Japan to give SE Asia new aid

Japan to give SE Asia new aid

SINGAPORE (AP): Trying to reassure Japan's neighbors that it
will help lead them out of economic turmoil, Japanese Foreign
Minister Keizo Obuchi said yesterday his government is
considering an additional US$20 million in aid to Southeast Asia.

Obuchi made the announcement during a policy speech in
Singapore, the last stop on his three-nation tour of the region.

"We are also studying a fresh contribution of about $20
million to the ASEAN Foundation," Obuchi told political and
business leaders. He said the money would be a "solidarity fund"
with the Association of Southeast Asian Nations, which comprises
Brunei, Indonesia, Laos, Malaysia, Myanmar, Philippines,
Singapore, Thailand and Vietnam.

Obuchi said the money would promote ASEAN's strategy "for
developing human resources and alleviating poverty, as well as
identifying regional projects," but gave no further details on
when or how it might be implemented.

The assistance would be in addition to $42 billion Japan has
pledged to help Southeast Asia through bilateral packages and the
International Monetary Fund. That amount "far exceeds the
assistance from any extra-regional country," he said.

Despite its own economic woes, Japan feels a responsibility to
help its neighbors by tailoring "our efforts to address the needs
of the region's less developed countries hit by the economic
difficulties."

"The Japanese economy has still not been able to overcome the
after-effects of the collapse of the bubble economy and is in a
state of severe stagnation," he noted. But social and economic
reforms will proceed regardless of the pain they cause, he said.

Continued multilateral trade and investment liberalization in
the region is essential if it is to overcome the economic woes,
he said.

Defending his government's recent stimulus package, Obuchi
said it will help steer Japan out of its economic doldrums and
that "in the not-too-distant future, the Japanese economy will
recover."

IMF director Michel Camdessus, who was also in Singapore on
Tuesday, said that the stimulus package is seen as a temporary
initiative, and that Japan still needs "permanent" measures to
boost the economy.

"We consider in the IMF that it would be extremely important
that these temporary measures be substituted as soon as possible
by permanent measures" and these should give an incentive to
consumers to spend rather than save.