June 2014

9Trans-PacificPartnershipJapanese Agricultural
Policy: Last Chance
for Change
Keeping the TPPOn Course

Views on China
China’s Foreign Policy
under Xi Jinping
Worsening Water
Shortages

Partnership with
AcumenDispatches from
Ghana: (4) Impact
and Lessons Learned

Maritime Security andthe Right of SelfDefense in Peacetime
The Komeito’s Curious
Journey
Lessons from Britain’s
General Practitioner
SystemGrowing the JapanEurope Partnership

Recent Articles from the Tokyo Foundation Website
No. 9, June 2014

Contents
National Security
Maritime Security and the Right of Self-Defense in Peacetime:
Proposals for a National Security Strategy and the New National Defense
Program Guidelines (Summary) .......................................................................... 3
The Tokyo Foundation
Ocean Governance in East Asia ........................................................................ 19
Masahiro Akiyama
The Rational Postwar Development of Japan’s Security Policy ......................... 24
Tsuneo Watanabe

Trans-Pacific PartnershipJapanese Agricultural Policy: Last Chance for Change ..................................... 27
Yuko Banno
Keeping the TPP On Course ............................................................................. 34
Takaaki Asano

Social Security
Lessons from Britain’s General Practitioner System .......................................... 43
Takashi Mihara

Politics & Government
The Komeito’s Curious Journey ....................................................................... 52
Katsuyuki Yakushiji

Partnership with Acumen
Dispatches from Ghana: (4) Impact and Lessons Learned ................................ 58
Junko Tashiro

Views on China
China’s Foreign Policy under Xi Jinping ........................................................... 67
Rumi Aoyama
Worsening Water Shortages .............................................................................. 73
Kunio TakamiInternational Affairs
Growing the Japan-Europe Partnership ............................................................ 79
Akiko Fukushima
President Obama’s April Trip: With a Focus on US-Japan-ROK Relations ........ 83
Chris Nelson
Moscow and Beijing Likely to Become Closer .................................................. 96
Paul J. Saunders

National Security
May 12, 2014

Maritime Security and the Right of SelfDefense in Peacetime
Proposals for a National Security Strategy and the New National
Defense Program Guidelines (Summary)
The Tokyo Foundation

FOREWORD1
What are the most pressing national security challenges confronting Japan today?
Over much of 2013, members of the Tokyo Foundation’s National Security Projectexamined this topic and summarized the findings into a set of recommendations,at a time when the government was working to articulate its first-ever national
security strategy and to update its National Defense Program Guidelines.
One of the biggest challenges the country faces, no doubt, is in the area ofmaritime security, inasmuch as Japan is an oceanic state. China’s rapid expansionof its naval power exerts a significant influence on Japan’s security, and so we madean estimate of China’s naval capacity around 2020. We also analyzed the directions
in which North Korea is likely to head in regard to its nuclear capabilities andwarhead stockpile, which are serious concerns for Japan.
To meet these challenges, members of the project team formulated 16 proposals
in areas that we feel require the greatest and most urgent attention, including theright of self-defense in peacetime; policies affecting maritime security; institutional
measures; and issues regarding defense technology, which are closely linked to Japan’s Three Principles on Arms Exports.
Japan’s first national security strategy and the updated National Defense Program Guidelines were approved by the cabinet in December 2013. In April 2014, the government announced the “Three Principles on Transfer of Defense Equipment and Technology” to relax
Japan’s self-imposed restrictions on arms exports, and it also stated it will update the ODA
Charter by the end of the year. While many of the proposals here were incorporated into
the strategy and the guidelines, the Tokyo Foundation will continue to advocate the establishment of the right of self-defense in peacetime, which was not fully reflected in the documents.

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3National Security
As government policymakers now draw up the national security policies andstrategies that will guide our country over the medium- to long-term, we hope thatthey will take note of and actively incorporate the proposals presented here.
November 2013
Masahiro Akiyama
President, Tokyo Foundation***

OVERVIEW
Following its December 2012 landslide victory in the House of Representatives
election, the Liberal Democratic Party began considering a revision to the December 2010 National Defense Program Guidelines, drafted when the Democratic
Party of Japan was in power. Inasmuch as the first DPJ Prime Minister, Yukio
Hatoyama, was forced to resign in June 2010 over his mishandling of the Futenma
base relocation issue, the DPJ’s national security policy, particularly with regard to
the US-Japan alliance, is often viewed as having been inappropriate. But the overall
direction of the 2010 Guidelines was not inconsistent with the defense policies thatwere in place under the LDP. In fact, the 2010 Guidelines contained many ambitious and proactive elements, such as the concept of a Dynamic Defense Force,
adopted in response to a new security environment—the diversification of threats
and the rising importance of the defense of the Nansei Island chain, including the
Ryukyu Islands, southwest of Kyushu, where China’s posture had become moreprovocative. Since only three years had elapsed from the last revision, moreover,some felt that another update was not yet necessary.
But Japan’s security environment has undergone considerable changes since2010. On September 11, 2012, the Japanese government purchased the three Senkaku Islands of Uotsurishima, Kitakojima, and Minamikojima, which had until
then been privately owned. In response, China, which unilaterally claims the islands as its own territory, began dispatching law enforcement ships and planes on
an ongoing basis, leading to tense face-offs with the Japanese Coast Guard and the
Maritime and Air Self-Defense Forces patrolling the area. On January 30, 2013, a
Chinese naval frigate directed its fire control radar at Maritime Self-Defense Forcedestroyer Yudachi in the East China Sea, a highly provocative incident that had thepotential of accidentally igniting a conflict.
Another change in the security environment relates to cyberspace. From about4National Security
2011, cyber attacks targeting the Japanese government and private companies,
especially those in the defense industry, have intensified. The US military established a Cyber Command in May 2012, and the annual report of the US Department of Defense to Congress on “Military and Security Developments Involving
the People’s Republic of China,” released three months later, stated that computersworldwide, including those in the United States, were being hacked from within
China. The report also noted that such activities are in step with efforts by the
Chinese military to develop cyber warfare capabilities, although there is no clear
evidence of direct military or government involvement. China has repeatedly denied the claims. Japan, too, inaugurated the Initiative for Cyber Security Information Sharing Partnership of Japan (J-CSI) in October 2011 to facilitate the sharing
of information on cyber attacks between the government and the private sector.
But additional steps are necessary to cope with the rapid sophistication of cyberthreats.
In March 2013 North Korea successfully conducted a nuclear test for the third
time. This, coupled with the development of its long-range missile technology, as
evidenced by its December 2012 launch of a satellite into orbit, shows that threats
to Japanese security are increasing, as Pyongyang is steadily acquiring the offensive
capability that would put mainland United States within range of a nuclear attack.
In Japan, a much expected revision of the Three Principles on Arms Exports
was omitted from the 2010 Guidelines—issued during the second DPJ administration of Naoto Kan—for political reasons. The subsequent Yoshihiko Noda administration eased the Principles, though, clearing the way for Japan to participate ininternational weapons development programs and broadening the scope of Japan’s
foreign assistance to include security capacity building of other nations. Any revision to the 2010 Guidelines, then, needs to build on such newly introduced concepts as a Dynamic Defense Force and make proactive adjustments in conformancewith the changes in the security environment and mid- to long-range trends.
Currently, the LDP administration of Shinzo Abe is moving forward with theestablishment of a National Security Council and the formulation of a national
security strategy. Japan’s long-term strategic issues had hitherto been addressed in
the National Defense Program Guidelines in the absence of other appropriate strategy documents, but henceforth, conceptual, strategic issues should ideally be addressed in the NSS, with the Guidelines focusing on concrete, defense-capacity
measures needed to ensure preparedness. This policy proposal thus offers recommendations for issues that should be addressed by not only the Guidelines but also
the NSS.
Unlike the previous Tokyo Foundation proposal on national security, published5National Securityin October 2008, when we adopted a broader perspective in analyzing issues andoffering recommendations (“New Security Strategy of Japan: Multilayered andCooperative Security Strategy”) with the hope they would be incorporated into the2010 Guidelines, this time we have focused on the most urgent issues confronting
Japan in a changing strategic environment.
As for the strategic environment, we have reviewed the situation in waters affecting Japan as a maritime nation and estimated China’s naval capabilities, inaddition to predicting North Korea’s nuclear capabilities. Based on these analyses,
we have made various proposals in the following three categories.
The first is Japan’s right of self-defense in peacetime—an issue requiring immediate attention if we are to prevent the standoff with China around the Senkaku
Islands from escalating into open conflict. This is an issue that has not been fully
debated, however, as it is often overshadowed by arguments regarding the right ofcollective self-defense. In this context, the proposals also address the question ofdeveloping the capacity to attack strategic, logistic bases and such new issues as
cyberspace and joint operations involving the amphibious capabilities of the
Ground Self-Defense Force.
The second major category addressed here is maritime security. Defending thesea lines of communication stretching from the East and South China Sea to theIndian Ocean is a matter of primal importance for Japan, and so is ensuring thesecurity of the emerging Arctic shipping route. The proposals below call for a more
systematic approach to Japan’s engagement in maritime security.
The third concerns measures to promote international security, including therole of the Self-Defense Forces. A new policy horizon for Japan is assistance for
Asian countries in the domain of capacity building. Proposals are offered for thisand such other issues as maintaining the level of Japan’s defense technology andproduction base, as well as the overseas transfer of defense-related equipment andthe protection of Japanese nationals living or visiting abroad—a growing concern
in the light of the January 2013 terrorist attack on an Algerian natural gas processing facility, in which 10 Japanese hostages were killed.
Finally, it must be emphasized that these proposals are not intended to incite
discord or to heighten tensions with China. There is no meaning in advocating a
Cold War containment strategy in the light of China’s deepening economic interdependence with Japan, the United States, and other countries around the world.
Rather, these proposals are intended to form the basis of an engagement policy toencourage China to make a bigger contribution to regional stability. This is a position echoing the Tokyo Foundation’s June 2011 policy proposal on “Japan’s Security Strategy toward China: Integration, Balancing, and Deterrence in the Era of6

National Security
Power Shift” calling for China to be more fully integrated into the regional security
architecture.
The tension between Japan and China in the seas around the Senkaku Islands
is a source of great anxiety for security specialists around the world. Successfully
resolving the current crisis through efforts by Japan, China, and other concernedcountries and newly establishing a stable order in the Indo-Pacific region would
not only engender great benefits for Japan but could also open up new horizons forJapan’s security strategy.
SUMMARY OF PROPOSALS
1. The Right of Self-Defense in Peacetime and Other Pressing Issues surrounding the Right of Self-Defense
Proposal 1: Amend the Self-Defense Forces Law and establish a basic national security
law to clear the way for the use of the right of self-defense prior to the issuance of adefense mobilization order—that is, for “gray zone” situations during peacetime—aswell as to enable the exercise of the right of collective self-defense. Regarding grayzone situations, identify issues the government needs to clear, establish a decision-making structure, and conduct periodic government-level command post exercises for specific situations.

