`The Japanese government stands ready to discuss these matters with the Chinese government. A negotiated peaceful settlement to this crisis has always been and remains the top priority of the Japanese government.'
Kabuto-cho Financial District, Tokyo
Local time: 1300 Wednesday 21 February 2001
GMT: 0400 Wednesday 21 February 2001
Hidei Kobayashi, the head of trading and strategy at Nomura Securities, switched the television set off. A hundred and one things were running through his mind at once as he tried to digest what the Prime Minister had said — shock at the nuclear test, fear at being cut adrift from the Americans, pride at hearing a Japanese speak so well — he'd tried to get all of that out of his mind and assess the investment decision. He did not take much time. He decided to buy selectively, especially in the defence area Mitsubishi Heavy Industries, Mitsui, Nippon Steel, and Sumitomo Steel which he calculated would benefit from bigger orders in the future. After all, Hyashi had said a `security system to meet Japan's needs can be built' implying that it had not yet been completed. Even the might of the Nomura could not turn the market. Foreign selling had become overwhelming. The Nikkei index, which had plunged 1,678 on Tuesday, fell precipitously again. By the end of the morning session it was 2,063 lower at 35,559.
The yen was under enormous pressure. The Bank of Japan virtually stood in the market and bought all the yen the market wanted to throw at it. From its New York close of .75 it fell to .75 in the first hour of trading. It was precisely at this moment that Phillips executed his winning deal. He gave instructions for the remainder of the yen position First China had accumulated for General Zhao to be unwound. First China was sitting on a billion position — the remainder of the position it had built up when the yen was trading around to the dollar. In the London market the previous day some billion had been reversed, netting General Zhao profits in excess of $200 million. In the Tokyo market, First China locked in the remaining gains. With the Japanese currency having fallen 36 per cent weaker, First China moved to cover its position, pocketing the best part of $256 million in the process.
In Hong Kong the market had opened sharply down. Hyashi's television appearance was seen throughout Asia on Star TV, the regional satellite broadcaster. Old memories die hard and the behaviour of the Imperial Japanese Army during the Second World War had been kept alive, partly because its deeds were so appalling and partly to use as a stick to beat Tokyo with whenever its compliance was needed. The market continued to slide all morning as Hong Kong Chinese investors liquidated their holdings of local stocks and switched their funds into US dollars. The Hong Kong dollar, pegged to the US dollar at a rate of HK$7.8 to $1 since September 1983, began to feel the strain of capital outflow. The Hong Kong Monetary Authority, which regulated banks and money markets, moved to support the local dollar by forcing a rise in interest rates. The authority was required by law to preserve exchange rate stability, so with the currency weakening it had to raise interest rates. This could not, however, have come at a worse time. The 0.5 per cent rise in short term interest rates to 11 per cent only served to weaken confidence in the stock market further.
The CNN Asia newsroom, Singapore
Local time: 1245 Wednesday 21 February 2001
GMT: 0445 Wednesday 21 February 2001
With the subtitle `Breaking News' running at the bottom of the screen, CNN announced India's condemnation of Japan's nuclear threat. It was a `disgrace and an abomination for the future development of the world'. India also blamed China for initiating its attack on Vietnam. `That irresponsible act has been the catalyst for the creation of a new and unwelcome superpower. Just as the world was balanced, it has become tipped into a perilous adventure.'
Russia said the inevitable had happened: `Nothing on this Earth can stand still. Japan has now barged its way into our exclusive club. Whether or not she will become a welcome member will depend on the level of maturity with which she uses her newly declared power.' The Russian government made no criticism of Operation Dragonstrike.
South Africa described the test as a disappointing trend. `While South Africa and other nations voluntarily abandoned their programmes to go nuclear, Japan was secretly pursuing the path to creating the most destructive weapons available to man. We are waiting to hear what she hopes to achieve and more importantly what level of protection she will offer in treaty to non-nuclear governments and whether she will guarantee a no-strike policy against those of us without such weapons.'
