincaid observes, ‘In democratic polities,non-violent conflict and competition are not only facts of political life, but alsoaccepted principles of politics’ (1990: 55).

Second, regarding the issue of Russian nationalism, it is important to note thatthis is not exclusively a post-Soviet phenomenon. As discussed in Chapter 5, it isbelieved to have originated in embryonic form in the early eighteenth century.Since this time, it has always been present in Russian society. Despite ostensibleBolshevik hostility to an ideology that flew in the face of proletarianinternationalism, the Soviet regime used Russian nationalism periodically as ameans of relegitimising the Soviet system during traumatic and difficult times. Atother times, Soviet authorities attempted to suppress any of its manifestations.

Third, there is significant Japanese involvement in the illicit trade in fish andmarine products, ranging from the channelling of money used for bribing Russianauthorities to the concealing and laundering of funds derived from sales.Moreover, it is the demand of Japanese consumers, who are renowned for theirlove of seafood, which has fuelled this trade.

Nevertheless, the factors described above became especially salient during(and because of) the Yeltsin regime’s state-building attempts. Intergovernmentalbargaining was a conspicuous feature of centre–periphery relations in Russia,whereas before the Soviet collapse it was virtually non-existent. The same can besaid of the struggle for power between the executive and legislative branches ofgovernment in the regions, particularly in the immediate post-Soviet period.Although Soviet authorities employed Russian nationalism in the past as a meansof buttressing the regime, it remained largely inhibited. The gradual liberalisationof public life in the USSR during the glasnost and perestroika years resulted inincreasing criticism of Marxism–Leninism and unwittingly encouraged the rise ofnationalism. The Soviet Union’s collapse marked the death knell of communism,

Conclusion 169

which created an ideological vacuum that Russian nationalism, stimulated by thefailure of neoliberal economic reforms, began to fill. Finally, while the Japaneseside must also accept some responsibility for the illicit trade in fish and marineproducts, the roots of this flourishing commerce lie in post-Soviet Sakhalin’schaotic commercial environment.3 If a highly centralised Soviet Unionmaintaining a firm military presence in the Asia-Pacific region had endured, thiscommerce would be virtually non-existent or, at the very least, would not havereached the scale it has today.

In a study attempting to explain why transnational relations have a varyingimpact on world politics and state diplomacy, Thomas Risse-Kappen examinesdifferences in domestic structures and degrees of international institutionalisationas keys to understanding this puzzle. Concerning domestic structures, he argues:

[These] are likely to determine both the availability of channels fortransnational actors into the political systems and the requirements for‘winning coalitions’ to change policies. On the one hand, the more the statedominates the domestic structure, the more difficult it is for transnationalactors to penetrate the social and political systems of the ‘target’ country.Once they overcome this hurdle in state-dominated systems, though, theirpolicy impact might be profound, since coalition-building with rather smallgroups of governmental actors appears to be comparatively straightforward.On the other hand, the more fragmented the state and the better organizedcivil-society, the easier should be the access for transnational actors. But therequirements for successful coalition-building are likely to be quitestaggering in such systems.

(1995a: 6–7)

Linking this with the latter, Risse-Kappen also contends that:

Domestic structures and international institutionalization are likely tointeract in determining the ability of transnational actors to bring aboutpolicy changes. The more the respective issue-area is regulated byinternational norms of cooperation, the more permeable should stateboundaries become for transnational activities. Highly regulated andcooperative structures of international governance tend to legitimizetransnational activities and to increase their access to the national polities aswell as their ability to form ‘winning coalitions’ for policy change.Transnational relations acting in a highly institutionalized internationalenvironment are, therefore, likely to overcome hurdles otherwise posed bystate-dominated domestic structures more easily.

(ibid.: 7)

As discussed in Chapter 2, an extremely fluid politico-economic institutionalcontext characterised Russia under the Yeltsin regime at both the national and the

170 Conclusion

regional level. Leaving aside the complex issue of civil society, according toRisse-Kappen’s thinking, one would expect that while post-Soviet Russia’sfragmented domestic structures have provided easier access for transnationallobbying efforts, they would concomitantly make successful coalition-buildingquite difficult. Matthew Evangelista confirms the argument in his study ofsecurity policy in the former USSR and Russia by showing that it wasincreasingly difficult for the transnational arms control community to influencepolicies in post-Soviet Russia (1995). Chapters 5 and 6, in particular, alsodemonstrate that Japan’s transnational attempts at mobilising public opinion inSakhalin oblast (and the rest of Russia) into accepting its position on theterritorial dispute have not been impeded significantly, but the impact of itslobbying efforts has been minimal.

Tying Risse-Kappen’s second proposition concerning internationalinstitutionalisation with the Russo-Japanese territorial dispute is more complex.As outlined above, strongly institutionalised structures of internationalgovernance in a particular issue-area are expected to legitimise transnationalactivities, and increase their access to the ‘target’ states’ decision-making process,as well as its chances of engendering a desired policy change. Generallyspeaking, it must be noted that international organisations such as the UnitedNations have a fairly poor record in settling territorial disputes. It is thereforeunlikely that the Northern Territories/South Kuril Islands will be resolved in sucha multilateral setting. Nevertheless, Japan and Russia have concluded a raft ofbilateral agreements in the past decade designed to bring both sides closer toresolving the territorial dispute. Moreover, high-ranking officials from bothcountries meet regularly to discuss the territorial problem. It will be also recalledfrom Chapter 4 that Farkhutdinov was involved in these, participating in parleysof the Russo-Japanese Border Demarcation Committee.

There is no denying that both governments have established strongly regulatedand cooperative structures of governance to regulate the territorial dispute,although one may perhaps question the quality of these agreements. Japan andHokkaido’s transnational activities have experienced few problems in gainingaccess to Russian decision-making structures at the federal and regional levels.Despite this, they have been unable to form sufficiently powerful coalitions tobring about change in Russian policy on the territorial dispute. Although this doesnot imply that international institutionalisation is irrelevant, it suggests that, inthis case, another variable – the specific nature of the issue-area – may also beimportant when determining transnational activities’ impact (see Risse-Kappen1995b: 305).

Risse-Kappen raises the issue of whether transnational activities might be lessrelevant in ‘high politics’ issue-areas, while matters concerning ‘low politics’would be more susceptible to transnational influence (ibid.). The study’s findingson the Russo-Japanese territorial dispute appear to support at least the first partof this proposition. Paradoxically, however, the reason for this is that, despite itstraditional perception as a ‘high politics’ issue-area, the dispute over the Northern

Conclusion 171

Territories/South Kuril Islands, possibly like most territorial disputes, shares animportant characteristic with ‘low politics’ issues such as the economy and theenvironment: it is a redistributive matter, which often involves the creation of‘countervailing coalitions’ (ibid.)4 of forces opposed to transnational attempts atinfluencing policy.

For Russia as a whole, transferring the South Kuril Islands to Japan wouldentail the obvious physical loss of territory. For the Sakhalin political elite andpublic, such a move would have a far greater and multifaceted impact. It wouldinvolve the political elite giving up an important card to extract variousconcessions from Tokyo and Moscow. Those dependent on the trade, both legaland illegal, in fish and marine products would be faced with the potential loss of(or at least reduction in) income. The public, already impoverished and feelingdisenchanted with life in post-Soviet Russia, would face another assault on theiralready wounded national pride. It is for these reasons that Sakhalin residentshave united under the local banner of maintaining Russian control of the SouthKuril Islands.

This study sheds light on new understandings of kanky™ seibi within thecontext of subnational public authorities’ transnational relations having a salutaryeffect on interstate relations. First, subnational government relations are unlikelyto contribute significantly to nation-state rapprochement when both parties adoptfundamental positions on the issue at the heart of bilateral tensions that arediametrically opposed to each other, and lobby their respective centralgovernments extensively to adhere to mutually unacceptable policies. In the caseof Hokkaido and Sakhalin’s position on the Northern Territories/South KurilIslands, the former, at least before Putin’s recentralisation of power, has staunchlyadvocated maintaining Russian control of all four islands, while the latter activelyseeks restoration of Japanese sovereignty over the islands. Although publicopinion in both regions makes this difficult, there are few or muffled voices ofmoderation ‘from below’ calling for change in both countries’ basic negotiatingposition on the territorial dispute or constructive advice on how to break thedeadlock. In a sense, Hokkaido and Sakhalin’s intra-state lobbying activitieshave, to a certain degree, undermined their transnational partnership in terms ofcreating an environment, at the subnational level, conducive to resolving theterritorial dispute.

Second, as outlined above, the domestic structure of the target country orregion of transnational lobbying is an especially important variable determiningthe extent to which such attempts are successful. Post-Soviet Russia’s weak andunstable politico-economic institutional context, especially during the 1990s,which has led to ideas such as nationalism playing a significant role in the foreignpolicy decision-making process, and also facilitated regional elites’ use of variousissues to bargain with the centre in order to extract political and economicconcessions, as well as for defeating local challenges to their authority, has madeit difficult to form a coalition in favour of transferring the disputed islands toJapan. Third, the specific nature of the issue-area affecting relations at the nation-

172 Conclusion

state level also appears to have an impact on the utility of subnational publicauthorities’ international activities. Territorial disputes appear to be generallyimpervious to transnational activities.

The preceding discussion highlights the limits of kanky™ seibi in contributingto the resolution of territorial disputes affecting state-to-state relations. However,this does not necessarily mean that Hokkaido–Sakhalin subnational governmentrelations have been entirely ineffective. During the Cold War, both countries’citizens held negative perceptions of each other, which government propagandafurther fuelled. Since the Soviet Union’s collapse, there has been a significantimprovement in Russian perceptions of Japan. This is particularly evident in theFar East. For instance, a survey conducted in March 2001 revealed that 61 percent of respondents in Sakhalin had friendly feelings for Japan (Gaimush™ 2001).Various forms of cross-cultural exchange, of which Hokkaido is at the forefront,have played a key role in humanising perceptions and generating goodwill. It hasalso probably increased mutual understanding in many areas, although not inmatters pertaining to the Northern Territories/South Kuril Islands dispute whereRussians and Japanese remain insufficiently cognisant of the islands’ intrinsic andinstrumental value for each other. While Hokkaido–Sakhalin relations have beeninsufficient to alleviate opposition to transferring the South Kuril Islands toJapan, the improvement in perceptions might, in a limited way, have a mitigatingeffect on the expected backlash in Sakhalin should the Russian governmentdecide to concede Japan’s territorial demands. In this event, both countries willbe better served by the presence rather than the absence of communicationchannels fostered by subnational government relations.

The impact of Putin’s recentralisation of powerIf features of Russian federalism during the Yeltsin presidency contributed toSakhalin’s growing authority in matters pertaining to the South Kuril Islands’future disposition, a shift in the balance of power in centre–region relations sinceVladimir Putin’s elevation to the top office in January 2000 appears to havegenerally diminished the efficacy of the ‘Sakhalin factor’. Under Putin’sleadership, the fluid domestic environment, a feature of the Yeltsin regime, hasstabilised. Putin’s hardline stance towards Chechnya and a fortuitous rise incurrent global oil prices, which has increased state revenues, have, inter alia,given him a high public approval rating. Public support, and a more cooperativeState Duma, are something that Yeltsin, except for the brief period immediatelypreceding and following the Soviet Union’s collapse, never really enjoyed.Emboldened by this support, Putin has sought to reassert federal control overRussia’s unruly regions by strengthening vertical authority in the context ofrebuilding the state under a ‘dictatorship of the law’.

