Chapter I.
General Overview

C. Relations with the United States and neighboring countries

1. Japan-United States relations

a) Overview

Japan-U.S. relations in 1999 turned even more positive against the background of the progress of the Japan-U.S. Security Arrangements, including the enactment of legislation related to the new Guidelines for Japan-U.S. Defense Cooperation, and the steady recovery of the Japanese economy. The cooperation between the two countries has also been advanced in a wide range of areas encompassing security, economic and global issues.

The event of particular importance for Japan-U.S. relations in 1999 was the Official Visit to the United States by Prime Minister Obuchi from the end of April to the beginning of May. It was the first Official Visit by a Japanese Prime Minister in 12 years. In Prime Minister Obuchi's meeting with President Clinton, both leaders affirmed that Japan and the United States, allied nations sharing the values of freedom, democracy and respect for human rights, would further cooperate toward their common goal of building a peaceful and prosperous world in the 21st century. Prime Minister Obuchi also visited Chicago and Los Angeles in order to deepen exchange with the American people, delivering speeches on the cooperation between the two countries in the Asia-Pacific and his vision for future Japan-U.S. relations. In these places, Prime Minister Obuchi also had conversations with students of the University of Chicago, young Americans with experience of residing in Japan, and other people with a view to expanding the horizons of Japan-U.S. relations.

Prime Minister Obuchi's successful Official Visit to the United States was followed by a Japan-U.S. Summit Meeting held during the G8 Cologne Summit in June and the Japan-U.S.-ROK Summit Meeting held on the occasion of the Asia-Pacific Economic Cooperation (APEC) Summit in September. Through such meetings, close cooperation between Japan and the United States in relation to the situation on the Korean Peninsula and other issues was confirmed at the Summit level. Frequent and close exchanges of views have also been conducted at the level of Foreign Minister. From June to September Foreign Minister Koumura, taking the opportunities of international conferences, had four meetings with U.S. Secretary of State Madeleine Albright, in which they exchanged views on issues ranging from Japan-U.S. relations to major regional issues concerning such regions as Asia and the Middle East. Foreign Minister Yohei Kono, having assumed his post in October, held a telephone conversation with Secretary Albright immediately after his appointment. Foreign Minister Kono met Secretary Albright also in November on the margin of the World Trade Organization (WTO) Ministerial Conference in Seattle, where they affirmed future cooperation in wide ranging areas.

Throughout 1999, a number of U.S. Congressmen and State Governors visited Japan, including Speaker of the House of Representatives Denny Hastert. Such visits contribute to the promotion of wide-ranging exchanges and mutual understanding between both countries.

b) Japan-United States economic relations

The United States' understanding and evaluation of Japan's active efforts toward economic revitalization gradually heightened during 1999, while U.S. interest in an early economic recovery for Japan remained as strong as ever with Japan unable to overcome its difficult economic situation. Furthermore, the United States stressed that the recovery of the Japanese economy should be realized on a domestic demand-led basis, and continued to hold considerable expectations for further deregulation and open markets in Japan.

In March, the Government of the United States re-instituted the special procedures of Section 301 of the Trade Act of 1974 (the so-called "Super 301") and Title VII by Executive Order, on the basis of which insurance, flat glass and construction were referred as practices of concern (the so-called "Watch List"). However, no priority foreign country practices were specified.

Among issues dealt with in the area of economy on the occasion of the visit to the United States by Prime Minister Obuchi, was the Second Joint Status Report on the U.S.-Japan Enhanced Initiative on Deregulation and Competition Policy, which was published at that time as an outcome of Japan-U.S. Deregulation Dialogue in its second year. Both leaders also affirmed on that occasion that dialogue would continue for a third year. The Report of the Working Group on Investment and Buyer-Supplier Relationships under the Framework for a New Economic Partnership was published at that time as well. Regarding the agreement between the Government of Japan and the Government of the United States of America concerning Cooperation on Anticompetitive Activities, which stipulates cooperation between competition authorities of both countries, a substantial agreement was reached on the occasion, and both governments signed the agreement in October.

