As the tension between China and Japan over the disputed Diaoyu or Senkaku Islands continues, concern is growing about the possible economic impact of anti-Japanese protests in China, which have spread to 85 cities and have forced scores of Japanese companies to shutter factories and suspend operations.

Further anti-Japanese demonstrations took place on Tuesday, the anniversary of the Mukden Incident, which Japan used as a pretext for its 1931 invasion of the northern part of China known as Manchuria, according to reports.

The growing spat has thrown relations between the world's second-largest and third-largest economy into their worst diplomatic crises since 2005 and has put at risk a trade relationship that's tripled in the past decade to $345 billion.

Automakers Toyota Motor Corporation (TYO: 7203), Honda Motor Co Ltd (TYO: 7267) and Nissan Motor Co., Ltd. (TYO: 7201), which had seen dealerships looted and dozens of cars set on fire by protesters, halted production at some plants on Tuesday.

Fast Retailing Co Ltd (TYO: 9983), owner of the Uniqlo brand, shut outlets in Beijing, while dozens of 7-Eleven convenience stores, which belong to another Japanese company, were also closed.

Meanwhile, Japanese electronics company, Panasonic Corporation (TYO: 6752) has instructed its employees at a communications equipment factory in Zhuhai to stay home Tuesday as operations were suspended. Canon Inc. (TYO: 7751), Fujikura Ltd (TYO: 5803), Sony Corporation (TYO: 6758) and Mitsumi Electric Co., Ltd. (TYO: 6767) also suspend operations on Tuesday.

Some market observers say that the tensions will likely be short-lived with limited impact, citing two other notable periods of anti-Japanese sentiment -- one that kicked off in March 2005 and another in October 2010 -- each lasted less than two months. Their view is supported by Nissan's latest announcement that it will resume production at four plants in China on Wednesday.

Fitch Ratings, however, struck a more cautious tone in a research note released Tuesday. The ratings agency threatened to downgrade the credit ratings for major Japanese automotive and technology companies if the tension escalates.

Fitch warned that Nissan is heavily at risk with 26 percent of its global car sales in China, followed by Honda with 20 percent. Toyota's sales in China account for about 10 percent of its global total.

Major Japanese electronics makers are also heavily exposed to China. Sharp's sales from China represented 20 percent of its total sales during the year ended March 2012. During the same period, Panasonic's and Sony's revenue exposure to China was also significant at 13 percent and 9 percent, respectively.

"There is little visibility on the extent to which their sales in China might be affected, and how long anti-Japanese protests may continue," Fitch stated.

It's arguable who would be hit worse. Both economies would suffer for sure. Damage from a China-Japan trade war would also spread beyond the two countries, affecting supply chains for everything from iPads to automobiles.

Here's a look at what's at stake in numbers:

China is Japan's largest trading partner, and by a lot. China accounted for 21 percent of Japan's exports and imports in 2011. The next closest was the U.S. at 12 percent, then South Korea at 6 percent.

The Hong Kong Economic Journal reported that China is drawing up plans to cut off Japan's supplies of rare earth metals needed for hi-tech industry. Those rare earths go into practically every gadget we buy or make. Almost every flat screen TV, every mobile phone, everything that requires memory, requires parts made in Japan with Chinese minerals. Without these rare earths, Japan's manufacturing will be hit hard.

Additionally, Chinese tourists account for more than 40 percent of foreign tourists to Japan.

But any move to punish Japan would likely prove, as Beijing's mouthpiece the People's Daily has observed, a double-edged sword.

China's second-biggest trading partner is Japan, coming after only the U.S., with $345 billion worth of goods going back and forth in 2011, representing 9 percent of China's overall trade. That's more than all the trade China does with the four other so-called BRICs countries - Brazil, India, Russia and South Africa - plus the U.K.

Japanese firms account for 4 percent of incoming foreign direct investment in China and Japanese businesses directly employ one million Chinese workers. Attacks on Japanese cars and businesses also harm the Chinese citizens who own and operate many of them.

Additionally, China was Japan's top international tourism destination in 2011. More than 3.65 million Japanese crossed the sea to visit China, a 50 percent increase from a decade earlier.