What if Japan stayed out of World War I?

In August 1914, when World War I began, Japan sent Germany a ultimatum. Germany was to remove it's ships from Chinese and Japanese waters and transfer the German administered port city of Tsingtao to Japanese control. The ultimatum expired on the 24th of August and Japan declared war on Germany, conquering Tsingtao on the 7th of November that same year.

Over the course of the war, Japan also conquered German-controlled Micronesia.

At the end of the war, however, Japan was shafted. Their proposed Racial Equality Clause to the Treaty of Versailles was at first approved, but then was overturned due to opposition by Australia and the United States. This overturning essentially branded them as inferior to the rest of the Allied representatives. This led to increased nationalism on the home front and soured tensions between Japan and the rest of the world.

The final nail in the coffin came in 1921 when that year's Imperial Conference shelved the Anglo-Japanese Alliance and Japan, believing that Britain no longer cared for Japanese interests, annulled the agreement.

But what if Germany gave into the Japanese ultimatum and ceded Tsingtao to them, thereby removing any reason for Japan to become involved in the war?
 
If the Germans have already given them what they want, those Southeast Asian colonies might start to look pretty interesting. After all, their owners don't have any men to spare to defend them because of the war in Europe.
 
To answer that very question I bought "War and National Reinvention", by Frederick R Dickinson, a book that in its reviews seemed to address head on how Japan was reshaped by the conflict and sent on track to become the Imperial Japan we now remember. I am hoping to read it very soon, I have had a while but keep bogging in European affairs sadly. My suspicion is that Japan experienced a truly transformative POD at opening hostility with Germany in China. Take it away and Japan itself may not appear anything like we presume it might or now believe it does. My frame is that British pressure against any change in China butterflies Japan's aggression here the UK is not pulled into the war. Until I finally decide if the UK truly stands "neutral" all of Asia is a rather blank page moving forward. I still must resolve the notion that Japan acts alone or later, that it still eyes China to be swallowed and create itself as the peer power in Asia. Onkel Willie may be right, we might open the door to a belligerent America in Asia eerily like the later War in the Pacific only brought forward 20 odd years. It looks quite murky. Japan is one country I am hoping to pass through to modernity without need to be nuked.
 
My pencil in the margins ideas for China include dampening the 1917 revolution and disintegration of China under the territorial military Governors, a rather different path overall for China perhaps. Japan accrued advantages in China that set in motion its later conquest, a restrained Japan might not gain enough to be more than a minor player in China and instead focus itself in Korea and Formosa. China might remain under unequal treaties longer but not fall to warlordism, instead strengthening its own Republic and casting off the bondage without either KMT or CCP as the alternatives. This could doom China to being a third-way India or open the door to it becoming something vastly different in the modern day.
 
I'm pretty sure the Kaiser was really racist against the Japanese, in fact Germany more or less created the whole "Yellow Peril" thing. I can't circumstances where they would surrender the colonies willingly. As others have suggested you'd need to make the Japanese decide it's not worth it. Maybe they do worse in the Russo-Japanese war and are less confident in attacking Germany, maybe remaining neutral during the conflict?
 
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