Japan Foreign Ministry Seeks ¥10 Bil. For ‘Offer-Type’ ODA, Seeks to Link Assistance to Japan’s National Interests

Prime Minister Fumio Kishida, right, and Indian Prime Minister Narendra Modi talk before their meeting at the Hyderabad House in New Delhi on March 20.

The Foreign Ministry has included ¥10 billion in its fiscal 2024 budget request for “offer-type” cooperation in official development assistance, an approach in which Japan actively proposes aid instead of waiting for requests from partner countries, several government sources said.

A new office will be established within the ministry’s International Cooperation Bureau in fiscal 2024. It will provide strategic support in three areas: supply chains, digitization and climate change.

Japan’s ODA has long been provided at the request of recipient countries for the construction of, mainly, roads, bridges and railroads. The current downturn in the domestic economy, however, has changed public perception about the government’s overseas assistance.

In a speech delivered in India in March, Prime Minister Fumio Kishida proposed “offer-type” cooperation, in which Japan proposes and implements projects that also support Japan’s national interests. An outline of the new style was stipulated in the Development Cooperation Charter when it was revised for the first time in eight years in June.

Regarding supply chains, the government will help develop mines for rare metals. China is a major producer of rare metals, which are used in electric vehicles. In light of the risk of supply disruptions, Japan is trying to ensure access to such metals by assisting in the development of mines.

In the digital field, it will encourage business expansion in developing countries by Japanese startups that are hesitant to do so. Chinese companies are making inroads in the telecommunications field, and Japan wants to be competitive in that market.

As for climate change, it will share hydroelectric power generation technology for decarbonization and also support production of hydrogen and ammonia.

A strategy document specifying these policies will be released in the near future.

The total fiscal 2024 ODA budget from the foreign ministry was ¥491.7 billion, up ¥48.9 billion from the previous year’s initial budget.

Offer-type cooperation will start on a small scale, but the ministry intends to work strategically in cooperation with the private sector and other ministries, centering on the newly established office, and eventually expand the scale by building up a record of success.