Chapter I. Changing World and Japan's Foreign Policy
Section 1. Underlying Current of Changes
1. The Gulf Crisis
(1) The Iraqi invasion of Kuwait, which occurred less than a month after the Houston Summit of 1990, strongly shook the international community. The impact of the Gulf Crisis on the international community was grave, as it happened just at the time the international community had begun to search for a new international order and as it took place in the world's major oil producing area.
The international community, unified under the United Nations, took action to pressure the Iraqi forces to withdraw immediately and unconditionally from Kuwait. This unity was evidenced by the following facts:
- Adoption by the U.N. Security Council of 14 resolutions which included the demand for Iraq's immediate and unconditional withdrawal from Kuwait, economic sanction measures, the decision authorizing the member states to take all necessary means including the use of force if Iraq failed to comply with relevant Security Council resolutions by the deadline and the declaration of a formal cease-fire.
- Deployment of multinational forces in the region from 29 countries under the leadership of the United States.
- Contribution of funds to support the multinational forces by such countries as Japan, Germany, Saudi Arabia, Kuwait and the United Arab Emirates.
It is unquestionable that the countries that participated in the joint actions acted with the recognition that the restoration of the international order by repelling Iraq's brutal act in Kuwait would be significant in setting a precedent for a new post-Cold War international order.
(2) What attracted particular attention in the responses to the Gulf Crisis was the increased role of the U.N. Security Council. Under the Cold War structure that had long dominated international politics after World WarII, the situation was such that the Security Council was not able to exercise its original functions. Compared with those years, the activities of the Security Council during the Gulf Crisis were nothing less than epochal. Needless to say, in the background was a broadly prevalent sense of crisis in the international community that the Iraqi invasion of Kuwait must not simply be left to take its own course. But in addition, an important point to be recognized is the fact that the rapidly emerging U.S.-Soviet habit of cooperation in recent years has contributed greatly to the orderly response of the Security Council.
(3) On the other hand, the Gulf Crisis left several important lessons for the international community.
The first lesson is that the international community still faces the danger of regional conflicts. It is a fact that the end of the East-West Cold War facilitated the solution of regional conflicts, as indicated by the settlement of the Namibian question and the Nicaraguan civil strife. A similar development is being seen on the Korean Peninsula and with the Cambodian problem. However, there still remain many unresolved problems, such as the Arab-Israeli confrontation, the Kashmir problem and the Cyprus problem, which occurred without a direct root in the ideological confrontation between East and West. Moreover, intensified conflicts based on nationalism in Yugoslavia and in the Soviet Union indicate that the progress in democratization and liberalization accompanying the alleviation of the ideological confrontation could lead to the surfacing of other antagonisms and disputes that have heretofore been contained.
The Gulf Crisis made the world realize anew the importance of paying attention to such confrontations and conflicts over territories, resources, ethnic and religious differences as well as to regional hegemonism. Thus, the Crisis also reminded the world of the importance of making efforts toward the solution of various confrontations and disputes that could cause regional conflicts.
Apart from those efforts made through the United Nations, Japan has rarely taken an active responsibility or role in settling such regional confrontations and conflicts. However, irrespective of whether or not Japan's interests are directly affected, it will be necessary henceforth for Japan, from the perspective of assuming responsibility and role of its own for the peace and stability of the world, to engage in diplomatic activities to help solve regional confrontations and disputes in various regions of the world and to secure regional stability after settling the disputes.
The second lesson of the Gulf Crisis is the importance of the non-proliferation of weapons of mass destruction and missiles as well as controlling transfers of conventional weapons. The Gulf Crisis led to a clear recognition of the danger of proliferation of nuclear, biological, and chemical weapons as well as missiles capable of delivering these weapons, and also the danger of the unlimited transfers of conventional weapons. The fact that the five permanent members of the U.N. Security Council, which are said to be conducting about 80 percent of the world export of weapons, started holding consultations on the restriction of the transfer of conventional weapons reflects such a recognition, as does the adoption at the London Summit of a Declaration appealing for the non-proliferation of weapons of mass destruction and missiles and for the control of transfers of conventional weapons.
In this context, the Government of Japan convened the United Nations Kyoto Conference on Disarmament in May to arouse the awareness of the international community to this problem. It also made a specific proposal for the establishment of a United Nations reporting system covering transfers of conventional weapons. These initiatives were highly appreciated internationally and the London Summit Declaration reflected the Japanese ideas considerably.