The European Union said the test was a `regrettable and unnecessary change to Japanese policy'. Spain called for an immediate international conference to determine new rules for the nuclear powers. Britain spoke of `having to come to terms with the grim realism of international affairs. At the end of the day Japan is an ally of the democratic West.' Nothing should be done in the present `climate of unpredictability in the Pacific' to damage that alliance. France even came close to subtly contradicting the European Union statement. `It is regrettable that one Pacific rim country has committed an act of such unpalatable aggression to cause another to declare its nuclear arsenal. If it comes to conflict between China and Japan, the government of France will support the Japanese.'
The Korean Peninsula
Local time: 1350 Wednesday 21 February 2001
GMT: 0450 Wednesday 21 February 2001
Japanese early warning aircraft monitoring the theatre detected the launch of the Taepo-Dong ballistic missile from a site north of Pyongyang and within seconds South Korea fired Mark IV American-made Patriot missiles to intercept it. The Taepo-Dong had last been tested in 1998 and with a range of nearly 2,000 kilometres it could strike most places in North-East Asia. But the missile was destroyed well before it reached its intended target of Pusan, on the southern tip of the Peninsula. Then the Japanese spotted the mobile launchers for two shorter-range No-Dong missiles, both in the far north of the country near the Chinese border, where North Korea had built up its road and power infrastructure under the guise of creating a free-trade zone. Defence analysts believed the missiles were being moved out of hiding to launch places. While the defence network of Patriot missiles and early warning detection provided a formidable cover against attack, it was not watertight. The failure of Patriots against Iraqi Scud missiles during the Gulf War was a grim reminder of South Korea's vulnerability. Killings were continuing in Seoul itself and North Korean saboteurs had begun a second wave of terror in Pusan and Mokpo in the far south.
In Pyongyang itself there was a diplomatic silence. From Beijing Jamie Song, momentarily diverted from Dragonstrike, put a call through to the North Korean capital in an attempt to talk to Kim Jong-Il. But the Foreign Minister's secretary said that as soon as she spoke the line went dead. All other numbers were either disconnected or rang without being answered. The Chinese Ambassador in Pyongyang said he had been trying to talk to the leadership for the past two days. The German Ambassador, one of the few Western diplomats accredited to the city, reported no unusual activity. There had been air-raid practices but this was routine. The city was blacked out after dark. Blinds were drawn down the windows of the Koryo Hotel, the only hotel open. Spotlights which usually lit up the Arch of Triumph, the statues of the Great Leader, the Juche Tower, and other symbols of North Korean greatness were turned off. But no extra troops were being openly deployed in this graceful totalitarian city, with wide boulevards for military displays, drab apartment blocks for the people, and imaginative monuments showing off the godlike qualities of Kim Il-Sung. The only sign of an impending war was the increased level of vitriol against America and South Korea on television and radio. `Our dear leader Kim Jong-Il is a genius at military strategy and a genius at military leadership,' was one radio message. `We have nothing to fear from the imperialist American invaders and their South Korean puppet army.' Meanwhile a television announcer chastised the selfishness of Western society: `To pursue the right of the individual is to be no better than a worm,' he said. `We have nothing to fear from the gu
ns and missile of worms, for when they face the courageous and unselfish soldiers of the Juche idea, the worms will wriggle and crawl back into the ground.'
