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.