Given the current situation around the Senkaku Islands, the scenarios under which
the SDF are most likely to be called into action will be “gray zone” cases: violationsof Japanese sovereignty that are not clear military invasions requiring the issuanceof a defense mobilization order but are beyond the policing capacity of the Japan
Coast Guard. There has not been a review of how best to cope with such infringements, though, in discussions of Japan’s defense to date. As matters stand, Japan
has done little to legally define gray zone situations, to identify issues the government must clear, or to establish a decision-making structure. The government iscurrently considering the approval of the exercise of the right of collective self-defense, but this is a matter involving the repulsion of an invading force throughmilitary means as an act of self-defense following the issuance of a defense mobilization order. This, too, is no doubt an important issue, but inasmuch as gray zone
infringements are taking place even now, enabling Japan to exercise its right ofself-defense in peacetime—as proposed here—should surely be addressed first, before engaging in a full-scale debate on the right of collective self-defense.

7

National Security
Proposal 2: To enable a proper response to gray zone incidents, relax the government’s interpretation of the Constitution, according to which three conditions must be
met for Japan to use armed force in the exercise of its right of self-defense. In particular, a more flexible interpretation of the first condition—“an imminent and illegitimate
act of aggression”—is needed.

The three conditions that must be met for Japan to use armed force in the exercise
of its right of self-defense, under the government’s current constitutional interpretation, are: (1) when there is an imminent and illegitimate act of aggression against
Japan; (2) when there is no appropriate means to deal with such aggression otherthan by resorting to the right of self-defense; and (3) when the use of armed force
is confined to the minimum necessary level. These conditions were establishedduring the Cold War—when a distinction could clearly be made between peacetime
and a state of emergency—and based on the assumption of a full-scale Soviet invasion. In the near future, Japan is much more likely to confront a gray zone crisis
that cannot clearly be classified as an “imminent and illegitimate act of aggression”—a product of a strict interpretation of the UN Charter’s Article 51 by thegovernment of Japan in the mid-1950s. A clear discrepancy thus exists between thegovernment institutions in place now, built on outdated assumptions, and current
realities. Under the circumstances, it may be difficult to deal effectively with violations of national sovereignty or invasions owing to delays in invoking the right ofself-defense following the issuance of a defense mobilization order.
Proposal 3: Japan (SDF) should establish the capacity to attack strategic, logistic bases
through the strengthening and utilization of the combined Japan-US security framework. The following three goals should be pursued: (1) a posture/structure within the
combined Japan-US framework enabling Japan to autonomously utilize this capacity of
the US forces; (2) a posture/structure enabling bigger mission roles and deeper involvement by the SDF for attacks on strategic, logistic bases, premised on combined Japan-US action; and (3) a clear policy statement by the government that Japan possesses
the inherent right, as an independent country, to maintain the capacity to attack strategic, logistic bases.

Ever since the establishment of the SDF, Japan has never taken specific action toestablish the defense capacity or operational structure to attack strategic, logistic
bases of enemy forces on foreign soil, despite a constitutional interpretation that
permits such attacks under certain conditions. For the SDF to be equipped withsuch capabilities is intrinsically desirable from the perspective of meeting Japan’s
8National Security
defense needs and ensuring the SDF’s autonomy. But this deficiency has been covered to date by the Japan-US security alliance, in which Japan has confined itself
to serving as a “shield,” with US forces acting as the “spear.” Given the severe budgetary and organizational restrictions of equipping the SDF with this capacity, evenwhen used only in cases meeting certain conditions, such a step will not likely be arealistic option in the immediate future. But this proposal is one that can be implemented over a period of about 10 years, which is the timeframe covered by the new
Guidelines. It is essential that Japan take steps toward these goals through thestrengthening and utilization of the combined Japan-US security framework.
Proposal 4: Station members of the GSDF in the Nansei Islands as a clear statement ofJapan’s intentions to defend its territory. Establish a position of deterrence throughjoint operations with the MSDF and ASDF in partnership with the US military. Establish
well-balanced amphibious capabilities (akin to those of the US Marine Corps) that will
repel invasions and quickly retake islands in the event that deterrence fails. This willentail detailed consultations with US forces regarding respective roles, responsibilities,
and capabilities to ensure effectiveness and efficiency.

The Nansei Islands

9National Security
The Nansei Islands are pivotally located between the western Pacific and the East
China Sea, impeding the passage of China’s North Sea Fleet and East Sea Fleet into
the Pacific. The chain of islands also forms the crux of the US forward deployment
strategy in the Pacific and is an important forward position for its Air-Sea Battle
concept. With the exception of Okinawa Island, though, there is virtually no military presence on these strategically important islands, creating a highly unstablesituation that could invite military adventurism by neighboring countries. The situation should be improved by stationing GSDF troops on a permanent basis, on
not only Okinawa Island but also major islands in the Miyako and Yaeyama chains,
as well as the island of Amami Oshima. Japan should make a clear statement of its
intentions to defend its territory, taking steps to deter territorial infringements andthereby promoting stability. The stationed troops should coordinate closely with
US forces in order to complement America’s forward deployment strategy and AirSea Battle concept, achieving a synergistic effect through joint operations with the
MSDF and ASDF, as well with as the US military. In the event that deterrence fails,
Japan must have the ability to quickly retake the islands with integrated amphibious capabilities.
Proposal 5: Lay down utilization objectives and strategies for cyberspace. Establish acyber unit in the SDF to address not only defense-related operations but all cyberspaceissues. Assign primary responsibility for the government’s use of cyberspace to the SDF,
giving it authority to oversee the IT departments of each ministry and agency. Also,
promote cooperation with the private sector to access the latest technologies andknowhow.

The United States has named cyberspace the fifth security domain after land, sea,
air, and space, for cyber attacks can not only obstruct intelligence gathering activities but also inflict actual physical damage. Many of the world’s leading cybercountries have well-defined utilization objectives, concepts, and strategies, according to which they manage their organizations and troops to defend against cyberattacks. Japan, too, has launched a number of initiatives, but government awareness of cyberspace use is still low. Cyber networks for information sharing remain
largely underdeveloped, and there is little understanding of the implications ofcyberspace for foreign and security policy. A unit to conduct cyber operations
should be established within the SDF—which is capable of securing the necessary
human resources and budgetary allocations—to oversee the IT activities of suchgovernment agencies as the Ministry of Defense, Ministry of Foreign Affairs, Ministry of Internal Affairs and Communications, Ministry of Finance, and National
10National Security
Police Agency. Cooperation with private companies that have more advanced
knowledge than the government is also indispensable in order to maintain leading-edge cyber capabilities. This should go beyond just joint research or the sharing
of information; budgetary approaches relying on a cost-accumulation formula alsoneed to be reassessed. The latest technologies in the private sector must be tappedby applying the constantly evolving knowhow and capabilities of private companies to government systems for intelligence gathering and processing.
2. Systematic Approach toward Maritime Security
Proposal 6: Set aside a section in the new Guidelines emphasizing the importance ofa more systematic approach toward maritime security and make clear this is a pressing
issue for Japan’s defense policy today. Closely monitor and analyze the maritime security situation that has been undergoing rapid change in recent years, especially in theseas with relevance for Japan, such as the western Pacific, the Indian Ocean, other seasaround Asia, and the Arctic Ocean, and indicate the basic directions for the country’s
comprehensive response.

The ocean is open to all users. The reasons shipping remains the most efficientmode of transporting goods are because there are no border checkpoints, giving
ships free passage to any port in the world, and because there is no theoretical limit
to the volume of goods that can be transported by freighters. Moreover, considerable progress has been made in recent years in the exploration of offshore energy
sources. The safety of the seas is thus of vital interest to Japan, an island country
surrounded by the sea. Of great importance are not just Japan’s shores and nearby
waters, though, for problems in any of the world’s oceans can have a major impact.
Because Japan is dependent on maritime transport for its economic activity, the country needs to pay special attention to security issues in the maritime domain. The new
Guidelines should thus devote greater attention to the issue of maritime security,
outlining both a comprehensive framework and concrete measures for key issues.
Proposal 7: Strengthen coordination among the Ground, Maritime, and Air SDF fromthe perspective of maritime security. Because maritime security involves the defense not
only of territorial waters but also the airspace above those waters and remote islands,
strengthen joint operations among the three services. A joint command for SDF operations should be achieved through the establishment of a unified C4ISR system, implementation of joint exercises, and the joint formulation of a common maritime security
strategy.
11National Security
The defense of remote islands is a vital component of maritime security that requires the closer integration of the Ground, Maritime, and Air SDF. Integrated
operations are predicated on the sharing of information and a unified command
structure, but each SDF branch now employs a different C4ISR (command, control,
communication, computer, intelligence, surveillance and reconnaissance) system.
This prevents the seamless coordination of targets and hampers the implementation of tasks central to joint operations, such as the assignment or transferring oftargets among the different branches. An integrated C4ISR system is indispensable.
Another key issue is unifying the command structure. The three branches should
conduct joint training and exercises on a regular basis to promote a better understanding of each other’s special characteristics and ensure the effective movementof troops. Joint operations necessitate the coordination of targets. Toward this end,
the three branches should work together to formulate a maritime security strategy,
clarify objectives, and draw up concrete tactical operation plans.
Proposal 8: Ensure that the MSDF and ASDF have the capacity to maintain sea and air
superiority in the territorial seas far from mainland Japan in the face of a changing maritime security environment. Qualitatively and quantitatively upgrade the ships, fighter
jets, patrol aircraft, and AWACS aircraft of both forces, and begin discussions on the
introduction of an aircraft carrier that can provide the air cover (air boundary defense)
necessary for the defense of territorial waters.

Maintaining good relations with neighboring countries and diplomatic efforts are
essential components of maritime security. But this does not preclude the need tomaintain sea superiority by Japanese and allied forces, without which Japan may
become vulnerably exposed in a contingency. Achieving superiority on the seasrequires dominance of airspace as well, for a maritime fleet will be hard pressed to
win a sea battle without air cover. Upgrading Japan’s ships, fighter jets, anti-submarine patrol aircraft, and aircraft carrying airborne warning and control systems(AWACS) is thus a priority issue. Given the importance of defending remote islands, the self-defense capabilities of the GSDF must also be upgraded in such areas
as surveillance, ability to secure bases of operation, and the conferring of amphibious capabilities. Establishing air cover around the Nansei Islands would require
either new bases on land or an aircraft carrier. The former would be difficult,though, from a political and operational (ability to withstand attack) standpoint,
so the remaining option would be to employ an aircraft carrier. Japan would notneed (or be able to finance) a carrier strike group like those employed by the UnitedStates. Japan should thus consider reinforcing the capability of warships now pos12

National Security
sessed by the MSDF, such as Izumo-class 22DDH destroyers, and the purchase of
F-35Bs with vertical take-off/landing capabilities.
Proposal 9: Strengthen the Japan Coast Guard and promote effective cooperation
with the SDF in defending territorial waters and remote islands and in ensuring order atsea. Involve all relevant ministries and agencies in the drafting, sharing, and operationof a crisis management program. Advance coordination and cooperation between the
SDF and JCG, as well as with such other relevant agencies as the Ministry of Internal
Affairs and Communications; Ministry of Foreign Affairs; Ministry of Land, Infrastructure, Transport, and Tourism; National Police Agency; Fisheries Agency; and Agency for
Natural Resources and Energy to assure a seamless response in the transition between
peacetime and a national contingency.