It is also important that the Government of Japan in April articulated its Official Development Assistance (ODA) policy, which will pay attention to trends in military expenditures, posture on the non-proliferation of nuclear weapons and other weapons of mass destruction and missiles, and on the transfer of weapons on the part of the recipient countries. This policy was pointed out in the London Summit Declaration as a good precedent.
Preventing the proliferation of weapons of mass destruction and missiles or controlling transfers of conventional weapons is difficult to put into practice. It is all the more important to endeavor continuously to increase the awareness of the international community to these issues and, at the same time, to steadily implement the necessary measures through international cooperation.
The third lesson from the Gulf Crisis is the abovementioned importance of settling conflicts through international coordination, the United Nations playing a central role. The experience with the liberation of Kuwait made it clear that there is no other country than the United States that can play a leading role in coping militarily with such a situation. However, at the same time, it became evident that the United States alone cannot fulfill such a role. Also reconfirmed was the importance of the principle of international coordination under the authority of the United Nations in effectively implementing international peace-restoring activities, including the times when the United States assumes a leading role. The fact that the main theme of the Political Declaration of the London Summit was "Strengthening the International Order," and that the Declaration particularly stressed the necessity of reinforcing the U.N. functions, reflect such a recognition.
2. Changes in the Soviet Union
(1) The nature of the issues concerning the Soviet Union as perceived in the international community rapidly changed around the time of the Houston Summit against the background of dramatic changes in Eastern Europe, the end of the Cold War and the promotion of perestroika in the Soviet Union. How to assist the Soviet Union in pursuing its efforts for democratization and introduction of a market economy has become an important policy objective for the West. Moreover, while the Soviet economy deteriorates, it has been recognized that the danger brought on by chaos within the Soviet Union is a more serious problem than the Soviet military threat. Against such a background, assistance to the Soviet Union was the main theme of discussions in the London Summit. Also, although it was separated from the G-7 Summit Conference itself, a meeting between the G-7 leaders and President Mikhail Gorbachev of the Soviet Union took place immediately after the G-7 Summit.
(2) The objective of assisting the Soviet Union is to support its democratization and introduction of a market economy and to encourage the Soviet Union to become a truly constructive partner in both fields of international politics and economy. This has been a goal since the Houston Summit in 1990.
At the London Summit, assistance to the Soviet Union was more fully discussed. Some of the European countries expressed opinions calling for radical support to the Soviet Union. The possibility of massive inflows of refugees, which might occur if the Soviet situation destabilized further, was a realistic fear of the European countries on the same continent of the Soviet Union. Germany, where approximately 270,000 Soviet troops were still deployed, was greatly worried that chaos in the Soviet Union would delay the withdrawal of those troops.
Ultimately, however, the G-7 countries agreed on the following six points which Prime Minister John Major explained in the press conference after the meeting between the G-7 leaders and President Gorbachev: (1) to welcome a special association for the Soviet Union with the International Monetary Fund (IMF) and with the World Bank; (2) that four international institutions - the IMF, the World Bank, the Organization for Economic Cooperation and Development (OECD) and the European Bank for Reconstruction and Development (EBRD) - will provide practical advice and know-how for Soviet economic reforms; (3) to intensify technical assistance in five areas - energy, defense conversion, food distribution, nuclear safety and transport; (4) to improve trade access to markets for Soviet goods and services, (5) to keep in close touch with developments on behalf of the G-7, the Chairman of the G-7 Summit (currently Prime Minister Major of the United Kingdom) visits Moscow before the end of 1991 and (6) to discuss a range of matters with the counterparts in the Soviet Government through visits of the Finance Ministers and the Ministers for Small Businesses. This agreement was reached on the judgment that in addition to the insufficient preparations within the Soviet Union itself to make daring economic reforms needed to introduce a market economy, the Soviet political determination to democratize was not far-reaching enough and more resolute improvements were deemed necessary on military expenditure cuts, the Northern Territorial Issue and the Soviet attitude on assistance to Cuba. Thus, it was the common perception of the G-7 countries that a large-scale financial assistance to the Soviet Union was still too early to be extended, even judged solely from an economic standpoint.
(3) The dramatic changes in the Soviet domestic situation which occurred a month after the London Summit fundamentally changed the nature of the issues concerning the Soviet Union. The failure of the coup d'etat by the conservatives in three days impressed upon the world that the strong expectations for democratization and liberalization had permeated broadly among the Soviet people. The rapid movement away from communism in the Soviet Union can be anticipated as a result of the sweeping movements, triggered by the actions overcoming the coup, toward the suspension of the activities of the Communist Party on both the Federal and Republic levels and the prohibition of the activities by political parties in public organizations, coupled with the fading appeal of the communist ideology among the public. Moreover, such waves of democratization and liberalization and the collapse of the mechanism of governance with which the Communist Party had virtually ruled the Soviet Union led to the nationalistic assertions and the explosion of the desire for independence among the Republics. This not only has led to the complete independence of the three Baltic countries, but also has stimulated the relations among the Republics to head in the direction of forming cooperative relations among new sovereign states, which are different from those under the past federal system.
