There are plenty of places the Chinese Navy can send its ships for training. Sending them to international waters near Okinawa has the added advantage of reminding Japan that China could use force to assert its rights over small islands Japan also claims. Some of these islands have oil and natural gas deposits nearby. Chinese leaders are very concerned about energy supplies, because China has to import nearly all its petroleum, and consumption is growing rapidly. Thus China blocks Western attempts to impose strong sanctions on Iran, which is a major oil supplier to China. In return, China is believed to have also helped Iran with its ballistic missile and nuclear weapons programs.
China is also still very concerned with Japanese military and economic power. Add to that the smoldering resentment for Japanese occupation and atrocities from the 1880s to the 1940s, and you have potential for war that is little appreciated outside the region. In fact, China has tense relationships with all its neighbors, in addition to a long history of Chinese aggression. The growing economic power of China is seen, by Chinese neighbors, as another weapon the Chinese will use against them.
Internet security experts in North America and India have uncovered a major Cyber War operation, coming out of China, and aimed at the Indian military and defense industries. The security researchers caught the hackers in the act, and traced them back to China. The Chinese deny everything, but the evidence keeps piling up that China has, for years, been stealing huge quantities of commercial, military and government data.
April 19, 2010: China sentenced an Australian mining executive to ten years in jail, for bribery and stealing trade secrets. China is a major buyer of Australian raw materials, and likes to play hard ball when it comes to prices and other terms. When Australian firms resisted the Chinese pressure, Australian mining executives in China were arrested and accused of crimes that were, for most businesses in China, normal operating procedures. Australian mining firms are moving more of their Chinese offices to Singapore, partly to get away from the Chinese secret police, who like to bug your offices and tap your phone lines and Internet connections.
April 18, 2010: The Japanese military announced that it was assigning more resources to keeping an eye on the Chinese military, and what developments there might mean for Japan.
April 15, 2010: Responding to Japanese media reports of menacing Chinese warships off Okinawa, China announced that these were Chinese navy ships engaged in training in international waters. Nothing special. Just training. Trust us.
April 14, 2010: There was a major earthquake in Tibet, killing over two thousand people, injuring over 12,000 and putting many more out of their homes. The Chinese were somewhat dismayed at the suspicion and resentment some of the 13,000 military and police relief workers received from some of the Tibetan earthquake victims. The Tibetans tend to blame China for everything that goes wrong, and bad relations between the Tibetans and ethnic (Han) Chinese remain even during a natural disaster.
April 10, 2010: Japanese air patrols spotted two Chinese submarines moving, on the surface, south of Okinawa, along with seven other combat and support ships. This caused consternation in the Japanese media, and demands that China explain what so many of its warships were doing less than 200 kilometers from Okinawa.
April 9, 2010: A crusading lawyer, Gao Zhisheng, has reappeared after having disappeared for a year. The government announced they were going to prosecute him for subversion. He would not say what he had been doing for the past year, but he was much thinner and subdued. He said he was giving up his crusading ways, and hoped to be reunited with his family (his wife, and two children fled, the country after Gao Zhisheng disappeared.) He and his family had been increasingly harassed by the police. The government was upset that Gao Zhisheng would take up unpopular (to government officials) cases, and make the point that Chinese law granted citizens far more legal rights than the government would like to acknowledge. More people like Gao Zhisheng are showing up. There are also a growing numbers of public demonstrations, many turning into riots, protesting corruption and officials being inept. These events are so common that even foreign tourists often see them.
April 8, 2010: In China, nine journalists were convicted of taking bribes from a mine owner, to play down a major accident at the mine. The government often orders journalists to do the same thing, but taking money from a non-government organizations to not report something is generally forbidden.
April 6, 2010: China's military has been given detailed instructions on how to improve their computer defenses against Cyber War attacks. This covers Internet based communications, as well as wireless equipment (radios and satellite based comms). China is introducing more communications equipment in the military, and is trying to improve and standardize security procedures and standards. It's an old Chinese tradition for troops to do only as much as they have to in order to appear ready for combat. But with Internet based communications, there is always a war going on, and patriotic hackers have been reporting that Chinese military networks are embarrassingly vulnerable.