The defense of territorial waters and remote islands should intrinsically be basedon the right of self-defense. But due to inconsistencies in Japan’s legal system, there
is no choice at present but for “gray zone” incidents to be addressed by the Japan
Coast Guard as part of its maritime law enforcement duties. Of urgent importance,
therefore, is not only to eliminate such inconsistencies, as described in Proposal 1,
but also to quickly and boldly upgrade and expand the structure and posture of
the JCG. There is also a pressing need to create a structure for seamless coordination between the JCG and SDF in case the security situation deteriorates. In concrete terms, a crisis management program should be drawn up and shared by all
ministries and agencies that would be involved in the transition between peacetime
and a national contingency.
Proposal 10: With the situation around the Nansei Islands becoming increasingly
complicated and transnational in scope, promote cooperation with other countries andmaritime industries. The international community should be broadly informed of attempts by Chinese law enforcement vessels to alter the status quo through repeatedintrusions into Japanese territorial waters so that a shared perception can be formed
regarding the dangers of harassment activities by Chinese paramilitary forces accidentally triggering a conflict.

International cooperation is critical in dealing with the increasingly complicatedand transnational nature of defending Japan’s territorial waters. Diplomatic efforts
must be made to broadly inform the international community of attempts by China
to alter the status quo through the use of force so that a shared perception can beformed regarding the need to prevent an escalation of such activities. Cooperation
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National Security
must also be advanced with maritime industries; there is a need for closer coordination on the utilization of stratospheric platforms to improve the monitoring ofocean areas and enhance telecommunication capacity—issues directly related to
the freedom of navigation, the development of marine resources, and other majorinternational concerns.
Proposal 11: Raise the rank of the SDF’s “legal affairs general” to that of “rear admiral/major general,” as in the United States, in view of the importance of legal issues inensuring maritime security. Restrain moves by countries that ignore rules and the legal
order, while at the same time working to integrate them into the established legal order. Have the MSDF learn from the practice of evidence accumulation, now conductedby law enforcement agencies.

Many maritime conventions and statutes have been established in addition to the
UN Convention on the Law of the Sea, which stipulates fundamental rules for theuse of the oceans. There are also many rules, including customary law, covering
military activities on the sea, both during peacetime and in contingencies. In viewof the increasing importance of the legal order in maritime security in recent years,
legal affairs general (equivalent to captain/colonel) in the SDF (especially the
MSDF) should be raised to the rank of “rear admiral/major general,” as in the
United States. Actions by countries that ignore maritime rules and the legal orderneed to be restrained. At the same time, efforts should be made to integrate theminto the established legal order, such as by demonstrating the importance Japanplaces on observing the maritime order. Inasmuch as the United States is the world’s
largest maritime nation, Japan should also strongly appeal to its alliance partner
to swiftly ratify the UN Convention on the Law of the Sea.
Proposal 12: Promptly establish a maritime security strategy for the Arctic Ocean, as
the melting of polar ice is likely to usher in significant changes in the near future—perhaps in just a few years. Draft a strategy that takes into consideration the commercial
use of Arctic sea lanes, the exploration and development of marine energy resources,
and the emergence of a new maritime security environment. Participate actively in the
Arctic Council and dispatch oceanographic observation vessels to Arctic waters by revising the Self-Defense Forces Law.

Recently released scientific analyses suggest that the melting of the Arctic ice cap
will henceforth progress at a rapid pace. This will have widespread repercussions
for maritime transport, natural resources development, fishing, and environmental
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National Security
conservation in the Arctic Ocean. In response, coastal countries are now developing
new security and defense policies. Significant changes in global naval movement
patterns can also be expected. Given the likelihood of major changes in the Arctic
Ocean in the near future, Japan should promptly establish a security strategy for
the Arctic.
3. International Security Policies of the Ministry of Defense and the Self-Defense Forces
Proposal 13: Significantly expand the budget and content of capacity building programs for the defense and law enforcement agencies of foreign countries, playing a
dynamic role in improving the regional and global security environment. Organicallycoordinate the capacity building assistance offered by the Ministry of Defense, official
development assistance provided by the Ministry of Foreign Affairs, and financing fromthe Japan Bank for International Cooperation.

The National Defense Program Guidelines currently call for stepped up efforts to
support capacity building in other countries to improve the security environment
in the Asia-Pacific region and around the globe. The Capacity Building Assistance
Office was established in the International Policy Division of the Defense Ministry’s
Bureau of Defense Policy in fiscal 2011, and it is engaged in supporting capacity
building and human resources development—primarily in Southeast Asian countries—in nontraditional security areas. Such support is currently offered in a limited number of fields and on a small scale, however, with an annual budget of no
more than 300 million yen. Both the content and budget for such activities should
be expanded significantly, bolstering Japan’s engagement in the region throughcloser coordination among various ministries and agencies. The greater part ofcapacity building assistance is targeted toward Southeast Asia, so emphasis should
firstly be placed on strengthening joint military exercises and training with thosecountries. Secondly, Japan should provide financial and technical assistance tostrengthen their defense capabilities and related infrastructure. National defense is
not simply a matter of amassing frontal combat equipment; other important factors include such infrastructure as airports, ports, roads, electric power, telecommunications, energy, and software, as well as the organization and human resources
to operate such facilities. The provision of such infrastructure and resources will
be of decisive importance in raising the defense capabilities of Southeast Asian
countries.

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Proposal 14: Substantially enhance coordination between international peacekeeping
activities and official development assistance. Create a permanent center for security
cooperation within the newly established National Security Council responsible for analyzing trends in UN peacekeeping operations and the peace-building and antipiracy
activities of multinational forces, as well as for promoting cross-agency cooperationand coordination on ODA and other issues on an ongoing basis.

The government must have the capacity to make decisions across various ministries
and agencies, given the need to proceed with great care in addressing the Senkaku
issue and to effectively respond to terrorist attacks, natural disasters, and otherunanticipated situations. The council will undertake long-term analyses of the domestic and international situation; create common, cross-agency national objectives; and formulate guidelines (strategies) for the development and use of policy
resources to achieve those objectives. A center for security cooperation should beestablished within the section responsible for drafting the long-term security strategy to analyze trends in UN peacekeeping operations and the peace-building andantipiracy activities of multinational forces, as well as to promote cross-agency
cooperation and coordination on ODA and other issues on an ongoing basis.
Proposal 15: Further streamline the Three Principles on Arms Exports in the new
Guidelines, enabling Japan to strengthen its defense technology and production baseand to advance reasonable arms exports, joint international development, and international cooperation. In particular, relax the remaining conditions for the transfer of arms
to third countries. Decisions regarding arms exports should be made by the prime minister based on strategic advice from the NSC and implemented by the minister of economy, trade and industry, who has jurisdiction over the Foreign Exchange and Foreign
Trade Act.

The Statement by the Chief Cabinet Secretary on Guidelines for Overseas Transfer
of Defense Equipment, Etc., issued by the Yoshihiko Noda administration in 2011,
announced a comprehensive easing of government policy regarding contributions
to peace, international cooperation, and joint development and production of defense equipment, marking a shift from the piecemeal, ad hoc measures that had
been taken until then. This was a step in the right direction, and government-led
efforts should henceforth be made to strategically strengthen Japan’s defense technology and production base; at the same time, a setup to enable an “all Japan”
response, transcending differences among ministries and agencies, must be createdto advance reasonable arms exports, joint international development, and interna16

National Security
tional cooperation. Also necessary is the relaxation of the requirement—which has
remained intact even after the 2011 revisions—for rigid controls to prevent thetransfer of exports, supplies, and jointly developed defense equipment to third
countries. The new Guidelines should take these points into consideration in outlining a clear and simple policy on the transfer of defense equipment, joint development and production, and such forms of international cooperation as capacity
building assistance.
Proposal 16: Looking toward the future,build a system of defense cooperation withindustry and academia to promote the development of defense-related technology,
including those with dual-use capabilities,
partly to make effective use of Japan’s limited funds for research and development.
As a first step, organically link the development of defense-related technologies with
the Cabinet Office’s Comprehensive Strategy on Science, Technology, and Innovation. In this regard, there is an urgent needto develop experts who not only are intimately familiar with defense technology
and its lifecycle but also have a broad understanding of all aspects of science andtechnology.

LIST OF ABBREVIATIONSASDFAir Self-Defense Force

AWACS

Airborne Warning and Control
Systems

C4ISR

Command, Control, Communication, Computer, Intelligence, Surveillance and Reconnaissance

DPJ

Democratic Party of Japan

GSDF

Ground Self-Defense Force

JCG

Japan Coast Guard

J-CSI

Cyber Security Information Sharing Partnership of JapanLDP

Liberal Democratic Party

MSDF

Maritime Self-Defense ForceNDPG

New National Defense Program
Guidelines

NSC

National Security Council

Another issue in maintaining Japan’s deNSS
National Security Strategy
fense production base is expanding doODA
Official Development Assistancemestic R&D funding for new technoloSDF
Self-Defense Forces
gies and equipment. Such funding fordevelopment, design, and production have been allocated to the Technical Researchand Development Institute of the Ministry of Defense, and complicated application
procedures are required to transfer these tasks to the private sector. Because of the
scarcity of partnerships with Japanese universities—which have advanced knowhow of underlying technologies—moreover, the capacity of private companies todevelop new equipment is not robust. If this situation goes unaddressed, and Japanese industry’s competitiveness erodes, maintaining a stable defense production
base will prove elusive even if the hurdles on arms exports and joint development
17

National Security
with other countries are lowered. Ideally, an “all Japan” framework for a comprehensive science and technology policy should be established through close coordination between the Defense Ministry’s planning and development project team andthe Strategic Innovation Creation Program (provisional name), scheduled to belaunched in the Cabinet Office’s Council for Science and Technology Policy. Sucha framework will entail huge political costs, though, given bureaucratic sectionalism—particularly the reluctance of the Ministry of Education, Science, and Technology to give up control of the R&D budget—and academia’s lingering aversion
to military technology, but this is a task that cannot be put off.

