Speech by Foreign Minister Masahiko Koumura "Growth of the Mekong Benefits ASEAN, and Growth of ASEAN Benefits Japan"

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May 23, 2008, Tokyo, Japan

Japanese

Ladies and gentlemen,

I wish to make some comments on the subject of "The Future of Asia," and since Prime Minister Fukuda, in his speech yesterday, painted a broad canvas that looks ahead thirty years, today I propose to focus on a somewhat narrower period covering the next ten years or so, taking up a subject that is likely to have a major impact on your activities.

My subject is the Mekong Region. The transportation infrastructure there has developed steadily, and the potential for the region to make robust future progress grows greater every day. Japan's investment in Vietnam has long been very substantial, and I have little doubt that many of you here today have been to Vietnam, looked from there at the Mekong Region to get a view that the region is likely to progress and has a bright future.

That is certainly how I myself feel.

I was Parliamentary Vice-Minister for Foreign Affairs and then was appointed Minister for three years or so from 1996, involved in diplomacy. One of the major themes at that time was the Mekong Region, and of particular importance was the restoration of stability to Cambodia. There the situation could at any moment have retrogressed into civil war, and I personally dedicated a great deal of effort to exercising persuasion.

It was at that time that Laos and Myanmar were welcomed into ASEAN, and Cambodia itself eventually put its crisis behind it and became a member of ASEAN in 1999. Vietnam had joined already in 1995, but I recall having the impression that it would take quite some time for them to join the ranks of the Asian "Tigers" or "Dragons," and to achieve a leap forward economically.

However, ten years later the expressions on the faces of the people of that area have brightened up a great deal and are exuding confidence, so much so that I found myself being energized by them when I had the first ever Japan-Mekong Foreign Ministers' Meeting here in Tokyo January this year, by inviting the foreign ministers of five countries, namely Cambodia, Laos, Myanmar, and Vietnam - which we also refer to as the CLMV countries - and Thailand, which is more advanced economically than the rest of the region, into under one single roof.

This is because in the Mekong Region, once rent asunder by war, those countries are developing a network that links their economies by three trunk roads running east to west and north to south. Of course, there is stimulation from China as well. The North-South Economic Corridor, the route that runs from Yunnan province in China into Vietnam, passing north of Hanoi to the port city of Haiphong, and also enters Thailand, via Laos, to reach Bangkok, is almost at the final stage of completion with the support of Chinese government, the Asian Development Bank, and the Thai government. China has also expressed its intention to construct a railway network from Kunming to Singapore across mainland Southeast Asia with the cooperation of the Asian Development Bank and other institutions. In any event there is tremendous potential for the infrastructure situation in the Mekong Region to be transformed over the next 10 years.

Some people tend to regard diplomacy as a zero-sum game. If I were to describe a situation as I just have, they might say something like "That's losing out against China again! What is Japan doing?" But diplomacy is not normally a clear-cut story in which one side wins and the other side loses. It is more often the case that both sides win, or both sides lose, and it is clearly far preferable if it is possible for both sides to win: a win-win situation.

The Mekong development is a typical example of this. It is a wonderful thing for the people of the region, and also for everybody else, if China invests in infrastructure.

Of course, Japan is not just sitting idly by. We have laid down the goal of making the Mekong Region a "Region of Hope and Development" and we have decided to make this area a priority target for economic cooperation and to send in official development assistance (ODA). In December 2006, a bridge called the "Second Mekong Friendship Bridge," which links Thailand and Laos, was completed with Japanese ODA, and with that the East-West Corridor was almost completely open. Nevertheless, we are going to provide a further US$20 million for the facilitation of goods distribution. In addition, there is a zone straddling the borders of Vietnam, Cambodia, and Laos that tends to lag behind development elsewhere and which we have called the "Development Triangle." We also intend to provide US$20 million there.

The level of wages in Laos and Cambodia is reportedly around one-fifth of the level in Thailand. Given that there is still substantial scope for improvement in the transportation network and in know-how in cross-border transit, if we can assist by transmitting our knowledge in such fields as customs procedures and there are improvements in those areas, then that will lead to greater inflows of goods, people, and capital from Thailand in the south and from China in the north, and without doubt many more companies would launch into Laos and Cambodia in pursuit of its lower wages.

