Figuring out Japan's new aid charter

The Japanese flag. What could the country’s new aid charter mean for development? Photo by: stacey shintani / CC BY-NC-SA

Japan’s foreign aid is taking on a new path as the country’s cabinet last week approved a new aid charter aligning the country’s development agenda more closely with national interests — a policy shift bannered by a clause allowing the country to use its assistance to fund foreign military troops but only for “nonmilitary” activities.

The new guiding document, called the Development Cooperation Charter, marks a new era in Japanese foreign aid as it takes a more “proactive” approach in promoting peace and stability. It’s arguably a clear declaration of the East Asian nation’s intent to respond to an increasingly insecure international environment.

“In this new era, Japan must strongly lead the international community, as a nation that contributes even more proactively to securing peace, stability and prosperity of the international community,” reads the document. The revision marks the first time the country’s basic aid policy was changed in almost 12 years.

While Japan remains a major economic and development player both in the regional and international stage, the country has seen itself slip in terms of both growth and military spending behind China, Russia and the United States. According to World Bank data, Japan’s military spending amounted to just 1 percent of its gross domestic product in 2013, as opposed to the other three nations’ 2 to 4 percent average.

Leveraging development assistance to advance national interests is not new. This is a strategy Japan has been implementing for quite some time, but which Prime Minister Shinzo Abe only officially acknowledge in mid-2013. Experts suggest this policy move is a step to ensure Japan could strengthen its international footing while continuing to grow and prosper.

“The recent revisions in the ODA charter … need to be understood against the shift of the strategic stance of Japan,” Syed Munir Khasru, chairman of Bangladesh’s Institute for Policy, Advocacy and Governance, told Devex. “With the renewed mandate, [Abe] wants to alter how Japan is perceived in the world and to become an influential international leader in setting new rules through proactive foreign policy.”

The move is not without basis. Apart from falling behind military spending and influence in the past couple of years, Japan is faced with a growing number of competitors in Asia-Pacific’s development sphere. China expects to finish the establishment of its Asian Infrastructure Investment Bank — seen by many experts to likely be in direct competition with the Japan-dominated Asian Development Bank. India is also shoring up its regional influence under the leadership of Prime Minister Narendra Modi, for instance by increasing assistance to neighbors like Sri Lanka.

But even local experts suggest the policy is not without its thorns. A spokeswoman from the JICA Research Institute told Devex that while the policy has been ratified, “considerable controversy still exists.”

Focus on security, influence

Japan’s decision to revise its charter to include, among other changes, funding foreign military troops — albeit only for “nonmilitary purposes” — raises a few questions on whether security concerns can be anticipated in the near future and whether this form of aid might be misused if not well regulated.

While the new aid charter “gives a clear indication of what Japan aspires to achieve, the modus operandi and the priority areas and the region,” Khasru expressed concern over the fact that the provision for “channeling aid for nonmilitary purposes is left open and vague.”

Military troops have long played a role in enabling nonmilitary activities in conflict-affected areas, fragile states or in humanitarian crises. The majority of foreign assistance given to the Philippines in the wake of Typhoon Haiyan, for instance, were coursed through official development agencies, nongovernmental organizations or foreign military personnel. But without proper planning and supervision, it is very easy for funding for nonmilitary purposes to be funneled into military activities.

The main problem, according to the IPAG chief, is that “the charter does not provide a clear strategy of how to mitigate the risks that arise from much a significant change in Japan’s mode of engagement with recipient nations.”

Speculation is rife that this heightened focus on security came in response to the recent killings of two Japanese nationals by the militant organization the Islamic State group. Just this Tuesday, the Japanese foreign ministry released a document outlining the three pillars anchoring its foreign policy response to the murders.

These include a $15.5 million counterterrorism capacity-building assistance in the Middle East and Africa, $200 million in nonmilitary aid for countries fighting the Islamic State group as part of efforts to boost diplomacy and create a more stable and prosperous Middle East, and improved coordination and knowledge exchange to make societies more resilient to radicalization.

Focus on ASEAN, Africa

Another aspect of the new aid charter is Japan’s renewed focus on regional and international cooperation, particularly with Southeast Asia and Africa.

The document emphasized that while Japan is gearing for a more integrated international community, “it is necessary to implement cooperation that caters to the needs and characteristics of each region while maintaining a global perspective.” Khasru said this focus will help Japan boost its economic growth and international influence.

Asia will be the main focus of Japan’s renewed commitment to development cooperation, particularly Southeast Asia, given its “close relationship with Japan and high relevance to its security and prosperity.”

The 10-nation subregion remains a fertile battleground between China and Japan not only for economic supremacy but also for geopolitical clout, which among other things include disputes over the South China Sea. Japan will be announcing new investments for the region, including support for the development of physical and nonphysical infrastructure in the Association of Southeast Asian Nations’ member countries.

In the case of Africa, Khasru said the region’s “abundant source of natural resources and potential source of future economic growth” made it alluring for Japan as it seeks to “build long-term ties with the African nations where China has already been shoring up presence.”

Despite the mixed reactions following the revision of its foreign aid, Japan has yet to face possibly its biggest challenge: convince the international community that its decision to underscore national interests in its development policy will not derail global development pursuits.

“It would be important for [Japan] to emphasize and create confidence among its neighbors and peers regarding how its ODA and international engagement strategy — although informed by ‘national interest’ — would align with global and regional peace, stability and development,” Khasru concluded.

What do you think of the key changes in Japan’s new aid charter? Please let us know by leaving a comment below.

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About the author

  • Lean 2

    Lean Alfred Santos

    Lean Alfred Santos is a Devex development reporter focusing on the development community in Asia-Pacific, including major players such as the Asian Development Bank and the Asian Infrastructure Investment Bank. Prior to joining Devex, he covered Philippine and international business and economic news, sports and politics. Lean is based in Manila.