Japan is letting the strain of its diplomatic relations with
China spill over into the nations' economic ties.
Japan's Chief Cabinet Secretary Shinzo Abe declared on Thursday
that his country would "put off making a decision on yen loans for
this fiscal year to China ... because of various situations
surrounding Sino-Japanese relations."
Abe did not elaborate what the situations are. The bilateral
relationship is at its lowest ebb after Japanese Prime Minister
Junichiro Koizumi was insistent on paying homage to the Yasukuni
Shrine.
The justification Abe gave for the delay, if not suspension, is
clear evidence of one thing: Japan is ready to put its economic
ties with China under the sway of political upheaval.
Japan announced last year that it was reducing aid to China from
2008. This time Abe offered an explicit link between the yen aid
and politics.
Japan's official development assistance (ODA) to China began in
1979 and has totaled more than US$25.7 billion.
The multiplicity of the money from the island neighbor has
greatly helped drive China's growth. The ODA from Japan has funded
large-scale infrastructure projects in China ranging from roads,
airports and power stations.
But the aid has also benefited the donor itself, economically,
politically and diplomatically.
A speech given by Japanese Foreign Minister Taro Aso at the
National Press Club in Tokyo on January 19 confirmed the point.
"It must not be forgotten that in the end, ODA is implemented
for Japan's own sake," Aso said.
He quoted a Japanese saying that goes, "sympathy is not merely
for others' sake," or in other words, "your kindness will be
rewarded in the end."
Obviously Aso was attempting to solicit domestic support for
continuing the ODA program, adding that it is the type of endeavor
that should be considered with a broad and long-term
perspective.
Aso reminded his audience that Japan implements ODA for its own
benefit in the end.
He recommended that Japan's ODA be used abundantly in the future
for the objectives of enhancing and expanding ties between Japan
and countries with the same interests and aspirations.
These, in Aso's eyes, are the objectives of building a type of
policy coalition or encouraging the stability of other countries on
which Japan's prosperity is built.
Since 1995, Japanese ODA has reflected another dimension of the
interdependence of the two countries that underscores elements of
concern rather than cordiality.
Japanese ODA has been re-targeted to address such areas as
environmental problems. This stems from Japanese worries about acid
rain and dust blown in from the continent.
The yen loans to China have been in decline, with the
Sino-Japanese relations afflicted with tension as a result.
The Japanese loans under the ODA to China fell to 85.9 billion
yen (US$728 million) in 2004 from 214.4 billion yen (US$1.19
billion) in 2000, a 60 percent reduction. China ranks third among
recipients of Japan's ODA.
Japan has long used its economic capabilities as a principal
instrument in conducting foreign policy.
Ostensibly, Japan's ODA involves the separation of economics
from politics. But as it has been used to promote Japanese business
interests, it can be seen to have advanced the country's interests
as a whole, especially in the context of a country that was the
first to advance the concept of "comprehensive security."
The economies of China and Japan have helped each other since
they normalized the diplomatic relations in 1972. China has turned
out to be a natural partner for Japan, a country poor in resources
but superior in high technology.
China has emerged as Japan's biggest trade partner, with the two
clinching a record high trade volume of US$189.3 billion last year.
Japan was the third-largest to China after the European Union and
the United States.
Paralleling this has been a corresponding rise in Japanese
foreign direct investment. By the late 1990s, China trailed only
the US as a destination for Japanese investment.
The economic interdependence between China and Japan is of
positive value to their relationship as a whole.
Japan is adding a new knot to its rocky relations with
China.
(China Daily March 27, 2006)
