PM Koizumi's ASEAN swing

PM Koizumi's ASEAN swing

Bantarto Bandoro, Editor, 'The Indonesian Quarterly',
Centre for Strategic and International Studies, Jakarta

Countries of ASEAN are now rapidly recovering from the currency
and economic crisis it has experienced since 1997 with the active
assistance of Japan. There was also a perception that a strong
interdependence was shared among the East Asian countries
including Japan and ASEAN countries as a result of the crisis.

The statement of Indonesia's foreign minister that the
Association of Southeast Asian Nations members are "alive" again
reflects a claim that ASEAN must keep up its outward-looking
spirit by involving itself more deeply and actively in an even
more complex international diplomacy. Koizumi's visit to ASEAN
member countries takes place against the background of ASEAN
readiness to boost its regional and international standing.

However, Koizumi's visit to Indonesia, the largest member of
ASEAN, will be shadowed by doubts whether Indonesia under
Megawati can really convince the Japanese leader that Indonesia
is now safe enough for a long term and sustainable foreign
investment.

Besides, because Indonesia-Japan bilateral relations is
preoccupied much by the issue of Overseas Development Aid (ODA),
the continuation of a present aid policy of Japan towards
Indonesia will be tested against Megawati's sincereness to tell
the Japanese leader that the ODA funds are not misused in a way
that brought huge profits to certain groups of national companies
or even to her own party's related organization. It is reported
that Japan cringes at Indonesia's attitude of "easy ask easy
lend" which has aggravated the ODA issue.

Koizumi was to have visited ASEAN countries last September,
but the trip was postponed following terrorist attacks in the
United States. Since the attack, Japan seemed to have been locked
into the United States arms in combating international terrorism.

Japan's decision to adopt an anti terrorist law confirmed
Japan's place in the U.S. anti terrorism strategy. But Japan
cannot let itself to be too preoccupied too long by its anti
terrorism policy at a time when it needs to broaden its regional
diplomacy -- which perhaps serves more promises for its long term
and stable economic development. Prior to the terrorist attack,
there was an impression that Koizumi has left Asia in the lurch
as he initiated policy to strengthen Japan's ties with the U.S.

Thus, Koizumi's visit to Southeast Asia is perhaps meant to
alter the impression that Japan is leaving Southeast Asia. It
has been the basic policy of Japan that Japan put great
importance in its diplomatic relations with Southeast Asian
countries. The statement made by Chief Cabinet Secretary Yasuo
Fukuda that there can be no Japanese diplomacy without Southeast
Asia countries reflects Japan's concerns of the vulnerability it
might encounter in the future if Japan neglects the strategic
importance of ASEAN and the Southeast Asia region.

As globalization rapidly progresses around the world, the
interdependence of Japan and the ASEAN countries is being
increasingly heightened.

Japan, looking on ASEAN as a vital partner of the peace,
security and prosperity in the East Asia, has been making every
possible efforts toward further development of cooperative
relations with ASEAN. Japan traditionally concentrates its ODA to
the ASEAN region, and recently put more focus on new ASEAN
members. ASEAN and Japan have also long been closely knit by
trade and investment.

It is reported that Koizumi will introduce his proposal for a
regional economic alliance. The alliance would include Japan, the
members of ASEAN, the United States , Australia and New Zealand.
The proposal is expected to include free trade agreements (FTAs)
between ASEAN and Japan, an accord linking Southeast Asia and
Japan.

Koizumi's idea however was greeted with skepticism inside
Japan, arguing that Japan can always talk about free trade and
deeper economic relation, but actually Japan has cut back on the
ODA to Southeast Asian countries. It is widely known that
recently Japan is under severe fiscal constraint and has been
cutting back on the domestic spending. Thus there is very little
prospect that Japan can play a major role in such regional
scheme.

There is also the question where China would fit into
Koizumi's regional economic plan. The newcomer to the World
Trade Organization and rising economic power recently had a
dispute with Japan over Chinese agricultural exports to Japan.

Despite skepticism, Koizumi is out to Southeast Asia to pitch
an idea that will drag the region into a more challenging and
competitive regional economic configuration. Koizumi will reveal
his major policy steps in his keynote speech in Singapore. To
some, the decision to have Singapore as a place for announcing
Japan's new regional policy is quite provoking, if it is seen
from the perspective of which countries in the region play the
most in influencing the development of the region .

As analysts say, such a decision, diplomatically, may become
an embarrassment for Megawati's government. There is some truth
in the argument. The fact that Indonesia is the largest and most
influential country in the region failed to become a magnet. The
inability of Megawati's government to solve the current crisis
will further strengthen the perception that Indonesia is still a
Southeast Asian giant with feet of clay. One then wonders what
Megawati will put forward in her talk with the Japanese leader.

Will she easily ask for "a bucket of money" or is she out to
convince her counterpart that Indonesia is prepared to take part
in a more competitive and challenging economic environment of the
region?

One thing that makes sense in Koizumi's ASEAN swing is his
pledge to strengthen Japan's relationship with Southeast Asia
with financial cooperation as the core of such efforts.