Following on from 1998, in 1999 a considerable number of anti-dumping cases were filed with regard to steel imports from Japan; a decision was made to impose anti-dumping duty on hot-rolled steel and investigation procedures advanced on cold-rolled steel and other products. The procedures under Article 201 of the Trade Act of 1974 (emergency action on import) were also launched with regard to wires and other materials. Japan initiated WTO dispute settlement procedures on the U.S. anti-dumping measure for hot-rolled steel, requesting bilateral consultations in November. Deeming the measures taken by the Government of the United States to be insufficient, in the U.S. Congress a number of recommendations for bills and other legislation urging regulations on steel imports were introduced. Furthermore, in response to the request by the U.S. side, the Japanese and U.S. Governments decided to launch a "Japan-U.S. Steel Dialogue."

c) Expanding Japan-U.S. cooperation

Within the framework of the Japan-U.S. Common Agenda for Cooperation in Global Perspective, launched in 1993, Japan and the United States have been advancing various projects in 18 areas under the four pillars of "Promoting health and human development," "Responding to challenges to global stability," "Protecting the global environment," and "Advancing science and technology." The Ninth Plenary Meeting was held in Washington D.C. in April. Based on the affirmation that it was necessary to engage in efforts with an accent on the important issues arising from time to time, views converged on advancing joint Japan-U.S. efforts for the time being toward the various economic and social challenges stemming from the Asian currency and financial crisis in terms of relief for the socially vulnerable, and both sides decided to engage in specific projects. Furthermore, the first Japan-U.S. Common Agenda Seminar was held in March under the theme of support for women in developing countries, mainly involving the participation of NGOs, as well as government officials of both countries.

The Common Agenda Round Table (CART), chaired by Gaishi Hiraiwa, Honorary Chairman of the Japan Federation of Economic Organizations (Keidanren) and inaugurated in February 1996, convened a regular meeting, discussing various global issues and offering advice and guidance to the Governments of Japan and the United States. CART is also actively working to cooperate with NGOs, for example by holding meetings with Japanese NGOs in recent years.

Japan and the United States actively cooperated throughout 1999 to address major issues facing the international community. On the occasion of the Prime Minister's visit to the United States in May, Prime Minister Obuchi and President Clinton affirmed that Japan and the United States would continue their cooperation in such areas as assistance to the socially vulnerable in Asia and global issues. At the same time, the Joint Statement on Japan-U.S. cooperation to address the Y2K problem and other documents were released. With a view to contributing to stability and peace in the world, Japan and the United States engaged in cooperation regarding the situation on the Korean Peninsula, notably the Korean Peninsula Energy Development Organization (KEDO), as well as close cooperation in other areas, including the Kosovo issue and assistance to Jordan.

d) Future outlook and challenges

As affirmed during the Official Visit to the United States by Prime Minister Obuchi, further bilateral cooperation between Japan and the United States to ensure the world peace and prosperity remains a key issue for both countries. Japan and the United States have built a strong bilateral relationship as allied nations that share the same values. This bilateral relationship is underpinned by mutual understanding and trust between the people of the two countries, and it is becoming increasingly important that the peoples of Japan and the United States, particularly young people, will engage in more exchange in all areas and deepen mutual understanding in order to further advance the Japan-U.S. cooperative relationship.

2. Japan-ROK relations

a) The development of future-oriented Japan-ROK relations

Through the visit to Japan by President of the Republic of Korea (ROK) Kim Dae Jung in October 1998, Japan and the ROK put the issues of the past behind them to build a future-oriented relationship as "a relationship between countries geographically close and close both in name and reality." In March Prime Minister Obuchi visited the ROK, holding a summit meeting with President Kim Dae Jung and delivering a policy address at Korea University. At the summit meeting, both leaders affirmed the steady implementation of the Japan-Republic of Korea Joint Declaration-New Partnership between Japan and the ROK towards the 21st Century and its annexed action plan, as well as announced the Japan-Republic of Korea Economic Agenda 21, in order to move toward the further promotion of Japan-ROK economic relations. Issues of the past were not taken up at the summit meeting, leaving the impression that the Japan-ROK relationship had entered into a new era. Further, the opening of the ROK to Japanese culture has been proceeding under President Kim Dae Jung, with bans lifted widely on screenings of Japanese films, performances of popular songs and other forms of culture.

