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The East China Sea (ECS) is gaining an increasingly central role in Sino-Japanese relations as it is crucial to the economic development and political affirmation of both countries, for whom the main sea routes crossing the ECS offer vital arteries for trade and energy imports. For the past year and a half, the ECS has attracted considerable international attention because of the flare-up of tensions over the sovereignty of the Japanese-controlled Senkaku Islands. This small group of islands is also claimed by the authorities in Beijing and known in Chinese as Diaoyu. Is war looming? Are we seeing an escalation spiral that will ultimately set the two countries on a collision course? The article argues that the current tensions should be seen in the wider context of the increased strategic significance of the ECS. For there are two different types of disputes here. One concerns sovereignty over the Senkaku/Diaoyu Islands; the other concerns the demarcation of the Chinese and Japanese maritime borders and exclusive economic zones (EEZ) as defined by the United Nation Convention on the Law of the Sea (UNCLOS). This distinction is important because sovereignty on land is different from sovereignty at sea. The former is connected to a vital national interest and historically, represented a primary reason for war. The latter focuses on functional rights over bodies of water included in the EEZ, not on the actual ‘ownership’ of the maritime realm. Accordingly, the article argues that seapower is going to play a crucial role in the projection of Japanese and Chinese power and status in the ECS and in the evolution of Sino-Japanese relations more generally. Significantly, Naval Defence doctrines in both countries have evolved greatly over recent years. [ABSTRACT FROM PUBLISHER]