Press Conference by the Press Secretary 19 March 1996

1. Visit to the Russian Federation by Minister for Foreign Affairs Yukihiko Ikeda
2. The Significance of the visit to the Russian Federation by Minister for Foreign Affairs Yukihiko Ikeda
3. Trade and economic issues involving the extension of assistance to the Russian Federation by Japan
4. Possibility of discussion between Japan and the Russian Federation on matters of security
5. Matters involving plans for promoting trade development between Japan and the Russian Federation
6. Matters regarding the schedule for the visit to the Russian Federation by Minister for Foreign Affairs Ikeda
7. Subjects of possible discussion between Japan and the Russian Federation involving the Tokyo Declaration and matter of the Northern Territories
8. Subjects of possible discussion between Minister for Foreign Affairs Yukihiko Ikeda and President Boris Yeltsin of the Russian Federation

1. Visit to the Russian Federation by Minister for Foreign Affairs Yukihiko Ikeda

   Foreign Ministry Spokesman Hiroshi Hashimoto: Good afternoon, ladies and gentlemen. Minister for Foreign Affairs Yukihiko Ikeda will leave for the Russian Federation tonight and hold talks with Minister of Foreign Affairs Evgenii Maksimovich Primakov and First Deputy Prime Minister Oleg Soskovets of the Russian Federation tomorrow on 20 March. Foreign Minister Ikeda will pay a courtesy call on President Boris Yeltsin of the Russian Federation on the same day. The political situation in Russia becomes increasingly opaque in the build-up to the presidential elections in June. Japan, together with other G-7 countries will urge Russia to continue its policies of reform. Foreign Minister Ikeda will visit the Russian Federation against this background.

2. The Significance of the visit to the Russian Federation by Minister for Foreign Affairs Yukihiko Ikeda

   Foreign Ministry Spokesman Hiroshi Hashimoto: Russia is an important neighbor of Japan. This visit by Foreign Minister Ikeda is a good opportunity for fostering closer contacts and dialogue. Dialogue during this visit will span a broad spectrum of fields. This will be the first time the Japan-Russian Federation Regular Foreign Ministerial Meeting and the Japan-Russian Federation Inter-Governmental Committee on Trade and Economy are held together. The former consultation consists of dialogue on the territorial issue, negotiations on a framework for the operation of Japanese fishing vessels in the waters around the Northern Territories, security dialogue, etc. The latter consultation consists of dialogue on solving the private sector debt issue, and creating taxation and legislative systems, confirming and providing assistance for continuation of the policies of reform, and strengthening economic relations with the Far Eastern region. Through these two consultations, this visit will serve to expand the foundation for overall Japan-Russian Federation relations, spanning both the political and economic sectors, based on the principle of balanced expansion. Expanding the foundation of overall Japan-Russian Federation relations will lay the groundwork for a Japan-Russian Federation Summit Meeting at the time of the Moscow Nuclear Energy Summit to be held in April this year. This visit by Foreign Minister Ikeda to the Russian Federation will provide an opportunity for the highest level dialogue between Japan and Russia since the Japan-Russian Federation Foreign Ministerial Meeting at the ASEAN Regional Forum held in Brunei in August 1995. This visit will also provide an opportunity for Foreign Minister Ikeda to meet, for the first time, Foreign Minister Primakov and First Deputy Prime Minister Soskovets. If I were asked about the priority of the agenda for the talks this time, I would reply that there are three pillars: First, reconfirmation of the 1993 Tokyo Declaration; second, the stepping up of dialogue on security; and third, strengthening of ties with the Far Eastern region of the Russian Federation.

3. Trade and economic issues involving the extension of assistance to the Russian Federation by Japan

   Q: Will there be anything more specific to announce on economic cooperation? I was reading in one of the Japanese papers about the possibility of a US$500 million Ex-Im Bank loan?

