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Analytical Studies

Country Objectives for the Genoa Summit Meeting 2001
Japan

Contents:
Political Data
Economic Data
Summit Issues for Japan

Political Data

Head of Government: Prime Minister Junichiro Koizumi (R)
Minister of Public Management, Home Affairs,
Posts and Telecommunications:
Toranosuke Katayama (C)
Minister Of Justice: Mayumi Moriyama (R)
Minister for Foreign Affairs: Makiko Tanaka (R)
Minister of Finance: Masajuro Shiokawa (R)
Minister of Education, Culture, Sports, Science and Technology: Atsuko Toyama (N)
Minister of Health, Labour and Welfare: Chikara Sakaguchi (R)
Minister of Agriculture, Forestry, and Fisheries: Tsutomu Takebe (R)
Minister of Economy, Trade and Industry: Takeo Hiranuma (R)
Minster of Land Infrastructure, and Transport: Chikage Ogi (Hiroko Hayashi) (C)
Minister of the Environment: Yoriko Kawaguchi (N)
Minister of State, Chief Cabinet Secretary (Gender Equality): Yasuo Fukuda (R)
Minister of State, Chairman of the National Public Safety Commission (Disaster Prevention): Jin Murai (R)
Minister of State, Director-General of the Defense Agency: Gen Nakatani (R)
Minster of State (Okinawa and Northern Territories Affairs, Science and Technology Policy): Koji Omi (R)
Minster of State (Financial Services Agency): Hakuo Yanagisawa (R)
Minister of State (Economic and Fiscal Policy, Internet Fair 2001 Japan, IT Policy): Heizou Takenaka (N)
Minster of State (Administrative Reform, Regulatory Reform): Nobuteru Ishihara (R)

"R" indicates that he/she is a member of the House of Representatives.
"C" indicates that he/she is a member of the House of Councillors.
"N" indicates that he/she is a member of the Diet.

Note:
On 6 January 2001 Japan's 22 ministries were merged into these 12 super-ministries.
On 26 April 2001, Koizumi was inaugurated as Prime Minister after the resignation of Prime Minister Yoshiro Mori.

Government

Type: A constitutional monarchy with a mixed electoral system.

Parliament:
House of Representatives consists of 480 seats.
House of Councillors consists of 252 seats.

Ruling Parties:
Liberal Democratic Party (LDP)
New Komeito
New Conservative Party

Opposition Parties:
Democratic Party of Japan
Japan Communist Party
Social Democracy Party
Liberal Party
Independent/Minor Parties

National Elections: Members of the House of Councillors are elected to a 6 year term, and terms are staggered with half seats being contested every 3 years.

Members of the House of Representatives are elected either in single-member constituencies, with the successful candidate winning a plurality (300 seats), or through proportional representative constituencies (180 seats). Parties earn their share of seats based on votes they receive and votes are calculated by the d'Hont system.

Most recent Elections: Were most recently held in June 2000.
Next Elections: The Upper House will have elections on July 27, 2001.

Source: Japan Information Access Project

Economic Data

GDP (FY1999): 4346.8 (blnUS$) 513,682.2 (bln Yen)
Source: WB and www.cao.go.jp

GDP per capita (FY1999): 36,984 (m/US$)
Source: Economic and Social Research Institute 10/Apr/01

Economic Growth Rate (1999): +0.2%
Source: Bank of Japan

2001 Projections: +1.8%
Source: www.nri.co.jp

Consumer Price Inflation (March 2001): -0.4 since previous year
Source: Ministry of Public Management, Home Affairs, Posts and Telecommunications 27/Apr/01

Unemployment Rate (2000): 4.8%
Source: Ministry of Public Management, Home Affairs, Posts and Telecommunications 30/Jan/01

Interest Rate (% per annum): Effective 01/Mar/01
Source: Public Relations Department Bank of Japan 28/Feb/01

Exchange Rate: (Yen per US dollar) 121.74
Source: U.S. Federal Reserve 12/June/01

Current Account: FY2000 a decline of 4.5 per cent to 12.07 trillion yen ($98.9 bln US).

