Indonesia, a genuine friend and partner of Japan

Indonesia, a genuine friend and partner of Japan

On the occasion of the birthday of His Majesty the Emperor of Japan, The Jakarta Post interviewed His Excellency Mr. Takao Kawakami, Ambassador of Japan to the Republic of Indonesia. Here we share his thoughts concerning Japan-Indonesia relations.

Question: First of all, may I have your views on Indonesia in 1998?

Answer: This year saw the beginning of Indonesia's new era for reforms both in political and economic fields, and overall, in my view, things seem to be going definitely in the right direction. I certainly wish the Indonesian people well in their continued strenuous efforts for reforms in the run-up period to the general election to be held in May or June next year and thereafter. In terms of reforms, Japan, too, is carrying out reforms in many fields, starting from the financial and banking systems.

Reforms tend naturally to be accompanied with pain. Reason and patience will be, therefore, very much in order. In fact, the Japanese economy is also facing a hard time with an increasing rate of unemployment as well as an increasing number of bankruptcies of banks and enterprises. Despite the difficult domestic conditions, however, Japan has been taking the lead in supporting the reform efforts made by Indonesia through its economic and technical cooperation schemes.

Would you please explain precisely about the economic assistance which has been done so far by Japan?

Over the past three decades, Indonesia has always been Japan's biggest development cooperation partner. It has constantly been the biggest recipient of Japan's official development assistance. Over 3 trillion yen of soft loans have been extended cumulatively during that period mainly to finance a great number of economic infrastructure projects together with about 200 billion of grant in aid, which has been disbursed in particular to address the social sector needs of the country.

In the field of technical cooperation, 7,000 Japanese specialists have been dispatched to Indonesia and 14,000 Indonesian trainees have been received and trained in Japan. All these figures exceed those of the economic assistance extended by Japan to any other developing country in the world in terms of its scale. We consider with certain pride that Japanese economic cooperation with Indonesia has played an important role for Indonesia's development in various key sectors, like agriculture, transportation, power generation and transmission, health, education, etc.

Our extensive cooperation in Indonesia's attaining self- sufficiency in rice in the early 1980s, and the establishment of three emergency hospitals in Jakarta, Surabaya and Bali are just a few concrete cases in point.

In this current economic crisis, the Government of Japan has already pledged, and is implementing 150 billion of sector- program loans, one million tons of rice aid and emergency grant assistance of medical materials and equipment as well as milk powder. I have to mention equally that the present Japanese economic assistance in this time of crisis in Indonesia has been focused in particular on helping the socially vulnerable people. It is my strong hope that the assistance will be of some help in stabilizing the poorer and needy people's lives in Indonesia.

Besides the government-to-government assistance, the Japanese government has also been extending grant aid for grassroots projects directly tailored to the needs of the Indonesian people through various Indonesian NGOs. This small-scale aid is used, among others, for electrification of villages, supply of water in rural areas, various educational needs, etc.

Apart from the government cooperation, needless to say there are a large number of Japanese investors operating in Indonesia. Presently, more than 1,100 Japanese joint-venture companies are operating here, with a total cumulative investment of US$42.6 billion for the past more than three decades.

They are serving for mutually beneficial causes, and are certainly contributing to job creation as well as transfer of technology in Indonesia.

Could you explain about the Miyazawa Plan, which was announced formerly to help Asian countries that are confronting the economy crisis?

In order to overcome the economic difficulties in Asia, while avoiding the risk of falling into a deflationary spiral, we believe it is imperative for Asian countries to take appropriate actions to put their economy on the path of recovery and sustainable growth.

It is in this context that Japan decided to provide adequate financial support, namely the "New Miyazawa Initiative", to Asian countries to assist the region overcome the economic difficulties and to contribute to stability of the international financial markets.

The total value of the New Miyazawa Initiative amounts to $30 billion, of which $15 billion will be made available for the medium- to long-term financial needs for economic recovery in Asian countries, and another $15 billion will be set aside for their possible short-term capital needs during the process of implementing the economic reform.

