Japan and ASEAN: Partnership for a Stable and Prosperous Future

8. The Koizumi Initiative

22 Takaaki Kojima In January 2002, in Singapore, Prime Minister Junichiro Koizumi made a policy speech, setting out a new vision of a basic framework for Japan’s relationship with ASEAN. In this speech, Prime Minister Koizumi announced the “Koizumi Initiative”. He proposed that in the twenty-first century, Japan and ASEAN as sincere and open partners, should strengthen their cooperation under the basic concept of “acting together, advancing together”, and introduced the idea of an “East Asian Community” that also includes Australia and New Zealand. 2003 marked the Japan-ASEAN Interchange Year and in December 2003, the Japan-ASEAN Commemorative Summit was held in Tokyo, 8 The Koizumi Initiative 23 The Koizumi Initiative where all the leaders of ASEAN countries had a meeting outside ASEAN for the first time. In this Summit, Prime Minister Koizumi clearly reiterated that Japan would continue to regard its relationship with ASEAN as of utmost importance and confirmed that Japan and ASEAN should further develop their relations as sincere and open partners that “act together, advance together”. On that occasion, Japan signed the Declaration on Accession to the Treaty of Amity and Cooperation (TAC). As mentioned at the outset, the East Asia Summit will be held for the first time in Kuala Lumpur later this month. This Summit comes as a big step toward the creation of the East Asia Community, proposed by Prime Minister Koizumi in 2002. I believe the Japan-ASEAN relationship should be the engine for the creation of the EAC because we have accumulated, for more than thirty years, a solid foundation of regional cooperation. We should promote East Asia cooperation, utilizing the Japan-ASEAN cooperation model. The rise of China and India has changed the international environment surrounding ASEAN. Professor Wang Gungwu even indicated that “China Fear” has been replaced by 24 Takaaki Kojima “China Fever” in the eyes of ASEAN. However , the importance of Japan for ASEAN would not be changed inspite of the rise of both powers. Needless to say, Japan is a global economic power second only to the United States and its economy is back on track after more than a decade long recession. Japan’s GDP is three times as large as that of China and nearly seven times that of India. The total trade value of Japan-ASEAN was still twice that of China-ASEAN, and nearly ten times more than India-ASEAN (in 2002). The accumulated FDI from Japan to ASEAN from 1995 to 2003 was approximately 28 billion dollars, which is forty-four times larger than that from China and forty-two times that from India. Above all, Japanese companies which have deep involvement in ASEAN countries including Singapore, have come to be strong engines for economic growth in ASEAN countries. Thus Japan-ASEAN economic relations driven by Japan’s direct investment are one of the main locomotives to substantially strengthen the regional economy. In this regard, let me quote the remarks by three of Singapore’s leaders. In his speech in 2000, then SM Lee Kuan Yew said that 25 “…with a strong presence in nearly all major sectors of Singaporean’s economy, Japanese companies accounts for about one third of MNCs operating here…. Through these investments, Singaporean learned reliable labor management and productive practices much as Quality Control Circle (QCC) and On-the-job Training (OJT)…”. PM Lee Hsien Loong, during his visit to Japan in May this year, said “…Japan possesses advanced technology and deep capabilities unmatched by any other country in the region. Japanese MNCs can offer ASEAN countries investments, know-how, jobs and access to developed countries’ markets. It will be a long time before Chinese MNCs can do the same…”. SM Goh Chok Tong stressed in the above-mentioned speech that the JapanASEAN relationship will be the most important for ASEAN in the next twenty years, at the very least. It has been pointed out that Japanese manufacturing companies might have shifted the focus of their investment from ASEAN to China. This is not the case. According to Japan’s METI statistics which covers capital expenditure by Japanese local entities whose sources of finance include not only funds The Koizumi Initiative 26 Takaaki Kojima directly sourced from Japan, but also funds sourced locally, such as internal funds and borrowings, and the funds sourced from other countries. The accumulated amount of Japanese...