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."