A squadron of South Korean F-16 aircraft crossed the Demilitarized Zone low enough to be underneath the enemy radar. They split into three groups to attack North Korean radar and air-defence positions with precision-guided bombs. The operation took a matter of minutes, but not without cost. The North Korean anti-aircraft defences, tested for the first time ever, were on a high alert and responded with enough accuracy to destroy two South Korean aircraft. As the South Korean pilots headed for home, the North scrambled its own aircraft, many of them from concealed hangars inside mountain bases. Over the next thirty minutes, South Korean air defences shot down five MiG-21 fighter aircraft, attacking them with surface-to-air missiles and F-16 fighters on both sides of the DMZ. One North Korean slipped through the first defences and crossed into South Korea, only to point his aircraft towards the sea and eject. He was picked up by American troops and taken straight in for interrogation. A second squadron of South Korean F-16s flew high above Pyongyang and further north to the suspected missile launch sites. They used both free-fall and guided bombs at points in the mountainous area specified on satellite photographs. As they headed back, one F-16 was shot down by a surface-to-air missile. The pilot died. The aircraft flew past a third squadron attacking radar and air-defence positions around Pyongyang, and a fourth which pounded the Yongbyon nuclear power facility, the focus of the North's nuclear weapons programme. For the next few hours, wave after wave of South Korean aircraft hit military installations in North Korea. Casualties were high. At the end of the day, South Korea had lost thirty-three aircraft. Only three pilots, who managed to nurse their planes back across the frontier, survived.
President Kim Hong-Koo spoke for less than ten minutes to Jamie Song in Beijing, after which he called a full meeting of the South Korean cabinet. `The Chinese government says it will support any action we take to neutralize North Korea. The view from Beijing is that the present regime in Pyongyang could destabilize the whole of the East Asian region.'
`But China itself is destabilizing the region,' interjected the Foreign Minister.
`China may well win in the end. North Korea is bound to lose,' answered the President. `Gentlemen, the way the Chinese Foreign Minister explained it to me was that we in Seoul had a duty to the region to bring stability back to the peninsula. China would play its part by offering diplomatic support and giving asylum to Kim Jong-Il and a select number of his cronies.'
`What will the Americans say?' asked the Foreign Minister.
`I can't see why they would disagree with China. A neutralized North Korea would be one less rogue state to deal with.'
The Sino-Vietnamese border
Local time: 1300 Wednesday 21 February 2001
GMT: 0600 Wednesday 21 February 2001
The Chinese met little resistance when they crossed the border. The Vietnamese forces, on orders, simply melted into the jungle. The Chinese commander took this as a sign of cowardice. His motorized units pushed on and were at the outskirts of Lang Son within three hours. There they halted, and fatally there they waited for the column behind to catch up.
Lieutenant Joffe motioned to Major Lon to commence firing. For the past ten minutes Joffe had been relaying detailed coordinates to Lon who, in turn, instructed his artillery officers as to elevation and type of ammunition to use. Lon commanded twenty-five 105mm howitzers. They could lob a shell 10 kilometres that would make a crater 3 metres in diameter on impact. In addition to the guns he had three batteries of multiple rocket launchers of a similar capacity. One after the other the big guns fired, interspersed with the woosh of the rockets. Together they hurled a deadly mix of high-explosive charges for the `hard' Chinese targets, such as the tanks and trucks and armoured personnel carriers, and an assortment of projectiles with variable time-fused munitions that exploded in the air, unleashing wave after wave of shrapnel upon the advancing Chinese infantry. In near real time — with seconds' delay — the French satellites monitored the fall of shot and allowed for target corrections to be passed via Lieutenant Joffe to Major Lon. Many hundreds of Chinese fell where they stood. The pinpoint accuracy of the French `firing solutions' enabled the Vietnamese to take out some of China's prized armour developed after the Gulf War to perform better than the tin cans Beijing had sold Saddam to fight his war against Kuwait. The Chinese commanders did not know which way to turn. With their battlefield management systems inoperable they resorted to voice communications. But again the Vietnamese were ready. They homed in on the Chinese radio traffic, recording it and replaying back on the same frequency but with a half-second delay. The result was that all the Chinese commanders could hear was gibberish; likewise their commanders in Nanning and posts closer to the border. Faced with no means of communication the commanders on their own initiative began to retreat, but as those who survived the initial barrages of shells and rockets tried to go back the way they had come they met fresh troops coming towards them. It was chaos. Unfortunately for the Chinese the concentration of men and machinery this confusion produced simply provided larger targets for the Vietnamese.