   A: In the past, the Japanese Government committed to extend assistance to the Russian Federation equalling US$4.48 billion, out of which Ex-Im loans are US$1.2 billion. Trade insurance is US$2.9 billion, and humanitarian and technical assistance is US$0.38 billion -- altogether, US$4.48 billion. On the Ex-Im Bank loans, both Japan and the Russian Government have already agreed to spend US$0.7 billion. The remainder is US$0.5 billion. This time, Foreign Minister Ikeda, and most probably First Deputy Prime Minister Soskovets, will talk on this matter, especially about where and on which projects the two governments will spend this amount of money. The Japanese Government, in principle, favors spending a large portion of this money for the projects in the Far East, while the Russian Government, presumably, wants to use the money for the other parts of the Russian Federation, too. We sincerely hope that Foreign Minister Ikeda and First Deputy Prime Minister Soskovets can agree on how to use this assistance. As for trade insurance, out of US$2.9 billion commitment, both governments have already agreed to spend US$1.8 billion; however, how to spend the remaining US$1.1 billion has yet to be decided on between the two governments. As for the humanitarian and technical assistance, the two governments have already, more or less, used up this assistance. If you talk about the strengthening of the economic and trade relationship between the two governments, I am sure that Foreign Minister Ikeda and First Deputy Prime Minister Soskovets will touch on the so-called Hashimoto Plan, which is related to Japan's technical assistance in the field of promotion of Russian exports, promotion of industrial policy, and promotion of restructuring efforts in the Russian Federation. In order to develop trade and economic relations, we have to solve the debt issue. The arrears on the side of the Russian Federation is equal to US$1.1 billion. I am sure that both First Deputy Prime Minister Soskovets and Foreign Minister Ikeda will touch on the subject. We hope that we can deepen our understanding on this issue. And, if we talk about the mechanism of the consultations on economic and trade matters, this is the first time for the bilateral Inter-Governmental Committee on Trade and Economy to be held on the ministerial level. We hope that the talks between Foreign Minister Ikeda and First Deputy Prime Minister Soskovets will yield fruitful results. That is about all -- on the trade and economic side.

   Q: How tight is the link between Russian repayment of arrears and further disbursements of existing commitments of Japan?

   A: As far as the Ex-Im Bank loans of US$0.5 billion, the issue is how the governments agree on where this money is going to be used. So, the question is how to distribute money between the Far Eastern region and the non-Far Eastern region of the Russian Federation. If we can agree, the Japanese Government will say that this money (US$0.5 billion) can be used for the development of industry in the Russian Federation. In the past, we asked the Russian Federation to use this money only for an humanitarian purpose. Redistribution of this money into the industrial sector is an issue. After the two governments agree on this, the private sectors can independently approach the Ex-Im Bank of Japan and can begin negotiations with the Ex-Im Bank on how to use this money. As far as arrears are concerned, in order to promote direct investment in the Russian Federation in the future, it is absolutely necessary to solve this issue. In addition to this, of course we have been and are going to continue to urge Russia, to improve its investment climate and provide a better legislative infrastructure, so that Japanese direct investment can be more smoothly made. As far as the private sector investments are concerned, it is absolutely necessary to solve the arrears issue. But, as for the Ex-Im Bank loan, for the time being, the most important thing is that the two governments agree on where and how to distribute the money.

   Q: But, there will be no new financial commitments apart from what you mentioned previously?

   A: This time, probably no.

4. Possibility of discussion between Japan and the Russian Federation on matters of security

   Q: What are the specific security issues to be discussed?

   A: Up until now, the dialogue on the security matter has been discussed in various ways. One is the policy planning dialogue between the two governments. The other is the exchange of experts on defense matters. There is a so-called tripartite forum, which consists of Japan, the United States of America, and the Russian Federation. Both government officials and academics are participating in this. We highly appreciate these dialogues. But, we would like to strengthen the dialogue, and we hope that this time, Foreign Ministers Ikeda and Primakov will exchange views. We hope that they can find some sort of concrete ideas to strengthen the dialogue.

   Q: Do you have any concrete proposals for these ideas to strengthen the dialogue? What is the Japanese proposal?

   A: I think I will leave this matter to Foreign Minister Ikeda, because he will directly communicate with Foreign Minister Primakov. We hope that something concrete will come up on this issue in the meeting between Foreign Ministers Ikeda and Primakov.

   Q: Could you explain for us what the connection is for the visit of de facto Defense Minister Usui in May to Russia?

   A: What I can say is that Foreign Minister Ikeda is not directly involved in the dialogue on security. However, as the Foreign Minister, he would like to arrange with Foreign Minister Primakov on how to strengthen this dialogue mechanism.

   Q: So, the China-Taiwan problem will be the topic of the talks?

   A: They will exchange views, not only on the bilateral relationship, but also on the international situations which both gentlemen are interested in. So, there is a possibility that they will exchange views on the situation of the Far East.

   Q: You said that one of these security dialogue topics in the Far East could be raised?

   A: I had better say that Foreign Minister Ikeda himself is not involved in dialogue on security. Mainly, he may talk about the framework -- how to strengthen security dialogue. But, at the same time, as a foreign minister, he may exchange views on the situation in the Far East or the Asia-Pacific region. They may exchange views on the Korean Peninsula situation or on the Taiwan Strait. But, it is completely up to the two gentlemen -- Foreign Ministers Primakov and Ikeda.

5. Matters involving plans for promoting trade development between Japan and the Russian Federation

   Q: I would like to come back to the economic topics. You mentioned this Hashimoto Plan. When was this published? I don't remember it.

   A: When Foreign Minister Soskovets visited Japan in November 1994 -- at that time, Prime Minister Ryutaro Hashimoto was the Minister for International Trade and Industry -- the two gentlemen met, and former International Trade and Industry Minister Hashimoto showed that the Japanese side was ready to cooperate with the Russian Federation on how to promote trade and exports with Russia. That is called the Hashimoto Plan.