Assistance to the Soviet Union to promote such changes steadily and to see them take root has become a task of greater importance. However, in order for the conditions to be met in which the foreign countries can extend full-scale assistance to the Soviet Union, the Soviet people, through their own will, will have to make several important decisions on the issues which include defining the authorities of the Republics and the Union, and forming clear plans for the introduction of a market economy.
Judging from the developments after the failed coup by the conservatives, it is anticipated that both the Soviet Union and the Republics will proceed in the direction of making decisive reforms toward the introduction of a market economy. However, the situation is changing very rapidly, and because of this, the possibility of the country falling into chaos as a result of unexpected incidents cannot be ruled out. How to secure the functions of each administrative organ is a great problem for the time being. The situation at local levels, in particular, is considered to be grave. Moreover, the forces trying to protect their vested interests are considered to have remained in various circles, and conflicts of interests among the Republics and nationalistic disputes at the local level are anticipated to surface.
On the other hand, the economy is deteriorating and there is a possibility of food shortages as winter approaches. Food and medical assistance from a humanitarian viewpoint is emerging as an urgent task for the international community.
How the control of nuclear, chemical and biological weapons currently held by the Soviet military will be conducted is one of the causes of international concern. It has become more important, in the context of supporting the Soviet Union, to encourage a further reduction of military forces and expenditures of the Soviet Union and to promote the transformation of military industries to civilian industries.
(4) It is an extremely important question for Japan what kind of country or group of countries the Soviet Union will evolve into. Japan has the capacity to play a major role both technologically and financially in assisting the Soviet Union, and expectations of assistance from Japan are mounting in the Western industrialized world, as well as in the Soviet Government, the Russian Republic and several of the other Republics.
On the other hand, Japan has the task of solving the Northern Territorial Issue and concluding Peace Treaty with the Soviet Union. Related to this problem, based on the perception that the so-called new thinking diplomacy of the Soviet Union is one of the important political issues in considering assistance to the Soviet Union, the Political Declaration of the London Summit stated, "We hope that this new spirit of international cooperation will be fully reflected in Asia as in Europe." Furthermore, the Chairman's Statement pointed out that "the full normalization of the Japan-Soviet relations, including the resolution of the Northern Territorial Issue, would contribute to this." While the G-7 countries had commonly recognized the importance of the Northern Territorial Issue at the Houston Summit, it is particularly significant that the G-7 countries this time articulated their shared recognition of the importance of this issue in relation to the assistance to the Soviet Union. For instance, the United States pressed the Soviet Union to make progress toward the solution of the territorial dispute with Japan, both during the visit by President George Bush to the Soviet Union in July and during the visit by Secretary of State James Baker to the Soviet Union in September.
As for Japan-Soviet relations, President and Mrs. Gorbachev visited Japan in April 1991 before the London Summit. It was stipulated in the Japan-U.S.S.R. Joint Communique issued at the time that the four islands of Habomai, Shikotan, Kunashiri and Etorofu are the subjects of the territorial issue to be settled in the Peace Treaty. In addition, it was confirmed that accelerating work to conclude the preparations on the Peace Treaty including the solution of this issue is of primary importance. Japan and the Soviet Union agreed to pursue a range of cooperative programs in a spirit of what is known as "expanding equilibrium," which is to work on the settlement of the territorial question as the priority issue and, at the same time, to improve relations in other fields. These measures were spelled out in 15 documents as well as the abovementioned Japan-U.S.S.R. Joint Communique. Although little substantial progress was made on the Northern Territorial Issue, it was epoch-making that President and Mrs. Gorbachev became the first Soviet Presidential couple to visit Japan and on that occasion, both Japan and the Soviet Union engaged in wide-ranging discussions on the future of Japan-Soviet relations. This was beneficial for the future of the Japan-Soviet relations as well as for the stability of the Asia-Pacific region.
