ODA looks wasted on China


This year Japan marks the 50th anniversary of the official development assistance program it launched after getting out of the postwar economic chaos. The Foreign Ministry’s 2004 white paper on ODA boasts that Japan, now one of the world’s largest ODA providers, has made major contributions to the economic development and the improvement of welfare in developing countries.

It says Japanese ODA has contributed to the phenomenal economic expansion of East Asian countries through the improvement of infrastructure and development of human resources.

In 2003, however, Japan’s actual ODA spending posted the fourth year-on-year decline. In 2001, Japan was replaced by the United States as the top ODA provider. In the coming years, it could be overtaken by France, Germany and Italy in the ODA rankings.

The white paper notes that the general account budget for ODA in 2004 fell 30 percent from 1997, while the defense budget decreased 1 percent and the public-works budget declined 9 percent.

The ODA cutback has reflected Japan’s huge budget deficit, one of the largest among industrial countries. With the outlook bleak for eliminating the deficit, the government budget inevitably places more importance on domestic requirements than on foreign needs.

The big question is how to restructure ODA in response to changing economic situations at home and abroad.

First, Japanese ODA should now be focused on Africa and other non-Asian regions. Asia, which has received 50 to 60 percent of the aid, has achieved fast economic growth.

The 10-member Association of Southeast Asian Nations, which seeks to conclude a free-trade agreement with Japan, is moving to expand trade and reduce its dependence on ODA in hopes of achieving economic independence.

Although ASEAN is urging Japan to lift import tariffs on rice, sugar, bananas and other farm produce, Japan’s farm ministry resists doing so to protect domestic farmers. There are fears that Japan could use ODA to placate ASEAN countries’ demand to lift tariffs.

The Foreign Ministry should permit corporate entities to acquire farmland and take other measures to expedite the restructuring of agriculture and the liberalization of farm-produce imports.

Second, Japan should strictly observe the principles of its ODA charter by suspending or reducing aid to countries that contravene them. China clearly flouts the principles as it is increasing military expenditures and has produced weapons of mass destruction and missiles.

China’s ongoing persecution of followers of Falun Gong, a spiritual practice combining exercises and meditation, contravenes another charter principle, which calls for protection of basic human rights and freedoms.

In recent years, Japanese ODA to China has been decreasing amid mounting public criticism, but in actual spending for 2003, China still was the second-largest recipient after Indonesia. China has the world’s second-largest foreign-currency reserves after Japan, and provides ODA to other developing countries. China should decline further ODA.

Prime Minister Junichiro Koizumi’s attitude toward China is perplexing. He has angered Beijing by continuing his visits to Yasukuni Shrine, which honors Japan’s war dead (including class-A war criminals). Meanwhile, anti-Japanese sentiment is strong among the Chinese, as evidenced by the reaction of Chinese spectators to Japan’s national team at an Asian Cup soccer game in August.

China reacted coolly when Koizumi announced Japan’s intent to seek permanent membership on the U.N. Security Council last month. The situation indicates that Japanese ODA to China has become a complete waste.

The ODA charter lists Central Asia as one of the important target regions for assisting democratization programs and market reforms. This is fine except for the large amount of aid being given to Kazakstan, the region’s richest country with oil, nonferrous metals and other resources.

The Kazak ambassador to Japan, with whom I met recently, said the country needs more direct investment from the Japanese private sector than yen-based loans from the government. I doubt whether Japanese aid is based on careful studies of the target region.

Third, the white paper says the government has been enhancing dialogue and cooperation with, and increasing aid to, nongovernmental organizations, but the efforts leave much to be desired. In 2002, subsidies to NGOs accounted for only 1.5 percent of Japanese ODA, far below 12.9 percent for the Netherlands, 12.1 percent for Ireland and 8.2 percent for Canada.

Michiya Kumaoka, president of the Japan International Volunteer Center, says European governments and NGOs tend to work as partners, but in Japan, the government totally controls ODA. NGOs in Japan are only subcontractors for the Foreign Ministry. In his opinion, the ministry should attach more importance to ODA-based projects worked out by NGOs.

The Foreign Ministry should make better use of NGOs to make up for the shortage of ODA staff, which is much smaller than in other countries, and to improve aid plans from citizens’ viewpoints.

I am seriously concerned about the Japanese government’s tendency to use huge amounts of tax money as reconstruction aid for Afghanistan and Iraq after blindly supporting the U.S.-led war on terror. This gives the impression that Japan is serving U.S. foreign policy, thus raising doubts about the integrity and humanitarian nature of Japanese aid and causing erosion in the trust of Japanese NGOs. More caution is needed concerning Japan’s aid policy.