Japan's Official Development Assistance White Paper 2007
Next PageMain Text > Part II ODA RECORD FOR FY2006 > Chapter 2 Details about Japan's Official Development Assistance > Section 2. Measures for Each of the Priority Issues > 1. Sustainable Growth > (1) Support for Socioeconomic Infrastructure
(1) Support for Socioeconomic Infrastructure
<Record for FY2006>
In terms of its record for infrastructure development in FY2006, Japan provided approximately ¥181.1 billion of assistance through a combination of approximately ¥159.0 billion in loan aid (to nine countries) and approximately ¥22.1 billion in grant aid (to 30 countries) for transportation sector infrastructure. It also provided approximately ¥168.9 billion of assistance through a combination of approximately ¥164.6 billion in loan aid (to eight countries) and approximately ¥4.3 billion in grant aid (to six countries) for energy sector infrastructure, as well as approximately ¥27.1 billion of assistance through a combination of approximately ¥26.2 billion in loan aid (to four countries) and approximately ¥900 million in grant aid (to one country) for communication sector infrastructure. Japan applied Special Terms for Economic Partnership (STEP)1 for approximately ¥34.5 billion in loan aid (to two countries) for transportation and other sectors, as well as for approximately ¥10.4 billion in loan aid (to two countries) for the communication sector.
<Current Status>
For poverty reduction, it is indispensable not only to implement measures to reduce poverty or to provide assistance in the areas of social development that could directly influence the poor, but also to promote sustainable development through economic growth. Japan has been placing importance on the improvement of socioeconomic infrastructure that provides the foundation for the development of developing countries. Development of infrastructure plays an essential role in economic development in developing countries: to construct infrastructure for transportation and communication like roads, ports, and airports; to expand exchanges between urban and rural areas; to ensure security against disasters; and to promote trade and investment from overseas. Also important to development is the improvement of infrastructure that contributes to the fulfillment of basic social services such as education, health care, safe water, housing, and better access to hospitals and schools. It is also important to improve small-scale infrastructure such as agricultural and fishery markets, fishery ports, and agricultural roads, in order to vitalize local economies.
<Japan's Efforts>
In term of Japan's efforts related to infrastructure development, one example from FY2006 is support for the Ho Chi Minh City Urban Railway Construction Project (Ben Thanh-Suoi Tien Section (Line 1)) which was decided on as loan aid (STEP) project. In the wake of recent economic development in Viet Nam, there has been a considerable increase in the amount of inner-city road traffic, with chronic traffic congestion occurring in Hanoi City as well, all of which hinders economic activities. This project aims to handle the increasing traffic demand in Ho Chi Minh, the largest city in Viet Nam, by constructing an urban railway within the city. The project responds to increasing transportation demand by constructing urban railways in Ho Chi Minh City, the largest city in Viet Nam, and will thereby contribute to developing the regional economy and improving the urban environment by alleviating traffic congestion and air pollution in the Ho Chi Minh metropolitan area.
In addition, power supply improvements are being carried out through grant aid for Honiara, the capital of the Solomon Islands.2 In Honiara, power outages were unavoidable when inspections were conducted on account of the insufficient capital investments. Furthermore, periodic maintenance was difficult during the period of ethnic conflict from 1999 to 2000. As a result, there were difficulties, such as operational problems with power generating installations and marked deterioration of the energy transmission and distribution facilities. The assistance, which includes establishing more power generation facilities and improving energy transmission and distribution facilities, will allow energy to be supplied in a stable manner. It is also expected that the functions of the capital will be maintained, with the stable implementation of administrative services. Other assistance includes communication infrastructure such as television and radio.
See Section 2 also for details
In order to establish infrastructure in developing countries in accordance with appropriate development policies and to maintain and operate them in sustainable manners, it is essential to develop human resources to handle these issues. Japan has been providing a wide range of technical cooperation, including the formulation of national land or city planning, the training of engineers to manage and operate constructed facilities, the provision of equipment necessary for management and operation, and development study.
For example, in the Philippines, where roughly 97% of the interregional freight transport in the country is done by maritime traffic, it would be beneficial to improve the transportation system (RRTS)3 in order to establish a consistent land and sea network. As such, routes and the placement of port facilities (Ro-Ro4 Terminal) designed so that automobiles can embark through their own power were examined, and a study was conducted on the feasibility of improvements, including improvements for access routes.
Furthermore, a technical cooperation project is being implemented in cooperation with the improvement of Cai Mep-Thi Vai International Terminal, which is a new deep water port in southern Viet Nam. This project aims for the introduction of a system which would allow private sector businesses to efficiently manage these port facilities. Since improvements have been carried out for this port through loan aid, this project is an example of coordination between aid instruments.
For Bangladesh, loan aid has been provided for the supply of power enhanced by means of construction of power plants, improvement of power lines and the electrification of agricultural communities. Experts have been dispatched and trainees have been accepted through technical cooperation, and supports like Total Quality Management (TQM) are provided in order to improve management practices and to advance maintenance techniques for electrical power facilities. A technical cooperation project designed to familiarize TQM and improve operation and maintenance capacity through TQM.
<Research on the Development of Infrastructure>
More and more attention is being paid currently to the effects of the development of infrastructure for the purpose of poverty reduction, and research has been undertaken by donors including international organizations and Japan. This proves that the importance of providing support to socioeconomic infrastructure sectors, which Japan has placed emphasis on, is once again being recognized, while traditionally support for areas of basic human needs, such as education and health, has been focused on especially by the developed countries of Europe. For example, a set of Guiding Principles has been drawn up to outline what should be practiced by donors, as a result of discussion on infrastructure held since 2003 by the Network on Poverty Reduction, an affiliate of the Organisation for Economic OECD-DAC. Specifically, the principles present suggestions on assistance for infrastructure aimed at poverty reduction such as planning and implementing infrastructure development in accordance with the development plans of recipient countries and improving access by the impoverished population to infrastructure services. In May 2006, Japan and the World Bank jointly hosted the meeting of the Annual Bank Conference on Development Economics (ABCDE) in Tokyo. The overall theme of the meeting was "Rethinking New Infrastructure for Development;" thereupon participants discussed the development of infrastructure in relation to economic growth and poverty issues. Representatives from Japan introduced their study results based on the country's experiences in Asia, while experts from various countries examined the role infrastructure plays in development.
Column 4 Japanese Customs for Railway in India
— Japanese assistance for the Delhi Metro construction —