Economic diplomacy is quite important in China and Japan foreign policy. As a defeated country in the II world war, Japan had to follow US liberal development policies, while communist China opted for an indigenous development pattern. later changing to "market socialism "during the reform process. In the XXI century, both countries chose an active economic diplomacy with rather different outcomes. Being global top trader and second economy, Japan had to concede both position to China which became the new superpower because of its impressive economic achievements after its trade revolution as a consequence of its membership in the World Trade Organization. This article is to respond to the question that "What role economic diplomacy plays in China and Japan foreign policy, and what factors have influenced different results?"

To respond the question, the hypothesis is based on the opinion that economic diplomacy is quite elevated in both countries' foreign policy, but because of a stronger government role in China's economy and its development oriented foreign policy, China has been able to secure tangible strategic results, while Japan's market oriented economy and government support for its keiretsus and Zaibatsus has gradually lost the competition. The present research has been developed using qualitative methodology, in which countries’ policies, programs and data have been used comparatively to prove the hypothesis.