Japan Aids Neighbors With ‘High-Quality Infrastructure’

[Aepsilons]

As Asian powers compete with each other to expand influence in emerging nations of Southeast Asia, Japan is increasingly turning to infrastructure development as a tool to make its mark.

As Prime Minister Shinzo Abe met with the leaders of the Association of Southeast Asian Nations for their annual summit Wednesday, Mr. Abe emphasized Japans’ intention to offer “people-centered investments” to aid infrastructure projects in the region. Officials in Tokyo believe Japan’s expertise in building high-quality infrastructure—from pollution-free power plants to bridges and ports resilient to natural disasters—sets it apart from countries including China and India that are also pouring money to expand security and economic ties with countries including Myanmar, Vietnam and Indonesia.

“To meet the region’s huge infrastructure needs appropriately and achieve high-quality growth, people-centered investments are indispensable,” said Katsunobu Kato, deputy chief cabinet secretary and a close aide of Mr. Abe. “These are the areas Japan is particularly skilled in.” Mr. Kato said that of the ¥5 trillion ($43 billion) in official development aid Japan pledged in December 2013 to the Asean nations over five years, ¥600 billion has been earmarked for specific projects.

Japanese officials say new focus of Japan’s infrastructure cooperation includes the emphasis on the life-cycle costs and environmental impact of projects, as well as the efficient use of public funds to entice private companies to bring in more investments.

With Japan facing severe budget deficits, the amount of its overall development aid has declined to ¥550 billion yen in the current year ending next March, from the peak of ¥1.169 trillion in fiscal year 1997, according to Japan’s foreign ministry data. And even as the nation’s military spending has increased slightly since Mr. Abe took office, overall development aid has remained little changed.

At his meeting with the Asean leaders—one of the several regional meetings held in this capital city of Myanmar this week—Mr. Abe also touched on expanding cooperation in regional security as China’s aggressive behavior keeps maritime tensions high in South China Sea, Mr. Kato said. Over the next three years, Japan’s coast guard will help train 700 experts from the region in maritime policing. That complements its existing efforts to provide patrol ships and communications equipment to nations facing pressure from China, such as the Philippines and Vietnam.

Defense ministers from Japan and Asean will hold their first joint meeting later this month in Myanmar to discuss a broad range of topics.

Mr. Abe repeated these themes with a few individual leaders in bilateral sessions.

As an example of “people-centered” infrastructure projects, Mr. Abe pledged a fresh loan of up to 25.9 billion yen ($220 million) to finance three projects in Myanmar during his meeting with President Thein Sein . Over half of that amount will be spent on port and electric generation facilities at a Japanese-sponsored industrial zone at Thilawa near Yangon. The other two involve the renewal of Yangon’s power grid and nurturing lenders specializing in small and medium-size companies, according to a foreign ministry news release.

Since Mr. Abe came to power two years ago, Japan has pledged over $1.5 billion in aid to Myanmar and canceled $2.7 billion in debt. Japanese officials are eager to build up Japans’ presence fast to counter the influence of China, by far the largest provider of investments traditionally. Japanese companies, meanwhile, see it as one of the region’s last frontiers and stepping up investments, but remain worried about inadequate infrastructure and an opaque regulatory environment.

As he met Philippine President Benigno Aquino, Mr. Abe promised a loan totaling ¥20 billion to finance infrastructure projects. Among them is the construction of several overpasses at major intersections in Metro Manila to ease congestion, according to the Japanese foreign ministry.

http://online.wsj.com/articles/jock...s-with-high-quality-infrastructure-1415809483

 

[mike2000]

huh..........what's the meaning of 'high quality' infrastructure?.............

 

[Aepsilons]

huh..........what's the meaning of 'high quality' infrastructure?.............

Perhaps the author wanted to emphasize high quality vs low quality ?

 

[key-CN]

In order to make money long to invest，Japan half a century are like this ？Bragging of the first。Excuses for high prices.

 

[Aepsilons]

In order to make money long to invest，Japan half a century are like this ？Bragging of the first。Excuses for high prices.