Three reforms, in particular, appear to have curtailed the governors’ influence.First, Putin issued a decree in May 2000 abolishing the more than 80 presidentialrepresentatives to Russia’s 89 regions and replacing them with seven

Conclusion 173

representatives who would be responsible for geographically broader federaldistricts. This move was partly necessitated by the fact that most of thepresidential representatives had come under the influence of Russia’s governorsand were unable to carry out their primary tasks of ensuring that local legislationwas compatible with federal laws and analysing and reporting to the presidentabout the situation in the regions. The new envoys have been charged with theresponsibility of ensuring that Putin’s domestic and foreign policies are beingimplemented, guaranteeing that suitable personnel are appointed to federal office,and reporting to the president about the national security, socio-political andeconomic situation in the federal districts and making appropriaterecommendations (Orttung 2004: 22). The presidential representatives, like theirpredecessors, have been given few actual resources to carry out their extensivetasks, thereby diminishing their effectiveness. However, this does not mean theyare completely ineffectual. Their presence has deprived the governors of theaccess to the president they enjoyed under Yeltsin. This has compelled thegovernors to work through the envoys and their staff when dealing with the upperechelons of federal government (Orttung and Reddaway 2004: 283).

Second, reforms to the upper chamber of the national Parliament, theFederation Council, which fully took effect on 1 January 2002, also appear tohave eroded the governors’ powers. Since 1996, Russia’s governors and regionallegislative speakers staffed the Federation Council ex officio. While the Councilwas beset by problems such as high absenteeism (members were full-timeofficials in their own regions) and fractious infighting as each region competedfor Moscow’s patronage, it was able to overcome internal divisions on specificissues and openly challenge the Kremlin when the situation warranted. Under thenew system, the governors and regional legislative speakers have given up theirseats and now appoint their own representatives to the Council (RRR, 5 December2001). The governors, in particular, do not have a free hand in appointing theirrepresentatives to the Federation Council because the Presidential Administrationputs extensive pressure on them to appoint ‘appropriate’ representatives who aremore likely to back the Kremlin’s initiatives. It is believed that pressure from theKremlin led Farkhutdinov to appoint Valerii Goreglyad, who had no obviousconnection to Sakhalin but had worked in the Federation Council staff (Wishnick2004: 254).5 The regional legislature appointed its former chairman, BorisTretyak, as its representative in the Council. However, like the establishment ofthe seven federal districts, the reform of the Federation Council did notcompletely nullify the regional elite’s influence as the governors and regionallegislatures can recall their representatives if they are unhappy with their votes inCouncil sessions. Nevertheless, it has deprived them of a federal platform to airtheir views and removed them from participating directly in drafting nationallegislation (Orttung and Reddaway 2004: 283).

Third, perhaps the most significant reform is that giving federal authorities thepower to remove governors who violate the law and to disband regionallegislatures that adopt unconstitutional laws and then refuse to amend them after

174 Conclusion

court warnings (RRR, 19 December 2001). This measure was initially consideredto be procedurally extremely cumbersome (Orttung and Reddaway 2004:287–90), which may have explained why Putin had to adopt informal methods ofbargaining to remove well-entrenched figures such as Nazdratenko and SakhaPresident, Mikhail Nikolaev. However, the passage of a controversial Kremlin-backed bill in December 2004 to abolish direct elections and appoint regionalgovernors, ostensibly aimed at consolidating central government control of thecountry in order to combat terrorism, has provided Putin with the means ofremoving troublesome regional elites.6 By June 2005, 20 regions had experiencedthe system of gubernatorial appointments with Putin reappointing 17 incumbents,dismissing one for incompetence and rejecting two nominees. This mechanismhas tilted the federal power balance in the Kremlin’s favour by making thegovernors’ ‘political fortunes dependent upon [it] rather than on the electorate’(Coalson 2005).

Putin’s own position on the territorial dispute has changed as his reforms havetaken hold and his grip on power has strengthened. During his first six months asleader, Putin signalled he would take an uncompromising stance on the territorialdispute. This hardline approach was demonstrated on a stopover in Sakhalin onhis way to Japan in September 2000. Although acknowledging the existence ofthe territorial problem and evincing a willingness to examine it, Putin declared‘Russia will not be giving its own territory to anyone’ (Vasil'ev et al. 2000: 1).7

The clarity of this anti-return statement, intended to assuage local concernsregarding possible territorial concessions, and Farkhutdinov’s inclusion in Putin’sentourage for the visit to Japan (the first for a Sakhalin governor), underscoredthe president’s sensitivity to the ‘Sakhalin factor’. Although Putin verballyacknowledged the validity of the 1956 Joint Declaration during talks withJapanese Prime Minister, Mori Yoshir™, he also adopted a Soviet negotiatingstrategy dating back to the 1970s of seeking to delay resolution of the territorialdispute by proposing an interim treaty of peace and amity.

By early 2001, signs began to emerge of a further softening of Putin’s positionregarding territorial concessions. During talks with Mori in Irkutsk in March2001, Putin agreed to formally recognise the validity of the 1956 JointDeclaration. Confirmation of this was contained in the Irkutsk Declaration. Thismarked the first time the Joint Declaration’s legal relevance was confirmed in abilateral written agreement, something to which Gorbachev and Yeltsin were notprepared to commit. By late 2004, Putin had progressed from invoking thevalidity of the Joint Declaration to proposing directly the transfer of Habomai andShikotan to Japan. If, as Viktor Pavlyatenko suggests, Putin’s offer representedthe launch of a trial balloon designed to gauge Tokyo’s reaction ahead ofcelebrations for the 150th anniversary of the establishment of diplomatic relationsin 2005 (cited in Medetsky 2004), it achieved this basic objective. However, apartfrom presenting itself as taking the initiative in territorial negotiations, Moscowaccomplished very little in concrete terms as the Japanese government rejectedPutin’s compromise, insisting that all four islands be returned.

Conclusion 175

While sounding out Tokyo about accepting a compromise solution to theSouth Kurils dispute, the Kremlin has concomitantly sought to prepare the grounddomestically for such a deal by forewarning regional authorities of the possibilityof Russian territorial concessions. In February 2002, letters were sent to thegovernor and regional legislature emphasising the validity of the 1956 JointDeclaration (Hokkaid™ shinbun, 7 February 2002). This represented another firstfor the Putin administration: in post-Soviet Russia’s brief history the Kremlinnever before openly conveyed to Sakhalin political elites a preparedness totransfer any of the disputed islands to Japan. The information contained in theletters, however, may not have been a complete surprise to Sakhalin officialsgiven the federal government’s declared intent to transfer disputed lands in theeastern border region to China, despite similar campaigns from elites inKhabarovsk krai to maintain Russian control over these territories. The absenceof any significant campaign of opposition in Khabarovsk to Russian territorialconcessions possibly signalled to Putin that compromising with the Japanese maynot entail serious political consequences.

The federal government’s offers to adhere to the Joint Declaration and transfertwo of the disputed islands to Japan have drawn contrasting responses from theexecutive and legislative branches of government in Sakhalin. In a notabledeparture from past practices, the Sakhalin administration under its newgovernor, Ivan Malakhov, appears to have accepted the Kremlin’s policy shift.Referring directly to the Joint Declaration, Malakhov spoke of the necessity of allstates fulfilling their international obligations (Administratsiya Sakhalinskoioblasti 2004).8 One of Malakhov’s deputies underscored the new acquiescentmood in the Sakhalin administration when he declared that any decision taken bythe president regarding the islands would be the correct one (Al'ternativnoeSakhalinskoe televidenie 2004).

In contrast, legislators and the general public in Sakhalin denounced this mostrecent offer to return two of the disputed islands to Japan. Thousands of Sakhalinresidents have expressed their opposition through talkback radio and television,signing online protest letters and attending mass rallies. Lawmakers adopted aresolution and sent an appeal to Putin, the Federation Council, the federalgovernment and the legislative and executive branches of subnationalgovernments across Russia emphasising the harmful consequences of bargainingwith Russia’s sovereignty and territorial integrity and exchanging these forforeign investment. The legislature also offered to send a delegation to meet Putinahead of a scheduled visit to Japan in early 2005 (subsequently postponed untilNovember 2005) in an attempt to persuade the president to change his mind, andthreatened continued protests should its pleas fall on deaf ears (Kim 2004). It mayhave partly achieved this objective when Putin, annoyed at Japan’s adherence tothe four-island claim, hardened his position, declaring in September 2005 that theislands were Russian territory under international law. However, it is plausible tosuggest the president would be prepared to give up Shikotan and the Habomaiislets in the (unlikely) event that Tokyo abandons it claims over the larger two

176 Conclusion

islands. The Sakhalin legislature has demonstrated that at least it is prepared tostand up to Putin as the guardian of regional interests, although this positionappears to have been undermined by an increasingly authoritarian and powerfulpresident who is prepared to make some short-term sacrifices in order toconsolidate Russia’s long-term strategic position in the Asia-Pacific region.

Conclusion 177

Notes

Introduction

1 The term ‘subnational’ can broadly denote all levels of government below the nation-state, including prefectures, towns, cities and villages. In this study it is predominantlyused to refer to regional (Russia) and prefectural (Japan) administrative units, whilethe term ‘local government’ signifies public authorities at the municipal level.

2 Ernest Gellner defines civil society as ‘that set of diverse non-governmentalinstitutions which is strong enough to counterbalance the state and, while notpreventing the state from fulfilling its role as keeper of the peace and arbitratorbetween major interests, can nevertheless prevent it from dominating and atomisingthe rest of society’ (1994: 5).

3 Japanese scholar Yabuno Yuøz™ also notes their diversity, explaining that ‘More thanone political organisation, local governments are a composite of various politicalgroups, interest groups and citizens’ (1994: 20–1).

4 According to Arai, ‘in order to resolve the Northern Territories dispute, it is impossibleto rely solely on the Tokyo–Moscow route. In order to appeal to public opinion inSakhalin, which is the most concerned party, to accept a return of the NorthernTerritories, Hokkaido–Sakhalin relations are absolutely necessary’ (Hokkaid™ shinbun,16 September 1990: 9). Yutaka Okuyama argues that the HPG pursued regionalcooperation with Sakhalin as a means of gaining political leverage to help resolve theterritorial dispute (2003: 46).

5 See, for instance, a press statement released by the HPG shortly after theHashimoto–Yeltsin informal summit in Kawana in April 1998 (Hokkaid™ S™g™Kikakubu S™muka 2000). Governor Hori mentioned this during a periodic pressconference after his return from a visit to Sakhalin in February 2002 (Hokkaid™ S™g™Kikakubu S™muka 2002). See also a document prepared by HPG’s Northern TerritoriesCountermeasures Headquarters (Hokkaid™ S™mubu Hopp™ Ry™do Taisaku Honbu2000: 7). The Hokkaid™ shinbun also reported that ‘many Hokkaido residents affordedYokomichi’s positive local government diplomacy, which aimed to create a favourableenvironment for resolving the territorial dispute, high praise’ (30 March 1993: 1).

6 An LDP-backed former METI official, Takahashi Harumi, was elected as Hokkaidogovernor in April 2003 following Hori’s retirement. She became the first femalegovernor of Hokkaido and the fourth female governor in Japanese history.

7 Purnendra Jain raises this issue with respect to Japan, but it is also applicable to Russia,particularly during the early post-Soviet period when there was a substantialdevolution of power from Moscow to the regions (2000: 21).

8 As of 1998, 30 sister-city agreements were concluded. See Ichioka (2000: 9–13).9 Its sister organisation, the Sakhalin–Japan Association, was established in August

1998.

10 For instance, Ivo Duchacek states that local governments deal primarily with what herefers to as the ‘territorial daily bread’ (1990: 2). Other contributors to this volumeexpressed the same opinion. See Soldatos (1990: 37); Ravenhill (1990: 102); and Fry(1990a: 289).

11 Ebashi Takashi (1997a: 173) argues that in an era of internationalisation there are stillfunctions a state can perform such as border management, defence, internal securityand policing. See also Takayanagi (1997: 307–27); and Nagao (1997: 286–306).

12 It should be noted that some scholars object to the perceived inferiority implicit in theterm paradiplomacy. John Kincaid has employed the term ‘constituent diplomacy’,which is a neutral descriptor and avoids the implication that the activities ofconstituent governments are necessarily inferior to the ‘high politics’ of nation-statediplomacy (1990: 74).

13 Governor Sumita thought that the Japanese Ministry of Education, Culture, Sports,Science and Technology’s adoption of a history text for use in junior high schools, thatglossed over past Japanese acts of aggression against Korea, also contributed to NorthKyongsang’s decision to recall its official from Shimane.