Amid the increasing authority of the Republics after the failure of the coup d'etat, the importance of the Russian Republic for Japan in dealing with the Soviet Union has greatly increased. It is particularly important that, as was made clear during the visit of Acting Chairman Khasbratov of the Supreme Soviet of the Russian Republic in September 1991, President Boris Yeltsin of the Russian Republic took the stance of promptly settling the Northern Territorial Issue based on law and justice. Under such a new political situation, it is indispensable for the Government of Japan to strengthen dialogues and exchanges with the Russian Republic in addition to those with the Soviet Union.
In this context, the most important task for Japan's foreign policy for the time being is how to attain simultaneously the two important policy objectives of smoothly promoting historical changes in the Soviet Union toward anchoring the process of democratization and introduction of a market economy, on the one hand, and of solving the Northern Territorial Issue, on the other.
(5) From a medium- and long-term perspective, for the Soviet Union, which had been a great communist power, to depart from communism and for the Republics to strengthen the trend for independence will have diverse impact on international politics, regardless of the form of cooperative relations to be formed among the Republics.
What kind of changes the Soviet reforms may bring to international affairs will depend on the scale and pace of the Soviet reforms, and simple extrapolations should be avoided. Moreover, there is a limit to external influence on the Soviet reforms; the will of the Soviet people and the leadership based on that will, needless to say, will determine the consequence of the reforms.
However, it is also true that the Soviet reforms will proceed while undergoing influence from abroad. This is already obvious from the fact that the Soviet Union will need assistance from abroad for its economic reforms, and therefore, the response of the international community to the Soviet reforms will be even more important.
In this context, another point to be noted is that, regardless of what kind of country the Soviet Union will evolve into, either the Soviet Union or the Russian Republic will continue to possess enormous military strength including nuclear weapons. For that reason, in considering assistance to the Soviet Union, it will be important to seek further reductions in military forces and military expenditures of the Soviet Union and the Republics.
Furthermore, another point to be noted in international politics is that the progress of democratization in Central and Eastern Europe, and in the Soviet Union that followed, has resulted in making the political system of socialist countries in other regions more conspicuous. As the democratization process in the Soviet Union is considered to strengthen the global trend for democratization, it appears that the problem of democratization in the socialist countries in regions other than Europe will attract even more attention in the international political arena.
3. U.S.-Soviet Relations
(1) The U.S.-Soviet relationship has changed its trend from that of confrontation to cooperation, with the bilateral Summit held in Malta in December 1989 serving as a turning point. The visit of President Gorbachev to the United States in May 1990 was part of the process. The visit of President Bush to the Soviet Union at the end of July 1991 also affirmed this cooperative relationship. Needless to say, the agreements reached in the meantime, including those on the negotiations on the Conventional Forces in Europe (CFE) and the Strategic Arms Reduction Treaty (START), and the accumulated records of coordination between the two countries in settling various regional conflicts, the Gulf Crisis in particular, underpinned and facilitated this cooperative relationship.
It is conceivable that the changing perception of the international situation both in the United States and the Soviet Union lies in the background of such changes in U.S.-Soviet relations. On the Soviet side, the strong awareness of President Gorbachev that cooperative relations with the United States are indispensable to pursue the political and economic reforms underlay the Soviet posture toward the United States in recent years.
It is judged that the following three major considerations were behind President Gorbachev's stance to emphasize improved relations with the United States: (1) that it is necessary to terminate the arms race with the United States to redistribute resources for the reconstruction of the Soviet economy; (2) that improved relations with the United States have an important bearing on securing Western assistance indispensable for the Soviet economic reforms; and (3) that to maintain, as a superpower, a position of parity with the United States and to achieve positive records in foreign policy are very significant for President Gorbachev himself in securing domestic leadership, and thus the maintenance of cooperative relations with the United States.
For the United States, it was also important to alleviate the military burden arising from confrontations with the Soviet Union, given the economic difficulties symbolized by the twin deficits in the trade balance and the national budget, as well as the increasingly noticeable loss of international competitiveness of U.S. corporations as compared with those in Japan and other countries. It was also necessary to obtain Soviet cooperation for the settlement of regional conflicts in various parts of the world. The cooperative stance of the Soviet Union that was beginning to be seen in the realization of the Namibian independence and of peace in Nicaragua was also observed in the pursuit of peace in Angola and El Salvador. In particular, the cooperative stance of the Soviet Union in coping with the Gulf Crisis is considered to have helped to impress deeply upon U.S. authorities the positive aspects of Mr. Gorbachev's foreign policy.
(2) It is unquestionable that the changes in the Soviet Union since August will fundamentally transform the nature of the U.S.-Soviet relations. U.S.-Soviet cooperation in the international political arena is expected to be strengthened further.