18

National Security
April 15, 2014

Ocean Governance in East Asia
Masahiro Akiyama

Tensions in the East China Sea are growing owing to territorial disputes, advances in maritime resource exploitation, and an ongoing power shift. This, maintains Tokyo Foundation
President Masahiro Akiyama, makes ocean governance an increasingly important issue forcountries in the region.
This paper, presented at a conference on “East China Sea Tensions: Perspectives and
Implications” hosted by the Maureen and Mike Mansfield Foundation in Washington,
DC, in February 2014, is reprinted here with the permission of the Mansfield Foundation.
The program brought together leading experts from government, defense, academia, andNGOs from Japan, China, and the United States for private and public discussions in
Washington and Tokyo.
***

Developments Affecting Asian Maritime Security
Ocean governance is, without doubt, a crucial issue requiring close examination inlight of the implications of growing maritime tensions in East Asia. In this context,
there have been several developments in recent years that have seriously affected
Asian maritime security. They include territorial disputes in the area, the entry into
force of the UN Convention on the Law of the Sea (UNCLOS), advances in maritime resource exploitation, and an ongoing power shift in the region.
First of all, the drawn-out disputes over the rights to territories and territorial
waters are becoming more serious, not only in the East China Sea but also in theSouth China Sea. Each coastal state should make clear its reasons for its claims
based on international law, but many of them have not done enough, particularly
with regard to the South China Sea. Military force has been used to settle someterritorial disputes in the South China Sea. This is a matter of grave concern. And

Masahiro Akiyama

President, Tokyo Foundation.
19

© Al Jazeera English (CC BY-SA 2.0)

National Security
now paramilitary force operations have become active, not only over territorial
issues but also to control the EEZ. China has recently begun using its paramilitaryforces effectively to assert its territorial claims in both the East China Sea and theSouth China Sea.
Secondly, UNCLOS was adopted in 1982 and, as of June 2011, 162 nations
have acceded to it. The convention newly defined such terms as “territorial sea,”“exclusive economic zone” (EEZ),
and “continental shelf.” It also established rules on the utilization, exploitation, and conservation of maritime resources. While these definitions
and rules are important, positive steps,
they have also given rise to new disputes and conflicts.
Countries all over the world are
eager to secure maritime and energy
A Japan Coast Guard patrol vessel passes by Uotsuri,
resources, so the delimitation of EEZs
the largest island in the Senkaku Island chain.
and the continental shelf has becomea crucial matter for them, making it
difficult to reach an agreement through discussion. At the same time territorial
disputes have intensified, as the EEZ is determined using the territorial base line.
Thirdly, advances in maritime resource exploitation have aggravated maritime
tensions in Asia. The success of maritime resource exploitation activities is of great
national interest, and it is also strongly related to the UNCLOS concepts of territorial waters, the EEZ, the continental shelf, the high seas, and the deep sea.
Offshore oil and gas field exploitation has a long history around the world, butattention has recently focused on seas around East Asia, which are eyed as potentially having huge reserves. In addition, rare metals, rare earth elements, cobalt-richcrusts, methane hydrates, seafloor hydrothermal deposits, and noble metals are
expected to be explored and developed in the near future.
Fisheries, of course, cannot be excluded from maritime resource discussions.
Humans are heavily reliant on animal proteins from fish, and the seas as a sourceof food will become much more crucial to each country. Historically speaking, evenmilitary conflicts have taken place over fishery resources.
Fourthly, there’s an ongoing power shift in East Asia. We have seen the rise of
China, India, and other Asian countries. But the focus of everyone’s attention has
been China. With the world’s biggest population of around 1.3 billion, China, since2010, has also claimed the second largest GDP.
20

National Security
China has aggressively been developing its maritime strategies. It attaches importance to the defense or control of the coastal, near-sea, and far-sea areas, and it
has strengthened its naval powers and expanded its area of military operations.
Claiming rights over vast territories and territorial waters in the South China Sea
and the East China Sea, securing large EEZs and continental shelves, exploiting anddeveloping energy and other maritime resource, and securing fishing grounds are
all related to its national interests.
China seems intent on achieving effective control of the East and South China
Seas, which is the area enclosed by the so-called First Island Chain. It also appears
to be targeting an outer area encircled by the Second Island Chain by strengthening
its military capabilities. China has tried to prevent foreign military ships and airplanes from conducting activities inside and over its EEZ. These areas are generally
treated in the same way as the high seas, where the freedom of navigation is guaranteed, so the Chinese attitude has sparked a number of small but serious conflicts
between China and the U.S.
China recently established an Air Defense Identification Zone (ADIZ) over the
East China Sea. This has alarmed the international community, as it suggests that
China seems intent on effectively controlling the air space in this area.
All of these developments are symbolic of the power shift in the region that will
have a major impact on Asian maritime security.
Ocean Governance
The issues I have mentioned are all interconnected, as you are no doubt well aware.
And they need to be addressed in an integrated manner within the framework ofocean governance.
Maritime resource exploitation is related to the delimitation of EEZs and thecontinental shelf, as defined by UNCLOS. I have learned that China understands
UNCLOS very well. The delimitation problem can be resolved through the procedures outlined by UNCLOS, although China has its own interpretations of theconvention and strong opinions based on its national interests. Differences between
two coastal states are best settled through negotiations. Failing that, another option
is to bring the issue to international courts, as some small and medium-sized countries have done. Joint development of maritime resources is an effective step towardachieving a final resolution
But any delimitation ruling can have serious repercussions on territorial disputes. So while territorial disputes involving many countries may be impossible toresolve through negotiations, the concerned states must nonetheless explain the21National Security
grounds for their territorial claims based on international law. The explanations
made by some coastal states in the South China Sea, such as those regarding thenine-dotted line, do not seem to adhere to international law. This is an area where
the international community can enhance its engagement. After all, this could seriously affect the freedom of navigation in the East and South China Sea, which is amatter of common interest to the global community.
The ongoing power shift is a more difficult issue. I believe China began focusing on controlling the East and South China Seas out of its own security concerns.
But now this objective has become part of a maritime strategy to expand its presence and accelerate the power shift. China is now showing greater interest in waters encircled by the Second Island Chain and also the outer sea, possibly hoping
to divide control of the Pacific Ocean with the United States. This would be one
manifestation of the new type of major power relations that China is seeking with
the U.S.
The problem is that China is advancing this by strengthening its military andparamilitary capabilities. China has become more aggressive in using its militaryand paramilitary forces to achieve its objectives as a major maritime power.
This can have a negative effect on delimitation decisions and territorial disputes, as China has increasingly been using its military and paramilitary might toassert its will. An arms race is emerging in Asia, which could undermine the peaceand stability of this region.
This is a challenge that can and should be met with U.S. involvement. China is
beginning to pose even a military threat to the United States. It may be difficult tostop China from becoming a major military power. But it is very important that
China be made to recognize that it cannot get its own way by throwing its military
weight around. This is where the international community, with the U.S. at thecore, has a crucial role to play.
China’s use of military or paramilitary power to prevent non-coastal statesfrom undertaking military activities in its EEZ should be discussed in a different
way. This is an issue that is closely related to China’s national security and interpretations of the relevant UNCLOS articles. It may be possible to introduce new
guidelines for military activities in other countries’ EEZs in order to reduce the riskof a military clash.
Conclusion
We must re-embrace the UNCLOS framework and steadfastly uphold internationallaw, confronting maritime issues, territorial disputes, and delimitation problems in
22National Security
East Asia from this point of view. As such I would strongly hope that the U.S. will
ratify UNCLOS as soon as possible.
The use of military and paramilitary forces should be discouraged throughtheir more effective management by the United States and the international community. China can and will then realize this goal to be in their common interest.

23

National Security
April 17, 2014

The Rational Postwar Development ofJapan’s Security Policy
Tsuneo Watanabe

Japan’s defense-related legal system is so restrictive as to hinder timely responses to contingencies, which could actually abet the escalation of tensions with neighbors. The reforms being advanced by the Abe administrations, says Senior Fellow Tsuneo Watanabe, are rational moves intended to address such shortcomings.
This paper, presented at a conference on “East China Sea Tensions: Perspectives and
Implications” hosted by the Maureen and Mike Mansfield Foundation in Washington,
DC, in February 2014, is reprinted here with the permission of the Mansfield Foundation.
The program brought together leading experts from government, defense, academia, andNGOs from Japan, China, and the United States for private and public discussions in
Washington and Tokyo.
*

*

*

P

rime Minister Shinzo Abe’s security policy intentions are often misunderstood or exaggerated, either intentionally or unintentionally. In its December 18, 2013, editorial, for example, the China Daily warned against Abe’s“proactive pacifism,” asserting that “the catchy but vague expression” is “Abe’s
camouflage to woo international understanding of Japan’s move to become a military power.”
Abe’s intentions, however, are not to turn Japan into a military power, either inqualitative or quantitative terms. Rather, his security policy is designed to incrementally enhance the functionality of Japanese defense capacity.
The China Daily’s editorial pointed out that Abe’s doctrine seeks to turn Japan’s Self-Defense Forces (SDF) into “ordinary armed forces.” In reality, though,the SDF are far from “ordinary armed forces,” which are able to take necessary

Tsuneo Watanabe   Senior Fellow and Director of Foreign and Security Policy Research,
Tokyo Foundation.
24

National Security
actions to defend the country and to contribute to regional security promotion.
Japan’s defense-related legal system is so restrictive, in fact, that the inability torespond to contingencies—even when a defense response is required—could actually abet the escalation of tensions with neighbors.
On February 4, 2014, the prime minister hosted a meeting of an expert panel
on reconstructing the legal basis for national security. According to media reports,
the panel proposed legislation to enable the use of the SDF to deal with so-called“gray zone” situations categorized between peacetime and genuine contingencies.
Under current Japanese law, the country cannot exercise its right of self-defense
unless it is under organized, armed attack.
The recommendation to the prime minister came from a panel of coolheaded
defense experts, not emotional nationalists. The Tokyo Foundation, too, made theabove point in its policy proposal on “Maritime Security and the Right of Self-Defense in Peacetime,” released in November 2013 under a project for which I myself
served as leader. The recommendation of Abe’s panel is closely aligned with our
proposal, which called on the government to make reforms to the Diet, law enforcement authorities, and the SDF that are long overdue in order to more effectively defend Japan’s territory and avoid an escalation of tensions with its neighbors, especially China, which is now persistently sending paramilitary vessels into
Japan’s territorial waters.
Currently, the deployment of the SDF is heavily restricted by legal and politicalconcerns, even in addressing self-defense needs. This is based on Japan’s remorsefor the suffering caused to its neighbors, including China, by its wartime aggressions. This self-restraint was functional during the Cold War, since Japan’s exercise
of self-defense was chiefly directed against the Soviet Union and integrated into
U.S. military strategy. There was no need to address intrusions into its territorial
waters by paramilitary vessels.
A military invasion of Japan would be a clear case of a contingency, when theJapanese government can legally order the SDF into action. Considering the current situation surrounding the Senkaku Islands, though, Japan is more likely to faceminor yet critical challenges from nonmilitary or paramilitary vessels, which would
not be considered armed attacks. This could place the Japanese government in adilemma. The SDF cannot use their full military capabilities without a defense order from the government clearing the way for self-defense maneuvers. If the government does issue such an order for an incident around the Senkakus, though, this
could send the wrong signal.
Ordinary democracies, such as the United States and its European allies, do nothave such a dilemma, since pre-defined Rules of Engagement outline the actions to25National Security
be taken by their military forces. Japan is constricted by its deep remorse for past
military aggressions and understands the sensitivity of its neighbors. But we mustalso keep in mind that lapses in Japan’s national security laws could actually leadto a heightening of tensions in the East China Sea.
Even if the legal reforms are legitimate, why, critics may say, does the prime
minister need to visit Yasukuni Shrine, stirring up new controversy and worrying
neighbors? I happen to agree that the visit was ill-timed, but we live in an imperfectworld in which emotional nationalism can sometimes become a source of political
capital. This is true not only in Japan, though, but also in China, South Korea, andeven the United States, which saw an upsurge of patriotic sentiment following the
September 11 terrorist attacks.
Despite the image encouraged by China and South Korea, the Abe administration is marked more by realism than nationalism. University of Tokyo Professor
Emeritus Shin’ichi Kitaoka, who is deputy chairman of Abe’s panel on reconstructing the legal basis for national security, was the leader of a Tokyo Foundation
project on Redefining Japan’s Global Strategy, which also recently announced its
policy proposal. The core message of the proposal was the importance of restraining emotionalism and taking pragmatic steps to find common ground with its
neighbors.
I do not endorse the prime minister’s visit to Yasukuni Shrine, and neither dothe realists in his cabinet. The administration’s current security policy initiatives,
therefore, are not the result of an emotionally charged nationalism but represent a
rational and incremental development of democratic governance in Japan’s postwar security and defense policy.