14 Daniel Latouche supports the claim made by the Feldmans, arguing that theintensification in transnational relations across the US–Canada border has led to anintensification in the level of subnational government interactions and a renewedinterest by the two central governments in rearranging their global relations on a state-to-state basis (1998: 32).

15 Weigel also argues that in the case of German–Israeli relations, local contactssmoothed the way for ‘real’ foreign policy.

16 Shut™ Nobuhiko also observes how local governments can act as a forum to establishinformal channels for peace negotiations and confidence-building measures (1995:53).

17 Taga Hidetoshi, a noted scholar of Northeast Asian regionalism, remarked that duringthe Cold War, these regions had their backs turned on each other and that the only thingthey had pointing at each other was military radar (1992: 23).

18 Purnendra Jain notes that local taxes, in fact, comprise 35 per cent of subnationalgovernments’ total revenue. If one also considers that the Local Allocation Tax, whichis transferred automatically from national to subnational governments, constitutesanother 22 per cent of subnational government revenue, more than half of subnationalrevenue has no direct strings attached to the central government (2005: 45).

19 This insight was gained from responses to questionnaires sent to Japanese subnationalgovernments that maintain sister-city ties with Russian localities.

1 Tokyo, Moscow and the disputed islands

1 Hokkaido University Professor, Yamaguchi Jir™, claims that if the four islands werereturned to Japan, the economic burden to Hokkaido would be substantial. He alsoquestions who is going to pay for the subsequent infrastructure costs (1997).

2 Tsuyoshi Hasegawa also argues that because of the overriding importance Japaneseconservative leaders placed on the US–Japan security alliance, it was advantageous tokeep the Northern Territories dispute unresolved (1994: 336).

3 For an overview of the Japanese argument, see William Nimmo (1994: 173–4). 4 Although the argument put forward by Welch is a generalisation, it is applicable to the

Japanese case. 5 According to a Yomiuri shinbun survey conducted in October 2001, a plurality of

respondents (43 per cent) were in favour of the simultaneous return of the four islandsand 15 per cent supported the ‘two-islands first’ approach. Over half of the respondentsaged 60 and above supported the simultaneous return of the four islands and 35 per

Notes 179

cent of those in their twenties and thirties were predisposed towards it (31 October2001: 14).

6 According to sources in the MOFA, the ‘two-islands first’ approach consists of fourelements: (1) seek from Russia confirmation of the 1956 Joint Declaration; (2) confirmthat Habomai and Shikotan belong to Japan, but recognise Russian administrativerights (shiseiken) for the time being. This is to be followed by the signing of anintermediate treaty that confirms the return of these rights to Japan; (3) continuenegotiations over Etorofu and Kunashiri; and (4) conclude a peace treaty after theislands’ ownership is decided (Yomiuri shinbun, 8 September 2000: 2).

7 There were believed to be opposing factions within the ministry that were divided overwhether to support the existing policy (dakiha) or change it (renkeiha) (Hasegawa H.2001: 15).

8 The islands to the north of Etorofu were under the direct control of the Nemurosubprefectural office.

9 From 1969, the Ministry of Home Affairs included the four islands in Hokkaido’sadministrative structure when formulating regional transfers (Hokkaid™ shinbun,29 August 1968: 1).

10 The population breakdown of the four islands was as follows: Kunashiri – 7,364,Habomai – 5,381, Etorofu – 3,608, Shikotan – 1,038 (Hokkaid™ S™mubu Hopp™Ry™do Taisaku Honbu 1999: 1).

11 This paragraph draws on information contained in the HPG’s homepage,http://www.pref.hokkaido.jp/soumu/sm-hrtsk/hp/histo.htm (accessed 8 June 2002).

12 This goal is explicitly stated in the HPG’s homepage. 13 See the HPG’s homepage, http://www.pref.hokkaido.jp/soumu/sm-hrtsk/hp/policy/

htm (accessed 8 June 2002).14 This is not to deny, however, that the question of a possible linkage between the

Northern Territories and Japanese participation in Siberian resource developmentprojects did emerge as an important issue of strategy in Japanese diplomacy in theearly 1970s. See Curtis (1977: 163, italics added).

15 For instance, in a survey of Hokkaido residents, only 20.2 per cent supported seikeifukabun, while over 38 per cent believed that the territorial dispute and economiccooperation should be dealt with at the same time and 36 per cent thought economiccooperation should be conducted separately from the territorial dispute (Hokkaid™shinbun, 3 January 1993: 1).

16 The Soviet Union long maintained that the development of bilateral relations ineconomic and other fields would create a favourable environment eventually leadingto a resolution of the territorial dispute (exit approach), while the Japanese adopted theopposite position, maintaining that a return of the Northern Territories would pave theway for economic aid and cooperation (entrance approach).

17 Saito (1993: 285) claims that Japan did not officially proclaim the abandonment of itsinseparability of politics and economics policy towards Moscow. Concerning the shiftin policy from inseparability of politics and economics to expanded equilibrium,Togawa (1993: 3) argues that it appears to be only a glossing over of terms.

18 The argument that Etorofu and Kunashiri are not part of the Kuril archipelago(Chishima rett™) appears in successive editions of Warera no Hopp™ Ry™do, which ispublished by the MOFA.

19 Some Russian observers are cognisant of this. For instance, Andrey Makarychev,Assistant Professor of Political Science at Nizhny Novgorod University, has noted that‘Japan’s widely discussed intention to offer financial compensation to the Kurilpopulation for yielding the islands to Japan is also an indicator of a clear regional tiltin Tokyo’s policy with regard to Russia’ (1999: 519).

20 According to the agreement, in the first year of its implementation, 45 Japanese fishingvessels can operate in the northern waters to the south of Kunashiri and Etorofu and in

180 Notes

the southern waters off Habomai and Shikotan. They are permitted to catch 1,071 tonsof Alaskan pollack, 740 tons of mackerel and 136 tons of squid. In accordance with theJapanese government’s position of avoiding any action that may be deemed aslegitimising Russia’s occupation of the islands, Japanese fishermen, in return,contribute 20 million yen for resource protection in the disputed waters. The HokkaidoFisheries Association will also contribute machinery to the value of 15 million yen.There is some dissatisfaction with the agreement, as Japanese fishermen are notpermitted to catch crab or shrimp. There is also the possibility that Japanese fishermenwho catch marine products not contained in the agreement may be captured by theRussian Border Guard.

21 The ‘Hashimoto–Yeltsin Plan’ covers six priority measures: protecting Japaneseinvestment in Russia; promoting the integration of Russia into the world economy;upgrading aid for Russian economic reforms; training Russian managers;strengthening dialogue on bilateral energy talks; and cooperating in promoting thepeaceful use of nuclear energy.

22 Hakamada Shigeki believes that since 1997 Russo-Japanese relations have gonethrough three stages: illusion, disillusionment and reality, which mirror perceivedprogress in territorial negotiations. Interview with the author, 29 June 2000.

23 According to one Russian scholar, the Russian foreign policy community considersJapan to be a part of the West, not of Asia (V. Gaidar 1992 cited in Miller 1995: 141).

24 The two countries’ leaders were supposed to sign the compendium during Yeltsin’splanned visit to Tokyo in September 1992. The two governments decided to release iteven though Yeltsin cancelled the visit. See Kimura (2000b: 168).

25 Richard deVillafranca suggests that the bilateral agreement to publish the historicalrecords jointly may have been a Pyrrhic victory for return advocates, contributing to agrowth of anxiety among nationalist parliamentarians in Russia regarding the MID’smanagement of relations with Japan (1993: 621).

26 Nakano Junz™ (1995: 67) notes that the shift to Eurasianism did not necessarily meanthat Russia had adopted an anti-Western foreign policy.

27 For instance, Igor Latyshev, a historian, wrote an inflammatory book, referring toKozyrev and Kunadze (along with Konstantin Sarkisov) as the ‘pro-Japan lobby’ inMoscow and accusing them of ‘undermining and slandering the patriotic movement indefence of the Kuril Islands, which comprises a wide-stratum of the Russianpopulation and especially the inhabitants of the Far East’ (1992: 209). The book wasreportedly sent to Yeltsin ahead of his scheduled visit to Japan in September 1992.

28 According to Japanese Ambassador to Russia from June 1990 to January 1994,Edamura Sumio, the MID desperately needed such a directive and often went toextreme measures such as writing through the press under the pseudonym ‘SergeiSmolensky’ in order to urge the President to make a political decision for an earlyresolution to the dispute. He further argues that the lack of communication between thePresident and the MID was a perennial problem throughout his tenure as ambassador.See Edamura (2000: 143–5).

29 Irina Kobrinskaya, a researcher at the Carnegie Endowment for International Peace,argues that ‘Russia is looking for strong new partners to maintain a balance of powerin the world. Russia is focusing its foreign policy on Asia to have room for manoeuvre’(Walker 1997: 11).

30 China surrendered to Russia first the Amur region in the Treaty of Aigun (1858) andthen the Ussuri region in the Treaty of Peking (1860).

Notes 181

2 Determinants of Russian and Japanese subnational diplomacyand the rise of the ‘Sakhalin factor’

1 According to Michael Stein, a unitary structure is one in which regional and local unitsare subordinate to central authority, whereas in a federal structure, the two authoritiesare in an approximate power balance (1968: 739).

2 Grahame Thompson draws a distinction between internationalisation andglobalisation, arguing that an internationalised world economy occurs when theprincipal entities remain national economies, or agents that continue to be tethered toa definite national territory, when there is a relative separation between domestic andinternational arenas, and when international processes, events and impacts arerefracted through essentially national frameworks and policies. On the other hand, ina globalised world economy, the principal entity is the globalised economy itself,which represents a new structure of disembedded economic relationships and is aneconomy that exists above and autonomously from national economic agents (1999:140).

3 These were Yuzhno-Sakhalinsk, Nevelsk, Kholmsk and Gornozabotsk (Hokkaid™shinbun, 6 December 1983: 22). Travel restrictions to Korsakov were partially lifted inearly 1988. A group of reporters from the Hokkaid™ shinbun travelled to the city inFebruary 1988. This was the first postwar visit to the city by citizens of a countryoutside the Eastern Bloc (Hokkaid™ shinbun, 16 April 1988: 1).

4 For economic planning purposes, Siberia was divided into three economic regions:Western Siberia, Eastern Siberia and the Far East.

5 According to Scalapino, natural economic territories ‘tak[e] advantage of geographicproximity, combine resources, manpower, capital and management to optimaladvantage for the parties concerned. They cut across political boundaries, but ofteninclude only portions of states’ (1997: xvi).

6 Widespread dissatisfaction with Yegor Gaidar’s radical economic reforms led to hisremoval from office in December 1992. The more conservative Victor Chernomyrdinreplaced him in January 1993.

7 According to the agency charged with implementing the plan, 48 production and socialinfrastructure projects had commenced and over 30 were functioning by early 2000(Saharin to Nihon, no. 194, 19 July 2000: 7–9).

8 As Sakhalin is not connected to the national power grid it cannot receive electricityfrom those regions that generate a surplus.

9 After an initial decline, industrial production began to rise gradually before stagnatingas a result of the 1998 Russian financial crisis.

10 Philip Hanson describes Sakhalin, as well as the entire Far Eastern macro-region, as a‘food-deficit region’ where in four out of five product groups (grain, potatoes, greenvegetables, meat and dairy products) its per capita output was below the all-Russianaverage (2000: 9–10).

11 Hokkaido’s share of Japanese domestic production fell to just under 4 per cent in 1998(JETRO Hokkaido 2000).

12 Duchacek further refers to the Soviet federation as a ‘Potemkine confederal facadesuperimposed on a tightly controlled monolithic centralism’.

13 It should be noted that although Russia is a multi-ethnic federation, it is morehomogenous than the former USSR. The titular peoples were a majority in only eightof Russia’s 31 autonomous areas, and Russians were a majority in 18. Moreover, theseareas constituted over half the territory of the RSFSR, but only some 15 per cent of thepopulation resided there. See Walker (1992: 4–8).

