The global recession has had seemingly conflicting impacts on China's policy toward Asian regionalism. But China has never viewed regionalism and globalism as mutually exclusive and has seen strategic value in pursuing both. A stronger China emerging from the crisis is playing both regional and global games with a stronger hand.

This paper examines the unusual case of the May 2002 Shenyang Incident. Acting out of character, Tokyo confronted China, motivated by cumulative resentment of recent Chinese actions. Beijing, for its part, reacted with restraint, owing to growing confidence in its place in the world and the continuous moderation of Japanese policy since 1998.