Promotion of the "Japan ODA Model"; The Successful Experience of Japan's Economic Cooperation Part 2.

(From Journal of Japanese Trade & Industry (JJTI))

Byline: Trade Finance and Economic Cooperation Division, Trade and Economic Cooperation Bureau, METI

II.Region-by-region responses for the situations of each developing country The "Japan ODA Model" that has been mainly implemented in East Asia should be applied to Africa and other regions in accordance with the circumstances of each region, while keeping Asia as the priority area.

(i) Asia Cooperation with East Asian countries, especially ASEAN countries, will be further promoted. Economic cooperation should consider the level of economic development of recipient countries. For instance, cooperation with advanced ASEAN countries (such as Thailand and Malaysia), should focus on building infrastructures in combination with private capital and developing highly specialized human resources. For the medium-developed ASEAN countries (such as Indonesia, the Philippines, and Vietnam), focuses on trade and investment climate improvement and human resources development to develop small and medium-sized enterprises are important. The developing ASEAN countries (such as Cambodia, Laos and Myanmar) need to develop basic infrastructure and rectify disparities in the region.

(ii) Others As for Africa, it is also important to extend economic cooperation to improve trade and investment climates that can attract private capital using the experiences in Asia. It is necessary to study such cooperation as; productivity enhancement to help technologies take root in the countries, assistance for the "one village, one product" movement, utilization of Nippon Export and Investment Insurance (NEXI) and the Japan Bank for International Cooperation (JBIC), support for export promotion through business matching and agricultural support.

As for the Middle East, an area important for its natural resources and energy policies, in order to develop a close and friendly relationship between Japan and the Middle East, highly specialized human resource development assistance is crucial. As for Central and Latin America, it is important to promote trade and investment climate improvement and poverty programs to narrow income gap.

III.Improvement of economic cooperation methods to enhance effects and efficiency (i) Effective combination of economic cooperation methods and development of new systems (1) Effective combination of yen loans, grant aid and technical cooperation It is necessary to establish a consultation system to ensure an effective combination of various support methods. It is vital that relevant ministries and agencies establish a forum to consult with local ODA taskforces, and sort out specific project needs. In addition, it is also important to organize an effective combination from the early stages and to formulate a medium-term plan, and then to proceed with the processes of request and examination based on this plan.