26

Trans-Pacific Partnership
May 12, 2014

Japanese Agricultural Policy
Last Chance for Change
Yuko Banno

Domestic political concerns—particularly the importance of the farm vote—have hitherto tiedthe hands of Japanese negotiators in international trade talks, forcing them to make substantial concessions to maintain nominal safeguards, as during the Uruguay Round. Recentchanges of government and growing awareness of the need for reform, notes Yuko Banno,
though, have prompted a serious rethinking of Japan’s farm policy.
*

*

*

D

espite reports of progress in the Trans-Pacific Partnership negotiations in
April 2014—between Japan and the United States during President
Barack Obama’s state visit to Tokyo—and the February 2014 ministerial-level meeting in Singapore, the political situation in each of the parties to thetalks means there are likely to be many more twists and turns before an agreement
is reached.
For many years Japan has been considered a poor negotiator. Additional support for this view is contained in a policy report examining Japan’s response to the
Uruguay Round talks, recently published by the Tokyo Foundation. During thosenegotiations under the General Agreement on Tariffs and Trade, Japan spent somuch energy trying to block the tariffication of rice that it ended up paying a higher“price” in the form of an increase on minimum access quotas for rice. This was ahollow victory for Japan: one that entailed more loss than gain.
It goes without saying that in any international negotiations, it is important tosecure real gains based on a careful consideration of the national interest. Discussions of trade and commerce policy in Japan are often framed in terms of “tradeoffs”
that seek to minimize the negative impact on Japanese agriculture. What is needed,instead, are negotiators who can make calm and rational decisions that serve the

Yuko Banno   Research Fellow and Project Manager, Tokyo Foundation.
27

Trans-Pacific Partnership
national interest while at the same time guaranteeing a strong foundation for thenation’s food supply.
It is instructive to compare Japan’s attitude during the Uruguay Round negotiations with the European approach. The European Union implemented a set of
regionwide reforms and succeeded in taking the initiative during the round bycompleting the necessary reforms before a binding agreement was reached. It wasat this time that the EU introduced a bold new policy of direct subsidies to farmers.
This had a huge impact on subsequent agricultural policy.
By contrast, Japan stubbornly clung to its position of blocking tariffication.
Further, when a post-agreement compensation package for farmers was being
drawn up, attention was narrowly focused on its total size, with little attempt being
made to clarify exactly how the Uruguay Round agreement would affect Japanese
agriculture. The package, moreover, was a mere rehashing of existing programs.
On the domestic front as well, Japan missed an opportunity to achieve real, substantive progress.
Stirrings of Change
The Uruguay Round negotiations and the subsequent domestic policy measures
were recently reviewed by the Tokyo Foundation’s project on Agricultural Policy
in a Globalizing World in order to shed light on what to prioritize—and what to
avoid—in the TPP talks today. The findings have been shared broadly with members of the media and individuals involved in agricultural policy, including a number of key policymakers in government and the ruling coalition. What are the mostimportant lessons of the Uruguay Round? And what are the issues that need to beborne in mind as the government formulates its farm policies going forward?
These discussions have revealed that Japan is at a turning point, ready to movebeyond the stopgap and symptomatic response that has marked the government’s
approach to agricultural policy to date. Some people may contend that this is a caseof “too little, too late” and that there is a real danger that the lingering stopgap
mentality in the agricultural lobby could become a potential barrier to further
change.
In this paper, I will examine the ways in which Japan’s agricultural policy ismoving away from the stopgap approach of the past and discuss the steps necessary to solidify such changes. I will also suggest a number of domestic reforms thatare needed in parallel with the TPP negotiations.
One clear sign of change in Japan’s approach to international negotiations is
the government’s perception of “sacred” agricultural products that were hitherto
28

Trans-Pacific Partnership
regarded as off-limits to concessions. Media reports have given the impression thatthe government is firmly committed to protecting the five priority items outlined in
the Liberal Democratic Party’s manifesto. However, comments by officials involved
in shaping farm policy suggest that the government attitude may be slightly more
flexible.
For example, Koya Nishikawa, chairman of the LDP’s committee on the TPP,
has said, “We’re prepared to consider whether tariffs on (some of) the five items
can be abolished.”1 He has commented, “My personal position (on the tariff lines)
is that we should keep them. But the TPP talks are premised on all items being on
the negotiating table, and I’m sure the Ministry of Agriculture, Forestry, and Fisheries is aware of that.”2
Akira Amari, the minister of economy, trade, and industry in charge of thenegotiations, has noted, “There’s no point in negotiating if you’re going to categorically refuse to budge on any point.”3 Other members of the LDP and government
have frequently referred to the need for “careful examination of the contents” ofany agreement and a position that is responsive to the “course of negotiations.”
Some of the remarks may have been taken out of context, but viewed together they
offer a somewhat different picture from media portrayals, both domestic andabroad, of an intransigent Japanese negotiating posture.
There have also been reports that Japan had submitted a draft proposal tolower its tariff rates on some the five “sacred” priorities during the February Singapore meeting.
The government position, therefore, appears quite different from the mindless
inflexibility seen during the Uruguay Round, when Japan sought to block rice tariffication at all costs. This may partly be due to the strong political support enjoyedby Shinzo Abe today, compared to the instability of the coalition led by Morihiro
Hosokawa during the Uruguay Round. One adept move in recent months has been
to assign the task of dealing with agricultural cooperatives and local farming communities to Koya Nishikawa and other politicians with strong ties to the farm
lobby. This represents a radical change from the days when such politicians would
vociferously oppose any trade concessions.
Also heartening were officials’ comments made to Tokyo Foundation research
fellows that any budget allocations for domestic measures taken in the wake of anComments made to the press during a visit to Indonesia on October 6, 2013.
From a speech made at the Japan Agricultural Journalists’ Association, December 20,
2013.
3
Press conference, February 18, 2014.
1
2

29

Trans-Pacific Partnershipagreement would focus on items directly linked to agricultural production, rather
than on the kind of vaguely defined programs adopted following the Uruguay
Round. And rather than narrowly dwell on the total value of such allocations, efforts would be made to adopt measures that actually boost the incomes of farming
households.

© katorisi

Who Benefits?
Looking at recent developments in agricultural policy as a whole, the LDP–New
Komeito coalition launched agricultural reforms last year, and implementation will
begin in earnest later this year. In concrete terms, the new policies will include thegradual abolition of the so-called gentan policy of rice paddy reduction, whereby
the government has paid subsidies tofarmers to reduce their acreage underrice cultivation. Another step involves
establishing “farmland intermediarymanagement institutions” to encourage the consolidation of farmland.
Both of these measures are aimed atmaking growing rice more cost-effective and represent proactive initiatives
ahead of a TPP accord—unlike theA farmer plants rice using a rice-planting-machine infoot-dragging on domestic reforms
the city of Katori, Chiba Prefecture.
seen during the Uruguay Round.
One cannot overlook the fact, though, that the change in posture may also be
a reflection of the dangerous decline in Japan’s agriculture and the urgent need forreform. The average age of Japanese farmers is over 65, and the total area of abandoned farmland has reached 396,000 hectares—equivalent to the whole of Shiga
Prefecture. Some statistics show that more than half of rice-farming villages4 now
have no farmers to till the paddies. There is no denying that Japanese agriculture
is facing a serious crisis.
What are the key issues that must be addressed, given the situation Japan finds
itself in today? Farmers say they have been at the mercy of a fickle agricultural
policy and are anxious about future directions. There have been radical shifts inthe chief targets of the policy, especially in the light of the change in government inrecent years, presenting substantial risks for farm operators.
4

Villages in which 70% or more of cultivated land is devoted to growing rice.

