Adopted as a cabinet decision in June 1992, Japan's ODA Charter demands the observance of several important principles with a bearing on the provision of aid. Though decisions on aid should be based on a comprehensive assessment of aid requests, economic and social conditions, bilateral relations, and other factors, the charter also urges consideration of four key factors: namely, (i) pursuit in tandem of environmental conservation and development, (ii) avoidance of any use of ODA for military purposes or for aggravation of international conflicts, (iii) full attention to trends in recipient countries' military expenditures, their development and production of weapons of mass destruction and missiles and their export and import of arms, etc. and (iv) full attention to efforts for promoting democratization and introduction of a market-oriented economy, and the situation regarding securing basic human rights and freedoms in the recipient country.

In keeping with the principles of its ODA Charter, Japan has actively provided assistance to Mongolia, Vietnam, and several countries in Central Asia because they have all demonstrated acceptable progress in terms of democratization and the transition to free-market economic systems. ²⁷ The Republic of South Africa inaugurated its current Mandela administration in April 1994 through a general election, in the process becoming another representative example of a country that succeeded in making a peaceful, democratic transition to a new political system. In the interest of aiding South Africa's progress along the democratization path, Japan has begun providing aid for programs of infrastructure and human resources development.

By contrast, the nuclear tests that India and Pakistan conducted in May 1998 forced Japan, in consideration of its ODA Charter, to adopt strict countermeasures. To be sure, the nuclear policies of both those countries had been in question for some time. Working through bilateral forums on aid, nuclear non-proliferation, and other policy dialogues, Japan and other countries concerned had urged that India and Pakistan rein in their nuclear weapons and missile development programs and sign the Non-Proliferation Treaty (NPT) as well as the Comprehensive Test Ban Treaty (CTBT). However, the Vajpayee Administration that assumed power in March 1998 raised further doubts about India's nuclear policies by declaring a policy guideline of the coalition government, in which India would exercise the option to become a nuclear-armed state. Though the Japanese government urged through high-level channels that it assume a policy of restraint, India decided instead to conduct underground nuclear tests in May 1998, going thus against the global trend toward a comprehensive ban on nuclear testing. Japan immediately and strongly protested, and, in consideration of the principles of its ODA Charter, decided to halt the provision of new grant aid (other than grant assistance for grassroots projects or of an emergency, humanitarian nature) and new yen loans, and to carefully consider any loans for India through multilateral development banks.

Following the Indian nuclear tests, Japan sent a Prime Minister's envoy to Pakistan and enlisted additional governmental channels to encourage Pakistan to exercise self-restraint. In late May, however, Pakistan also went ahead with underground nuclear tests, and Japan responded accordingly by imposing essentially the same measures it had taken against India.

Given that India and Pakistan are countries with which Japan has traditionally maintained friendly ties, it is disappointing that both have decided to act counter to the interests of the non-proliferation regime. It is expected that both countries will adopt revised nuclear policies that include abandoning the development of nuclear weapons.

China has actively pursued steps in openness and reform policy, and has also continued to show welcome progress toward a market-oriented economy. However, in 1995 it engaged in nuclear tests despite repeated requests from Japan. As a consequence, in August that year, Japan imposed a freeze on all grant aid to China other than aid of an emergency, humanitarian nature or for grassroots assistance. In July 1996, China enacted a moratorium on further nuclear testing and later signed the CTBT, thus prompting Japan to resume grant aid to the country in March 1997. Japan has also taken various opportunities to explain the position outlined in its ODA Charter on military spending and related issues, and has urged that China adopt a more transparent set of military policies, while China has taken some steps toward improved transparency, such as the publication of a document on Chinese arms control and disarmament in 1995 and another on national defense policy in July 1998.

With regard to Myanmar, Japan provides aid on a case-by-case basis, albeit with attention to trends regarding democratization and human rights, mainly for ongoing projects and other ventures in the area of basic human needs that can be expected to benefit the general public. Since Myanmar authorities have yet to demonstrate much progress in adopting democratic principles or, for that matter, a positive stance on respect for human rights, Japan is not yet in a position to provide significant levels of aid. However, in March 1998, it decided to furnish a 2.5 billion yen loan on grounds that it was urgently necessary, but only for safety-related restoration and repair work as part of the Yangon International Airport Expansion Project, an on-going project formerly funded by Japanese aid. Furthermore, Japan provided Myanmar grant aid for increased food production the following July as a measure mainly aimed at fighting the drug problem. ²⁸

Among other aid recipients, Sudan and Nigeria still face a Japanese freeze on aid in principle due to human rights violations and other actions taken by their military governments.