That Eastern island looks a bit lonely. You should put something on it to create more conflict between the two races. For example, what if that island was the only known source of <Generic Shiny Ore> which provided enhanced abilities to combatants (IE, it's the material used to build Master Seals). Both species would require it to efficiently defend against Wild Beast attacks, but neither has control of it for very long exactly for that reason. I feel at the moment, there isn't really enough tension between the two areas for an all-out war, and even if you have plans for how that starts, this could be an extra crack in the column to help it fall even quicker.
It could also function as a plot device for other things. If the island was in a state of constant war, inhabitants from both species there would get little chance to contact the mainland, so the prejudices there could be something to extract some extra-juicy stuff from; it could even play a role in calming tensions if it had something like WW1's famous Christmas event going on - in which the soldiers on both sides have played and worked with each other as friends and are fighting reluctantly.