First published in October 2012

Over the last few days the climate in Beijing has transformed ominously. Perhaps it is simply the darkening blanket of smog and dust that lingers listlessly over the capital.

But there is something else fermenting in this hazy air: the swelling feelings of resentment and bitterness felt among this city’s 20 million residents, towards their Japanese neighbours.

Riding the underground across the city to Liangmaqiao station yesterday, the usual attire of the commuting crowd – suits, briefcases and mobiles – had been exchanged for fiery red Tshirts and crimson furled banners. At each stop, shopkeepers, taxi drivers and senior citizens brandishing portraits of Chairman Mao and placards emblazoned with striking calligraphy condemning Japan joined the throngs, so that the carriage soon bore an unnerving resemblance to a Red Army troop train on its way to the front. By the time we had arrived outside the Japanese embassy in Chaoyang, the masses were spoiling for a fight.

At the heart of their fury are five uninhabited islets and three barren rocks 200 miles off mainland China that form the Diaoyu Islands (alternatively the Senkaku in Japan). As is often the case in major territorial disputes, large deposits of natural resources – here gas and oil reserves – were discovered offshore during the 1970s, prompting each nation to claim sovereignty and provoking aggressive sabrerattling from all sides.

The hotpot of the East China Sea has finally reached boiling point. Last week, the People’s Republic sent two patrol boats to the region to “safeguard the PRC’s territory”. China claimed this was a precautionary response to the landing of 150 right-wing Japanese nationalist activists in early August. Late last month Japan formally nationalised three of the islands with a bargain purchase of just £15.7 million. The government’s statement that there was “no doubt that the Senkaku Islands are clearly an inherent territory of Japan” provoked public outcry from across Taiwan and mainland China. In short, it is a confusing display of geopolitics and rhetoric.

But to the incensed citizens of Beijing the situation is abundantly clear. Arriving outside the gates of the Japanese embassy, I watched thousands of protesters surging against ranks of paramilitary riot police, singing the national anthem and chanting ultra-nationalist slogans: “Down with the Japanese dogs!”, “Loyal Chinese, join us!”, and most surprisingly “Long live Chairman Mao!”. The walls of the embassy were coated with eggs and rotten fruit hurled over the barricades. Nearby Japanese restaurants had been closed and boarded shut, with signs from their Chinese owners pleading the protesters to spare their businesses from the torch.

The residents of Beijing are not alone in their anger; demonstrations have spread to more than two dozen cities across China, with protesters calling for boycotts of Japanese businesses and turning increasingly violent. In the eastern port of Qingdao a Panasonic warehouse and Toyota dealership were set ablaze, forcing frightened expatriates into hiding. Japanese friends here in Peking University are being urged by authorities to lie about their true nationality, claiming “neutral” Korean origin in public. Even the local real estate agencies are offering an 8% discount to those admitting the Diaoyu Islands rightfully belong to China.

Don’t be fooled, however: such open displays of violence are neither spontaneous nor confined solely to the question of the Diaoyu Islands. With this week marking the 81st anniversary of the Japanese invasion of Manchuriain 1931, these protests are largely expressions of historically deep-seated mutual animosity, and as the T-shirts for sale outside the Beijing metro stations demand, “Never forget our national humiliation!”

Domestic Chinese and Japanese politics are also playing an important role. Indeed, the true question of this clash is the extent to which the two central governments are fuelling the flames of anger. The looming leadership transition of the Chinese Communist Party’s ruling Politburo has been marred by intrigue and controversy, with former candidate Bo Xilai under house arrest and his wife on trial for the murder of British businessman Neil Heywood. At the same time, Chinese leader-in-waiting Xi Jinping only yesterday re-emerged after disappearing mysteriously for two weeks. Leadership elections for Japan’s two major political parties are on the horizon with nationalist priorities high on the agenda. In such uncertain political times, directing animosity towards “foreign aggression” in a show of national unity diverts focus away from troubled internal politics.

With the latest reports from Japan claiming a fleet of 1,000 fishing boats are en route to the disputed islands, and no sign of tensions easing, the coming days and weeks will prove defining for Sino-Japanese relations. If these two nations fail to find common ground and insist on pushing the boundaries of brinkmanship, that smoggy Beijing haze of suspicion and anger will continue to spread across the East China Sea, bringing the region ever closer to a potential flashpoint.