Foreign Aid: (ODA): 10,498 (mln US $)
Source: Ministry of Finance Japan 27/0ct/00

World Ranking: 2nd

Major Trading Partners:
Export to: US 31%, Taiwan 7%, China 5.5%, South Korea 5.4%, Hong Kong 5.2% (1999)
Import to: US 22%, China 14%, South Korea 5.1%, Australia 4.2%, Taiwan 4.1% (1999)
Source: CIA country factbook

Value of Exports (FY2000): 51,658 (bln Yen)
Value of Imports (FY2000): 40,916 (bln Yen)
Source: Ministry of Finance Japan "Trade Statistics"

Summit Issues for Japan

The issues Japan is expected to highlight at the Genoa Summit this year are: poverty reduction, infectious diseases, environment, DOT Force, and economic reform. Being Koizumi's first summit, his performance will be indicative of where his administration stands on the international political platform. Arriving in Genoa with over 80% domestic support, the G8 Summit will be a test of Koizumi's ability to balance domestic desires with international responsibilities. Upon his return to Japan, he faces Upper House elections on July 29th - elections which are vital to Koizumi silencing his oppositions within the party. Koizumi does not want to risk making bold initiatives on domestically unstable topics such as NMD. On the same note, regarding the Kyoto Protocol, don't be surprised if at the Summit's wrapup, Japan does not back the US as strongly as it has of late. Domestically, there is support for its ratification and Koizumi is unlikely to make any decisions that could potentially cost him the Upper House elections.

Poverty Reduction

Japan announced its expectation that official development assistance (ODA) may be one of the key topics to be discussed at the Genoa Summit, in light of its failing domestic economy and increasing national debt. Japan is the biggest contributor in the world in terms of ODA amount.

In 2000, Japan's total ODA was approximately $13.1 billion, ranking first in the world for 10 consecutive years. In April 2000, Japan decided on a 100% reduction of non-ODA claims under the international framework (IF) as well as ODA claims, and a contribution of up to $200 million to the multilateral debt relief fund of the World Bank.

Japan believes poverty reduction must not only incorporate debt relief but also include assistance in the areas of human development, infrastructure development and capacity building. Moreover, Japan stresses that development must be supported by the developing countries themselves.

Although Japan makes its utmost effort in the field of development, difficulties in overcoming its economic and fiscal conditions may have a negative effect in allocating its budget to ODA. Hence, we expect Japan to push for "comprehensive assistance" at the Summit. For example, Japan will most likely consider utilizing the UN Human Security Fund for assistance towards fighting against HIV/AIDS since it poses a threat to human life and is an issue closely related to human security. As a first step, assistance to South Africa's HIV/AIDS countermeasures will be considered through UNDP from the Human Security Fund. The Government of Japan is also looking to further cooperate with the UN and to strengthen links with other organizations, possibly including the United Nations Population Fund.

Infectious Diseases (Health)

In the past year, Japan has positioned itself as a leader in the war against infectious diseases.

At the Okinawa Summit, Japan committed $3 billion U.S. over five years in what is called the Okinawa Infectious Diseases (ID) Initiative. The aid was aimed to help developing countries fight infectious diseases such as AIDS, tuberculosis, and malaria. On June 30h of this year, the government of Japan announced its decision to donate $200 million U.S. to the UN AIDS fund during U.S.-Japan bilateral meeting at Camp David.

Since Okinawa, Japan has been implementing numerous measures against infectious diseases amounting to more than $700 million U.S.. As well, on December 7th and 8th 2000, Japan hosted an International Conference on Infectious Diseases as a follow up of the Kyushu-Okinawa Summit. In the Conference, concrete actions plans were drawn to target numerical goals set during the Okinawa Summit on the fight against major infectious diseases by the year 2010. In keeping with its actions this past year, we expect Japan to continue leading concrete measures against infectious diseases in Genoa.

Global Economy (Japanese Economic Reform)

It is expected that Prime Minister Koizumi will bring Japan's unstable economy to the table in Genoa. Japan is the second largest world economy and the leading Asian economy. Hence, the economic recovery of Japan is important to the long term economic stability of the Asian region, and the rest of the world at large. Koizumi will be looking to reassure the members of the G8 that Japan is ready to take steps to spur economic activity, despite the possible negative side-effects of the reform plans such as bankruptcies and unemployment. The government has recently approved a sweeping reform program aiming to revive the economy in two to three years through a fundamental cleanup of the banks' non-performing loans as well as a thorough review of the state budget.

