"The World and Japan" Database (Project Leader: TANAKA Akihiko)
Database of Japanese Politics and International Relations
National Graduate Institute for Policy Studies (GRIPS); Institute for Advanced Studies on Asia (IASA), The University of Tokyo

[Title] Speech by Prime Minister Junichiro Koizumi at the ASEAN Business and Investment Summit on October 7, 2003

[Place] Bali, Indonesia
[Date] October 7, 2003
[Source] The Ministry of Foreign Affairs of Japan
[Full text]

Distinguished guests, ladies and gentlemen:

Good morning!

Almost exactly one year ago, many lives were taken in a terrorist bomb attack here in Bali. I would like once again to extend my condolences to the victims and their families. We must not be daunted by terrorism, and it is of symbolic importance that many of the region's heads of state and government as well as business leaders have gathered here today to discuss the creation of our future.

Last year, I proposed "act together and advance together" and "sincere and open partnership" in the relationship between Japan and ASEAN. This statement is based on my conviction that we are at a stage where we should advance toward an even greater goal, building upon the ties which Japan and ASEAN have enjoyed over the past 30 years or so.

This year has been designated ASEAN-Japan Exchange Year 2003, celebrating our long history of friendship. Over 600 commemorative events and programs will have been held in Japan and ASEAN countries. As the crowning event of this year of exchange, the Japan-ASEAN Commemorative Summit will be held for the first time in the history of ASEAN. It will be held in Tokyo at the end of the year. I hope that the Commemorative Summit will give broad guidelines for the partnership between Japan and ASEAN in the 21st century.

I firmly believe that the aim of the Japan-ASEAN partnership is to transform the East Asian region into an open community that "acts together and advances together" and shares greater prosperity, peace, and trust. Japan and ASEAN should strengthen their cooperation as the engine behind not just their own mutual prosperity but also the prosperity of the entire East Asian region.

East Asia is the world's most promising growth center. ASEAN, Japan, China, and South Korea are home to approximately one third of the world's population and account for about one fifth of both the world's nominal GDP and total trade volume. Nonetheless, compared to the dynamism in North America through NAFTA and Europe via the EU, the Asia region lags behind in terms of regional cooperation and is not fully exercising its potential as a region.

In recent years, however, we have seen impressive developments in East Asian region, including not only cooperation between Japan-ASEAN but also collaboration among ASEAN+3 and among Asian and Oceanian nations related to transnational issues, including piracy and illicit drugs. In the financial world, institutional arrangements for the Chiang Mai Initiative and the development of Asian bond markets are being promoted to prevent recurrence of an Asian financial crisis. ASEAN itself is making efforts to enhance its integration and heighten its competitiveness. Today as regional cooperation has started to develop, it is expected that all measures taken by this region will be promoted keeping in mind the overriding aim of creating an open community that "acts together and advances together."

What tasks should Japan and ASEAN address in order to achieve mutual prosperity and create an East Asian community?

First, partnership on the economic front should be fortified. If the exchange of ideas and the movement of people, goods, and funds are enhanced within the East Asian region with its great potential, economic activities will be further stimulated, and the economy of scale will also take effect. Japan and ASEAN are becoming increasingly interdependent in terms of their economies. Alongside the EU, ASEAN is Japan's second largest trade partner, sharing over $110 billion in trade annually. Moreover, accumulated amount of direct investment from Japan to ASEAN exceeds $100 billion. As the nucleus of economic cooperation in the East Asian region, the economic partnership shared by Japan and ASEAN should serve as a model.

Based upon this idea, I proposed "The Initiative for Japan-ASEAN Comprehensive Economic Partnership" last year. This initiative promotes not only the liberalization of investment and trade in goods and services, but also encourages advanced cooperation in a wide range of fields from tourism to human resources development and small and medium-sized corporations. We strive not only to achieve economic profit, but also to deepen our political and human ties and to increase the strength of the entire region through friendly competition. The Japan-Singapore Economic Partnership Agreement has already entered into force, and consultations are underway with Thailand, the Philippines, Malaysia, and Indonesia with a goal toward creating similar bilateral economic partnerships. Moreover, a basic agreement has been reached on the Japan-Viet Nam Investment Agreement. Japan is working to create an economic partnership with ASEAN as a whole in fields for trade facilitation and cooperation as well as in areas for liberalization.

Secondly, the economic crisis made us keenly aware that East Asia needs strong economic systems which would enjoy confidence of investors and consumers in the world. This means enhancing the legal systems in the area of anti-monopoly issues so that rival companies can compete on an equal footing. The protection of intellectual property rights must also be ensured so that inventors whose profits are protected would have an increased desire to develop new technology. The transparency of the public procurement system also has to be secured in order to prevent corruption. The kinds of reforms required will differ from country to country; however, every country will need the determination to change systems if ill-suited to the current situation though they used to function well. I am promoting reform in Japan in the belief that "without structural reform there can be no rebirth for Japan." At the same time, I am calling upon the Japanese people not to fear change but to take up the challenges presented by the new age. By developing its economic systems, ASEAN can continue to be an attractive investment destination for foreign corporations. Japan and ASEAN can further prosper, I believe, sharing their experiences and lessons.

The third issue is promoting economic development and rectifying the disparities in the ASEAN region. Japan recognizes the importance of ASEAN's maintaining its unity and developing together. Japan has placed special emphasis on ASEAN countries in providing ODA to developing countries in the world. Over the past decade, Japan has extended bilateral ODA to ASEAN countries in the amount of approximately $24 billion or about 30 percent of Japan's total bilateral ODA. Japan will continue to emphasize ASEAN countries in its ODA activities.

At the same time, foreign direct investment assumes increasing importance for the economic development of the ASEAN countries. Investment plays a significant role for developing countries to achieve self-reliant prosperity. Thus, it is of utmost importance to improve investment environment. For example, the Mekong subregion development requires a new strategy that combines various elements, including not only ODA, but also market integration, trade, and investment. Moreover, following the good tradition of East Asia where countries that are at different levels of economic development help and complement each other, Japan intends to support new members of the ASEAN through its partnership with its more advanced members.

I would like to make one final remark. A sound political environment is indispensable to overcome the various issues I have just mentioned and expand trade and investment. The countries of this region should offer each other advice and assistance to resolve any difficulties they face in the political realm. In this area as well, Japan will "act together and advance together" as a "sincere and open partner."

The world is changing and growing day after day. I am confident that future generations will view the various kinds of regional cooperation we are undertaking today as a history-making endeavor to raise East Asia to a new stage. I am proud that Japan and ASEAN can play an active role in these historic times. Japan is always prepared to provide cooperation and support for the further development of ASEAN countries. This basic stance of ours is unshakable. I strongly hope that Japan and ASEAN will further deepen heart-to-heart understanding and continue to be true friends who help with each other at any time, not only in fair weather, but in adverse circumstances as well.

Thank you for your kind attention.