14 Krais, oblasts, autonomous oblasts and okrugs are collectively referred to as regionsin the Russian political discourse.

15 Political considerations are believed to lie behind the decision to allow the regions toelect their own governors. As Martin Nicholson notes, in order to secure the type of

182 Notes

Federation Council that he wanted, Yeltsin was compelled to agree at the end of 1995to the popular election of governors, where it had not already taken place. He hadwanted the regions to be represented in the council by their executive and legislativeleaders ex officio. This was opposed by the Duma because it would have meant thathalf of the council’s members would be Yeltsin appointees. As a compromise, it wasagreed that the council should comprise the heads of the two branches of power exofficio, but that the leaders of the regional executives should first have been electedlocally, as those of the legislatures already were (1999: 38).

16 Sakhalin appears to be an exception, receiving more subsidies in 1993 than any otherregion in the Russian Far East.

17 Moscow’s preparedness to negotiate further agreements with the regions is alsoreflected in Article 78 of the Constitution which allows the executive organs of thefederal government, by mutual agreement, to delegate some of their powers to theregions and republics, and likewise permits the executive organs of the regions andrepublics to delegate dome of their powers to the federal government.

18 A law drafted on the initiative of a number of State Duma deputies demarcating thepowers of the federal government and the regions and also regulating the procedure formaintenance of foreign relations by the regions was adopted by the Duma. However,it was delayed in the Federation Council and, as a result, work was completed on it bya conciliation commission.

19 Others such as Tomino Kiichir™ are more circumspect regarding the 1995 Guidelines,arguing that they severely limit the international activities of subnational governmentsto international exchange (1997: 33).

20 The association’s name has changed several times, the latest being the Far East andLake Baikal Interregional Association for Economic Cooperation. See Valliant (1997:15) and Troyakova (2001: 53).

21 In academic circles Arai Nobuo argues that ‘Russo-Japanese peace treaty negotiationsthat have been formed and based on the assumption of the Russian federal governmentas the sole concerned party and Japanese domestic public opinion regarding this ispressed to pay greater attention to the “Sakhalin factor”’ (2000: 51). Similarly,Duckjoon Chang states that ‘the positions of provincial leaders may have substantialramifications for the territorial issue. In so far as the independent minded provincialleaders insist on their own administrative rights over the disputed islands, bilateralrelations between Japan and Russia may face an impasse which would be difficult toovercome’ (1998: 182).

3 Hokkaido–Sakhalin transnational relations

1 See Yokomichi’s comments in the introductory chapter. Also, during a session of theregional assembly in September 2000, Governor Hori, in response to a question aboutHokkaido’s role in exchange with Russia, declared ‘I recognise it is necessary tocontribute at the regional level to the advancement of political discussions between theJapanese and Russian governments, and have frank discussions with Sakhalin andresolutely carry out our own substantial exchange, while especially keeping in mindthe Northern Territories problem’ (Minshut™ Hokkaid™ 20 September–14 October2000).

2 According to the ‘Sakhalin oblast law regarding referenda’ adopted by the SakhalinDuma on 31 January 1996, there are three ways to propose a referendum. First, if morethan one-third of oblast Duma members propose a referendum and more than two-thirds second the motion; second, if the governor makes a proposal to the oblast Dumaand two-thirds of its members agree; and third, if a civic group consisting of more than50 people collects more than 10,000 signatures of eligible voters, but at a minimum,more than 2,000 must be collected from residents of Yuzhno–Sakhalinsk. For a

Notes 183

referendum to be valid, more than 50 per cent of eligible voters in the oblast must voteand the result is decided by a simple majority. The referendum’s result binds allresidents and does not require the approval of any state organ. The decision cannot beamended without conducting another referendum and cannot be invalidated(Nakamura 1998: 290).

3 In fact, the idea for a symposium can be said to date back to April 1985, followingYokomichi’s visit to the Soviet Union at the invitation of the RSFSR government. In apress conference after his return Yokomichi spoke of his failure to reach an agreementon the Northern Territories problem and the necessity of holding a forum to discussmatters and for extensive exchange (Hokkaid™ shinbun, 28 April 1985: 2).

4 In addition to alleviating tension in the border zone, for leftist forces in Hokkaido, eliteexchanges also appear to have been politically coloured. For instance, in October1967, a delegation comprising municipal officials, chamber of commerce and labourgroups from Sapporo, Otaru, Asahikawa and Nemuro visited Sakhalin to celebrate thefiftieth anniversary of the Bolshevik Revolution (Hokkaid™ shinbun evening,14 November 1967: 7). A delegation headed by the First Secretary of the SakhalinCommunist Party, P. Leonov, visited Hokkaido for the twenty-fifth anniversary of theestablishment of the JSP in Hokkaido and again in 1972, at the invitation of theHokkaido branch of the JSP and the mayor of Muroran, to attend the Sapporo WinterOlympics (Hokkaid™ shinbun, 5 December 1970: 5; Hokkaid™ shinbun, 18 January1972: 2).

5 Despite this reputation, Yokomichi was clear and upfront regarding the territorialdispute and believed that raising the issue, in otherwise friendly discussions with theSoviets, was a matter of course for a Hokkaido governor. For more on the use ofacademic and business elites as ‘pipes’ in Japan–Soviet relations, see Rozman (1992:36–8).

6 A HPA delegation also visited Sakhalin in August 1992. The delegation’s primary aimwas to promote friendly relations with the oblast soviet, but it also focused on theNorthern Territories problem, probing the opinion of local residents on the territorialdispute. See Hokkaid™ Gikai (1992).

7 For the Ainu, the Northern Territories problem between Japan and Russia is consideredto be a dispute between thieves. The Utari Association, the peak representative bodyof the Ainu, has been outspoken in its criticism not only of Russian but also ofJapanese territorial claims. Paradoxically, Japan’s historical claims to the islandsderive in part from the initial Ainu settlement of the islands. It can be surmised thatFedorov offered an invitation to the Ainu representatives in order to check Japan’sclaims and create a disturbance in the Japanese camp. In this regard, the Ainurepresentatives lived up to Fedorov’s expectations, arguing during the dialogue that theJapanese did not listen to them nor invite them to territorial negotiations. See Bugaev(1992: 1).

8 At a Japan/Soviet Union–Hokkaido Friendship Conference in March 1984, theJapanese MOFA told the Japanese side not to forget to explain Japan’s positionregarding the Northern Territories. Deputy Chairman of the HPA, Ikejima Nobuyoshi,obliged by declaring ‘there are unresolved problems remaining like the NorthernTerritories problem, but by Hokkaido and the Soviet Far Eastern regions holdinghands, we want to achieve mutual development and contribute to world peace’. TheSoviets opposed Hokkaido’s efforts to mention the territorial dispute in the jointdeclaration. After reaching a compromise on the issue, both sides agreed to makeefforts to bridge the difference of opinion regarding the territorial dispute (Hokkaid™shinbun, 1 April 1984: 3; Hokkaid™ shinbun, 20 April 1984: 2).

9 However, Sakhalin residents raised some objections to the contents of a pamphlet onthe Northern Territories that the Japanese brought into the hall (Hokkaid™ shinbun, 13June 1992: 1).

184 Notes

10 Svobodnyi Sakhalin reported that although there was a change in the speakers, theessence of the speeches remained the same: ‘these islands are ours’ (Bugaev 1992: 1).

11 Minagawa also suggested that Fedorov may have deliberately chosen speakers whohad opinions at variance with those of the Japanese. However, the same charge couldalso be levelled at the Hokkaido delegation for excluding Ainu representatives fromtheir selection of speakers.

12 Soviet–Japan relations were in turn heavily influenced by the vagaries of US–Sovietrelations. Since the inception of the practice in 1964, grave visits were allowed in 1968and from 1971 to 1973. No visits took place between 1976 and 1985 – a particularlytense period in bilateral relations – but they recommenced in 1986, a year afterGorbachev’s rise to power.

13 Instead of a passport and visa, Japanese travellers are given identification papersissued by the Japanese Ministry of Foreign Affairs and a slip of paper by the RussianEmbassy certifying the person as a regular traveller as agreed to by both countries.Russians go through a similar procedure when visiting Japan (Asahi shinbun, 23 April1992: 1).

14 Arai and Hasegawa also point out that this protest session has become a contest amongForeign Ministry officials, although these protests no longer have teeth, degeneratinginto mere formality.

15 The local press in Sakhalin has also alleged that Japanese delegations visiting theSouth Kurils gave the Russian islanders materials outlining Japan’s historical and legalclaims to the islands. See Golovnin (8 November 1996: 2).

16 These are: (1) Do not make statements that are premised on the fact that the NorthernTerritories are Russian territory. (2) Do not encourage or propose economic exchangeand individual cooperation. (3) Do not make any statements that contradict thegovernment’s four-island policy. (4) Do not make any statements indicating you havegiven up on an early resolution of the Northern Territories problem. (5) Do not makeunsubstantiated or emotional statements. (6) The Northern Territories are Japaneseterritory. Therefore, in statements and accounts concerning the Northern Territoriesand the Russians living there, avoid expressions that suggest the Northern Territoriesare Russian territory, eg. Do not call the area between Cape Nosappu and the NorthernTerritories ‘the border’ and when travelling to and from the islands, do not say‘entering a country’ or ‘returning to my country’. When arriving, use the expression‘entering the area (not country)’ and when departing, ‘leaving the area’ (cited in Kotani2000: 152–4).

17 In October 1991, the Kuril District Soviet on Etorofu also sought to hinder the visa-less exchange programme when, in a blatant display of chauvinistic nationalism, itadopted a ‘Japan Exclusion Resolution’ in which local authorities claimed they wouldnot be responsible for the safety of any Japanese who visited the island under theprogramme (Hokkaid™ shinbun, 18 October 1991: 3).

18 Moreover, the financial burden imposed on the Russian islanders who participate inthe programme is substantial. Calculating the cost of the entire programme iscomplicated, but a simple itinerary for a recent trip cost $1,680 per person for twobusloads of Russians – for most, this is the equivalent of several months’ wages. As aresult, rather than all of the islanders participating in the programme, the ‘wealthier’ones are making repeat visits (The Sakhalin Times, 22 November – 6 December 2001).

19 Otaru concluded an agreement with Nakhodka (Primorskii krai) in September 1966and Rumoi one with Ulan Ude (Buryat Republic) in July 1972 (Ichioka 2000: 10).

20 The term kanpai gaik™ or ‘cheers diplomacy’ was coined by Shut™ Nobuhiko (1995:53).

21 According to Ichioka Masao, former head of the Niigata municipal government’sInternational Exchange Division, who was active in the development of Niigata’srelations with the Russian Far East, most of the time spent in the Japan–Russia coastal

Notes 185

mayors’ meeting was taken up with how to deal with the Northern Territories problem– more specifically, how to put the issue into a joint declaration without damaging eachparty’s claim to the islands. Ichioka communicated this to Arai Nobuo who revealedthe information to the author during a discussion in Yuzhno–Sakhalinsk, 22 August2001.

22 It should also be noted that there were some in Hokkaido who feared that the exportof raw material processing technology would lead to a loss of local jobs, given theimportance of marine and timber resources for the Hokkaido economy.

23 Cooperative trade was conducted between various cooperatives or small-medium sizedcorporations in Japan and the Soviet Trade Corporation (Soyuzkoopvneshtorg) in theforeign trade section of the Soviet Cooperative Central Union (Tsentrsoyuz) (Edmonds1983: 216).

24 The Japanese side also promised to make efforts to remove the restrictions on Russianplanes using Hokkaido’s Chitose airport that were put in place because of its locationnext to a Japanese air base.

25 For instance, during periodic talks in May 1998, both sides verbally agreed to establisha consultative mechanism for ‘safe’ fishing by Japanese vessels in the islands’ fisheriesand to expand the visa-less exchange framework, but the written record of the talksgave no concrete details of this discussion. It is believed the details were left out in consideration of Tokyo’s position on these issues (Hokkaid™ shinbun, 30 May 1998: 4).