Further, in 1999, as a part of continuous political dialogue, many mutual visits were conducted at the summit and ministerial levels in accordance with the Japan-ROK Joint Declaration. In October, the Second Japan-Republic of Korea Ministerial Meeting was held on Cheju Island, with many Ministers participating and engaging in frank exchanges of views. Such frequent interchanges have thus served to further promote the close, friendly and cooperative relationship.

At the Ministerial Meeting in October, Japan and the ROK agreed to designate 2002, the year in which Japan and the ROK will co-host the FIFA World Cup, as the "Year of Japan-ROK National Exchange in 2002," and to promote a range of exchange projects encompassing all areas. By deepening exchange not only between the public and private sector, but across all levels of civil society, it is expected that Japan and the ROK will build ever more solid foundations of trust into the 21st century.

One of the various issues that remains between Japan and the ROK is that of territorial rights over Takeshima Island. Japan has consistently held the position that, in light of the historical facts, as well as the rules and principles of international law, Takeshima is an integral part of Japan, and will take a course of continued and persistent dialogue with the ROK on this issue.

b) Japan-ROK economic relations

During the visit to Japan by President Kim Dae Jung and the visit to the ROK by Prime Minister Obuchi, both leaders resolved to strive to promote trade, investment and other areas in order to elevate the bilateral economic relationship to a higher dimension toward the 21st century. The Japan-Republic of Korea Economic Agenda 21, announced by both leaders during Prime Minister Obuchi's visit to the ROK in March, included an agreement to conduct negotiations toward the early conclusion of the Japan-ROK investment treaty stipulating comprehensive investment rules between Japan and the ROK. Following preparatory consultations held in February and April, the main consultations were held at the end of September. Further, as to efforts continuing on from 1998 to stimulate trade between Japan and the ROK, the ROK Minister of Trade, Industry and Energy and businesspersons visited Japan in December, and a joint government-private sector investment promotion conference was convened.

In terms of cooperation in the area of standards and certification, Japan and the ROK continue to promote the exchange of information on cooperation in the areas of mutual approval and standards in order to advance the use of products and services in both countries, and to facilitate trade. Moreover, in June the source diversification system for specific imports, essentially a regulatory measure on Japanese imports, was completely abolished, demonstrating that considerable efforts are being made toward the further promotion of Japan-ROK economic relations.

c) The new Japan-ROK Fisheries Agreement

Both sides exchanged an instrument of ratification of the new Japan-ROK Fisheries Agreement, which entered into force in January. As a result of the new Fisheries Agreement, Japan-ROK fishing relations have entered a new era, and further efforts are being made toward building more cooperative relations under the new Agreement.

The new Agreement stipulates that both countries will decide annually upon catch quotas and other operational provisions for vessels belonging to the other country, taking into account such factors as the state of resources in the Exclusive Economic Zones (EEZs) of their respective countries. The Japan-ROK Fisheries Joint Committee convened on 28 December reached a settlement on operational provisions and other conditions in EEZs for both sides in 2000.

3. Japan-China relations

a) Overview

Japan-China relations are one of the most important bilateral relations for Japan. The further development of Japan-China relations is therefore hugely significant for the peace and prosperity not only of the Asia-Pacific, but also of the world. Japan, for its part, hopes that China will exert a role as a more constructive partner in the international community through expanding exchange and cooperation at all levels.

In order to further promote Japan-China relations, which had entered a new phase as a result of President Jiang Zemin's visit to Japan in November 1998, the first visit of a Chinese Head of State, in July Prime Minister Obuchi visited China, meeting with President Jiang Zemin, Premier Zhu Rongji and National People's Congress Standing Committee Chairman Li Peng. A substantial agreement was reached in bilateral negotiations on China's accession to the World Trade Organization (WTO), and both sides agreed to a visit to Japan by Premier Zhu Rongji in 2000 and the further promotion of 33 specific areas of cooperation toward the 21st century. With these results and others, the visit served as a bridge to the new century. During the visit, Prime Minister Obuchi also proposed the establishment of a 10 billion yen fund (the so-called "Obuchi Fund") as an assistance package for the afforestation and greenification movements undertaken toward China by Japanese private-sector groups, and in November Japan and China conducted an Exchange of Notes to materialize the proposal.

