Japan won't be left behind in Asia: Koizumi

Japan won't be left behind in Asia: Koizumi

Elaine Lies, Reuters, Bandar Seri Begawan

Japanese Prime Minister Junichiro Koizumi denied on Tuesday his
nation faces a challenge to its Asian leadership hopes from
China, saying that Japan will not be left behind in the region.

Leaders of the Association of Southeast Asian Nations (ASEAN)
and China agreed to a free trade area within 10 years, prompting
questions in some areas that attention, and influence, may be
shifting from Japan to China.

"There is absolutely no worry about Japan being left behind,"
Koizumi told a news conference in Brunei, where he has taken part
in a meeting of ASEAN leaders and leaders from China, Korea and
Japan for the last two days.

"Japan received expressions of strong gratitude from all the
ASEAN nations for the aid and help it has given the region in the
past, and I am very encouraged by this," he said.

"If China and ASEAN deepen their ties, we welcome this."

The differences between buoyant and economically robust
Beijing and Japan, whose lagging economy has put paid to the
lavish checkbook diplomacy of its past, were easily apparent.

For China is newly confident, its pride boosted by robust
economic growth, imminent entrance into the World Trade
Organization, and selection as host to the 2008 Olympics.

In contrast, Koizumi had the unenviable task on Monday of
having to tell ASEAN leaders that Japan's main task was improving
its economy, which is teetering on the brink of recession.

Southeast Asia's exporters have been hit by a slump in demand
from the United States and Japan, prompting many nations to look
towards integrating China's growing economy with that of
Southeast Asia to try take up some of the slack left by Japan.

"What we are aiming for is the biggest free trade area in the
world with 1.7 billion people, and it will be closer to two
billion when it comes into effect," said Sultan Hassanal Bolkiah
of Brunei, who was host and chairman of the ASEAN summit.

Asked if Japan was interested in taking part in some sort of
free trade area, Koizumi was guarded.

"There are some difficult points," Koizumi conceded. "But we
should try to overcome obstacles and move forward in a
constructive way."

Some Japanese business leaders have said they favor the plan
but that it is more of a political dream at this point and will
take time and patience to achieve, which Koizumi acknowledged.

"We should move ahead, step by step, while verifying the
importance of a free trade area," Koizumi said. "It cannot be
done all at once."

Earlier on Tuesday Koizumi assured ASEAN leaders that Japan
will continue to provide broad support for the region despite its
own economic woes.

These include fighting infectious diseases such as HIV/AIDS
and development of the Mekong River area.

Tokyo has long used its overseas development assistance (ODA)
program as a powerful diplomatic tool, and it was the world's top
aid donor for the 10th straight year in 2000.

But in August, as the economy continued to flag, the
government lopped 10 percent off ODA for the fiscal year starting
in April 2002 in an effort to tackle its huge public debt.

"Japan attaches much importance to ASEAN nations, and to aid
for them under our overseas development assistance program,"
Koizumi told ASEAN leaders at the end of two days of meetings in
Brunei. "Even though we are in the midst of extremely tough
economic conditions, ASEAN remains important."