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Last updated at: (Beijing Time) Sunday, February 08, 2004

Japan decides to further cut back economic aid to China

According to a report by United Morning News, the Japanese government decided to reduce economic aid to China to 100 billion Yen in line with the new fiscal year budget of Japanese Ministry of Finance.


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According to a report by United Morning News, the Japanese government decided to reduce economic aid to China to 100 billion Yen in line with the new fiscal year budget of Japanese Ministry of Finance. The reason given was that the Chinese economy was "growing strong". This was the most "shabby" gesture made by Japan over the last three years when Japan began cutting back economic aid to China.

In 2000 Japanese economic aid to China reached its peak - 214.3 billion Yen. Since then the figure has kept shrinking year by year - the figure for last year was 25 percent less than the previous year. The figure for this year continued to shrink and was reduced by half in three years.

The reasons that the Japanese government made the decision to massively cut down loans and economic aid to China were mainly twofold: firstly, the Japanese ruling party has always been complaining over the last three years that economic aid policy toward China is too generous. The said party's voice was taking effect in the Foreign Ministry and Finance Ministry of Japan. Secondly, China successfully launched Shenzhou V last year. Japanese politicians believe this to be a demonstration of the rising of China's financial resources and national strength and the cut-down of economic aid to China a matter of course.

There is another saying about the aid reduction, which asserts that Japan's recent decision to allocate US$1.5 billion for Iraqi reconstruction has compelled Japan to make a budgetary choice and reduce economic aid to China.

The report points out that the foreign economic aid is generally called ODA (Official Development Assistance) in Japan. So-called "aid" is actually Japanese Yen loans policy attached with a string of stipulations and conditions. As regards the loans to China Japan allowed China to use these loans to build roads and railways in the 1990s. This time the Japanese listed clauses stipulating that China could only use this loan in environment protection facilities and the balancing of poverty problems in China's inland.

The Japanese foreign economic aid policy toward Asian countries is viewed by some Japanese scholars of the "Conscience School" as a channel for the Japanese government to blur the problem of Asian War indemnity. It is a diplomatic means of "getting by however one can". Moreover, since the benefits of many economic aids eventually fall on the Japanese companies, the nature of Japanese economic aid should, it is believed, be questioned.

By People's Daily Online


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