The second generation of the Japanese crested ibises presented during President Jiang Zemin's visit to Japan was hatched in May, and, the Government having asked for suggestions from Japanese elementary school students, was named Yuyu, which means "tenderness" in Japanese. As part of the Cooperative Plan on a Framework between the Government of Japan and the Government of the People's Republic of China for Further Development in Youth Exchanges agreed to again at the time of President Jiang Zemin's visit, a group of 100 Chinese high school students visited Japan in August, and 100 young Japanese people, including high school students, visited China in October. Further, with 1999 marking the 20th anniversary of the signing of the Japan-China Cultural Exchange Agreement, various cultural exchange programs were implemented under the banner of the "Japan-China Culture and Friendship Year."

The visit to Japan in December by Chairman of the Chinese People's Political Consultative Conference Li Ruihuan also allowed for a further deepening of the future-oriented, friendly and cooperative Japan-China partnership.

In addition, visits made to Japan included those by Director of the Information Office of the State Council Zhao Gizheng in January, Minister of Culture Sun Jiazheng in May, Minister of Public Security Jia Chunwang in September, and Minister of Education Chen Zhili in October. From Japan visits were made by Minister of Transport Jiro Kawasaki in April, President of the House of Councilors Juro Saito in May, and Minister of Posts and Telecommunications Seiko Noda and Chairman of the National Public Safety Commission Takeshi Noda in September, as well as visits by delegations of the major political parties in Japan, including the Liberal Party in March, the Democratic Party in May, the Social Democratic Party in October, and the Liberal Democratic Party and the Komeito Party in November. As such, active exchanges were conducted by both countries.

b) Japan-China economic relations

Total trade between Japan and China in 1999 amounted to 7.5328 trillion yen, a year-on-year increase of one percent. In recent years, China has become Japan's second largest trading partner, while Japan is China's largest trading partner, and interdependence in the area of trade is deepening. In addition, since 1988 the balance of trade has shown an excess of imports for Japan, reaching 2.2180 trillion yen in 1999.

At the same time, in terms of direct investment to China, new contracts have been stagnant due to regulations on various types of investment resulting from the announcement of the June 1996 Guidelines on the Introduction of Foreign Capital and a review of preferential treatment policy for foreign capital. The number of new contracts for the first half of FY1999 stood at 35, totaling 35.3 billion yen, a year-on-year decrease of 41.2%.

Japan has supported the realization of an early accession to the WTO by China from the perspective that it will serve to strengthen the multilateral trade system, further promote China's reform policy of opening up to the outside world and enable China to become a more constructive partner in the international community. On the occasion of Prime Minister Obuchi's visit to China in July, Japan reached a substantial agreement with China on bilateral negotiations, thereby contributing to the advancement of accession negotiations.

In the area of fisheries, both sides continued to engage in energetic consultations with a view to the early entry into force of the new Japan-China Fisheries Agreement signed in November 1997. (Based on the results of the ministerial-level consultations held between Minister of Agriculture, Forestry and Fisheries Tokuichiro Tamazawa and Chinese Minister of Agriculture Chen Yaobang in February 2000, an Exchange of Notes took place on 31 March, and the Agreement was to enter into force on 1 June.)

c) Relations with Taiwan

Article 3 of the Joint Communiqué of the Government of Japan and the Government of the People's Republic of China clearly states that the Government of Japan "fully understands and respects this stand of the Government of the People's Republic of China," that is, "Taiwan is an inalienable part of the People's Republic of China." Based on this 1972 Joint Communiqué, Japan has maintained its relations with Taiwan as exchanges of a private and regional nature, in other words, working relations on a non-governmental basis.

Regarding relations between the parties on both sides of the Taiwan Strait, Japan strongly hopes that issues surrounding Taiwan are resolved peacefully through direct dialogue between the parties, and has repeatedly issued statements to this effect.

Following the major earthquake that struck Taiwan on 21 September, Japan took the decision on the very same day to dispatch an international emergency aid unit and to extend emergency grant aid totaling US$500 thousand. In addition, Japan also supplied tents, generators and other emergency aid materials totaling around 29.8 million yen and provided 1,000 emergency houses through emergency grant aid. Since then, Japan has been providing assistance in line with Taiwan's needs, including the provision of expertise in rehabilitation, and financial assistance to Japanese NGOs conducting relief activities in Taiwan. Japan provided large-scale, detailed assistance to the Taiwan earthquake which was widely reported throughout Taiwan, and as such Japan received numerous expressions of gratitude from authorities, residents and those affected by the disaster.

