(Provisional Translation)

Address by Mr. Hisashi Tokunaga,
Parliamentary Vice-Minister for Foreign Affairs

Forum for the Promotion of Public-Private Cooperation in the Mekong Region

December 14, 2010

Distinguished delegates from the governments and private sector of the Mekong nations, ladies and gentlemen:

Thank you for taking your valuable time today to attend the Forum for the Promotion of Public-Private Cooperation in the Mekong Region. I would like to extend an especially warm welcome to the government and industry delegates and the young leaders who have traveled to Japan to represent the five Mekong nations at this Forum.

At the First Mekong-Japan Summit Meeting, in November 2009, Japan and the countries of the Mekong region reaffirmed a number of commitments, including a pledge to promote public-private cooperation that contributes to the effective implementation of cooperation projects in various areas, such as infrastructure improvement, development of natural resources, and improvement of logistics networks. In the Mekong-Japan Action Plan 63 adopted at that First Summit Meeting, it was agreed that Japan would launch a new forum to discuss issues from the viewpoint of cooperation between the public and private sectors, and that undertaking has resulted in our meeting here today.

1. Japan's Assistance for Development in the Mekong Region

The Asian region and Japan have long enjoyed a close relationship, especially in the political, economic, and cultural spheres, and Asia is a priority region in Japan's official development assistance (ODA). Japan has contributed to the region's growth through economic cooperation which creates organic alliances between public funds and private-sector enterprise. We have also supported efforts to address global and regional challenges such as environmental and climate change issues, infectious diseases, and disaster prevention.

In recent years, with a view to helping close development gaps and reinforce integration within the ASEAN region, Japan has placed particular importance on its cooperation with the Mekong region, where most of the mainland ASEAN states are located. At the First Mekong-Japan Summit Meeting in 2009, we committed a total of more than 500 billion yen in ODA over three years, and we are steadily carrying out this pledge. The progress of the various cooperative programs was monitored at the Mekong-Japan Foreign Ministers' Meeting in July and the Second Mekong-Japan Summit Meeting in October. Japan also considers it important that regional growth should be in harmony with the environment, and the Second Summit Meeting accordingly adopted an action plan for an initiative known as "A Decade toward the Green Mekong," which coordinates environmental and climate-related efforts. A further action plan, the "Mekong-Japan Economic and Industrial Cooperation Initiative" (MJ-CI), focuses on hard infrastructure, trade facilitation and logistics, enhancement of small and medium enterprises and supporting industries, and enhancement of the service sector and new industries, based on recommendations from the business communities of the Mekong countries and Japan. Going forward, Japan is committed to work with the Mekong countries to implement these action plans.

2. Support for Strengthening ASEAN Connectivity

Another area of importance to Japan is helping to enhance connectivity within ASEAN, thus facilitating people-to-people interactions and the movement of goods in the region. At the ASEAN-Japan Summit on October 29 of this year, Prime Minister Kan expressed its support for the Master Plan on ASEAN Connectivity, which was adapted at ASEAN Summit on October 28. Enhanced connectivity will ease the expansion of operations, both by Japanese companies that want to optimize the distribution of their production bases in the region, and by the Mekong's own companies, and it is essential if the region's latent growth potential is to be fully realized.

As part of its support for enhanced ASEAN connectivity, Japan has actively backed the improvement of hard and soft infrastructure in the Mekong region. This hard infrastructure, or physical connectivity, is not the only driver of economic growth. Equally important are the institutional arrangements and the training of personnel to operate this infrastructure. Japan has made assistance in these two areas a particular focus, and we intend to intensify these efforts further.

3. Development in the Mekong Region and Public-Private Cooperation

Amid accelerating cross-border economic activity, Southeast Asia and Japan have longstanding trade relationships, including goods and services, in sectors from agricultural products to manufactured goods. Among Asian regions, the Mekong has particularly strong economic potential, a high-quality workforce, and social stability, and Japanese companies are interested in expanding their business there in areas ranging from manufacturing to service industries.

In recent years, Japan has pursued projects that support the development of the Mekong region as a whole through public-private cooperation, by means of schemes designed to simultaneously realize the expansion of Japanese corporate activities in the Mekong region and the further growth of the Mekong countries themselves.

For example, with Japanese support, Mekong-Japan Vocational Training Centers for business personnel have been established in Cambodia, Laos, and Viet Nam, and opened up business courses. The people trained at the center such as ones in Phnom Penh and Ho Chi Minh City are now succeeding in the business community and human connection formed through Japan-ASEAN networks is helping to promote industry in the Southern Economic Corridor and is positively contributing to the economy of the southern region.

We are also organizing forums to allow the public and private sectors to jointly discuss improving the investment environment: for example, workshops on trade and investment in Myanmar, and the the 4th Industry and Government Dialogue in Laos, which is due to take place this week, on December 17. If the business environment for Japanese-affiliated companies continues to improve thanks to these dialogues, we anticipate that investments will expand.

In addition, we are supporting Japanese corporate investment in the Mekong countries through financing by the Japan Bank for International Cooperation and a special support framework provided by Nippon Export and Investment Insurance (NEXI).

As activities by private sectors in the Mekong region become more active, we must involve private sector in the development as well as grasp the needs of private sector quickly, in order to promote sustainable development of the Mekong region, a region with great possibility of economic growth, and establish win-win relationship between Japan and Mekong region countries.

In the field of ODA, Japan implemented a system in which government adapt projects proposed by private sector. As the first project recognized under this system, a project of constructing deep-water port in Lach Huyen, Viet Nam, is being planned. We envisage a new development model for this project, with Japanese loan financing for the phase with low financial viability, that is, the construction of the port and related infrastructure, followed by a joint venture between several Japanese and Viet Namese companies which will install and operate the berth equipment, as this can be done profitably. We will explain the details later, this year we launched a scheme to conduct preparatory cooperation studies on the basis of proposals by companies that plan to take part in PPP infrastructure projects.

In a further initiative, Japan has recently established a Ministerial Meeting on the export of Integrated Infrastructure Systems, and is making arrangements designed to meet the needs of partner countries by integrating promising Japanese technologies into systems created for specific projects. Embassies have designated "Infrastructure Specialists" and organized a system in which specialists would assume information gathering and coordination with personnel in charge of coordination between public-private sector.

4. Message to the Participants

Today, in addition to the government and private-sector delegates and young leaders from the Mekong countries, who number more than sixty, we have with us many people from the relevant ministries and private companies in Japan. It is my hope that this Forum will create organic ties among members of the different sectors in Japan and the Mekong countries, and that it will stimulate activities that contribute to the future development of the Mekong region.

Thank you very much.