30

Trans-Pacific Partnership
For many years, a succession of LDP-led governments relied on public works
spending to advance agricultural policy and address rural development. This approach enabled them to build up political support in rural communities, and LDP
politicians from such constituencies often became the spokespersons for the farm
lobby, particularly the agricultural cooperatives. The chief instruments of public
policy at the time were public works projects and other supply-side measures, andthey were used in advancing agriculture policy as well.
Following the Democratic Party of Japan’s electoral victory in 2009, the new
government made substantial cuts in public works spending while introducing an“individual farming household income support” system to provide farmers withdirect subsidies, according to the area of cultivated land. This was part of the DPJ’s
election pledge, which also included measures to enable farmers—even those withsmall plots—to continue tilling the land by encouraging their expansion into thefood processing and marketing sectors. The party placed “all farmers, including
smallholders” at the center of its agricultural policy. Once debate began on Japan’s
participation in the TPP negotiations, though, the DPJ government made a 180-degree turn and began emphasizing the need for enhanced competitiveness, the roleof ninaite (bearers), and “policy concentration.”
The word ninaite has a very specific meaning in the context of agricultural
policy. It does not refer to all farmers but only those currently operating “effective
and stable farm management,” as described in the 1999 Basic Law on Food, Agriculture, and Rural Areas, and others who might be expected to achieve such standards in the future. “Efficient and stable farm management” means farming on alevel capable of bringing in a lifetime income comparable to that obtainable inother industries by working a similar number of hours.
Since 2007, the LDP has introduced a numbers of measures to support a stable
income for managers engaged in the cultivation of rice and other agricultural products. The aim of these measures was to allow such managers to obtain incomeroughly comparable to what they might expect to earn in other industries andthereby give agriculture a stable and sustainable future. The measures outlined anumber of conditions regarding the size of the farming business in an attempt tobolster land-extensive farming. The change of government in 2009, though,prompted a dramatic change in the kind of farmers targeted for development andsupport.
After returning to power in December 2012, the LDP maintained the “individual farm household income support” system for a year before announcing plans to
cut subsidies in half in 2014 and to phase them out by 2018. Inasmuch as subsidies
were provided only to those households that adhered to the government’s gentan
31Trans-Pacific Partnershippolicy, their abolition would eliminate a major incentive to reduce the acreage
under rice cultivation. The administration is also setting up intermediary institutions in each prefecture to encourage the consolidation of farmland into the handsof the ninaite.
The bulk of assistance provided under Japan’s farm policy is expected to continue going to the ninaite. But exactly how the policy will evolve in the years ahead
is still far from certain. Many claim they see little clear sense of direction, which isperhaps unavoidable given the inconsistent policies of the past. The decisions regarding who will be the main recipients of farm assistance are also likely to provequite painful, not only for the farmers themselves but also for the agricultural cooperatives and the politicians who rely on the support of the farming community.
But given the nation’s increasingly precarious fiscal situation, pork barrel largesse is no longer an option. There is a need for thorough debate on such key
questions as who should receive the subsidies that are financed by taxpayers and,ultimately, who should bear the burden of ensuring a stable supply of food andprotecting the environment. The public must also be better informed of the reasonsfor the decisions reached. Without fuller accountability, policies capable of reinvigorating Japanese agriculture will remain elusive.
Now or Never
A review of the Basic Plan for Food, Agriculture, and Rural Areas has begun andis expected to be completed by March next year. The plan sets the priorities forgovernment strategy over the next 10 years or so, and here, too, there is likely to
be considerable debate on who the principal “bearers” should be. Partly due toexternal factors like the negotiations for the TPP and other “mega” free trade
agreements, Japanese agriculture either needs to remake itself with bold reforms orface being driven over a cliff.
There are definite signs of change in agricultural policy, but this may not beenough. It is the job of politicians to balance competing interests and take responsibility for their decisions. But the crisis facing agriculture will not go away simply
by blaming the politicians. The LDP is not the same party it was when it dominatedJapanese politics, having experienced an election loss in 2009 and owing to ongoing generational change. Even members of the party’s agricultural zoku (tribe) areshowing interest in remaining accountable to all taxpayers—not just in lobbying
for the farming sector.
Inasmuch as it is public opinion and the voice of constituents that move politicians to action, though, they will feel compelled to safeguard the five “sacred”
32Trans-Pacific Partnershipareas if that is what is demanded of them, as was the case in the Uruguay Round.
Similarly, if attention becomes narrowly focused on the total value of the compensation package for farmers, the discussion on domestic countermeasures will again
deteriorate into a squabble for budgetary resources. In this sense, the media andthe agricultural cooperatives have a vital role in shaping the politicians’ course ofaction.
Japan needs to take advantage of the TPP process to clearly identify the bearersof agricultural policy and to seek the desired transformation of the sector. Whether
Japan can secure real gains this time around depends on the choices made by all
those involved. This may be Japan’s last chance to change its agricultural policy.

33

Trans-Pacific Partnership
April 24, 2014

Keeping the TPP On Course
Takaaki Asano

Negotiations for the Trans-Pacific Partnership have lost momentum and are in danger ofstalling completely. Although Japan’s tough stance on rice tariffs has been under scrutiny,
the biggest obstacle to this Washington-led initiative may be the political climate within the
United States, as the Tokyo Foundation’s Takaaki Asano explains in this Nikkei Business Online interview.
***

Prospects for the TPP [Trans-Pacific Partnership] are beginning to look uncertain.
TAKAAKI ASANO Before the February 25 TPP ministerial meeting, Akira Amari,state minister for economic and fiscal policy, warned that without a breakthroughof some sort, the negotiations could come to a standstill. The February meeting
didn’t yield a breakthrough, so people are wondering if the TPP process can getback on course.

The main obstacle seems to be tariff disagreements between Tokyo and Washington.
ASANO You’ve heard it said that the TPP is at heart a Japan-US free trade agree-

ment. And I agree. That’s why the media has played up tariff talks between Tokyoand the Washington. Now they’re saying that the negotiations have gone badly.
But the real focus of the TPP isn’t tariffs. The problem is that, before an agreement can be concluded and ratified, each of the negotiating parties has to securepolitical support for it back home. And from this standpoint, agricultural tariffs
have emerged as one of the bones of contention in Japan-US negotiations. In Japan,
this is inevitably the center of attention, so everyone has been asking whether Japan

Takaaki Asano   Research Fellow and Project Manager, Tokyo Foundation.
34

Trans-Pacific Partnershipwill successfully defend its five “sacred” farm products [rice, barley and wheat,sugar crops, dairy products, and beef and pork] from foreign imports. But defending these five priority farm products should not be the goal of our participation in
the TPP.
The Real Roadblock
What’s the new target date for an agreement?
ASANO From here on in, the US political calendar is going to be a major factor.

The TPP is largely Washington’s initiative, but midterm elections are coming up in
November, and an election year is not the best time to seek congressional approval
for major free trade initiatives.
Initially, the participating countries had agreed to try to reach an agreement by
the end of 2013. In the media, the standard explanation for this was that the WhiteHouse, under President Barack Obama, felt that a successful conclusion to thenegotiations would help the Democratic Party in the midterm elections. But it’s
debatable whether concluding an FTA would score political points for the Democrats, given that key elements of the party’s traditional base, such as organized labor, are highly skeptical of such pacts.
Are you saying the TPP could backfire on the Obama administration?
ASANO It raises challenges for environmental protection and for labor, and these

are areas the Democratic Party has championed over the years. If the administration backpedals on those issues, it could alienate the Democratic base and get the
party into political trouble. That’s why I think it’s simplistic to interpret Obama’s
push for the TPP as part of an election strategy.
This political dynamic is playing out in the president’s bid for Fast Track negotiating authority [trade promotion authority]. Fast Track authority expired in
2007, and it was only in January this year that a bill to renew it finally came before
Congress.1 Whether or not the bill passes could have a huge impact on the negotiations.

The Bipartisan Congressional Trade Priorities Act of 2014, introduced by Democratic
Senator Max Baucus and GOP Representative Dave Camp. Commonly referred to as theCamp-Baucus bill.

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Trans-Pacific Partnership
How would the Fast Track bill strengthen the president’s hand?
ASANO Assuming the parties to the TPP reach and sign an agreement, the pact still

has to be approved by Congress. Unless the president has Fast Track authority,
Congress has the right to deliberate individual provisions and even force the president to renegotiate them, so the process could drag on and on. Under Fast Track,
Congress is only permitted to approve or reject the entire pact as negotiated under
the president’s authority.
So, even if all the TPP countries were to reach an agreement, it could still fail topass Congress.
ASANO Yes, and in that case, you would have an agreement signed by all 12 coun-tries but impossible to implement because of political opposition in the
United States. This would undermineinternational confidence in Washington’s ability to negotiate agreements
in general. To avert such a scenario,
the White House needs to acquire Fast
Track authority before any agreement
comes before Congress.
You say the bill was introduced in January. How long will it take to pass andcome into effect?

Domestic opposition could trip up TPP’s fate, even if
agreement is reached among negotiators.

ASANO Actually, I don’t think it’s going to pass.

No?
ASANO As things stand now, at any rate, the chances of its passing before the No-

vember midterm elections are very slim.
Why is that?
ASANO Because it faces opposition not only from Republicans but also from a lotof Democrats.
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Trans-Pacific Partnership
Because they want to be able to modify the agreement themselves?
ASANO First of all, they have the interests of their constituencies to consider. But

there are other grounds for opposition as well. Some take a kind of fundamentalist
position with regard to the powers of Congress, saying that Congress has the authority to regulate commerce, and it shouldn’t just hand that over to the executive
branch. Others are willing to hand over authority, provided the bill offers Congress
sufficient assurances in return.
What sort of assurances do they want?
ASANO The Camp-Baucus bill establishes negotiating objectives and requirements

for congressional consultations with the aim of defining the basic direction of future trade agreements and ensuring that Congress has sufficient input. Some members of Congress want stronger language with regard to the negotiating objectives.
Politicians with ties to the auto industry are particularly insistent about the needfor tough provisions on currency manipulation in the TPP because they claim thatJapan and South Korea have manipulated exchange rates to boost exports to theUnited States. The Camp-Baucus bill contains a directive regarding currency manipulation, but some members of Congress have voiced their opposition on the
grounds that the language is too weak.
So, if the Fast Track bill doesn’t pass, how does that affect the prospects for reaching a TPP agreement within the year?
ASANO Unless the president can secure Fast Track authority, any TPP-related leg-islation that comes up for deliberation in Congress is going to run into trouble. It’sgoing to be much harder to get those bills through Congress, and other countries
are going to start to question how serious America is about the whole undertaking.
Meanwhile, it’s 2014, and the midterm elections are looming.
ASANO Well, they’re about six months off now, so there’s still some time. But bySeptember, the election season will be in full swing, and the climate is not going to
be conducive to cool-headed debate on free trade agreements. In any case, it seems
clear that Obama’s dwindling political capital at home is having an impact on
Washington’s dealings abroad, including the TPP negotiations.

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Trans-Pacific Partnership
On the Cusp of a New Trade Era
So, it sounds unlikely that we’ll be seeing a TPP agreement emerge anytime soon.
ASANO There’s still a chance. I think it might still be possible to take advantage of

Obama’s visit to Japan in April and the meeting of APEC [Asia Pacific Trade Cooperation] trade ministers in May to bring the negotiations to a successful conclusion.
There’s been some talk about South Korea joining the talks, and it’s been suggested
that that could cause further delays. What’s your take on that?
ASANO Well, I do think that an agreement would take longer if South Korea de-cided to enter the negotiations. But whether it can enter the talks at this point is adifferent question. All the current participants have to consent before a new party
can join in international negotiations of this sort. Japan was a latecomer to thetalks, and it had to secure the approval of all the other eleven countries before it
could finally take a seat at the table in July last year. South Korea can’t just raise
its hand and say, “Me too.” It will have to pass inspection by the current participants.
On the other hand, South Korea already has a bilateral free trade agreementwith the United States, so if it did join the TPP negotiations, at least it wouldn’t
need to spend a lot of time in tough tariff negotiations with the United States.
But Washington is dissatisfied with the way the US-Korea Free Trade Agreement has been implemented in South Korea since it came into effect two years ago.
So, there’s a risk that the United States will drag its feet about letting Seoul join the
TPP negotiations.
In the midst of all these delays, mightn’t China decide to throw its hat into the ringas well?
ASANO It’s true that China is eyeing the TPP with greater interest. But Chinese

membership isn’t realistic at this point. In the near term, there’s no way China
could sign on to the kind of high-level agreement envisioned by the current participants.
What are the obstacles?