4. Japan-ASEAN relations and regional cooperation in East Asia

a) Relations with the Association of South East Asian Nations (ASEAN)

While ASEAN countries were severely affected by the currency and financial crisis which broke out in 1997, thanks to the assistance provided by the international community and the reform efforts of each country, the ASEAN economy was in recovery during 1999 (for further details, see Part B, Section 4 of this Chapter). As for ASEAN, with the accession of Cambodia to ASEAN in April, "ASEAN10," which ASEAN has wished for since its establishment in 1967, was realized. Throughout 1999, Japan worked to build a new partnership toward the 21st century with ASEAN, which has gone through such developments, with the potential developments following the currency and financial crisis borne in mind.

First, at the ASEAN Post-Ministerial Conferences (PMC) held in Singapore in July, Masahiko Koumura, Minister for Foreign Affairs of Japan delivered a speech as the lead speaker at the ASEAN10 + 10 Meeting (with dialogue partners). In his speech, Foreign Minister Koumura stressed the historical significance of the realization of ASEAN10 and its implications for ensuring the security of Asia, and, highlighting the importance of reform efforts to ASEAN countries, emphasized Japan's active commitment to revitalizing the Asian economy. Furthermore, at the following Japan-ASEAN Foreign Ministers' Meeting, Japan considered ASEAN10 a partner for peace in Asia, announcing its "Commitment to Peace in Asia" as its determination to build peace in Asia with ASEAN. Japan also proposed the "Frontier Spirit for Manufacturing" and the "Frontier Spirit for Building Information and Developing Information Technologies" in order to realize the full-fledged revitalization of the ASEAN economy in recovery, and both of these were supported by ASEAN countries.

Prime Minister Obuchi, who attended the ASEAN+3 (Japan, China and the ROK) Summit Meeting held in Manila at the end of November, announced the "Plan for Enhancing Human Resources Development and Human Resources Exchanges in East Asia," based upon the Report of the Mission for Revitalization of Asian Economy that was dispatched between the end of August and early September, and later named the "Obuchi Plan" by Philippine President Joseph Estrada, demonstrating that the Plan was highly valued by ASEAN leaders. At the following Japan-ASEAN Summit Meeting, Prime Minister Obuchi announced that Japan would actively extend assistance to develop a cooperative entity through which ASEAN could promote internal cooperation such as in the ASEAN Free Trade Area (AFTA) and contribute to the peace and prosperity of Asia. In particular, Japan announced cooperation to narrow economic disparities in the ASEAN region, centered on assistance to newly acceding ASEAN countries.

Moreover, as for "Towards Vision 2020: Japan-ASEAN Consultation Conference on Hanoi Plan of Action," a conference of eminent persons from Japan and ASEAN announced by Prime Minister Obuchi at the Japan-ASEAN Summit Meeting held in Hanoi at the end of 1998 (Japanese co-chair: President of the Japan Institute of International Affairs Hisashi Owada), the first meeting was held in Vietnam in October and, at the meeting, a lively exchange of views was conducted on the modalities for cooperative Japan-ASEAN relations with a view to the 21st century. Following its Second Meeting, the Consultation Conference is supposed to report its recommendations to the Japan-ASEAN Summit Meeting to be held in Singapore at the end of 2000. Results are expected from the Conference, which will serve as a forum for debate on the modalities for mid- to long-term Japan-ASEAN cooperative relations from a comprehensive and wide-ranging perspective.

b) Relations with individual ASEAN countries

Mutual visits of VIPs have also been actively conducted with individual ASEAN countries. In November, prior to the ASEAN+3 (Japan, China, the ROK) Summit Meeting in Manila, Prime Minister Obuchi visited Indonesia, and in July Foreign Minister Koumura also visited Indonesia following his attendance at the ASEAN PMC in Singapore.

From the ASEAN countries, visits to Japan were made by Samdech Hun Sen, Prime Minister of Cambodia in February, Mr. Phan Van Khai, Prime Minister of Vietnam in March, Mr. Joseph Estrada, President of the Philippines and Dr. Mahathir bin Mohamad, Prime Minister of Malaysia in June, Mr. Chuan Leekpai, Prime Minister of Thailand in October, Mr. Abdurrahman Wahid, President of Indonesia in November, and Mr. Goh Chok Tong, Prime Minister of Singapore in December. In addition, exchanges across a wide range of areas, including the private sector, were conducted and these contributed to the strengthening of Japan's relations with ASEAN countries.