On the other hand, even though the agreement on START will lead both the United States and the Soviet Union to take concrete measures to reduce their strategic nuclear arsenals, the fact remains that the two countries continue to possess nuclear weapons on a massive scale and maintain their posture of mutual deterrence. Therefore, it appears that emphasis will be placed on the following points in U.S. policy toward the Soviet Union regarding disarmament and arms control: to promote the ratification of START and CFE Treaties as well as to promote negotiations on a further reduction of nuclear weapons following the START. It is expected that the United States will also continue to attach importance to maintaining cooperative relations with the Western countries, particularly the G-7, on assistance to the Soviet Union.
Furthermore, the United States no longer has the objective of "containing" the Soviet Union, the communist superpower, and preventing its expansion outward, which dominated American foreign policy of the post-World War II years. Having lost this objective, what kind of foreign policy the United States will adopt will have important bearings on international politics. Though it is not anticipated that the United States will return to isolationism, considerable changes may well be seen in the priorities of American foreign policy.
4. Stability and Development of the Asia-Pacific Region
(1) The Asia-Pacific region has attained steady economic development, with the Association of Southeast Asian Nations (ASEAN) and the Newly Industrializing Economies (NIEs) playing a central role. This has, in turn, contributed to the stability of the region as a whole. Moreover, while international political attention was focusing on the changes in U.S.-Soviet relations, the reforms in the Soviet Union and the Eastern European countries as well as the Gulf Crisis, many positive developments were observed in the Asia-Pacific region toward the reduction of tensions. The Republic of Korea and the Soviet Union established diplomatic relations in September 1990. President Roh Tae Woo of the Republic of Korea visited the Soviet Union in December 1990 and President Gorbachev made a stop-over at Cheju Island on his way home from his visit to Japan in April 1991. These summit meetings were epoch-making events. Moreover, China and the Republic of Korea agreed in October 1990 to open trade offices. China normalized relations with Indonesia in August 1990 and established diplomatic relations with Singapore in October of the same year. China-Soviet relations also were completely normalized after President Gorbachev's visit to China in May 1989 and the visit to the Soviet Union by Chinese Premier Li Peng in April 1990, and by the General Secretary of the Chinese Communist Party, Jiang Zemin in May 1991.
The Japan-Soviet relationship, which is one of the most important relationships in the region, also saw improvement. As stated earlier, President Gorbachev visited Japan and an agreement was reached to accelerate the negotiation to conclude the Peace Treaty by settling the problem of the four Northern Islands. Another important move in the region toward the reduction of tension was the beginning of negotiations aiming at the normalization of relations between Japan and North Korea (the Democratic People's Republic of Korea).
(2) As for Soviet military strength, it is said that the withdrawal of Soviet forces from Mongolia and Cam Ranh Bay is proceeding, and that the plan announced in 1989 to reduce the Soviet troops deployed in the Soviet Far East by 200,000 soldiers has been completed. However, the modernization of weapon systems in the Far Eastern Soviet forces still continues, and there is no fundamental change in the situation that the Soviet Union has an enormous stockpile of military equipment including nuclear weapons in this region.
On the other hand, the U.S. forces are also partially reducing troop levels under the Overseas Force Reorganization Plan announced in 1990. However, at the same time, recognition is deepening among the relevant countries that the presence of U.S. forces is a stabilizing factor in the region. The conclusion of the executive agreement in November 1990 between the United States and Singapore concerning the expanded use of Singaporean military facilities by U.S. forces reflects this recognition. Moreover, the special agreement signed between Japan and the United States in January 1991 for Japan to increase its cost-sharing for the U.S. forces in Japan is recognized as an important development in this area.
(3) There are two areas of confrontation and conflict in the Asia-Pacific region. With respect to the Korean Peninsula, which has a very substantial international impact, the beginning of talks between the Prime Ministers of North and South Korea in September 1990 can be considered as a major development toward the reduction of tension. The simultaneous admission to the United Nations of the Republic of Korea and the Democratic People's Republic of Korea can be expected to bring about positive effects on the reduction of tension in the Korean Peninsula.
While the possibility of nuclear weapons development by North Korea has become an international concern, a safeguard agreement between North Korea and the International Atomic Energy Agency (IAEA) was approved in the IAEA Executive Council in September 1991. But North Korea is delaying the conclusion and implementation of this agreement by attaching various conditions. It is important for Japan, which is proceeding with negotiations to normalize relations with North Korea, to confirm that North Korea faithfully adheres to its obligations under the Nuclear Non-proliferation Treaty (NPT), which North Korea has signed. Moreover, if North Korea is indeed developing nuclear weapons, it is a serious development that threatens not only the security of Japan but also that of the Asia-Pacific region as a whole. It would also be a challenge to the nuclear non-proliferation regime. Therefore, it is important, while cooperating with the relevant countries, to seek responsible actions from the North Korean authorities.