As the medium- to long-term financial facilities, Japan will provide funds in the form of loans from the Export-Import Bank of Japan, and ODA loans. Also, guarantees by the Export-Import Bank of Japan will be provided in respective governments' raising funds through international financial markets. Furthermore, we intend to support in other areas, such as interest subsidies, technical assistance, etc.

These schemes will target various areas, such as: 1) supporting the corporate debt restructuring in the private sector and efforts to make financial systems sound and stable, 2) strengthening the social safety net, 3) stimulating the economy by implementing public undertaking, and 4) addressing the credit crunch.

Japan is now considering more details of this initiative, based on respective Asian governments' needs and requests.

Hopefully, this Japanese initiative will help Asian countries overcome the current economic difficulties and bring the region back on to a steady growth path again.

What do you think is the key, or secret, of Japan's successful economic growth?

Some people may point out that one of the reasons for the success of the East Asian countries is their very high rate of domestic savings. I think policy priority on, and emphasis in, education and human resources development, solid and honest bureaucracy and relatively fair distribution of income, etc., are to be cited equally as constituting very important elements for economic growth.

Sociopolitical stability is also very much needed for economic growth. I believe that economic development which is achieved by social stability in Japan has, in turn, brought further stability to the society, offering a solid guarantee to our national security.

Having said that, I must recognize, at the same time, as I said above, that Japan does have problems now, structural and otherwise, and that the Government of Japan is trying vigorously to deal effectively with these problems.

Do you have any advice to give Indonesia as a friendly country to Japan?

Indonesia is now going through a period of one of the greatest political changes in its history. It is, equally, in the throes of the severe effects caused by the present Asian economic crisis. Here, naturally, I must say I have certain limits as Ambassador in making comments. On this premise, however, political stability seems to me indispensable from economic recovery. Indonesia is faced with many challenges. Transition should, therefore, be orderly. In this regard, I believe the spirit of musyawarah (consensus) and gotong-royong (communal allocation of tasks) you all share as a part of your culture may be very beneficial in producing national consensus on a number of vital issues.

Anyway, I am convinced that the traditional wisdom, perseverance and courage for which the Indonesian people are known will certainly help soon overcome Indonesia's current problems, and that a renewed Indonesia will emerge even more vigorous in the 21st century on its path to further rapid economic development. And Japan, as a genuine friend and partner of Indonesia, is always there to help.

It is often said that Japan-Indonesia relations mainly depend on economic aspects only. What is your opinion about that?

I do not share that view. Our cooperation is by now much wider in scope. We have a wide range of increasingly intense human exchanges and interaction between the two countries in the noneconomic fields as well. A great number of youth exchange programs, both governmental and nongovernmental is, for example, a case in point.

Cultural exchanges through the Japan Foundation or otherwise are also being intensified. In 1995, we held a major cultural event called the "Japan-Indonesia Friendship Festival", which was held successfully by the Indonesian side in a number of cities in Japan.

Lots of tourists from Japan are visiting Bali and other tourist attractions in Indonesia. This certainly helps also to bring the two countries closer together. I know personally that Indonesia is very rich in its cultural heritage. It is my personal desire to visit, if possible, all of Indonesia's provinces during my tenure here.

Could you give an explanation about the system of scholarships from Japan and Japanese studies in Indonesia?

The Japanese government provides a number of scholarships for Indonesian students to study in Japan. About 1,000 Indonesian students are now studying in Japan as undergraduate students or postgraduate students (master's or doctorate courses), etc. The total number of scholarship grantees has been increasing year after year.

Japanese studies in Indonesia have a long history of more than 30 years, having started with the opening of the Japanese program at the School of Letters, University of Indonesia. I am very happy to note that recently, interest in the Japanese language and culture is expanding, especially among the younger generation in Indonesia. I am impressed by the fact that Japanese language courses and centers for Japanese studies are increasing in number. In Japan, people are surely paying much more attention to Asia, including, in particular, Indonesia's culture and civilization.