If, in ways such as this, the economy of the Mekong Region begins to boom, then in the spheres of trade and investment that could certainly be expected to have a favorable impact on Japanese companies that have strong relationships with the area. Additionally, in the Mekong Region Japan, China, Thailand, Singapore, and of course the CLMV countries, would surely be able to pursue possibilities for coexistence, shared prosperity, and win-win outcomes. In this context I would like to inform you that, with respect to the development of the Mekong Region, Japanese and Chinese foreign-policy officials have opened a policy dialogue on Japan's and China's policies for the Mekong, so as to coordinate policies and share information on a regular basis.

Myanmar, one of CLMV countries, has suffered unprecedented damage from the cyclone that struck in the early part of this month. I have sent a personal message of condolence, and Japan has announced emergency material and financial assistance totaling some 1.3 billion yen, including physical items such as tents, and money in the form of emergency aid of US$10 million and assistance for NGOs. The nation is gradually allowing emergency relief personnel from Thailand and other neighboring countries to enter the nation. It is my hope that, for the sake of coexistence and shared prosperity with the people of Myanmar, the country will show greater determination to take in still more such personnel.

When you return home after this conference, I would like you to do so with the memory that in Japan's diplomacy in Asia, the Mekong Region is the place to which we are devoting our strongest efforts. Since we wish to make it a "Region of Hope and Development," we have designated next year (2009) as the "Japan-Mekong Exchange Year," and we intend to raise the tempo of interaction by conducting exchange activities among the five home nations and Japan throughout the year. I wish to take this opportunity to request your cooperation in making the year a success.

The project that will bring 10,000 young people to Japan from the Mekong Region over a five-year period has already started and is being carried out in a serious-minded way, and Japan will be sending young people over there both this year and next. These exchanges between peoples are activities that will nurture "trust" between Japan and the region.

We must aim for "development" built on "trust". For this, cooperation in the development of infrastructure plays an important role, as I mentioned earlier, and I would like to make the kind of support involving all parties in Japan, public as well as private and that includes not only ODA but also private-sector investment. After all, the government's Mekong support is an archetype of the old adage that "One good turn deserves another," as one of its aims is for Japanese companies and other companies with whom Japan does business to be able to conduct business actively on the Mekong frontier.

After "trust" and "development," I talked about "stability" during my discussions with the foreign ministers of the Mekong countries. In brief, we are faced with a very difficult issue in the form of the Myanmar problem. But what I would like to see is that the C, L, and V of CLMV - namely Cambodia, Laos, and Vietnam - experiencing the reality that "good things do happen as a result of associating with Japan," and that will give the CLV countries a persuasive impact on Myanmar, and in turn should add weight to Japan's advice to Myanmar that it should restore democracy, and that if it does there will be more scope for economic growth than there is now.

Taken together, the collective name for all these efforts directed at the Mekong Region is the "Japan-Mekong Region Partnership Program." This is a major policy into which we will continue to invest a considerable amount of effort, and it is based on three main pillars in particular. The pillar that supports the foundation of the policy is that Japan will render firm support for the fundamental values for which the people of the region strive, such as democracy and the rule of law. This pillar also includes the consideration and resolution of problems common to the region, or more precisely the ways to overcome poverty and to address the issues of infectious diseases and environmental problems.

The two other pillars of the policy are the integration of the regional economy and fostering of collaboration, and the expansion of trade and investment between Japan and the Mekong Region. If I may add one important comment on the matter of regional economic integration, it is to say that stimulating growth in the Mekong Region, a late starter within ASEAN, will be of direct benefit to ASEAN as a whole, and in turn will benefit Japan itself, given its strong ties with ASEAN in the political, economic and cultural spheres. I would also like private-sector firms to work actively to promote trade and investment. For the government's part, by concluding bilateral investment agreements with Cambodia and Laos we will, inter alia, enhance the safety of investment activity and, as I mentioned earlier, will convey our own experience in such areas as cross-border transit and customs procedures.

