Since the end of the cold war, there has developed a climate in which donor countries are able to carry out their foreign aid programs purely from the North-South perspectives without being constrained by the East-West context. What is more, many developing countries are still struggling against famine, poverty, economic stagnation, current-account deficits, and mounting foreign debts. Thus, the North-South problem is tightening -- rather than easing -- its grip.

Meanwhile, many of the former Soviet-bloc countries and developing countries are making their efforts to develop a market-oriented economy and democratize their political system. It has become all the more necessary for industrialized nations to actively lend a helping hand in support of their reform efforts. More important, some of the prolonged regional and internal conflicts such as in Cambodia, Mozambique, Central America, South Africa, and Palestine are winding down. As these conflicts are being resolved, ODA could play a vital role in building peace in these countries or regions. In addition, global issues -- such as environmental conservation, population, AIDS, refugees, and drugs -- are becoming more critical, and they require determined and earnest concerted efforts by all human kind.

While needs for ODA are growing and diversifying in step with changes occurring in the community of nations, a tendency of so-called "aid fatigue" is spreading among many donor countries reflecting economic stagnation and fiscal constraints they are facing, and stalling or retrogressing economies of African countries which they have been aiding. Of the 21 member countries of the Development Assistance Committee, only three of them including Japan have increased their total ODA spending (in dollar terms) in 1993 over the preceding year, with the result that the total ODA spending of the DAC countries as a whole in 1993 decreased to $54.79 billion, down 11.38% in nominal terms from $61.82 billion in 1992.

Japan, also, has to cope with a number of domestic issues -- the necessity for improving social capital and community facilities, a prolonged economic stagnation, and domestic natural disasters. However, stepping up its contribution to world peace and prosperity through official development assistance to developing countries will strengthen relations with them, win their trust in the basic stance of its foreign policy, enhance its international stature, and by extension, serve its broadly-defined national interest. As used in this context, the term "broadly-defined national interest," as opposed to the narrowly-defined one such as the use of its foreign aid as a lever to gain commercial advantages, refers to the end result that comes about as a corollary of the kind of economic aid which is wanted by recipient countries, satisfies their vital needs, and is appreciated by them. In truth, contribution to the economic growth of developing countries through official development assistance, together with Japan's diplomatic efforts in other fields, will enhance their confidence in and support for the basic stance of Japanese foreign policy. Based on this recognition, in recent years, Japan has taken initiatives in hosting meetings of International Conference on Reconstruction of Cambodia (ICORC), International Conference on African Development, and Mongolia Assistance Group Meeting. We believe that the community of nations is looking to Japan to play a leadership role in reemphasizing the necessity of continued or even increased support for the efforts by developing countries.

Indeed, official development assistance is the most important instrument of foreign policy of Japan that is determined to promote peace and its important vehicle for international contribution. Japan itself has had the experience of reconstructing its war-torn economy with the help of other countries before it became one of the leading donor countries of the world. Today, it has financial and technological resources to help other countries develop their economies. Economic aid to developing countries is the very area to which Japan can actively contribute by bringing its experience and resources. In step with the changes occurring in the environment surrounding official development assistance, needs for ODA have increased and diversified - so much so that the importance of ODA will grow, not decline, and the role Japan can play in this area will take on growing importance in coming years.