On Cambodia, another area of conflict, Prince Sihanouk's leadership and efforts made by the co-chairing countries of the Paris Conference as well as other countries concerned led to the Supreme National Council (SNC) to begin functioning as a forum for dialogue among the Cambodian parties. Major progress was seen in the development toward peace, such as the agreement on the reduction of military forces of each party that the SNC reached, by the end of August 1991. Consequently, there is a prospect for the resumption of the Paris Conference within 1991 and the final adjustment being achieved toward a fair and lasting peace with appropriate U.N. intervention.
Needless to say, on the dawn of the realization of peace, Japan will play an active role for the stability and reconstruction of Cambodia. Already in May 1991, Prime Minister Toshiki Kaifu stated clearly in his policy speech during his visit to the ASEAN countries that Japan would host a Cambodian Reconstruction Conference after peace is attained.
(4) On regional cooperation in the Asia-Pacific region, the activities of the ASEAN Ministerial Conference, the ASEAN Post Ministerial Conference (ASEAN-PMC), the Asia Pacific Economic Cooperation (APEC) Ministerial Conference and others are well in place. In particular, in addition to the dialogues on economic cooperation, dialogues on political and security issues are deepening, mainly through the ASEAN-PMC.
Regarding the security of the Asia-Pacific region, the Soviet Union had argued for the application of a process similar to that of the Conference on Security and Cooperation in Europe (CSCE). Australia and Canada also floated roughly similar ideas. In contrast, Japan has pointed out the differences in geopolitical conditions and strategic environment between the Asia-Pacific region and Europe and has argued that it is more important to ensure regional stability by utilizing the existing cooperation mechanisms, centering on economic cooperation. President Gorbachev, during his visit to Japan, did not repeat the earlier Soviet argument to apply the European process to the Asia-Pacific region. This shows an improved understanding on the Soviet side of the actual situation of the region and is worthy of appreciation.
On the other hand, the current concern of many Asian countries is to what extent the United States will reduce its presence in the region, and in that context, what kind of role Japan intends to play in the region and whether it will expand its role to include military activities. In the background of such concern lie the memories of the tragedy which past Japanese actions had brought on the Asian people and their apprehension of Japan's future rooted in these memories. Prime Minister Kaifu expressed his sincere contrition for past Japanese actions in the course of his visits to the Republic of Korea in January 1991, the ASEAN countries in May 1991, and China and Mongolia in August 1991. He also pledged in his policy speech in Singapore to improve history education in Japanese schools. These statements reflect the consideration shown for the sentiment of the Asian people. Moreover, Foreign Minister Taro Nakayama spoke in the ASEAN Post Ministerial Conference in July 1991 of the importance of "political dialogue for mutual reassurance among the friendly countries" in the Asia-Pacific region and proposed to utilize the ASEAN Post Ministerial Conference as a forum for such dialogue. These steps were taken to strengthen the political foundation for intra-regional cooperation based on a shared sense of reassurance.
5. Transnational Issues
A major feature of the international situation in recent years is that such global problems as the global environment, refugees, drugs and terrorism have become more conspicuous. These problems cannot be solved by one country alone, since they have impacts that cross national borders. The importance of international cooperation in solving these problems is being stressed. As Japan attaches importance to assisting developing countries, it is worth noting that many of these problems are rooted in economic underdevelopment or political instability in developing countries. It is also the case that these problems serve to exacerbate the economic difficulties and political instability of these countries.
The global environmental problem was recognized as a priority issue in the London Summit, where the importance of coping with the problem through international cooperation was stressed, in particular to ensure the success of the United Nations Conference on Environment and Development scheduled to be held in June 1992 in Brazil.
The problem of refugees and evacuees is not only a humanitarian issue, but also a political one that can become a destabilizing factor in surrounding regions. Much of this problem is occurring in the developing regions. It is said that the number of refugees worldwide increased in the past year from 15 million to 17 million people.
Terrorist incidents still continue to occur around the world. Recently, as seen in the assassination of the experts of the Japan International Cooperation Agency (JICA) in Peru, the danger of the Japanese becoming the target of terrorist attacks is increasing. International transactions of drugs are also steadily increasing. Cooperation among producing, transmitting and consuming countries toward the solution of this problem as well as efforts to reduce drug production and to prevent illegal trading are gaining importance.
