Over the past couple of decades, Japan has indicated its desire to play a bigger role in Central Asia and has gradually increased its developmental efforts in the region. However, Japan’s engagement in the region remains overwhelmingly government-driven. To make a bigger impact, it must increase private sector participation.
In recent years, China and its Belt and Road Initiative have comprehensively appropriated the term “Silk Road.” But before China, one of the first East Asian countries to invoke the notion of the Silk Road in its diplomatic initiatives in Central Asia was Japan.
On Central Asia’s part, there are significant expectations from governments and the public with respect to Japan. For Central Asian governments, Japanese involvement in the region represents an opportunity to balance Russian and Chinese influence. According to polls, Central Asian public opinion on Japanese engagement in the region is overwhelmingly positive.
Such sentiments can be attributed to the fact that Central Asian states never experienced Japan’s historical imperial aggression (as opposed to several of Japan’s East Asian neighbors). These states do not associate Japan with imperialism, but rather with technological progress, politeness, and years of official development assistance (ODA) commitments.
While it is clear that Japan desires to play a bigger role in this resource-rich, rapidly developing region, its current efforts, concentrated in government-directed aid, are not enough. To become a truly active presence in Central Asia, Japan needs to intensify its outreach efforts, particularly in the area of economic engagement by its private sector.
A History of Tentative Steps
Since the collapse of the Soviet Union, Japan has sought to establish a presence in Central Asia, the continent’s frontier. In 1997, then-Prime Minister Ryutaro Hashimoto’s administration launched “Silk Road Diplomacy,” one of the first international diplomatic initiatives to appeal to the connectivity and revival of the ancient trade route across Asia. Japan’s Silk Road Diplomacy prioritized three areas of concern: political dialogue, economic cooperation (including natural resources development), and cooperation on peacebuilding, nuclear nonproliferation, democratization, and fostering stability.
Japan’s ODA in Central Asia increased from US$2.57 million in 1993 to US$242.28 million in 2003: almost a hundredfold in 10 years. By 2003, Japan’s accumulated bilateral ODA disbursements to Central Asian and Caucasus states had reached US$1.98 billion.
Japan’s official development assistance in Central Asia increased from US$2.57 million in 1993 to US$242.28 million in 2003: almost a hundredfold in 10 years.
In continuing Hashimoto’s work in Central Asia, one of the most notable among his successors was Junichiro Koizumi. In July 2002, as prime minister, Koizumi dispatched the “Silk Road Energy Mission” to promote closer energy cooperation with the Central Asian states, setting the stage for potential regional institution-building. Later, in August 2004, Japan, in conjunction with countries in the region, launched the Central Asia Plus Japan Dialogue. In addition, Koizumi became the first Japanese prime minister to visit Central Asia in an official capacity when he went to Uzbekistan and Kazakhstan in 2006.
Japan’s search for a pathway into Central Asia has continued under current Prime Minister Shinzo Abe, with his 2015 visit to the region indicating a renewed prioritization of functionality and practical outputs over the values-based approach. This shift may have come about from the Japanese leadership realizing that, for Central Asia, democratization was a longer-term objective, and in the meantime, economic opportunities needed to be taken.
Advantages in Duality
There are certain features that Japan makes use of to its advantage in Central Asia.
Japan’s distance from the region is frequently interpreted as an obstacle to engagement, due to potential logistical problems associated with reaching regional resources and markets. However, the Japanese government has remolded this distance into a competitive advantage, especially with regard to China and Russia and their relationships with the Central Asian states. It is precisely this distance that allows the Japanese government to claim “selfless” commitment to the region, as geography ostensibly prevents it from dominating and exploiting Central Asia. This claim of altruism enables Japan to provide a sense of security to its Central Asian partners, in contrast to the region’s behemoth neighbors, China and Russia.
Uzbekistan, despite its poor human rights record, has been one of the top recipients of Japan International Cooperation Agency aid.
Also, Japan has embraced a duality in its engagement with Central Asian states. As one of Asia’s, and the world’s, leading democracies, Japan is committed to liberal values. But it has not enforced them as a precondition for cooperation in Central Asia. In fact, Koizumi was the first leader of a liberal democratic country to visit Uzbekistan following the imposition of sanctions by the United States and Europe on former Uzbek President Islam Karimov’s government for the massacre of protesters in the city of Andijan in May 2005. During the visit, Koizumi did bring up the importance of human rights, but he also pledged unconditional developmental assistance. Thus, Uzbekistan, despite its poor human rights record, has been one of the top recipients of Japan International Cooperation Agency (JICA) aid.
A similar example of this duality can be found in Japan’s ODA practices in the region. In 2014, a Japanese company became embroiled in a bribery scandal involving Uzbek (as well as Vietnamese and Indonesian) officials in the ODA disbursement process. Although Japan condemned the corruption, it nevertheless continued its ODA to Uzbekistan without imposing punitive measures against the government. In doing this, Japan displayed a certain degree of understanding with respect to Central Asia’s problems in making democratic transitions. This duality reflects the Japanese belief that issues of governance and transparency can only be dealt with through engaging Central Asian states, and not through punitive measures.
Work that Remains to be Done
In contrast to Japan’s governmental initiatives, investment by the country’s private sector in Central Asia has been much less impressive. The largest investments have been made in energy resource-rich Uzbekistan (US$900 million) and Kazakhstan (US$357 million), two of the larger economies in the region. Japan exports mostly machinery and industrial goods to Central Asian states and imports textile yarn, fabrics, and nonferrous metals from the region.
The major actor mediating these interactions is an intergovernmental committee on economic cooperation between Japan and Central Asia, involving Japan’s Ministry of Foreign Affairs, the Japan Association for Trade with Russia & NIS, JICA, chambers of commerce, and representatives from Japanese corporations. The economic cooperation roadmaps produced by this committee mostly consist of intergovernmental framework agreements, mutual understanding memoranda, and agreements on ODA projects.
In 2016, there were only 18 Japanese companies operating in Uzbekistan, compared to 410 South Korean companies and 480 Chinese companies.
This is indicative of the Japanese private sector’s lack of impetus to commit to projects in Central Asia. In 2016, there were only 18 Japanese companies operating in Uzbekistan, Japan’s most significant Central Asian partner, compared to 410 South Korean companies and 480 Chinese companies.
Japan still faces a number of challenges in its engagement of Central Asia.
First, Tokyo has yet to fully define the strategic importance of its burgeoning relationship with the region in practical terms. This, in turn, impacts the perceived viability of economic cooperation. For instance, the 2017 road maps for Japan-Uzbekistan cooperation did not clearly demonstrate how the Japanese corporate community and taxpayers could benefit from higher engagement. This has led to Japan’s engagement in Central Asia being dominated by government-driven, humanitarian-focused projects, with little participation from the private sector.
Second, there is a lack of contact between the political leadership of Japan and Central Asian states. China and South Korea, whose leaders are frequent visitors to Central Asia, have demonstrated that a higher frequency of interaction results in more collaborative projects. Since the Central Asian countries gained independence from the Soviet Union, Japanese prime ministers have visited only twice.
If Japan wants to be a vital player in Central Asia, it will need to fill these gaps in its relationships.
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University of Tsukuba