26 The Agreement was not only intended to fulfil economic objectives. An official fromthe HPG claimed that Sakhalin’s opposition to a territorial return was a political carddesigned to attract economic aid from Japan. The Agreement was therefore one of thepolicies intended to weaken Sakhalin’s emotions (Hokkaid™ shinbun, 8 November1998: 1).

27 An article in the Hokkaid™ shinbun also suggested that Governor Hori was seeking touse the Agreement to increase his popularity ahead of upcoming gubernatorialelections (26 August 1998: 4).

28 The HPG was also able to skirt adroitly a potential conflict with Sakhalin authoritiesby shading in a map of Hokkaido, Sakhalin and the Kuril Islands in the same colour ina pamphlet commemorating the first anniversary of the signing of the 1998 agreement.This discursive practice damaged neither country’s position on the territorial dispute(Hokkaid™ S™mubu Chijishitsu Roshiaka Kokusaika date unknown [a]).

29 This was revealed in information supplied to the author (in the form of interviews andquestionnaire responses) by Japanese local governments that participate in exchangeswith their Russian counterparts.

30 According to responses to questionnaires the author sent in May and June 2000 tomunicipal authorities in Hokkaido maintaining sister-city relations with localgovernments in Sakhalin, three have received an official notice (tsuø tatsu) from theMOFA in the past. In October 1990, Kushiro officials were told to follow the MOFA-designated route when travelling by sea to Sakhalin. Monbetsu authorities have alsoreceived instructions pertaining to travel routes. Municipal authorities in Asahikawahave received advice regarding the complex procedure for inviting Russian citizens toJapan.

4 The Sakhalin political elite and the South Kuril Islands

1 David Lane and Cameron Ross define political elites as those holding high positionsin three different sectors: 1. the parliamentary elite of the Federation Council; 2. thegovernment elite; and 3. the regional elite. Regional elites include heads of regionaland republican administrations, legislative chairs and presidential representatives(1998: 35). This chapter focuses on Sakhalin’s post-communist governors. However,

186 Notes

as their positions on the South Kuril Islands have often been influenced by theirpolitical opponents, the analysis will also include these other elites.

2 It is worth noting that Fedorov’s economic views were not as radical as many were ledto believe. He was a vocal critic of the early economic ‘shock therapy’ programmelaunched by the Gaidar-led Russian government. He instead called for a social marketeconomy and more gradual reforms.

3 Fedorov was at best ambivalent toward the idea of establishing a free trade zoneincorporating Sakhalin and the Kurils (at least with foreign involvement), soon arguingthat with the weakened state of the Soviet economy, an unrestricted influx of foreigncapital and labourers would transform Soviet territory into a foreign colony withirreversible consequences. He instead called for development to be oriented towarddomestic possibilities. See Fedorov (1991: 13).

4 Bondarchuk was the successor to long-standing local Party chief, Petr Tretyakov, whowas forced to step down in the face of unprecedented, large-scale street demonstrationsfollowing corruption charges in May 1988.

5 Putin later appointed Gulii Deputy Presidential Representative for the Far East in May2000. Some in Japan saw the appointment of Gulii, known for his flexible approachtoward the territorial problem, as an expression of the importance Putin places onrelations with Japan and also as a counter to the hardline approach to the problemexhibited by the Sakhalin regional administration (Hokkaid™ shinbun, 20 September2000: 8).

6 The existence of this plan was announced by the chief or Ataman of the Far EasternCossacks, Vladimir Starkov, who declared ‘only Cossacks have rights to the KurilIslands. In the near future Cossacks are scheduled to settle on these islands. Cossacksare prepared to defend the border of this region’ (cited in Ueda 2000: 283).

7 According to the Ataman of the Sakhalin Cossacks, Oleg Gusev, a Cossack communityor stanitsa has been established on Iturup and Kunashir. The Cossack elder for theislands headed an ‘energy association’ which planned to develop geothermal energy tosatisfy all of Kunashiri’s needs by 1995. A Cossack firm also intended to opentransport links with the South Kuril Islands (Quinn-Judge 1992b: 46–8).

8 Although registered in Hong Kong, Carlson-Kaplan turned out to be a paper companyrun by a Japanese citizen with a Taiwanese father.

9 This was revealed in an interview with the Japanese translator of his book Silaekonomika. See Fedorov (1995: 279).

10 Fedorov’s statements prior to Yeltsin’s proposed visit to Japan echoed calls made inSeptember the previous year when he warned that if the decision was made to returnthe isles, ‘we will build a base of stubborn resistance’ (Hokkaid™ shinbun, 25September 1991: 3).

11 The Deputy Speaker of the krai soviet was opposed to the original draft claiming it didnot reflect the position of the Russian leadership. The draft composed by Fedorov andother Sakhalin delegates became the basis of the declaration (Hokkaid™ shinbun, 22October 1991: 7).

12 Aksenov had even warned that there would be riots if the islands were returned. 13 Democratic forces in Sakhalin who helped Fedorov come to power claimed they had

been deceived by a ‘political adventurer straight out of the pages of Russian fiction’(Quinn-Judge 1992a: 16).

14 Fedorov joined the party after he left Sakhalin and became a Deputy Minister ofEconomics in the Russian government.

15 It must be pointed out that according to Russian electoral laws, candidates need toobtain more than 50 per cent of the vote to be elected to the Russian Congress ofPeople’s Deputies. Zinberg gives Fedorov’s total vote in the run-off as being only47.78 per cent, which is just short of an absolute majority. If Zinberg’s figures arecorrect, Fedorov’s election to the Congress represents an exception to Russian

Notes 187

electoral laws. Fedorov’s seat in the Congress can be confirmed by examining anofficial list of RSFSR People’s Deputies. (See Verkhovnyi Sovet/RSFSR 1991: 97).

16 Fedorov returned to Moscow, and confirming speculation that he sought higherpositions in the central government, served a brief stint as a Deputy Minister ofEconomics until 1994. He then became Vice President of the Russian Union ofIndustrialists and Employers and then returned to Sakha, becoming Prime Ministerwhere he continued to be a headache for central officials, calling for a picket ofgovernment buildings in Moscow to protest an economic blockade against theRepublic in 1997.

17 Nazdratenko stated that such a move would also serve to strengthen Russia’s positionin the Asia-Pacific region (Vinogradov 1994: 1).

18 The former head of the Russian secret service, Sergei Stepashin, mentioned thepossibility of an administrative merger of Sakhalin oblast and the Kuril Islands withPrimorskii krai at a meeting with entrepreneurs in Nakhodka in June 1994 (cited inKirkow 1995: 934)

19 Karasin reportedly described the project as lacking ‘a single trace of rationality’. 20 The Sakhalin administration also organised a symposium in Yuzhno-Sakhalinsk in

December 1997 to commemorate the 300th anniversary of the Russian discovery ofthe Kurils. Various local social, academic and economic groups participated in thesymposium which stressed the islands are Russian and that borders are inviolable(Svobodnyi Sakhalin, 18 December 1997: 3).

21 As of 2006, the Russian government had yet to lodge the registration with UNESCO. 22 The Sakhalin Duma also lodged complaints with South Korea’s Ambassador to Russia

after Korean-made maps of the Far East depicted the islands of Etorofu and Kunashirias Japanese territory (The Sakhalin Times, no. 13, 22 November 2001).

23 In February 1999, the district’s generators ran out of oil. Sakhalin authorities arrangedfor a tanker from Vladivostok to carry 230 tonnes of crude oil. As it would take overfour days for the supplies to arrive, South Kuril authorities appealed to the Russian,Japanese and Hokkaido governments for oil in the interim (Hokkaid™ shinbun, 17February 1999: 3).

24 Tsuyoshi Hasegawa offers a contrasting viewpoint, arguing that ‘It was not thatGorbachev could not accept a compromise solution during his visit to Japan becauseof the domestic pressure, as is often believed, but that Gorbachev himself was themajor stumbling block to such a compromise’ (date unknown).

25 Despite his running for parliament, Farkhutdinov did not seriously contemplate givingup the governorship to take up a seat, which he would have been compelled to do, inthe case he won. If victorious, Farkhutdinov declared he would pass on the seat to thenext candidate (Gubernskie vedomosti, 15 September 1999: 1).

26 The ‘party of power’ was a political party that had the tacit support of the RussianPresident.

27 The Governor of Khabarovsk krai, Viktor Ishaev, and the Presidents of Tartarstan andBashkortostan were also members of the official party.

28 During the same trip Yastrzhembsky visited the island of Kunashiri where he declaredthat ‘nobody is going to do anything behind the back of Sakhaliners’ (Kyodo, 21 April1998).

29 Prior to the Mori–Putin summit in September 2000, Suzuki Muneo also visitedSakhalin in an attempt to appease local sentiments (Fujimori and Tsuno 2000: 1).

5 Sakhalin public opinion and the South Kuril Islands

1 Although the ultimate objective differed, there is a similarity in the rationale behindUS cultural exchanges with the Soviet Union during the Cold War. Yale Richmondnotes that an unstated objective of these exchanges for the US was the hope that

188 Notes

‘opening up the Soviet Union to Western influences would create pressures fromwithin for reforms which might make the Soviet Union more likely to cooperate with,rather than confront, the West’ (Richmond 1987: 8).

2 It is worth noting that feelings of trust and friendship are also known to exist at theelite level. During a reception for the visiting Russian President in September 2000,Japanese Prime Minister Mori Yoshir™, introduced Governors Hori and Farkhutdinovto Putin as ‘Governors who are the closest of friends in this arena’ (Hokkaid™ shinbun,5 September 2000: 3).

3 Only 3 per cent of Russians from the mainland and 5 per cent on the three inhabitedSouth Kuril Islands favoured a ‘simultaneous return of four islands’ as a means ofresolving the dispute. Another survey of Yuzhno-Sakhalinsk residents conducted inearly 1998 revealed that 84 per cent of respondents believed the islands were an‘inalienable part of Russia’ (neot'emlemoi chast'yu Rossii). Moreover, in a vote onwhat would be the likely outcome if the Russian government decided to hand over theislands to Japan, 81.1 per cent of respondents said they would demand retraction of thisand the President’s immediate resignation; 78.6 per cent claimed they would condemnthe decision and even possibly launch a protest action; and 17.8 per cent were preparedto commit extreme acts, including taking up arms to defend the Kuril Islands. SeeBorovskoi (1998: 1).

4 A survey by the Russian Fund revealed that opponents of a handover of the islandsnumbered more than 70 per cent (Sovetskii Sakhalin, 7 August 2001: 1). In addition, asurvey of Sakhalin State University students revealed that an overwhelming majoritythought the most acceptable way of resolving the territorial dispute was by putting theislands under Russian jurisdiction. The only difference of opinion was regardingJapanese economic involvement in the disputed islands; 47.1 per cent supported the‘status quo’ and 43.1 per cent were in favour of ‘joint economic activities, but underRussian jurisdiction’. A total of 84.9 per cent of respondents ‘absolutely could notagree with handing the islands over to Japan’ and more than 60 per cent replied that ifJapan challenged and threatened Russia’s sovereignty, they were prepared toparticipate in demonstrations (cited in Saharin to Nihon, no. 228: 2–3).

5 For instance, a survey of the four islands conducted by the Sakhalin oblast CommunistParty Committee in March 1990 revealed that 88 per cent were against Russiareturning the islands to Japan (cited in Fujimori 2001: 7).

6 Moreover, on 17 March 1991, in conjunction with the Soviet referendum onmaintaining the Union, the Sakhalin regional government conducted a large-scalesurvey of oblast residents. A total of 12,000 South Kuril residents were reportedlysurveyed (90 per cent turnout), and overwhelmingly opposed handing over the islandsto Japan. A Japanese MOFA official was sceptical about the results, claiming that thequestions were worded so as to induce a negative response (Hokkaid™ shinbunevening, 18 March 1991: 4).

7 This book was also translated into Japanese under the title of Hopp™ Yont™ henkan nosusume: zaijuø Roshia j‰narisuto no teigen (Recommending the Return of the FourNorthern Islands: A Proposal by a Russian-based Journalist, 1994).