Many members of the Diet also have a good understanding of diplomacy of this kind, and in consequence more than 70 members of the House of Representatives and House of Councilors have joined the Japan-Mekong Parliamentary Friendship League, which was established in November last year. That has been a very welcome development.

The population of Vietnam is 84 million, that of Laos 6 million, that of Cambodia 14 million, and that of Myanmar 56 million, making a total of 160 million. If we add Thailand's population of 66 million we can see that the total population of the Mekong Region forms a major market of nearly 230 million people. With the exception of Thailand, however, none of these countries has a per capita GDP that exceeds US$1,000. In my view, the day on which these countries attain the US$1,000 level, led by Vietnam and followed by Laos and Cambodia, will come within 10 years through their own efforts and support from Japan and other countries outside the region, especially the support of ASEAN as a whole. I believe that this is a day that must arrive.

If this comes to pass, the region will literally be a "Region of Hope and Development", and that is something to which I look forward very strongly.

In any event, this year is the 41st since ASEAN was established. Although the era and the environment have changed, ASEAN has achieved steady progress overall, at times going through difficult periods of adversity, but advancing nevertheless in a steadfast manner. When looking back at it afresh over the past 10 years I feel nothing but admiration for the hardy resolve it has shown. What ASEAN has accomplished in creating and treading the path to peace, development, and democratization can only be described as a great achievement.

There is no need to mention the importance of an ASEAN such as this for Japan. Our sea lanes pass right through the middle of ASEAN, making its strategic importance immediately obvious, and as a trading partner ASEAN ranks in importance equally with the European Union, after the United States and China. Also, from ASEAN's perspective, Japan is the second-largest investor after the EU.

Therefore, placing importance on ASEAN is of great benefit to Japan itself. In addition, since ASEAN is a group with a strong sense of collective responsibility it is perfectly reasonable to think that ASEAN should sit behind the wheel in forming regional cooperative structures, for example the East Asia Summit.

Japan will give its total support to ASEAN which seeks to enhance its integrity as a group by proposing changing its method of decision-making from a consensus method to a majority vote method of the kind that facilitates flexibility and creating a charter that respects universal values.

Incidentally, I wonder whether you know of "BIMP-EAGA." "BIMP" combines the first letters of Brunei Darussalam, Indonesia, Malaysia, and the Philippines, and "EAGA" stands for "East ASEAN Growth Area." The point is that the areas within ASEAN that need support are not only the Mekong Region but also underdeveloped areas in some of the more developed countries within ASEAN, such as the islands of Borneo and Mindanao, and BIMP-EAGA denotes the effort that is being made to fill the disparities between the two.

This shows that what ASEAN is devoting most effort to at the moment is the correction of disparities within the area. Japan intends to give its utmost support to this aspect, too, and our cooperation for the development of the Mekong Region also falls in line with this purpose. BIMP-EAGA is seeking to expand eco-tourism and other activities that take advantage of flourishing unspoiled natural areas on Borneo and Mindanao, and I feel sure that the private sector in Japan could also contribute in various ways. As for the Japanese government, it intends to give consideration to the things that it can do.

Towards ASEAN, Japan wishes to continue in the future to be a "partners thinking together, acting together, sharing a future vision" doing so by supporting the integration of ASEAN through the correction of intraregional disparities and, by strengthening economic relations by means of multi-tiered economic partnership agreements, on which I could have stated more. ASEAN, which constitutes the hub of East Asia, and Japan, which contributes to the stability and development of East Asia through providing international public assets such as the Japan-U.S. Alliance, are natural partners. The growth of the Mekong Region is beneficial to ASEAN, and the growth of ASEAN is beneficial to Japan and is, in turn, beneficial to the Asia-Pacific region and to the world economy as a whole.

I have talked today in some detail about the Mekong Region in particular, and will conclude my remarks now by expressing the hope that I have gained your understanding for Japan's policy towards ASEAN and the Mekong Region.

Thank you.


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