At various other international conferences, Japan has also engaged in dialogue with ASEAN countries at the leaders' and foreign ministerial levels. In particular, on the occasion of the ASEAN+3 (Japan, China, the ROK) Summit Meeting, a Japan-Myanmar Summit Meeting was held for the first time in 15 years, in which Prime Minister Obuchi called on Senior General Than Shwe, the Chairman of the State Peace and Development Council (SPDC) and Prime Minister of Myanmar to advance the democratization process in Myanmar, and expressed Japan's intention to cooperate with Myanmar's economic reform efforts.

c) Regional cooperation in East Asia

The spread of the currency and financial crisis and its impact on the entire East Asian region urged East Asian countries to strongly recognize the relations of interdependence among them. As East Asian countries learned from the lessons of the currency and financial crisis, a momentum to strengthen regional cooperation in East Asia was gained among such countries.

In response to this gain of momentum, at the ASEAN+3 (Japan, China, the ROK) Summit Meeting held in Manila at the end of November, leaders adopted the "Joint Statement on East Asia Cooperation," in which leaders resolved to promote cooperation in a wide range of areas encompassing monetary and financial cooperation, social and human resources development, scientific and technical development, the cultural and information area, development cooperation, political-security, and transnational issues, as the first ever joint statement within the framework of the meeting. Given the importance of steadily implementing the Joint Statement in the future, as a result of a Japanese proposal, it was decided that the first ASEAN+3 (Japan, China, the ROK) Foreign Ministers' Meeting would be held on the occasion of the ASEAN PMC in Bangkok in July 2000.

On the occasion of the ASEAN+3 (Japan, China, the ROK) Summit Meeting in Manila, based upon a proposal from Prime Minister Obuchi, a trilateral leaders'-level dialogue among Japan, China and the ROK was realized for the first time in the form of a breakfast meeting. At the breakfast meeting, leaders exchanged views on issues of culture, history, tradition and other areas which the three countries share, as well as on economic issues focused mainly on the WTO. As Mr. Kim Dae Jung, President of the ROK proposed at the meeting that joint research should be conducted on the impact of China's accession to the WTO among others, the meeting marked an important first step toward trilateral Japan-China-ROK leaders'-level dialogue and the promotion of regional cooperation in East Asia. Japan believes that the steady promotion of the Japan-China-ROK process and trilateral cooperation will contribute to the peace and prosperity of East Asia, and in turn, of Asia as a whole.

5. Japan-Russia relations

a) Overview

With regard to relations between Japan and Russia, the Tokyo Declaration, which was signed during the visit of President Boris Yeltsin of Russia to Japan in 1993, has been a cornerstone of the development of bilateral relations. Japan's basic policy toward Russia is to make every possible effort to resolve the issue of the attribution of the Northern Territories based on the Tokyo Declaration, thereby concluding a peace treaty and fully normalizing relations between Japan and Russia. Japan also supports Russia's reform initiatives and is working to strengthen cooperation and relations in various fields. Strengthening Japan-Russia cooperative relations is also seen as a major contribution to the stability and prosperity of the Asia-Pacific region.

In 1999, Japan and Russia continued to maintain regular high-level dialogue and worked to strengthen bilateral relations based on the series of agreements and declarations between the Japanese and Russian leaders to date, including the Krasnoyarsk Agreement reached at the Japan-Russia Summit in Krasnoyarsk in November 1997 (which expressed that both countries would exert utmost efforts to conclude a peace treaty by 2000 based on the Tokyo Declaration), and the Moscow Declaration on Building a Creative Partnership between Japan and the Russian Federation of November 1998. Consequently, Japan-Russia cooperative relations have seen steady progress across a wide range of areas, including politics, the economy, security, personal exchange and cooperation on international issues.