Well, you do get what you pay for.

 

[Killswitch]

Hopefully Japan can help with the construction of the newly proposed Highway in the Northeast along the Tibetan border.

 

[Levina]

@Nihonjin1051
I just read this news
Japan's economy makes surprise fall into recession

Japan's economy contracts for a second quarter in a row.

Japan's economy unexpectedly shrank for the second consecutive quarter, leaving the world's third largest economy in technical recession.

Gross domestic product (GDP) fell at an annualised 1.6% from July to September, compared with forecasts of a 2.1% rise.

That followed a revised 7.3% contraction in the second quarter, which was the biggest fall since the March 2011 earthquake and tsunami.

Economists said the weak economic data could delay a sales tax rise.

Sales tax delay
Prime Minister Shinzo Abe is widely expected to call a snap election to seek a mandate to delay an increase in the sales tax to 10%, scheduled for 2015.

The tax increase was legislated by the previous government in 2012 to curb Japan's huge public debt, which is the highest among developed nations.

April saw the first phase of the sales tax increase, from 5% to 8%, which hit growth in the second quarter and still appears to be having an impact on the economy.

The economy shrank 0.4% in the third quarter from the quarter previous.

The data also showed that growth in private consumption, which accounts for about 60% of the economy, was much weaker than expected.

The next tax rise had already been put in question by already weak economic indicators.

There is growing speculation that Mr Abe could call an early general election
"The Japanese economy is in recession and has now contracted in three of the last four quarters," said Glenn Levine, senior economist at Moody's Analytics.

"The most likely course is now a snap election in December in which voters choose, naturally enough, to delay the tax increase."

Election expected
Speculation had been growing that the Japanese prime minister would call an election next month to gain support just two years after his election.

Local media are now reporting that Mr Abe could announce the next election as early as Tuesday to be held on 14 December.

The Japanese government's chief spokesperson Yoshihide Suga said on Monday that Mr Abe was expected to decide on various steps to take amid the "severe economic situation".

While Mr Abe's popularity has fallen since he took office in 2012, he is expected to win if an election were called, because the opposition remains divided.

In reaction to the negative economic data, the dollar went above 117 Japanese yen before settling back at 115.69.

The benchmark Nikkei 225 index, meanwhile, closed down almost 3% to 16,973.80, marking its biggest one-day drop since August.

Analysis: Rupert Wingfield-Hayes, BBC Tokyo Correspondent
Where did Abenomics go wrong?

In the spring of 2013, Prime Minister Shinzo Abe launched an ambitious growth strategy that rapidly became known as Abenomics.

Its aim was to drag Japan's economy out of 20 years of deflation and put it back on the road to growth. Billions of dollars were pumped into the economy through stimulus spending. The Bank of Japan went on an even bigger spree, printing hundreds of billions of dollars of new money and using it to buy government bonds.

This had two effects. First, it pushed down the value of the yen, which made Japanese exports cheaper. Second, it pushed investors out of bonds and in to stocks. The Tokyo stock market soared. By mid-2013 Japan's economy was back in what looked like solid growth.

Then, in early 2014, Mr Abe's government took a calculated gamble. With the economy growing he could risk putting up taxes for the first time in nearly 20 years. Consumption (purchase) tax would rise from 5 to 8%. The tax rise was urgently needed to plug the giant hole in Japan's public finances.

But the gamble has not paid off. Japanese consumers have stopped spending and the economy is back in recession. Why? The fall in the yen gave a huge cash windfall to Japanese exporters. But instead of increasing the wages of their employees, they have sat on the money.

The huge stock market rise only benefited a minority of rich people. 80% of Japanese people do not own any shares. Instead, their incomes are stagnant or falling, and the tax rise has made them feel even poorer. Hence they have stopped spending.

 

[Huaren]

Indeed hopefully japan will spend more investment elsewhere so their home economy could fall even faster. Such investment projects are all of longterm prospects, Structural support and at least stable economy at home are some of the necessities for these kinds of coorperation to prosper over the time.

Not much "competition to expand influence" if one is risking failing at homefront at the same time.