Japan has a big role to play in solving each of these problems. In particular, the environmental and refugee problems are issues in which Japan can play a major role in terms of financial, technical and human resource contributions. In January 1991, Professor Sadako Ogata of Japan was appointed the U.N. High Commissioner for Refugees. Japan should view this appointment as a reflection of great expectations placed on positive cooperation by Japan on refugee problems.
6. International Economy
(1) The greatest task in the international economy today is the maintenance and strengthening of the multilateral free trading system. At the Houston Summit of July 1990, the G-7 countries stressed their determination to maintain and strengthen the open world trading system and confirmed that they would conclude the Uruguay Round negotiations by the end of 1990. Nevertheless, in the Ministerial Conference held in Brussels in December 1990, the negotiations were not concluded due to confrontations over agricultural issues. The negotiations were resumed thereafter and have continued toward a conclusion by the end of 1991 under seven groups, including those on the agriculture and service sectors. In the Economic Declaration of the London Summit in July 1991, the G-7 leaders pledged to aim for the completion of the Round before the end of 1991, stating that they shall "each remain personally involved" in the process.
In order to conclude the Uruguay Round successfully, each country is asked to make domestically difficult decisions. Considering the fact that the free trading system has sustained the past prosperity of Japan and is confirmed to be indispensable for Japan's future development, it is Japan's responsibility to play an active role for the successful conclusion of the Uruguay Round.
(2) Another issue facing the international economy is the development toward regional economic integration. In the European Community (EC), which aims to form a single market by the end of 1992, steps toward integration, including the political aspect, have become active since December 1990. The moves to establish the European Economic Area (EEA) with the European Free Trade Association (EFTA) countries and to conclude association agreements with the Eastern European countries are progressing. In North America, the U.S.-Canada Free Trade Agreement took effect in 1989, and initiatives are being taken to conclude an agreement on a free trade area between the United States, Canada and Mexico. Depending on circumstances, such regional approaches could become exclusive and could move toward a direction that would undermine the principle of free trade. In the background of Malaysia's proposal on the East Asia Economic Group (EAEG) concept in December 1990, there seems to be such a concern about moves toward regional integration. In this respect also, efforts are constantly required to ensure that regional integration be promoted in a way which is consistent with the maintenance and strengthening of the multilateral free trading system.
(3) The global gap in supply and demand of funds has also become a source of a great concern. In addition to the financial requirements for economic development of the developing countries, financial demand is anticipated to increase due to the German unification, the economic reforms in Eastern Europe and the increasing investment accompanying the economic recovery in the industrialized countries. There is also a possibility of the Soviet transformation into a market economy leading to yet stronger demand for capital.
On the other hand, since the supply capability of capital in the industrialized countries is on a diminishing trend, the gap between capital supply and demand is expected to widen. It is feared that this would raise world interest rates, leading to an increased burden on the heavily indebted countries, or to the deceleration of economic growth, and that this would have adverse effects on the ability of the developing countries to procure funds required for economic development.
In order to cope appropriately with such a situation, it is becoming increasingly important for each country in the world to reduce fiscal deficits, to increase private savings and to ensure efficient utilization of capital.
7. Japan-U.S.-European Relations
(1) As stated above, the Gulf Crisis strongly impressed the world with the military strength and political leadership of the United States in coping with international crises.
However, a limitation in the power of the United States has started to surface as well. The posture of the United States Government in strongly seeking a burden sharing among the allied countries in coping with the Gulf Crisis reflects the awareness on the part of the United States of its limitations. Particularly in the economic aspect, the relative erosion of American strength is notable. The fact that the United States has turned into a net debtor country since the mid-1980s and that the country is the world's largest debtor today symbolizes this point.
As though in reverse proportion with the eroding economic strength of the United States, Japan's international position has risen. The fact that Japan was asked by the international community to make a large financial contribution to the process of coping with the Gulf Crisis should be understood as Japan having been expected to assume a responsibility commensurate with its position as an economic power, rather than in the context that Japan relies heavily on oil imports from the Gulf region. The fact that Japan is always expected to provide financial assistance on international aid initiatives, such as assistance to the Soviet Union, to Central and Eastern Europe and to Latin America, should also be considered in a similar context.
