Putting ODA in its place

The Japanese government has recently announced a plan to renew an important component of its diplomacy — a plan aimed at not only checking but reversing the downtrend in Japan’s official development assistance. Specifically, in its basic policy program for the nation’s financial and fiscal operations as well as structural reform, the government has made clear that it will attain a sufficient level of ODA.

By doing so, the government intends to make continuous efforts to achieve the goal of raising ODA expenditures to 0.7 percent of gross national income (GNI).

In 2003, Japan revised its ODA guidelines to use it more strategically and to enhance Japan’s national interests. In the guidelines, the government attached importance to increasing the efficiency of ODA. Due to concern about the nation’s deteriorating financial situation, Japan’s ODA decreased for six years in a row, registering a 30 percent drop from the peak.

Since ODA is an important instrument for helping developing countries overcome poverty and put themselves on a path of sustained economic growth, increasing the amount of ODA will be welcomed by such countries.

The suddenness of the recent government decision suggests that Japan is trying to use a policy of increasing ODA as a means of leveraging international support for its bid to become a permanent member of the United Nations Security Council. The government, for example, has announced that it will double its ODA to Africa in three years, with a bigger grant component.

Japan’s new ODA policy will be tested as it takes concrete forms. At home, though, the government has a problem to solve in implementing its new plan. Public support for ODA is at an all-time low. According to polls by the Cabinet Office, the percentage of people who expressed “positive” feelings about ODA plummeted from 41 percent in 1991 to 18 percent in 2004.

By contrast, the percentage of people who think that the “less ODA the better” jumped from 8 percent to 25 percent. To win greater public support for ODA, therefore, it is indispensable that the government collect accurate information on how ODA has been actually put to use in recipient countries and make this information public.

U.N. Secretary General Kofi Annan has called on rich countries to increase their ODA to 0.7 percent of their GNI by the year 2015, describing 2005 as a make-or-break year for the world’s poor. More than 1 billion people live on less than $1 a day, he said. Five million children will die before reaching the age of 5 in 2015, according to the U.N. Development Program.

The GNI figure of 0.7 percent is nothing new. Developed countries have been called on to provide that amount in ODA for more than three decades. Japan’s ODA in 2004 amounted to only 0.19 percent of its GNI, putting itself in the bottom group among developed countries.

Only five countries — Denmark, Luxembourg, the Netherlands, Norway and Sweden — have managed to achieve the 0.7 percent target. Germany, which also seeks a permanent seat on the Security Council, provides 0.28 percent of its GNI as ODA. The corresponding figure for the United States is 0.17 percent. While all 25 EU nations have pledged to increase their ODA to 0.7 percent of GNI by 2015, Japan and the U.S. have not yet set concrete timetables.

In terms of ODA amounts, Japan occupied the top position as a donor for 10 years from 1991. It provided a total of more than $220 billion to 185 countries and regions, helping them with economic growth, poverty reduction, and promotion of health and education services. Although Japan has been criticized for the large loan component of its ODA, yen loans have greatly helped to build or improve infrastructure such as railways, roads and power stations, thus contributing to the economic growth of China and Southeast Asian countries.

Japan should use its long experience as an ODA contributor to work out programs that are reasonable to recipient countries as well as to Japanese taxpayers. Care should be taken so that ODA benefits are visible to the Japanese public and to the international community. In this sense, making ODA transparent and efficient is all the more important.

Prime Minister Junichiro Koizumi has stressed that, in combating poverty and promoting development, Japan must extend assistance and cooperation corresponding to its economic and technological strength. The success of Japan’s ODA will depend on doing more to enlighten Japanese taxpayers about ODA and to encourage recipient countries to eliminate corruption and other barriers to the efficient use of aid money.