8 It should be noted, however, that in another article Kimura recognises these inter-island differences (2001: 11).

9 Also, according to a Vox Populi survey of 300 residents of the South Kuril Islands(1,800 and 300 people on the mainland and Sakhalin, respectively), 65 per cent onEtorofu, 44 per cent on Kunashiri and 28 per cent on Shikotan were opposed to atransfer of the islands to Japan (cited in FBIS/SOV, 98/30, 30 October 1998). A surveyconducted in Shikotan in April 1992 revealed that 83 per cent of respondents voicedsupport for a transfer of Habomai and Shikotan to Japan. This was in contrast to only30 per cent the previous year (Yomiuri shinbun, 27 April 1993: 5).

Notes 189

10 However, it does say that the Japanese government organised an expedition to surveyHokkaido, the Kurils and Sakhalin in 1785, which could suggest prior knowledge ofthe area.

11 For instance, ‘Posle zaversheniya posvobozhdeniya samykh krupnykhyuzhnokuril'skikh ostrovov’; ‘Operatsiya po osvobozhdeniyu yuzhnoi chastiKuril'skikh ostrovov’ and ‘v boyakh za osvobozhdenie Yuzhnogo Sakhalina iKuril'skikh ostrovov’.

12 William Nimmo notes that the 1925 treaty establishing diplomatic relations betweenJapan and the Soviet Union, although nullifying all tsarist Russia treaties except the1905 Portsmouth Treaty, was silent on the issue of Japan’s ownership of the KurilIslands. Because Japan had legal possession of the islands in 1925, the Soviet Union –by remaining silent on the matter – gave de facto recognition to Japan’s title to theterritory (1994: 173–4).

13 Hiroshi Kimura has noted that ‘The quickest way for Russians to overcome theiridentity crisis is to resort to nationalism’, which is ‘overly concerned with preservingnational prestige and protecting territorial integrity, resulting in a tendency towardxenophobia’ (2001: 11).

14 It will be recalled from the previous chapter that Farkhutdinov also deemed itnecessary to mention the islands in the lead-up to gubernatorial elections in 1996.

15 These settlements are Leonidovo, Smirnykh, Buyukly, Tel’novskii, Chaplanovo,Nikolaichuk, Bolkovo and Simakovo (see Vysokov et al. 1995: 141–2).

16 Hiroshi Kimura argues that there was a political message behind President Putin’slaying of flowers at the Monument of Honour in the victory against Japan: ‘he wasattempting to impress upon the majority of the Japanese people the legitimacy of theformer Soviet Union’s participation in the war against Japan, as well as Russia’scurrent occupation of the Northern Territories’ (2001: 7).

17 Local authorities on Kunashiri did not recognise the question pertaining to the 1956Joint Declaration.

18 An official in the local administration on Shikotan said that if the power plant was notrepaired by November, residents would submit a proposal to the federal government tolease the islands to Japan. If the plant was repaired, the proposal would be withdrawn(Sovetskii Sakhalin, 29 October 1998: 1). Governor Farkhutdinov was critical of theproposal, calling it ‘an illusion of a country mayor’ and promised to resolve the issueby winter (Sovetskii Sakhalin, 3 November 1998: 1). Sakhalin’s First-Vice Governor,Vladimir Shapoval, called the campaign to lease the islands ‘irresponsible’ and furtheradded that these actions ‘will hardly contribute to funding sources for the Sakhalineconomy, as a whole, and for the Kuril Islands in particular’ (Vladivostok News, 30October 1998, no. 179).

19 Because of continuing after-shocks and problems with the electricity supply, peoplewere forced to camp in the open (Arai and Hasegawa 1997: 181).

20 Fedorov also reiterated that a majority were opposed to making any territorialconcessions to Japan.

21 Hiroshi Kimura notes that the majority of Shikotan’s inhabitants would rather see theirisland reunited with Japan because ‘Shikotan is geographically closest to Hokkaido,and because the residents would have been left without electricity had it not been forthe humanitarian aid provided by Japan when their seafood processing plant wasdestroyed in the 1994 earthquake’ (2001: 13).

22 The Russian newspaper Komsomol'skaya pravda featured an article claiming thatmany Russians from peripheral regions, as well as from Ukraine and Kazakhstan, weretravelling to Shikotan in the expectation that the island would be returned to Japan(cited in Hokkaid™ shinbun, 12 November 1998: 3).

190 Notes

6 Sakhalin’s commercial environment and local trade

1 In 2001, uniform taxes for small and medium-sized companies were established,reducing the number of taxes. However, taxes still vary depending on the industry andscale of the business venture.

2 The author is grateful to Dr. Bäckman for providing a transcript of this lecture. 3 See, for instance, Hokkaid™ shinbun, 23 November 1998 (cited in Saharin to Nihon,

no. 131, 3 December 1998: 1–2). 4 Farkhutdinov also stated that given Russia’s legal system, similar incidents could

occur again. 5 According to the former head of the Hokkaido representative office in Yuzhno-

Sakhalinsk, Yasuda Keiji, ‘the Russian side is fed up with the procession of inspectiondelegations from Japan, which results in “nothing happening” (nashino tsubute)’(Yokoi 1998: 4).

6 Interview with Tanabe Hirokazu from the Hokkaido representative office in Yuzhno-Sakhalinsk, 20 August 2001.

7 Until late 1993, Russian border guards had adopted a fairly moderate positionregarding Japanese fishers’ incursions into the disputed islands’ fisheries, simplyrecording such violations without detaining the boats and their crews. However, fromlate 1993, the number of Japanese fishing vessels operating in these waters increaseddramatically. In response, the Border Guard began shooting at suspected poachers andconfiscating their boats (see Arai and Hasegawa 1997: 180).

8 The Japanese Immigration Bureau issues special shore leave documents for the crewmembers of foreign aircraft and ships arriving in Japan who do not have visas and wishto disembark temporarily to shop or rest (Hokkaid™ Shinbun J™h™ Kenkyuøjo ed. 2001: 9).

9 Konstantin Sarkisov claimed that monies derived from this illicit trade flow to theState Committee for Fisheries in Moscow (discussion with the author, 24 June 2001).

10 There is said to be an ‘organisational fusion’ between criminal groups in Hokkaido andSakhalin (Belov date unknown: 2).

11 The Japanese mass media often encloses the words ‘violation of territorial waters’(ry™kai shinpan) and ‘illegal operations’ (fuh™ s™gy™) in inverted commas whendescribing these activities in order to emphasise that these views are strictly Russian.See, for instance, (Asahi shinbun, 28 November 1994: 2).

12 The customs posts were also established as a result of concerns from local fishersabout maintaining the freshness of their catches due to the legal requirement to unloadtheir product in distant Korsakov for inspection (Hokkaid™ shinbun, 27 May 1992: 3).

13 Regional lobbying led to a visit in August 2000 by the then head of the State FisheriesCommittee (Goskomrybolovstvo), Yurii Sinel’nik. While in Sakhalin, Sinel’nikannounced the federal government would make it obligatory for high-priced marineproducts such as crabs, scallops and sea urchins caught in Russia’s 200 mile EEZ to betaken to Russian ports for customs inspection before they could be exported.

14 However, in recent years there has been increasing cooperation between the JapanCoast Guard and Russian Border Guard.

15 After heading a delegation of oblast Duma members to Japan, the current head ofSakhalin’s Department of International Affairs and Foreign Economic Relations,Vladislav Lukavets, commented that the Japanese were beginning to cooperate withSakhalin as a result of the Japanese handing over a list of names of those Russian shipsdocking in Hokkaido’s ports and the fish being unloaded (cited in Saharin to Nihon,no. 185, 18 May 2000: 1).

16 In fact Hokkaido fishers have a long history of involvement in clandestine operations.During the Cold War, certain fishers operated boats that were referred to as goshuinsenor ‘honourable red seal boats’. These were named after vessels belonging to merchantsand other individuals who engaged in foreign trade during the late sixteenth and early

Notes 191

192 Notes

seventeenth centuries. They were obliged by Japanese authorities to purchase licences(red seals) in order to engage in trade. The modern-day goshuinsen would supplySoviet border guards with coveted consumer goods, whilst the operators of so-calledreposen (or ‘report boats’) would provide various pieces of information consideredimportant by Soviet security organs. Both did this in return for money and not beingcaptured by Border Guard patrols (Stephan 1974: 178).

17 The number of second-hand cars loaded onto Russian fishing vessels at seven ofHokkaido’s ports for ‘export’ exceeded 30,000 in 1993. From 1993–1997, this numberremained steady at about 20,000, but dropped to just under 8,000 after the Russianfinancial crisis in 1998. The numbers given here are conservative, as they do not takeinto account the shipment of stolen cars to Russia (Hokkaid™ Shinbun J™h™ Kenkyuøjoed. 2001: 8–9).

18 One remains sceptical over accusations of broad-based, institutional participation inthis commerce by members of Russia’s armed forces and security organs. Well-publicised campaigns and vented frustrations over the inability to eradicate marinecontraband suggest a concerted effort by at least some members to tackle this issue.Nevertheless, it would appear a significant, corrupt minority is seriously underminingsuch efforts.

19 Judith Thornton also highlights incidents of theft of catch and other forms of robberyinvolving individuals in the Border Guard (2001: 116).

20 There are longstanding doubts regarding the Russian military’s emphasis on the SouthKuril Islands’ strategic importance. For instance, one commentator revealed that theformer Soviet military’s opposition to transferring the disputed islands to Japan hadlittle to do with national defence, but rather the potential wealth derived from theabundant marine resources found in the islands’ fisheries (Hokkaid™ shinbun, 28 April1989: 1).

21 I am grateful to Vladimir and Ekaterina Gorshechnikov for providing me with a copyof this book.

Conclusion

1 A study by Filippov and Shvetsova highlights how bilateral bargaining in the RussianFederation was effectively instituted before Russia’s independence by the efforts ofUnion authorities during the Soviet Union’s last years (1999).

2 This is particularly the case in relatively decentralised federations such as Canada andGermany. See, for instance, Lehmbruch (2000) and McKay (2001).

3 Vitalii Elizar'ev emphasised that the Russian side was to blame because of itsunsatisfactory laws regulating this commerce (Interview, 23 August 2001).

4 It should be added that the findings of Risse-Kappen’s study suggest that differencesin domestic structures are in general more significant than variations in issue-areas.

5 The regional administration appointed Boris Agapov, a former Lieutenant General inthe KGB and Vice President of Ingushetia, as Sakhalin’s representative in theFederation Council in October 2005 following Goreglyad’s resignation.

6 Under the law, if regional legislators reject the president’s candidate twice, he cannominate someone else, appoint an acting governor or dissolve the legislature. If acandidate is rejected for a third time, the president has the authority to dissolve thelegislature without further consultation.

7 The major aim of Putin’s visit to Sakhalin was to discuss problems arising from theProduct-Sharing Agreement legislation for the oil and gas development projects. Inaddition to promising not to hand over the South Kuril Islands, Putin vowed to bringorder to the Far East maritime border (Svobodnyi Sakhalin, 7 September 2000: 3).

8 Malakhov was elected governor in November 2003 following Farkhutdinov’s death ina helicopter accident three months earlier.