Energetic negotiations in 1999 continued regarding the peace treaty in particular, including meetings of the Subcommittee on Border Demarcation and the Subcommittee on Joint Economic Activities which had been set up under the Japanese-Russian Joint Committee on the Conclusion of a Peace Treaty at the Japan-Russia Summit in November 1998. Agreement was also reached on implementing so-called "free visits" to the Northern Territories by former islanders and their families, the first group of which visited the Habomai Islands in September.

b) Continuing close political dialogue and progress of relations in various areas

Close political dialogue was maintained by Japan and Russia throughout 1999, with one bilateral Summit and six bilateral Foreign Ministers' Meetings. Prime Minister Obuchi also held talks with Prime Minister Vladimir Putin of Russia on the occasion of the Asia-Pacific Economic Forum (APEC) Summit Meeting, and the Russian First Deputy Prime Minister, who also served as the Russian co-chair of the Japan-Russian Federation Inter-Governmental Committee on Trade and Economic Affairs, visited Japan on two occasions.

At the Japan-Russia Summit Meeting held on the occasion of the G8 Cologne Summit in June, Prime Minister Obuchi expressed the hope to perform the historical work of realizing the Krasnoyarsk Agreement, demarcating national boundaries and concluding a peace treaty. In response, President Yeltsin expressed overall support for this, demonstrating a positive stance by stating: "Border demarcation was my proposal."

At the foreign ministerial level, Minister of Foreign Affairs Igor Ivanov of Russia visited Japan in February, with Foreign Minister Koumura visiting Russia in May. On these respective occasions, both Foreign Ministers held a meeting as Joint Chairs of the Japanese-Russian Joint Committee on the Conclusion of a Peace Treaty as well as their regular Japan-Russia foreign ministerial consultations. Both Foreign Ministers also frankly discussed the peace treaty negotiations on the basis of the proposals presented by both sides at the 1998 Summit Meetings, and affirmed that they would continue to proceed energetically with negotiations in accordance with the series of agreements and declarations issued since the talks in Krasnoyarsk.

Both Foreign Ministers took the opportunities of the G8 Foreign Ministers' Meetings in June and December, the ASEAN Regional Forum (ARF) in July and the United Nations General Assembly in September to meet regularly in 1999, exchanging wide-ranging views on bilateral matters as well as international issues of concern to both countries.

In terms of economic affairs, First Deputy Prime Minister Yuri Maslyukov visited Japan in March, convening a meeting together with Foreign Minister Koumura as Joint Chairs of the Japan-Russian Federation Inter-Governmental Committee on Trade and Economic Affairs. In addition, from the end of August until the beginning of September First Deputy Prime Minister Viktor Khristenko visited Japan for the convening of the third meeting of the Inter-Governmental Committee. Throughout 1999, the "Hashimoto-Yeltsin Plan," which comprehensively outlines Japan-Russia cooperation in the economic sector, was steadily implemented and expanded. With respect to the untied loans of US$1.5 billion from the Japan Bank of International Cooperation (JBIC) (announced in February 1998 through co-financing with the World Bank, but suspended as a result of the Russian financial crisis in the summer of 1998) financing was resumed in September, and has been steadily implemented since.

Bilateral personal exchanges and defense exchanges were further promoted, keeping in stride with political dialogue and the advancement of cooperation in the economic area. The Japan-Russia Youth Exchange Center opened in May, and by the end of the year around 400 young Russians had been invited to Japan. In terms of defense exchanges, Minister of State for Defense Hosei Norota visited Russia in August, where he and Russian Minister of Defense Igor Sergeyev exchanged views on Japanese and Russian defense policy and regional situations, and signed a Memorandum of Understanding on the development of defense exchange. The May Japanese proposal for "joint Japan-Russia operations for disarmament and environmental protection," including cooperation in the dismantling of retired nuclear submarines was highly commended by Russia as a new area for Japan-Russia cooperation.

Japan-Russia cooperation was in this way further promoted throughout 1999 in various areas, and Japan-Russia relations moved forward steadily toward the building of a "creative partnership." Although President Yeltsin, who exerted a lead role in promoting Japan-Russia relations on the Russian side, resigned his post at the end of December, the trend in bilateral relations had already become what could be called a "historical tide" and will continue to proceed despite the change in the Russian administration. Japan, for its part, is determined to cooperate closely with the Government of Russia, to be led by a new President, in order to further develop Japan-Russia relations, based on the results achieved with President Yeltsin.

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