The country has been undergoing economic difficulties since 1991. In April, Japan's four megabank groups each reported losses, unemployment rose to 4.8%, real wages dropped by 0.5%, consumer spending declined by 4.4% and industry production fell by 1.7%. On May 25, 2001 a plan was put forth to tackle employment and industrial structure reform. A negative growth rate of 0.8% was reported for the first quarter of 2001. The government seeks to pursue constructive collaboration on the economic sectors between the G8. On that note, it will likely want to use the Summit as a chance to enhance the Japan-US alliance.

IT Digital Opportunity Task Force (DOT Force)

The government sees the information technology (IT) revolution as a predominant factor in the development of economy and society in the 21st century and has emphasized this with the enactment of the IT Basic Law and the decision to adopt an "e-Japan Strategy" for the nation. In the current session of the Diet, more than ten related bills are being deliberated.

Japan will also be interested in addressing high-tech crime and has stressed the importance of dialogue among government and private sectors regarding high-tech crime. In the current session of the Diet, deliberation is scheduled on the Personal Information Protection Law as well as that on amendment of the Penal Code regarding counterfeit credit cards and other fraudulent crimes. While the organization called "the cyber police" was developed within the police force, cooperation with the private sector is underway, including the establishment of "the Liaison Council with the Providers" within the local police force. In this way, Japan is striving to implement concrete measures against high-tech crime.

At Genoa, Japan will be looking to move ahead with proposals outlined in the report by the DOT Force in mid-May, under the Genoa plan of action. These proposals include integrating IT-related entrepreneurship into their programs. Japan seeks the cooperation of the G8 in linking information technology to promote strategic investments in research and development in science and technology - areas that form the foundation of industrial competitiveness, thus ensuring a high-quality standard of living.

Environment (greenhouse gasses, antidumping, international aid, technology transfers, etc.)

With the Rio 10 summit in 2002 fast approaching, Japan is eager to ensure that agenda be set for the future. Lately, the Koizumi government has announced that it will be difficult to ratify the Protocol without the participation of the United States. Despite pressures from the European states to sign the Protocol, Japan insists on luring the U.S back to the negotiating table. This may entail altering the agreement to appease the U.S., which could require more research dollars being spent before implementing the plan. Similar to Canada's position, Japan has recently shown a desire to allow for greater percentage points from carbon "sinks". Japan and Canada could potentially bridge the gap among the EU states and the U.S. towards ratification of the Kyoto Protocol.

On a general note, the government's environment policy is geared towards creating "Wa-no-Kuni" - an eco-nation. Japan feels that the multilateral environmental agreements (MEAs) on the issues of ozone layer depletion, climate change, desertification, and the conservation of biological diversity need to be managed more effectively and efficiently. The government wants to examine how trade restrictions introduced for environmental protection can be co-ordinated with the provisions of the WTO.

Japan also believes financial assistance and technology transfer to developing countries is necessary to comply with MEAs. Its environmental ODA amounts to about 20-30% of total bilateral ODA every year. This line of policy is part of their commitment to "comprehensive assistance", which they plan to bring to the table this year.

Bilateral: Japan/US

Japan is looking to strengthen ties with the new U.S. administration. Koizumi has gone so far as saying improved relations with the US means smoother relations with other nations. To what extent Koizumi's prediction is true will be seen during Summit negotiations with the EU and Russia

Japan is also looking to clarify its diplomatic stance regarding the Kyoto Protocol as well as Japan-U.S. security alliance. NMD, an issue on the backburner for the rest of the G8, is one which Japan is expected to push to the forefront of negotiations. Up to this point, Koizumi has said he understands the U.S. desire for the missile defence system but has stopped short of publicly lauding it. However, Koizumi's enthusiastic embrace of the U.S. at the G8 could come at a cost. Grumblings of neglect are being heard from Japan's powerful Asian neighbours, China, and South Korea.

Prepared by Amy Schwartz, Caroline Konrad and Haruka Araki, University of Toronto G8 Research Group, June 2001.

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