AppendixHokkaido–Sakhalin sister-city agreements

Name of municipality Partner Date of Agreement(Japan)

Asahikawa Yuzhno-Sakhalinsk 10 November 1967Hakodate Yuzhno-Sakhalinsk 27 September 1997Kitami Poronaisk 13 August 1972Kushiro Kholmsk 27 August 1975Monbetsu Korsakov 12 January 1991Nayoro Dolinsk 25 March 1991Nemuro Severo-Kurilsk 27 January 1994Sarufutsu Ozersky 25 December 1990Teshio Tomari 28 July 1992Wakkanai Nevelsk 8 September 1972

Korsakov 2 July 1991Yuzhno-Sakhalinsk 9 September 2001

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216 Bibliography

Agapov, Boris 192Ainu 69, 79, 135, 184n7, 185n11Akaha Tsuneo 34, 38Aksenov, Anatolii 108–9, 126, 187n12Alaska 6, 69, 96, 104 Alegedpinov, Yakup 151–2 Alexseev, Mikhail 16, 68 Allison, Anthony 164Allison, Graham 22And™ Ishisuke 27 Arai Nobuo 32, 78, 88, 90, 118, 178n4,

183n21, 185n14, 186n21 Arase, David 15 armed forces: Japan 22, 36, 46, 55; Russia

46, 156, 163–4, 166, 192n18; see alsoBorder Guard; Soviet Red Army 136,139–40

Asahikawa 86, 184n4, 186n30, 193Asahi shinbun 72, 131Austin, Greg 46

Bäckman, Johan 150, 191n2 Bok Zi Kou 111Bondarchuk, V. 105, 187n4Bondarenko, Oleg 133 Border Guard, Russia 37, 45–6, 54, 81,

85, 106, 122, 132, 154–7, 164, 181n20,191n7, 191n14, 192n16, 192n19

border trade 49, 162; see also fishingBradshaw, Michael 56Breslauer, George 138Brezhnev, Leonid 31, 75, 109Brown, Archie 47Bugaev, Mikhail 137–8 Burbulis Commission 109, 126Busygina, Irina 102

Carlson-Kaplan deal 107, 187n8; see alsoShikotan Island

Centre for Modern HistoryDocumentation, Sakhalin 134

Chang Duckjoon 183n21charter 62, 64, 77; Sakhalin 7, 64, 71, 74,

76, 84, 98, 117, 128; South KurilDistrict 7, 74, 76–7, 98

Chernomyrdin, Viktor 56, 114, 118, 182n6China: and Japan 10, 14, 22, 31, 60, 120,

145; and Russia 16, 44, 48–50, 139,176, 181n30

Chubais, Anatolii 114 Clean Government Party (K™meit™) 24Constitution: Japan 63, 65; Russia 46–7,

62–4, 67, 71, 76–7, 98, 117, 127,183n17; Soviet Union 75

Cossacks 106–7, 134, 187n6, 187n7cultural exchange 1–2, 4, 10, 13, 18, 52,

74, 91, 97–8, 118, 130, 188n1; conflictand cooperation with Japanese andRussian policy 89; see also Dialogue’92; sister-city relations; visa-lessexchange program

Dialogue ’92 74, 78–81, 89, 98–9, 158;see also cultural exchange

D™gakinai Naohiro 28Dolinsk 87, 193Duchacek, Ivo 10, 12, 16, 125, 179n10,

182n12Dulles, John Foster 24Duma: State 47, 115, 117, 119, 126, 137,

148, 163, 173, 183n15, 183n18;Sakhalin 6, 71, 83, 116–17, 126, 138,152, 163, 183n2, 188n22, 191n15

Ebashi Takashi 65, 179n11

Index

economic relations: conflict andcooperation with Japanese and Russianpolicy 97–8; see also fishing;Hokkaido and Sakhalin 89–97; Japanand Russia 38–41

Ekonomika i zhizn' 152elites: definition of 186n1; Russia 11, 61,

64, 67, 102–3, 175–6, 184n5; Sakhalinsee also Igor Farkhutdinov; ValentinFedorov; Yevgenii Krasnoyarov; SouthKuril authorities

Elizar'ev, Vitalii 154, 158, 192n3Etorofu Island 43, 46, 48, 125, 157,

180n8, 180n10, 188n22; Japan’s claimover 21, 23, 25–7, 30, 33, 180n6,180n18; public opinion on 105–6,132–6, 180n20, 185n17, 189n9; socio-economic conditions 112; see alsoOstrovnoi

Evangelista, Matthew 171

Far Eastern Association 12, 68, 108 Farkhutdinov, Igor 72, 94–7, 102, 113–14,

140, 147, 151, 161–2, 188n25, 189n2,190n14, 190n18, 191n4; and thefederal government 126–9, 171, 174–5;and the visa-less exchange program 82,84; attempts to prevent Russianterritorial concessions 115–16, 167;motives in preventing Russianterritorial concessions 116–20

federalism: definition of 169; Russia 53,62–3, 173; Soviet Union 61

Federation Council, Russia 11, 112, 174,176, 183n15, 183n18, 186n1, 192n5

Fedorov, Valentin 3, 5, 16, 57, 72, 78–80,85, 92, 98, 103, 126, 142, 147–8, 158,184n7, 185n11, 187n2, 187n10,187n11, 187n13, 187n15, 190n20;career after leaving Sakhalin 187n14,188n16; Carlson-Kaplan deal 107;Cossack plan 106–7; see also FourthWay; and Gorbachev 105–6, 122;motives in preventing Soviet/Russianterritorial concessions 106, 108–11,128, 167; and Yeltsin 123–4, 129

Feldman, Elliot and Lily 12, 179n14,fishing 7, 37, 40, 45, 58, 96, 107, 141,

180n20, 186n25, 192n17;criminalisation of 155–64; fishinggrounds in South Kuril Islands’ EEZ21, 27, 30, 60, 110, 121, 191n7;Hokkaido–Sakhalin joint ventures

153–5; see also Pokidin proposal; seealso Santa Resort Hotel incident

‘five-stage plan’ 42, 47; see also Yeltsin,Boris

Fourth Way 104–5, 126, 187n3; see alsoFedorov, Valentin

Freeze, Gregory 147Fry, Earl 6, 15Fujiwara Hiroshi 26Furumaya Tadao 14

Gaidar, Yegor 56, 126, 182n6, 187n2Gelman, Harry 49globalisation 10, 53, 54, 65; definition of

182n2Godunov, Vladimir 122Golovnin, Vasilii 156Gorbachev, Mikhail 3, 31, 47, 70, 75, 175,

185n12, 188n24; and Boris Yeltsin122–5, 128; visit to Japan 2, 24, 40,81,105–6, 109, 114, 157

Goreglyad, Valerii 174, 192n5 Gorshechnikov, Vladimir 138 Gromyko, Andrei 87, 109Gubernskie vedomosti 8, 132–3 Gulii, Vitalii 104–5, 109, 187n5Gusev, Oleg 187n7

Habomai islets 48, 54, 71, 81, 105, 116,125, 132, 157, 175–6, 180n10, 181n20,189n9; Japan’s claim over 21, 23–7,30, 33, 159, 180n6

Hakamada Shigeki 40, 181n22 Hakodate 27, 55, 87–9, 97, 193Hanson, Philip 148, 182n10Hara Kimie 23Hasegawa Tsuyoshi 23, 32, 179n2,

185n14, 188n24 Hashimoto Ry tar™ 25, 34–6, 39–40, 50,

115–16, 178n5, 181n21Hatoyama Ichir™ 24‘high politics’ 2, 9, 11, 171, 179n12;

definition of 10; see also subnationalgovernments’ international activities

Hill, Ronald 76Hingley, Ronald 138history education: Sakhalin 131, 134–7,

143Hocking, Brian 124Hokkaido Prefectural Assembly (HPA) 4,

6, 28–9, 79, 184n6, 184n8 Hokkaido Prefectural Government (HPG):

and kanky™ seibi 4, 74, 178n4, 178n5;

218 Index

office in Yuzhno-Sakhalinsk 6, 93–4;support for Northern Territories ReturnMovement 28–30, 82, 160, 180n12,180n13

Hokkaid™ shinbun 2, 7–8, 29, 80, 95, 103,109, 113, 133–4, 142, 179n5, 182n3,186n27

Holsti, Kal 13,Hori Tatsuya 4, 26, 82, 84, 94–9, 161–2,

178n5, 178n6, 183n1, 186n27, 189n2Hough, Jerry 103humanitarian assistance 85–6

Ichioka Masao 185n21identity: Hokkaido 69; Northern

Territories and Japanese 23; Russia138, 190n13; Russian Far East 68;Sakhalin 135

Ikejima Nobuyoshi 184n8ikkatsu sokuji henkan 32Institute of World Economy and

International Relations (IMEMO) 103,115–16

Ishaev, Viktor 188n27Ishikari 97, 155It™ Tetsuo 79

Jain, Purnendra 12, 17, 178n7, 179n18 Japan Communist Party (JCP) 24Japan External Trade Organisation

(JETRO) 66, 145Japan League for the Return of Northern

Territories Inc. (Hopp™ Ry™d™ FukkiKisei D™mei) 27

Japan–Sakhalin Association 9Japan Socialist Party (JSP) 3, 24, 28, 78,

184n4Japan Times 133Joint Declaration, Japan–Soviet (1956) 25,

30, 43, 48–9, 79, 105, 108–9, 132, 134,140, 175–6, 180n6, 190n17

Joint Declaration, Japan–Soviet (1991) 41,105–6

Jukes, Geoffrey 45juøs™teki (multilayered) approach 34, 36,

52, 89

Kaifu Toshiki 41, 105Kaigara Islands 54 kakudai kink™ (enlarged balance/expanded

equilibrium) 31–2, 180n17Kamano Yukio 14, 16, 18

kanky™ seibi (creating an environment)1–4, 18, 29, 37, 50, 74, 168, 172–3

Karafuto 82; see also South SakhalinKarasin, Grigoriy 116, 118n19 Kasai Tatsuhiko 85 Kat™ K™ichi 107 Kawana summit 35–6, 39, 40, 50, 127,

178n5Keating, Michael 1 Keohane, Robert 13Khasbulatov, Ruslan 42, 109, 114, 124 Kimura Hiroshi 18, 22, 47–8, 50, 82, 104,

133, 189n8, 190n13, 190n16, 190n21 Kimura Masato 22–4Kincaid, John 169, 179n12 Kirienko, Sergei 127, Kirkow, Peter 64Kitami 86, 193Klepikova, Elena 139Kodera Jir™ 25–6K™no Y™hei 37Korsakov 55, 70, 87, 88, 89, 182n3,

191n12, 193Kostikov, Viacheslav 44, 47 Kozyrev, Andrei 43, 45, 123, 181n27Krasnoyarov, Yevgenii 111–13, 158 Krasnoyarsk summit 35, 39, 41, 48, 50 Krupyanko, Mikhail 49 Kunadze, Georgi 43, 45, 123–4, 181n27 Kunashiri Island 43, 46, 48, 70, 105, 116,

122, 125, 135, 157, 180n10, 180n20,188n22, 188n28; Japan’s claim over21, 23, 25–6, 30, 33, 180n6, 180n18;public opinion on 106, 132–4, 140–1,189n9, 190n17; socio-economicconditions 121, 141, 187n7

Kushiro 27, 86, 155, 160, 186n30, 193 Kuznetsov, Vladimir 108

Latouche, Daniel 179n14law and order: Russia 149–50‘law and justice’ 33, 42–3, 48, 50; see also

Yeltsin, BorisLeague of Residents of the Chishima

Islands (Chishima Rett™ KyojuøshaRenmei) 28

League for the Return of Chishima and theHabomai Islands (Chishima oyobiHabomai Shot™ Henkan Konsei D™mei)27

Levy, Thomas 13 Liberal Democratic Party (LDP) 24–6, 41,

59, 109, 123, 178n6

Index 219

Local Autonomy Law, Japan (LAL) 65–6‘low politics’ 1, 9, 11, 128, 171–2;

definition of 10; see also subnationalgovernments’ international activities

Luk'yanov, Mikhail 141; see also Zemlyak

MacArthur, Douglas 27 McVeigh, Steve 117 mafiya 149–50, 155–6Magami Tokunai 135 Malakhov, Ivan 176, 192n8 Maruyama Kazuyuki 26 Matsushita Keiichi 65–6Mikhailov, Yevgenii 15 Minagawa Shuøgo 80, 185n11 Minakir, Pavel 147 Ministry of Economy, Trade and Industry,

Japan (METI) 145Ministry of Foreign Affairs, Japan

(Gaimush™ or MOFA); attitude towardssubnational governments’ internationalactivities 10, 17, 66, 85, 94, 99,186n30, 184n8; Northern Territoriespolicy 23, 31–3, 41, 79, 89, 180n6,180n18; Sakhalin policy 93, 119; andSuzuki Muneo 25–6

