Nikkei conference

Japan open to joining Belt and Road push

Abe's comments seen as olive branch to pave way for possible summit with Xi next month

Japanese Prime Minister Shinzo Abe last night opened the door to Tokyo playing a role in China's ambitious Belt and Road initiative, in a sign of thawing ties ahead of a possible summit with President Xi Jinping next month.

"Japan is ready to extend cooperation" to the plan to revive ancient trade routes linking Asia, Europe and Africa through a massive infrastructure network, Mr Abe said, noting its potential to "connect the East and West and the diverse regions found in between".

He stressed the projects must follow international norms such as fair procurement and debt sustainability. He was speaking last night at a dinner reception for global leaders attending the 23rd International Conference on The Future of Asia organised by Nikkei Inc, including Singapore's Emeritus Senior Minister Goh Chok Tong.

"It is critical for infrastructure to be open to use by all, and to be developed through procurement that is transparent and fair," Mr Abe said. "I consider it essential for projects to be economically viable and to be financed by debt that can be repaid, and not to harm the soundness of the debtor nation's finances."

The initiative must also "come into harmony with the free and fair Trans-Pacific economic zone, and contribute to the peace and prosperity of the region and the world".

While Japan cannot compete with China in dollars, it has touted its superiority in its capability to build high-quality infrastructure and commitment to train local workers.

OPEN AND FAIR

It is critical for infrastructure to be open to use by all, and to be developed through procurement that is transparent and fair.

JAPANESE PRIME MINISTER SHINZO ABE, on China's Belt and Road initiative.

Its overall financial cooperation this year will amount to US$200 billion (S$276 billion), Mr Abe said.

Japan has long been wary of the initiative also known as One Belt, One Road (Obor) - Mr Xi's pet project - amid concerns that it signifies Beijing's rising dominance in the region.

In a surprise move, Tokyo sent senior ruling party politician Toshihiro Nikai to the Belt and Road Forum held in Beijing last month.

At last year's Nikkei conference, Mr Abe said that "infrastructure cannot be cheap and poor" in what the Nikkei Asian Review publication describes as a "not so discreet jab at China's pet initiative".

His remarks last night are seen as an attempt to offer an olive branch to Beijing, to pave way for a possible leaders' summit with Mr Xi next month on the sidelines of the G-20 meeting in Hamburg.

In his speech, Mr Abe dealt at length with the issues of connectivity and trade liberalisation at a time when nations are trying to fight the scourge of protectionism.

On the Trans-Pacific Partnership (TPP), from which the United States has withdrawn, Mr Abe said: "Unfortunately, the TPP has yet to come to fruition. However, I have not given up." As the largest economy among the 11 countries left in the bloc, Japan is stepping up to lead what has been referred to as the "gold standard" of trade deals for its expansive coverage.

Mr Abe said it is his hope that such rules can eventually be applied in the 16-nation Regional Comprehensive Economic Partnership (RCEP) which was mooted by Asean and brings on board Australia, China, India, Japan, New Zealand and South Korea.

"The RCEP, which is our future goal, can become a high-quality agreement by building on the rules that came to fruition under the TPP," he said.

A version of this article appeared in the print edition of The Straits Times on June 06, 2017, with the headline 'Japan open to joining Belt and Road push'. Print Edition | Subscribe