38Trans-Pacific Partnership
ASANO Well, I don’t think China could go along with the TPP’s goals for invest-

ment liberalization, open and fair competition, or limitations on state-owned enterprises, not to mention the elimination or reduction of tariffs.
But wouldn’t you agree that the TPP comprises a lot of policy reforms that China
is going to need to implement anyway in the not-so-distant future?
ASANO That depends on the direction in which Beijing decides to steer the econ-omy. If it decides to boost economic growth through liberalization, then in the final
analysis, it will probably need to implement the measures currently incorporated
in the TPP in one form or another. Most experts believe that China reaped big
dividends from its acceptance into the World Trade Organization in 2001.
But the TPP is on a different plane?
ASANO Yes, and I think the Chinese realize it. That’s why they’ve been backing the

RCEP [Regional Comprehensive Economic Partnership].
The TPP and the RCEP are both so-called mega-FTAs, agreements that are
expected to boost economic dynamism through the integration of two or moreexisting trade areas. Other mega-FTAs under discussion include a US-EU agreement and a Japan-EU pact. On the basis of this trend, I think it’s fair to say that
global trade is about to enter a whole new era.
What’s behind this shift?
ASANO The simplest explanation is that with WTO negotiations at an impasse,

countries have opted for bilateral and regional FTAs as the next-best thing. The
Doha Round began in 2001, and there’s still no agreement or breakthrough insight. Most commentators say that bilateral or regional FTAs are on the rise because it’s become so difficult to reach one global agreement encompassing all the
WTO member states.
So, instead of negotiating one big agreement, they’re trying to conclude a lot ofsmaller ones and weave them together.
Domestic Politics and International Trade
ASANO During international trade negotiations, each government has to either
39

Trans-Pacific Partnershipaccommodate or override demands from various economic sectors, and when that
happens, national politics inevitably comes into play. Along with an open and honest national conversation about the economic benefits and costs of any given free
trade agreement, we need more coverage of the political dynamics behind international trade negotiations.
You mean the wheeling and dealing behind the scenes?
ASANO I’m not talking about exposing backroom dealings so much as focusing

more on the political and economic realities that shape each government’s negotiating position.
For example, how does domestic politics affect negotiations regarding specificsectors that various countries have traditionally regarded as off-limits where free
trade is concerned? You hear a lot about Japanese protection of agricultural products, particularly rice. But Canada is equally adamant about maintaining its poultry supply management system, and America’s refusal to open its sugar market is amajor source of frustration to Australia.
Where sugar is concerned, there’s no strong consensus among Americans forprotecting domestic sugar producers, so you would think it would be possible tooverturn the status quo through strong political leadership. But the Obama administration doesn’t have much political leverage at this point. If the Americans seeminflexible on sugar at the bargaining table, it might reflect the White House’s lackof political capital at home.
By contrast, it seems to me that the Abe administration is in relatively good
position to persuade or override the farm lobby and its allies.
But regardless of Tokyo’s actual negotiating position, the stereotype of theJapanese as diehard protectionists is so firmly entrenched that we could end up
getting blamed anyway if the TPP talks fail.
You think Japan might be made the scapegoat if the negotiations break down?
ASANO Between these preconceptions and the impulse to lay the blame elsewhere,

I do worry that people will blame any breakdown on Japan’s intransigence. The
best defense against that is an active public diplomacy campaign, both before andafter the fact.
Momentum and the Search for Common Ground40

Trans-Pacific Partnership
ASANO The TPP is more than a commitment among a group of countries to reduceor lower tariffs. It also has great potential as a new framework for economic dialogue, and our first goal should be to launch that framework and make the mostof it. Granted, APEC already exists is a regional economic forum, but I think East
Asia and the Asia-Pacific could benefit from having other frameworks forwide-ranging exchange of opinion on the economic order. In this sense, the TPP
negotiations represent a historic opportunity, one that we should capitalize on.
All the more reason to avoid a deadlock.
ASANO When countries are at loggerheads and negotiations enter a holding pat-tern, there’s always a danger that the talks will lose momentum and fizzle out
completely. This is what Japanese commentators mean when they speculate on the
Doha-ka [“Doha-ization”] of the TPP talks.
Well, then, let me rephrase the question I asked before. Do you think it’s possible
for an agreement to be reached during the first half of 2014?
ASANO Leaving aside bilateral tariff negotiations, the positions of the participating

countries seem to be converging on most of the major issues. So, I do think it’s
possible. But it’s not going to happen either through unilateral concessions fromJapan or through unilateral concessions by America and the other participants.
Which means that an agreement has to be reached before the end of summer, when
America’s midterm election season begins.
ASANO I think it’s important to set a target date, partly in consideration of US

politics and partly in order to maintain some momentum, which is always essential
to the success of negotiations. On the other hand, since any agreement has to be
ratified at the domestic level, it’s also important to maintain close dialogue between
the administration and the legislature during the negotiations. If the negotiating
parties get carried away by momentum and neglect that angle, any agreement theycome up with is likely to be meaningless.
It sounds awfully tricky finding common ground among all those interests.
ASANO The Tokyo Foundation project on Agricultural Policy in a Globalizing

World analyzed the agricultural trade negotiations of the Uruguay Round of the41Trans-Pacific Partnership
GATT [General Agreement on Tariffs and Trade, the WTO’s predecessor] and themeasures implemented in conjunction with that agreement, reached in 1993. Oneof the conclusions was that Tokyo slipped in the negotiations because it was overly
influenced by domestic opposition to the tariffication of rice. In a last-minute deal
with Washington, it agreed to accept “minimum access” rice imports as an alternative. But paradoxically, the impact on the domestic market was greater than it
would have been had it accepted tariffication. I hope that Japan puts that lesson togood use this time around.
From what I can gather, our top agriculture officials today have learned thislesson, so it could be that Japanese farm policy is approaching a turning point. If
the Japanese government could successfully convey this new domestic dynamic to
the international community without compromising its bargaining position, it
would be a big step toward enhancing Japan’s image and reducing the risk of apublic-relations defeat.

The article was translated by the Tokyo Foundation with permission from Nikkei
Business Online.

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April 1, 2014

Lessons from Britain’s General Practitioner
SystemTakashi Mihara

Japan’s free-access, fee-for-service health insurance system is proving unsustainable, as growing numbers of aging patients flock to full-service hospitals for expensive tests and treatment. Takashi Mihara looks to Britain’s National Health Service for keys to containing
costs while maintaining quality of care and consumer choice.
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I

n October 2012, the Tokyo Foundation’s project on Crafting the Medical,
Nursing-Care, and Social Security Systems of the Future issued a policy proposal on Promoting Community-Based Primary Care calling for sweeping reforms of Japan’s medical and nursing-care systems. Since then, the Foundation has
continued to sponsor forums and seminars and solicit the opinions of experts andstakeholders with a view to deepening understanding and spreading awareness ofhealthcare issues.
On November 18, 2013, the project team hosted a seminar on the primary caresystem in Britain with special guest Noriaki Sawa, who practices family medicine
in Britain. The seminar also featured a report on my own tour of British generalpractices and nursing facilities the previous month, questions and answers, anddiscussion.
Of course, a week of study and observation followed by a two-hour seminar
do not constitute an exhaustive study, but they did yield some preliminary observations pertinent to healthcare reform in Japan. Those observations are the subjectof this article.
Free Access versus Gatekeeping

Takashi Mihara   Research Fellow and Project Manager, Tokyo Foundation.
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Britain’s taxpayer-funded National Health Service provides all legal residents withhealthcare free at the point of service. (In Japan, healthcare is administered undera system of universal health insurance, funded by premiums rather than taxes.)
Under the NHS, community-based family physicians known as general practitioners, or GPs, are responsible for primary care.
Even during my limited tour of British healthcare facilities I became acutely
aware of the central role of these GPs, who, in addition to their other duties, pay
regular visits to nursing homes for onsite examinations and assist in the implementation of Britain’s national dementia strategy. All British citizens are
required to register with a local GP
surgery, or practice, and the process of
consultation, diagnosis, and treatment
begins, as a rule, with an appointment
at that surgery.
In Japan, by contrast, where careis usually offered by specialists, con- The surgery where Dr. Sawa has his practice.
sumers have open access to the entire
spectrum of licensed healthcare providers and facilities—from neighborhood offices and clinics to university hospitals. Because Japanese health insurance pays forwalk-in consultations, tests, and examinations at any facility the patient chooses,
at any time during regular hours, healthcare consumers rely increasingly on big
hospitals even for routine examinations and minor problems, making unfettereduse of costly specialist services.
Recently, however, the Japanese government has begun laying the groundworkfor reform. The August 2013 report of the National Council on Social Security
System Reform stressed the need for the kind of holistic approach to medical careembodied in general practice. Work has begun on a new professional training andcertification program for “general physicians” (sogo shinryo i), scheduled to go into
effect in 2017.1
In this connection, the Tokyo Foundation’s October 2012 policy proposal
stressed the need for community-based professionals who can fill the role of patientadvocate and recommended that Japan learn what it can from Britain’s solidly
The Japanese sogo shinryo i does not correspond exactly to the British general practitioner, as the former encompasses hospitalists specializing in general internal medicine aswell as community-based primary care providers.