Ministry of Foreign Affairs, Russia(Ministerstvo inostrannykh del or MID)43, 64; marginalisation of 45–6,181n25, 181n28; and Sakhalin 100,106, 110, 115–16, 125–7, 129

Ministry of Home Affairs, Japan (MOHA)66–7

Ministry of International Trade andIndustry, Japan (MITI) 145

Miyata Shigeo 85–6 Miyazawa Kiichi 32–3, 44Monbetsu 87–8, 155, 160–1, 186n30, 193 Mori Yoshir™ 25, 39, 175, 188n29, 189n2 Morris-Suzuki, Tessa 137 Moscow Declaration (1998) 50, 89Muraviev, Alexey 46

Nagasu Kazuji 14Nakamura Itsur™ 64, 76–7 Nakhodka 91, 185n19, 188n18nationalism: definition of 130; on Etorofu

185n17; Japan see Northern Territories:symbolic value for Japan; Russia 44–7,52, 67, 72–3, 124, 138–9, 163, 169–71,190n13; Sakhalin 68, 117, 130

Nayoro 87, 193

Nazdratenko, Yevgenii 16, 112–13, 128,146, 175, 188n17

Nemuro 23, 26–30, 37, 60, 82, 87–8, 96,155, 157–60, 180n8, 184n4, 193

Nester, William 22Nevelsk 86, 113, 182n3, 193 Nicholson, Martin 63, 182n15nidankai henkanron (two-stage formula)

32–3Niigata 185n21Nikolaev, Andrei 45 Nikolaev, Mikhail 175nit™ senk™ henkanron (return of two

islands first approach) 25Northern Territories: economic

significance for Japan 21; andHokkaido 26–30; political value inJapan 24–6; see also public opinion inJapan concerning the; strategicsignificance for Japan 22; symbolicvalue for Japan 22–6; see also SouthKuril Islands

Northern Territories CountermeasuresHeadquarters (Hopp™ Ry™do TaisakuHonbu) 29, 178n5

Northern Territories Issue Association(Hopp™ Ry™do Mondai Taisaku Ky™kai)28

Northern Territories Return Movement 1,26, 28–9, 36, 79, 81–2, 84, 88

Nye, Joseph 13

Obuchi Keiz™ 36, 37, 39, 50, 89, 127 ïhira Masayoshi 31, 87Ohmae Ken'ichi 21 oil and gas projects, Sakhalin 6, 57, 71,

88, 90, 93, 95–7, 117, 119, 148–50,152, 162–3, 192n7

Okuyama Yutaka 178n4Orthodox Church 116 Ostrovnoi 142; see also Etorofu IslandOtaru 55, 87, 89, 97, 161, 184n4, 185n19;

Otaru University of Commerce 145ïya Kaiji 37, 121Ozawa Ichir™ 123Ozersky 87, 193

Panov, Aleksandr 35 paradiplomacy 10, 99, 129, 179n12;

definition of 1Pavlova, Galina 148Pavlyatenko, Viktor 175

220 Index

Pokidin, Nikolai 121–2; Pokidin proposal37–8, 121; see also fishing

Poronaisk 86, 193 Primakov, Yevgenii 45, 50–1, 127 Primorskii krai 16, 64, 68, 93, 108,

112–13, 117, 128, 146, 188n18 Pskov 15public opinion 4, 75, 101; in Hokkaido

concerning the Northern Territories 30,32, 180n15; in Japan concerning theNorthern Territories 23, 25, 29, 159,179n5; in Russia/Soviet Unionconcerning the South Kuril Islands2–3, 40, 43, 76, 113; in Sakhalinconcerning the South Kuril Islands 19,70–2, 74, 76, 78, 118, 130–2, 178n4,189n3, 189n4, 189n5; 189n9; on thedisputed islands 84, 132–4, 189n6,189n9

Putin, Vladimir 39, 127, 132, 140; federalreforms 19, 53, 67, 109, 172–5; and theNorthern Territories/South KurilIslands 25, 117, 175–7

Quebec 11, 15

regionalism 14, 179n17; Japan 68–9;Russia 67–8, 73

regulatory framework: Russia 147, 159 Reznik, Boris 156 Risse-Kappen, Thomas 170–1, 192n4 Rodionov, Igor 36 Rogachev, Igor 43 Romanovski, Mikhail 152 Roosevelt, Franklin D. 75 Rosenblum, Daniel 57 Rozman, Gilbert 2, 156 Rudakova, Rimma 133Rukavets, Vladislav 4–5 Rumyantsev, Oleg 45 Ruud, Charles 138

Sakamoto Masahiko 151–2‘Sakhalin factor’ 19, 53, 70–2, 79, 101,

124, 126–7, 168, 173, 175, 183n21Sakhalin Project Hokkaido Consultative

Council 6, 97Sakwa, Richard 146San Francisco Peace Treaty (1951) 23, 25,

93, 119Santa Resort Hotel incident 150–3; see

also fishing

Sarkisov, Konstantin 22, 141, 181n27,191n9

Sarufutsu 79, 87, 193Sat™ Takayuki 109Sea of Japan 2, 6, 4–15, 46, 160 Sea of Okhotsk 6, 22, 45–6, 96, 104 seikei bunri (separation between politics

and economics) 31 seikei fukabun (inseparability of politics

and economics) 31–2, 51, 180n15Sergounin, Alexander 64 Severo-Kurilsk 87–8, 96, 193Shapoval, Vladimir 190n18 Shevardnadze, Eduard 70 Shigemitsu Mamoru 24 Shikotan Island 26, 71, 105, 175–6,

180n10, 190n22; Carlson-Kaplan deal107; Japan’s claim over 21, 23–5, 30,33, 43, 48, 125, 159, 180n6; publicopinion on 132–4, 140–3, 189n9,190n21; socio-economic conditions121, 141–3, 190n18

Shinoda Kenji 33‘shock therapy’ 44, 126, 138, 187n2 Shuman, Michael 11 Shut™ Nobuhiko 18, 179n16, 185n20Sinel'nik, Yurii 191n13sister-city relations 17–18; Hokkaido and

Sakhalin 7, 55, 86–8, 96, 99, 152,186n30, 193; Japan and Russia 7–8,178n8, 179n19; see also culturalexchange

Slider, Darrell 126Smith, Gordon 75 Smith, Hedrick 139Society for the Research of Security Issues

(Anzen Hosh™ Mondai Kenkyuøkai) 115Soldatos, Panayotis 16, 53, 72, 99 Solnick, Steven 116–17, 119 Solovyov, Vladimir 139Soskovets, Oleg 37South Korea 14, 153, 188n22; see also

Takeshima/Dokdo Island South Kuril Islands: and Igor

Farkhutdinov 113–20; and ValentinFedorov 103–11; and YevgeniiKrasnoyarov 111–13; see alsoNorthern Territories; public opinion inRussia/Soviet Union concerning the;public opinion in Sakhalin concerningthe; public opinion on the disputedislands; South Kuril authorities 120–2

Index 221

South Sakhalin 79, 89, 93, 98, 119–20,135–6, 139; see also Karafuto

Soviet Union 2–3, 14, 31–3, 41, 44, 48,51–2, 60, 78, 81, 83, 89, 93, 104, 106,108, 119, 170, 180n16, 190n12; attackon Japan 2, 22–4, 135, 190n16;collapse of 14, 19, 42, 53, 55–6, 61–2,67, 70, 72–3, 76, 87, 90, 93, 98, 120,123–4, 132, 138, 141, 155, 164, 167,169, 173; cultural exchanges with theUnited States 188n1; decision-making101; Far East 2, 56, 92; GovernorYokomichi’s visit to 157, 184n3;history textbooks 134; public opinion75

Special Committee on the NorthernTerritories (Hopp™ Ry™do TaisakuTokubetsu Iinkai) 29

Starkov, Vladimir 187n6 Stepashin, Sergei 188n18 Stephan, John 134 subnational governments’ international

activities: catalyst for change in statediplomacy 11–15; conflict andcooperation with state diplomacy15–18; domestic determinants 55–69;external determinants of 54–5; see also‘high politics’; see also ‘low politics’

Sumita Nobuyoshi 10, 179n13Suzuki Muneo 25–6, 37, 122, 188n29Suzuki Yuøji 16Svobodnyi Sakhalin 8, 133, 137, 150,

185n10

Taga Hidetoshi 179n17 Takahashi Harumi 178n6Takeshima/Dokdo Island 5, 10; see also

South KoreaTanaka Kakuei 31Tanaka Makiko 25Tanaka Naoki 18Tarlow, Lisbeth 123 Tatarchuk, Aleksandr 132–3 Tatarstan 16tax system: Russia 57, 149Tereshko, Mikhail 122 Teshio 87, 193 T™g™ Kazuhiko 25, 32–3Tokyo Declaration (1993)Tolz, Vera 102 Tomari 87, 193 Tomino Kiichirø™ 183n19Toyohara 82; see also Yuzhno-Sakhalinsk

track-two diplomacy 4transnational relations: influence of 1–5,

12–14, 73, 167, 170–3Treaty of Shimoda (1855) 43, 135–6Treaty of St Petersburg (1875) 43, 135–6Tretyak, Boris 126, 174 Tretyakov, Petr 187n4 Troyakova, Tamara 68 Tsipko, Aleksandr 49 Tuminez, Astrid 110

Uchiyama K™hei 145United States (US) 16, 24, 22, 29, 42, 44,

46, 48–9, 104, 135, 146, 185n12,188n1; containment strategy towardsthe Soviet Union 14, 45, 78, 179n2;states as international actors 10, 12, 15,179n14

unrestricted visits (jiyuø h™mon) 37, 82Usui Hideo 36

Valliant, Robert 12 visa-less exchange program 36–7, 40, 74,

81–5, 106, 122, 133, 143, 186n25;conflict and cooperation with statediplomacy 89, 98–9; see also culturalexchange; Igor Farkhutdinov’s attitudetowards 84, 118

Vladivostok 36, 92, 149, 188n23 Vries, Maarten Gerritsen 135 Vysokov, Mikhail 134

Wada Haruki 23, 38 Wagner, Beate 13 Wakkanai 7, 55, 86–9, 96–7, 155, 160,

193Watanabe K™ichi 142Weigel, Detlef 13, 179n15 Welch, David 22–4, 179n4 White, Stephen 76, 140 Wyman, Matthew 131

Yabuno Yuøz™ 178n3Yakovlev, Aleksandr 104 Yamaguchi Jir™ 179n1Yastrzhembsky, Sergei 127, 188n28 Yasuda Keiji 191n5 Yeltsin, Boris: conduct of regional

relations 61–5, 67–8; 77, 169, 183n15;see also ‘five-stage plan’; andHashimoto Ryuøtar™ 35, 39, 115–16,181n21; and Igor Farkhutdinov 127;see also ‘law and justice’; leadership of

222 Index

44–5; see also Mikhail Gorbachev;postponement strategy 21, 46–51, 125,129; and Valentin Fedorov 106–7, 110,124; visit to Sakhalin and the SouthKuril Islands 70

Yokomichi Takahiro: and Japanese fishingin disputed islands’ EEZ 157–8; kanky™seibi 2–3, 178n5, 183n1, 184n3,184n5; participation in visa-lessexchange program 82; promotingeconomic relations with theSoviet/Russian Far East 91–4; viewson Japan’s policy on the NorthernTerritories 26, 28, 32; see alsoDialogue ’92

Yomiuri shinbun 49, 179n5 Yuzhno-Sakhalinsk 7, 55, 86–9, 91–8,

119, 127, 137, 139, 152, 182n3,188n20, 189n3, 193; see also Toyohara

Zaitsev, Valeriy 115–16, 125 Zaslavskaya, Tatyana 75 Zema, Vladimir 122, 141Zemlyak (fellow countryman) 140–1; see

also Luk'yanov, Mikhail Zhan Jun 10Zhirinovsky, Vladimir 15, 137Zinberg, Yakov 70, 111, 124, 187n15

Index 223