Chinese President and Japanese PM Hold Talks on APEC Summit Sidelines

Chinese President Xi Jinping and Japan's new Prime Minister Sanae Takaichi held their first formal meeting on Friday during the APEC summit, as trade and security tensions continue to strain relations between the two Asian powers.

The leaders met for an official discussion Friday afternoon, following a brief conversation earlier in the day, Takaichi confirmed on her official X account. This marks their first substantial diplomatic engagement since she took office.

The timing of this meeting highlights Japan's complex position in regional geopolitics. China remains Japan's largest trading partner, but Japan relies on the United States for critical security guarantees. This creates a delicate balancing act for Tokyo as US-China tensions continue to escalate.

For investors and markets, this meeting signals both countries want to keep economic ties stable despite broader regional tensions. Trade between China and Japan totals hundreds of billions of dollars annually, making their relationship too important to let political disputes derail completely.

But here's the challenge: Japan faces growing pressure from Washington to take a tougher stance on China, particularly around technology transfers and military cooperation. At the same time, Japanese businesses depend heavily on Chinese markets and supply chains.

The APEC summit provides neutral ground for these conversations, away from the domestic political pressures both leaders face at home. Whether this meeting leads to concrete agreements or just keeps communication channels open remains to be seen, but maintaining dialogue is crucial when tensions run this high.