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Beijing also issued a set of rules for the zone, saying all aircraft must notify Chinese authorities and are subject to emergency military measures if they do not identify themselves or obey orders from Beijing. It said it would "identify, monitor, control and react" to any air threats or unidentified flying objects coming from the sea.
The rules went into effect Saturday.
In Tokyo, Junichi Ihara, head of the Foreign Ministry's Asian and Oceanian Affairs Bureau, protested by phone to China's acting ambassador to Japan, Han Zhiqiang, saying the zone is "totally unacceptable," according to a ministry statement.
Ihara also criticized China for "one-sidedly" setting up the zone and escalating bilateral tensions over the islands.
Both Beijing and Tokyo claim the islets, called Diaoyu in Chinese and Senkaku in Japanese. Protests erupted throughout China last year to denounce the Japanese government's purchase of the islands from private ownership.
A rising economic and military power, China has become more assertive over its maritime claims. It has been in disputes with several neighboring countries over islands in the East and South China seas.
"By establishing the air-defense zone Beijing has ... potentially escalated the danger of accidental collisions between the Chinese military and the U.S. and Japanese counterparts," said Tomohiko Taniguchi, a counselor in the office of Japanese Prime Minister Shinzo Abe. "It poses a serious challenge against freedom of movement in the sky and in the seas."
China said the zone is in line with the practice of other nations that have similar zones to protect their coasts. The new zone overlaps with Japan's existing zone, which also includes the disputed islands.
"This is a necessary measure taken by China in exercising its self-defense right," Chinese Defense Ministry spokesman Yang Yujun was quoted as saying on the ministry's website. "It is not directed against any specific country or target. It does not affect the freedom of over-flight in the related airspace."
South Korea and Taiwan also claim the barren, uninhabited islands in the East China Sea.
U.S. Secretary of State John Kerry and Secretary of Defense Chuck Hagel issued separate statements that said the U.S. was "deeply concerned" about China's announcement regarding the East China Sea air defense zone.
"This unilateral action constitutes an attempt to change the status quo in the East China Sea," Kerry said Saturday in Geneva where he was engaged in talks on Iran's nuclear program. "Escalatory action will only increase tensions in the region and create risks of an incident."
Kerry said that overflight and other internationally lawful uses of sea and airspace were essential to prosperity and security in the Pacific.
Kerry said the U.S. does not support efforts by any state to apply procedures of an air defense identification zone to foreign aircraft not intending to enter its national airspace. He said the U.S. does not apply its air defense identification zone procedures to foreign aircraft that do not intend to enter U.S. airspace.
"We urge China not to implement its threat to take action against aircraft that do not identify themselves or obey orders from Beijing," Kerry said.
Hagel declared that China's announcement "will not in any way change how the United States conducts military operations in the region."
He added that the United States is conveying its concerns to China "through diplomatic and military channels" and is in close consultation with Japan and other U.S. allies in the region. He reaffirmed the longstanding U.S. policy that Article V of the U.S. Japan Mutual Defense Treaty applies to the Senkaku Islands. Article V states that in the case of an armed attack against Japanese territory, both the U.S. and Japan "would act to meet the common danger" in accordance with "constitutional provisions and processes."
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