US, Japan in $27bn aid
tie-up By Suvendrini Kakuchi
TOKYO - Japan and the United States have
begun discussions to collaborate on their aid
budgets and make international assistance more
effective, officials say.
The first
discussions, proposed by US Secretary of State
Condoleezza Rice, were held September 28 in
Washington. A Japanese Foreign Ministry official
said the talks focused on two sectors - creating
an environment to expand private investment in
developing countries and job-training for youth.
"Both sectors are considered crucial for
the economic growth of developing countries, which
is why the US and Japan decided to
narrow our focus here,"
the official, who asked not to be identified, told
IPS.
Projects will help developing
countries reduce tariffs and other trade barriers
to boost international trade and foreign
investment, he said. "We just had the first main
meeting that discussed outlines and the next step
is to expand into details."
Japan is the
world's second biggest donor, contributing a
budget of US$8.86 billion in 2004, its generosity
next only to the US, which spent $19 billion on
official development assistance (ODA), last year.
The combination of both budgets comprises
a hefty 40% of the world aid budget, a move that,
say analysts, will naturally have major
consequences on overseas assistance direction and
policy. "Japan and the US are the two leading
economies of the world," said Keisuke Oohashi, a
professor of international development at Keisen
University. "The move to work together has left
smaller countries, that are dependent on aid, with
no alternative development strategies."
The choice of sectors for US-Japanese
collaboration has put pressure on developing
countries to embrace globalization and the
privatization of important social sectors such as
education and health, not necessarily welcomed by
the local people in these nations, he
said.
"I have always advocated an
internationally linked aid system under the United
Nations, which would better represent the needs of
developing countries rather than bilateral
collaboration," he said.
Oohashi represents
a growing feeling of unease among experts and aid
activists about the new push to link Japanese ODA
with that of its US counterpart.
Professor
Hisashi Nakamura, a well-known expert on Japanese
ODA and economist at Ryukoku University, contends
Japan is bowing to US pressure as before.
"I am not sure US-Japanese collaboration
will work smoothly as the two countries do not
necessarily follow similar aid policies," he said.
"Tokyo obviously could not turn its back on the
proposal."
He explained that Japanese aid
puts priority on developing the local
infrastructure in recipient countries as a means
of increasing private investment, compared to the
US that has supported technology exchange.
Moreover, Nakamura said, job-training
means teaching Japanese language to students in
developing countries in contrast to the programs
followed in the US that are based on English.
The Foreign Ministry, however, denies its
aid budget, which plays the important role of
national diplomacy, will face pressure from
Washington.
"Japan will maintain its ODA
principles that put priority on aid that supports
the goals and desires of the recipient countries,"
the official said. "There is no fear of US
domination."
He explained that
collaboration could pave the way to cut waste in
both the Japanese and US budgets by sharing
consultants and staff and reducing overlapping in
projects.
Analysts say bilateral
collaboration could work well in areas such as
sharing of experienced staff and joint work
between non-governmental organizations, a sector
that is more advanced in the US than Japan.
Japanese aid has been dwindling during the
past seven years to cope with the economic
recession, and it faces the risk of further cuts
next year.
Pressure is also expected to
increase on the ODA budget as the country embarks
on stringent structural reforms though activists
are advocating an increase to meet US targets of
0.7% of the gross national income.
Critics
also argue there is public pressure to use ODA to
shore-up national interests against the gloomy
economic climate.
The Foreign Ministry
reports Japanese ODA will continue to meet UN-led
Millennium Development Goals (MDGs) for
poverty-reduction, and new collaboration with the
US will be a plus in this aspect.
Other
Japanese ODA policies, such as its focus on Asian
developing countries and its latest commitment to
double aid to Africa, will not change, the
official said.
But Oohashi warned of the
danger of politicizing of the UN's MDGs with the
new linking of Japanese and US ODA, which will
pursue the interests of both countries rather on a
multi-national platform with other countries.