   Q: You have stressed the fact that Japan has interests in Northeast Asia regional development. What are the concrete projects? What's this NHK report about there being no commercial ports? What are the projects Japan thinks by any reasons are of most priority?

   A: As far as the concrete project which the US$0.5 billion may be applied to, we still have to wait to see what projects will be shown to the Ex-Im Bank of Japan. However, if we talk about the Zarubino project, I can say that the Japanese Government is now studying the possibility of extending appropriate assistance, together with the private sector, on the feasibility study on the repair project of the Zarubino port.

   Q: Repair?

   A: Repair. Reconstruction, if I may say so.

   Q: Not extension?

   A: Extension, if I may say so. Port Zarubino itself is over there, so you can call it expansion of the facilities, but in any case, they have to repair or reconstruct or rehabilitate the port facilities and expand the capacity of the port. I think Foreign Minister Ikeda will express the position of the Japanese Government on this to First Deputy Prime Minister Soskovets. However, I would just like to remind you that this will not pre-judge a possible participation of the Japanese Government in the rehabilitations or reconstructions or expansions of the port of Zarubino itself in the future. Those two issues are separate.

   Q: What is the economic meaning of this port?

   A: It is situated in the area where the Chinese and North Korean borders are close. The United Nations Development Programme (UNDP) has, for a long time, been conducting a basic development program over there, because the UNDP considers that area as having potential for future economic development. The port of Zarubino can play an important role for the future development of that area. In Japanese we call it tomanko, but I do not know how to express it in Russian.

   Q: So, am I correct to say that the basic meaning of this port is to facilitate trade with the northern part of China, and not so much with some industrial or economic areas in Russia?

   A: As far as this particular feasibility study is concerned, it involves the reconstruction or expansion of the port itself. If the facilities are improved over there, Russia can export its products to China through the existing railway service. Japan will also benefit from this. We can import agricultural products from the northern part of China using these facilities.

   Q: What kind of products?

   A: Beans, etc. And, the Russian Federation can provide those good facilities to other countries. But, we understand that there are several other big projects in the Far East.

   Q: For example?

   A: I do not know the details. I was told there are four big projects which are handled by the Keidanren.

6. Matters regarding the schedule for the visit to the Russian Federation by Minister for Foreign Affairs Ikeda

   Q: Will Foreign Minister Ikeda also meet the other candidates for the Presidential election?

   A: No, I do not think so. This visit will be a very short one. Foreign Minister Ikeda will leave Tokyo this evening, and will arrive in Moscow at night. However, on the evening of 20 March, he will leave Moscow to go back to Tokyo. Basically, he will meet President Yeltsin, Foreign Minister Primakov, and First Deputy Prime Minister Soskovets.

7. Subjects of possible discussion between Japan and the Russian Federation involving the Tokyo Declaration and matter of the Northern Territories

   Q: You didn't mention the Tokyo Declaration and the Northern Territories?

   A: Yes, I made mention of it. You did not ask about the importance of it. Of course, we give first priority to the reconfirmation of the 1993 Tokyo Declaration. It is very important for the two governments, at the level of foreign minister, to reconfirm this, because all the important elements are included in the Declaration.

   Q: What is your information on the present position of Russia? Do you think it will be difficult to have this confirmation? Do you think there is some progress?

   A: Personally, I shall be completely surprised if the Russian Federation declines to reaffirm the Declaration. However, Japan has a new government now, and the political situation in the Russian Federation is rather fluid. Russia has a new Foreign Minister. Therefore, it is very important for the two governments to reconfirm this politically important declaration.

   Q: Just two questions on the Tokyo Declaration. Have there been any fresh financial commitments since the Declaration was signed, and also, has there been any concrete progress at all on the island issue since the signing of the Declaration?

   A: Unfortunately, there has not been progress on the island issue. Basically, it is a bit difficult for us to see progress on the island issue. But, both governments have to tackle the issue. Therefore, although we cannot make much progress now, it is very important for us to reconfirm the Tokyo Declaration, so that in the future, probably after the presidential elections in the Russian Federation, we will continue this dialogue.

   Q: And, on the question of the money?

   A: Apart from what I have said, there has not been big movement. First of all, we have to use the pipeline. At the same time, we have to once again tell the Russian Federation that we need to see the Russian Federation continue its policies of reform. And, we would like to expand the political relationship, together with the economic relationship.

8. Subjects of possible discussion between Minister for Foreign Affairs Yukihiko Ikeda and President Boris Yeltsin of the Russian Federation

   Q: Can you tell us about the special message by Prime Minister Hashimoto to President Yeltsin?

   A: Foreign Minister Ikeda said yesterday that he will deliver a message from Prime Minister Hashimoto, but does not want to disclose it to the public now. I think he would like to directly pass the message to President Yeltsin. Thank you very much.