In the first battle for Lang Son — the one President Wang participated in — the Chinese captured the town for the cost of 20,000 lives before they retreated across the border. This time the invading army didn't even make it to the town gates. Without even seeing a Vietnamese soldier, let alone killing one, the Chinese, in the space of five hours of concentrated and constant artillery barrage, lost 25,000 men — either killed outright, injured, or missing. Of the 250 battle tanks that entered Vietnam that day only 85 returned. 25,000 men made it across the border, harried and badgered by the Vietnamese Army all the way home.
The Foreign Ministry, Beijing
Local time: 1430 Wednesday 21 February 2001
GMT: 0630 Wednesday 21 February 2001
The Japanese Ambassador's Nissan President drew up in front of the Foreign Ministry ten minutes before his meeting with Jamie Song. Hiro Tanaka was a stocky man in his early fifties. He was a fluent Mandarin speaker who came from a long line of Japanese sinologists: his grandfather was a senior official with Japan's South Manchurian Railway Company, which was the colonizing power in north-east China during the 1930s and 1940s; his father was an army intelligence officer based in Shanghai. Tanaka, and a First Secretary from the embassy who would take notes, climbed the stairs to the Foreign Ministry and entered its somewhat musty interior. Inside another flight of steps greeted the visitors. These were covered with a light brown carpet and led to a suite of rooms, each more magnificent than the other, where Foreign Ministry officials met visiting diplomats and journalists. Tanaka and his official were shown into a medium-sized rectangular room. Along its walls were upholstered armchairs and in between them were tables with ashtrays and space for the ubiquitous blue and white mugs in which Chinese officialdom served green tea. The room was sparsely decorated although one wall was dominated by a painting of blossom that was badly executed but typical of the somewhat flaccid style favoured by China's post-Revolution leaders. Typical also of the room was its appalling overhead lighting. Light globes in Chinese official buildings are unique for their ability to shine but illuminate little. The room was unremittingly gloomy, though well heated.
The door opened. Jamie Song and his retinue swept into the room. Curt bows preceded handshakes and a gesture to take a seat. An assistant to Song handed the Foreign Minister a piece of paper. Song studied it for a while, looked up, and then began to speak.
`Ambassador, you have been summoned here to receive my government's formal protest at your government's nuclear test earlier today. It is a measure of China's horror at Japan's action that I, rather than the Vice Foreign Minister for East Asia, am delivering this note.
`The government of the People's Republic deplores in the strongest possible terms the decision by Japan to explode a nuclear device. The Chinese government has always st
ood for nuclear disarmament and has strenuously opposed the proliferation of weapons of mass destruction. The decision by Japan to detonate a 50 kiloton device at a facility in the Ogasawara Islands is a retrograde step and can only increase tensions in the Asia-Pacific region. At a time when China is defending its sovereignty in the South China Sea such a test can only be treated as a hostile act.
`The Chinese government calls upon Japan to renounce the use of nuclear weapons, to uphold the Japanese constitution and renounce war as a sovereign right, and to explain to the international community its reasons for this criminal act.'
Song look up. His face was expressionless. Tanaka, who knew a thing or two about looking impassive, returned his gaze, and held it.
`I shall report your views to my superiors in Tokyo,' he began. `But I am also instructed by Foreign Minister Kimura personally to deliver a note myself. The government of Japan deplores the warlike actions of China in the South China Sea, actions in contravention of accepted international behaviour and in violation of international law. In particular my government views with the utmost seriousness the sinking of the USS Peleliu, a ship belonging to a friend and ally of Japan, engaged on a humanitarian mission. There can be no justification for this act of international terrorism. My government will render any and all assistance the United States requests.
`The government of China must pull back from this adventurism in the South China Sea, to seek a compromise with interested parties, and to return to the path of peace which the world has the right to expect. The government of Japan stands ready to defend its vital interest.'
Dragon Strike -- A Novel of the Coming War with China (Future History Book 1) Page 21