In Europe, governmental consultations on the economic and monetary union and the political union are progressing toward the EC integration beyond the market integration. Moreover, with the return of the Central and Eastern European countries into Europe, there is a bright prospect for the medium- and long-term future of Europe. Under the situation, the Western European countries are strengthening their wish to enhance Europe's international influence. In the security area, they have begun moves in the West European Union (WEU) and the EC to strengthen the European pillar of defense in the North Atlantic Treaty Organization (NATO). Europe has its problems: the incorporation of former East Germany imposing a short-term heavy burden on the German economy; the Yugoslavian ethnic disputes giving apprehension in the neighboring countries; and the deterioration in the Soviet domestic situation becoming a source of instability in Europe. The relative position of Europe in the international community, however, is considered to be rising.
(2) Changes are emerging in Japan's relations with the United States as well as with Europe. The cooperative relationship between the Governments of Japan and the United States is becoming closer, as reflected in the two meetings held between Prime Minister Kaifu and President Bush in 1991 in Newport Beach, California, in April and in Kennebunkport, Maine, in July, in addition to the G-7 Summit and their constant contacts by telephone.
However, against the background of economic problems between Japan and the United States, including the protracted large trade imbalance, a feeling of suspicion and mistrust toward Japan is mounting among the American public. In a public opinion poll made in 1989, it has become clear that the feeling is spreading in the United States that the Japanese economic competitiveness is a greater threat to the country than the Soviet military strength. During the Gulf Crisis, the voice of appreciation was small in the United States toward the large financial contribution made by Japan. More dominant was the critical voice on the small presence of the Japanese in terms of human resource contributions. On the other hand, there is a growing feeling among Japanese public against the American posture on Japan in economic negotiations deeming it high-handed and the voices are rising that Japan should articulate more independent initiatives in its relations with the United States.
Voices of concern are also beginning to be heard among the Asia-Pacific countries regarding the future of Japan-U.S. relations.
The reason behind such trends in public opinion in Japan and the United States is not entirely clear. It is a fact that the present Japan-U.S. relationship, as a result of the greater interdependence between the two countries, has various problems that have to be solved jointly. However, behind these perceptions of the two countries, the mistrust of Japan, which is spreading among the American public in recent years, or the assertion which is rising in the Japanese public opinion that "Japan should be more self-assertive toward the United States" is a more deeply rooted problem connected with the changes in the relative strength between the two countries. Furthermore, with the disappearance of the East-West confrontation, it cannot be denied that the alliance, which has been a political prerequisite dominating Japan-U.S. relations, is becoming less persuasive among the public. It cannot be denied that this is one of the factors creating such debates.
On the other hand, it is clear that the United States and Japan are, and will be, complementary and interdependent, both needing each other. The commitment of maintaining the stability of such relations and strengthening them is by no means important, not only for the two countries, but also for the stability of the Asia-Pacific region and of the entire world. Therefore, the present important policy tasks for the Governments of Japan and the United States are to address this problem of mutual perception and to strengthen the bilateral relations in such a way as to win public support in both countries.
(3) Relations between Japan and Europe have been the shallowest among the trilateral U.S.-Japan-Europe relations. This can be explained by the geographic distance separating Japan and Europe. However, more fundamental factors that account for Japan-European relationship not having deepened to this date are that, apart from problems of the world economy, the Western European countries and Japan have had different regions of political interest, and that on relations within the Western bloc, Japan and Europe have concentrated on the maintenance and strengthening of their respective alliances with the United States. There are cases, such as that of Japan and the United Kingdom, of bilateral relationships that have been enhanced through efforts on both sides. However, Japan-European relations are generally shallow even from a bilateral point of view. It is no exaggeration to say that the relations between Japan and the EC have been confined to certain exchanges of economic cooperation.
It was a significant event that Prime Minister Kaifu visited the Netherlands, which held the Presidency of the EC, after the London Summit in order to hold the first Japan-EC Summit with Prime Minister Rudd Lubbers and EC President Jacques Delors, and to issue a declaration to expand cooperative relations between Japan and the EC.
It is clear that in this background exists the will of both Japan and the EC to strengthen the cooperative relations between Japan and the EC and also between Japan and West European countries, not only in the field of economic affairs, but in a wider range of areas from the political to the cultural, given the EC integration at the end of 1992. The major task for both Japan and Europe from now on is how to realize the spirit expressed in the declaration.
(4) Japan, the North American countries and the Western European countries share the fundamental values of freedom, democracy and a market economy. The total GNP of Japan, the United States and Europe accounts for about 60 percent of the aggregate global GNP. The strengthening of the trilateral relationship, therefore, by all means carries vital importance for the peace and prosperity of the world.
It is important in this sense that policy coordination among the G-7 countries in recent years has become more affirmative not only economically, but also politically.