The concept of "setting aside dispute and pursuing joint development" advanced by Deng Xiaoping carries a distinct feature of the contemporary time and provides a new approach for peaceful settlement of territorial disputes.
China has resolved territorial and boundary issues with all but a few of its neighbors, but the issues of the Diaoyu Island and the Nansha Islands remain unsettled.
China and Japan differ in their respective stand on the Diaoyu Island. To develop its relations with Japan, while adhering to its consistent position, the Chinese government reached agreement with the Japanese government during the negotiation on normalizing the diplomatic relations between the two countries to resolve the issue at a later date. During talks with Japanese Prime Minister Takeo Fukuda on October 25, 1978, Vice Premier Deng Xiaoping, who was on an official visit to Japan, stressed that both China and Japan should place priority on the overall interests of the two countries with regard to the issue of the Diaoyu Island. At the press conference held after the talks, Deng Xiaoping said the following: When China and Japan normalized their relations, both countries agreed that this issue should not be involved. When we negotiated the Sino-Japanese Treaty of Peace and Friendship, we also agreed not to deal with this issue. We believe that we should set the issue aside for a while if we cannot reach agreement on it. It is not an urgent issue and can wait for a while. If our generation do not have enough wisdom to resolve this issue, the next generation will have more wisdom, and I am sure that they can find a way acceptable to both sides to settle this issue. When meeting Suzuki Zenko, a member of the lower house of the Japanese Diet from the Japanese Liberal Democratic Party on May 11, 1979, Deng Xiaoping said that consideration may be given to joint development of the resources adjacent to the Diaoyu Island without touching upon its territorial sovereignty. In June the same year, the Chinese side formally proposed the concept of joint development of resources adjacent to the Diaoyu Island to the Japanese side through diplomatic channel. This is the first time that China openly stated its position that China is ready to settle disputes with its neighbors over territorial and maritime rights using the concept of "setting aside dispute and pursuing joint development".
When China entered into diplomatic relations with the Southeast Asian countries in the 1970s and 1980s, during talks with the leaders of these countries, Deng Xiaoping made the following reasonable proposal for resolving disputes over the Nansha Islands: The Nansha Islands have been an integral part of China's territory since the ancient times. But disputes have occurred over the islands since the 1970s. Considering the fact that China has good relations with the countries concerned, we would like to set aside this issue now and explore later a solution acceptable to both sides. We should avoid military conflict over this and should pursue an approach of joint development. In June, 1986, Deng said to visiting Filipino Vice President Laurel: "We should leave aside the issue of the Nansha Islands for a while. We should not let this issue stand in the way of China's friendship with the Philippines and with other countries." Deng Xiaoping once again brought up this idea when he met visiting Filipino President Aquino in April, 1988. Deng said: "In view of the friendly relations between our two countries, we can set aside this issue for the time being and take the approach of pursuing joint development." Both President Aquino and Vice President Laurel responded positively to Deng Xiaoping's initiative. In addition to proposing the approach of "setting aside difference and pursuing joint development", Deng Xiaoping also explained China's stand that it has sovereignty over the Nansha Islands. He explicitly pointed out that "the Nansha Islands have always been marked as part of China on the maps of the world. The Nansha Islands belong to China." "We have many evidences. The maps of the world in many countries also prove this." He also said to President Aquino that China is in a most authoritative position to address the issue of the Nansha Islands since they have always been a part of China's territory.
The concept of "setting aside dispute and pursuing joint development" has the following four elements: 1. The sovereignty of the territories concerned belongs to China. 2. When conditions are not ripe to bring about a thorough solution to territorial dispute, discussion on the issue of sovereignty may be postponed so that the dispute is set aside. To set aside dispute does not mean giving up sovereignty. It is just to leave the dispute aside for the time being. 3. The territories under dispute may be developed in a joint way. 4. The purpose of joint development is to enhance mutual understanding through cooperation and create conditions for the eventual resolution of territorial ownership.
Adhering to Deng Xiaoping's principled position of "setting aside difference and pursuing joint development", the third generation of Chinese leaders with Jiang Zemin at its core have held talks with the leaders of the ASEAN countries concerned on numerous occasions. Consultations have been conducted by delegations of both sides on maritime environmental protection, meteorology and fishery in the South China Sea, which have yielded progress.