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established system of community-based primary care centered on general practitioners.
With this purpose in mind, let us begin by examining the function of GPs in the
British healthcare system.
Promoting Doctor-Patient Dialogue
What struck me most during my tour of British healthcare facilities were the GPs’
examination rooms. The average GP appointment is 10 minutes long, and during
this time the emphasis is on two-way communication with the patient. This focus
on dialogue is reflected in examination rooms that resemble counseling offices intheir relaxed, comfortable atmosphereand lack of bulky medical equipment,such as CT scanners, which often clutters clinics in Japan.
How, then, do these examinations
proceed? At the November seminar,
Dr. Sawa illustrated the British GP’s
approach using the example of a patient who comes in complaining of asevere headache and insists on a CT
scan, even though it seems clear to the Not being cluttered with medical equipment, Dr. Sawa’s
examination room resembles a counseling office.
doctor that the cause is a common
cold.
In Japan, most doctors would either dismiss the request peremptorily or yield
to the patient’s demands. British GPs, however, are trained to engage the patient in
dialogue. Upon asking why the patient feels a CT scan is necessary, the GP may
discover that the patient’s father died prematurely from a cerebral hemorrhage.
Then the doctor can reassure and persuade the patient using evidence-based arguments, explaining that the most likely cause is a cold, that the probability of findinga cerebral hemorrhage with a CT scan is close to nil, and that such scans expose
the body to levels of radiation more than 100 times that of a chest X-ray. The final
decision is left to the patient.
Speaking at a Tokyo Foundation forum held the previous May, Sawa explainedthat the role of the British GP often transcends the conventional boundaries of
medical care. “Often, when an examination fails to reveal any medical condition,
the symptoms can be traced to daily stress and lifestyle issues. During consultation,
the patient may refer to family problems—complaining, for example, that her hus45

Social Security
band doesn’t help out with the housework or childcare. In such cases, the GP canrefer the patient to a family counselor, encourage the person to take time off fromwork, or help the person secure assistance through social services.”
By building long-term relationships with patients and fostering an atmosphereof honest dialogue, GPs encourage their patients to open up about any number ofconcerns that may be affecting their quality of life or that of their family, from ahusband’s fierce temper to a child’s junk-food addiction. This puts them in a position to suggest solutions that most Japanese physicians would consider beyond
their purview, including strategies for minimizing the workplace stress that may becausing a patient’s headaches or addressing the family issues underlying a patient’s
emotional problems.
At the November seminar, Sawa discussed his own initial difficulty adjusting
to the British approach, coming from a country where hospital-based care has
become the norm. “When I began my postgraduate training, I had a tendency toadopt a hospitalist’s approach when examining patients,” he said. “For example, if
a patient was suffering from a little vertigo, even if there were no other major
symptoms, I was inclined to make a tentative diagnosis and order a battery of tests.
But my supervising doctor let me know that that sort of approach wasn’t considered appropriate for primary care—that British generalists had their own special
way of handling things.”
As we in Japan begin deliberating standards for the training and licensing ofgeneral physicians, we need to think about ways of nurturing primary-care physicians as holistic practitioners focused on dialogue-based problem solving, insteadof devoting all our energy to delimiting their professional turf or defining the necessary diagnostic skills.
Respecting Patient Choice
Another important aspect of the British primary care system today is its policy oftreating healthcare as a doctor-patient partnership, offering patients a set of options and empowering them to make evidence-based choices, instead of placing all
power in the hands of the doctor. The aim is both to raise patients’ awareness andto get them to share responsibility for their own care. Community-based primarycare should be predicated on patient choice, not unilateral decisions by the primarycare physician.
To be sure, few healthcare consumers can fully grasp the complexities of today’s advanced medical science. To borrow the terminology of economics, a certain
degree of “information asymmetry” will always persist. But Britain’s healthcare
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Social Security
system has a variety of mechanisms designed to support informed consumer
choice—one way in which the system selectively incorporates market principles tocreate a healthcare “quasi-market.” Let us examine these mechanisms.
Where previously each household was assigned to a GP surgery according tolocation, British healthcare consumers today have a right to choose from any qualified general practice in their district. The GP
Patient Survey website permits them to search
practices by name and location to see how existing and previous patients have rated theirexperience via the GP Patient Survey, conducted annually. Survey questions include thefollowing.
Did you have confidence and trust in the
GP you saw or spoke to?
Is your GP surgery currently open at times
that are convenient for you?
Last time you saw or spoke to a GP fromyour GP surgery, how good was that GP at thefollowing? a. Involving you in decisions about
your care; b. . . .
Would you recommend your GP surgery Sawa, left, and Mary Brown, right, a practicenurse. GP nurses in Britain have considerable
to someone who has just moved to your local latitude to act on their own authority.
area?
In addition, users can access a variety ofdata about providers on the NHS Choices website (http://www.nhs.uk/Pages/
HomePage.aspx) by doing a search on the name or location of the practice. A
search on the name of Dr. Sawa’s surgery yielded such basic data as the address andtelephone number, hours, and disabled access, along with the names of the five GPs
who practice there. The website also provided such helpful information as thenumber of female physicians, languages spoken other than English, and patient
survey results and scores.
According to Sawa, the principle of patient choice also extends to secondarycare. Patients who are referred for hospital treatment by their GP can choose anarea hospital with the help of a five-star rating system. Speaking at the November
seminar, Sawa explained, “There are three hospitals near my surgery, and any patient I refer is given a password that permits him or her to make an appointment
online. The website provides information about each of the three hospitals, including the waiting times, so that patients can choose the one that’s best for them.”
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Of course, Japan’s free-access system offers greater freedom of choice, but itlacks a built-in mechanism for rating and comparing facilities with respect to patient and family satisfaction. Instead, consumers rely on word-of-mouth or magazine rankings (as well as general geographical considerations) when selecting afacility, and as a consequence they inevitably gravitate to the large regional or national hospitals.2
The August 2013 report by the government’s National Council on Social Security System Reform expresses concern that the current healthcare system will “cease
to function if patients continue to gravitate toward large, elaborately equipped
hospitals.” It recommends measures to encourage hospital specialization and topromote “flexible gatekeeping” by primary care physicians with whom patients
have established an ongoing relationship. It also suggests increasing the fee for an
initial consultation at a large hospital unless the patient has a written referral fromsuch a primary care physician.
It seems to me, however, that the preference for large hospitals is unlikely tochange until the public gains greater confidence in local primary care doctors andfacilities. For this to happen, Japan needs to implement systemic reforms to facilitate informed patient choice, including fuller disclosure of information and a moreuser-friendly and detailed quality rating system.
Incentivizing Cost-Effective Quality Care
Another systemic reform that could expand the role of GPs in Japan is a capitation
payment system similar to that used in Britain. Roughly 70% of the NHS’s fundingof general practices is in the form of capitation payments tied to the number ofcommunity residents registered at each surgery. This method guarantees a basic
income for GPs and—unlike Japan’s fee-for-service reimbursement system—eliminates financial incentives to over-treat and over-test in order to recover personnel
and equipment costs.
The risk with capitation is that it could encourage providers to skimp on
needed services, since a practice receives the same amount per patient regardless of
the level of care it provides. To prevent this from happening and ensure high-qualThe Japan Council for Quality Health Care does carry out evaluation and accreditationof hospitals, but the council’s focus is on improvement of hospital management, not patient
choice. With regard to nursing-care facilities, the Ministry of Health, Labor, and Welfare
administers a Nursing Service Public Information System that provides basic information
for services qualifying for reimbursement under Japan Long-term Care Insurance System,
along with the results of third-party evaluations.

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Social Security
ity care, NHS payments also have a performance-based component (roughly 30%of the total) calculated according to various quality-care indicators set forth in the
Quality and Outcome Framework (QOF).
The QOF system hinges on the widespread use of a standardized electronic
medical record system. In Britain, GPs keep digital charts that include each patient’s complete medical history, records of previous examinations, and dates of
future appointments. If the patient undergoes hospital testing or treatment, theresults are relayed to the GP electronically when the patient checks out, ensuring
seamless follow-up care.
These same electronic records are used to assess the health status of a practice’s
patients and assess treatment quality and preventive care using the QOF indicators.
Practices that record improvements in those indicators are rewarded with higher
payments.
At the November seminar, Dr. Sawa explained how electronic records are used
to manage and monitor preventive care. Patients with high blood pressure, forexample, are tagged with a standard code. With the help this code, one can quickly
determine the number of patients in a given practice that have high blood pressure
and track their readings without compromising patient privacy. A rise in the percentage of those patients in whom the last recorded blood pressure was 150/90 or
lower will result in an increase in the QOF payment the practice receives from the
NHS.
“The latest evidence shows that influenza immunization offers very few benefits for healthy, young people like me,” Sawa elaborated, “but considerable benefits
for people 65 or older and for people with asthma and other chronic conditions.”
Electronic records allow the surgery to identify its high-risk patients and notify
them by mail when it is time to come in for a flu shot. The percentage of high-riskpatients who receive shots affects the practice’s QOF payment. In addition, prospective patients can go online to check the performance of a given GP surgery on
various QOF indicators and use that information when choosing a primary careprovider.
Standardizing Quality of Care
The QOF indicators are based largely on recommendations from NICE (the National Institute for Health and Care Excellence), an independent public agency
involved in the development of evidence-based clinical standards. NICE also provides professional healthcare providers with guidance on the most cost-effective
treatment for various conditions, in some cases advising against the use of a par49

Social Security
ticular drug or procedure. Meanwhile, the Care Quality Commission (CQC) monitors hospitals, nursing homes, and other healthcare facilities to ensure that theymeet national standards.
Together, these frameworks are contributing to the standardization of healthcare quality throughout Britain, ensuring that people all over the country haveaccess to the same high-quality care. As Sawa noted in his seminar remarks, GPs
are acutely aware that their performance is being monitored and evaluated, whether
by NICE, the CQC, or the GP Patient Survey. In addition, the GPs at his surgery
are continually discussing and reviewing their outcomes with the aid of electronic
records.
Here in Japan, where the topic of healthcare reform tends to focus almost exclusively on cost issues, policymakers should pay heed to the way Britain has balanced measures designed to control costs with systems aimed at enhancing patientsatisfaction and medical outcomes through quality assurance and standardizationof care.
Delegating Care to Qualified Nurses
Finally, the British system depends heavily on
the contribution of general practice nurses,
who form an integral part of the primary
healthcare team at each GP surgery. The practice nurses at Sawa’s surgery have their own
examining rooms, complete with examinationtables and an entire array of examining equipment. Indeed, the nurses’ rooms conform moreclosely to the Japanese image of a doctor’s office than the GPs’ rooms.
According to Dr. Sawa, practice nurses arehighly experienced healthcare professionals
who are qualified to diagnose and treat small
injuries and minor illnesses, undertake simple
medical procedures like wart removal, advise The nurse’s room looks more like a typicalJapanese examination room.
patients on the management of chronic conditions, and dispense medication. Registerednurses must undergo six months of additional training to qualify as practice nurses
at Sawa’s surgery. When patients make appointments, they are routinely asked
whether they want to see a GP or a practice nurse, and the majority end up request50

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ing a nurse. The results of any examination by a GP nurse are recorded in theelectronic medical record to ensure continuity of care.
In the Netherlands, another country that has built a sustainable healthcare
system based on community-based primary care, visiting nurses play a pivotal rolein healthcare delivery. Data from both countries support the notion that delegating
authority to qualified nurses can lighten doctors’ workload, improve the efficiencyof healthcare delivery, and lead to higher patient satisfaction.
In Japan, however, even the most highly trained nurses have very little latitude
to act on their own authority. Reforms currently in the works will allow registerednurses to provide dietary and other lifestyle guidance to diabetic patients on thebasis of a physician’s written instructions and permit those who have passed a
special nationally accredited training course to carry out such emergency procedures as tracheal intubation and administration of intravenous fluids on their own
authority. Unfortunately, however, the government has opted against more substantive reform via the institution of a nurse practitioner system.
Among the topics left largely unaddressed during my tour and the subsequent
seminar was the planning and purchasing of NHS services to meet the health needsof the local population, a role that has passed from primary care trusts to clinicalcommissioning groups (previously known as GP consortiums). In addition, further
study will be needed to clarify the role of NICE and CQC in standardization andquality assurance, the calculation of capitation and QOF payments, and othercomponents of Britain’s primary care system. As an independent not-for-profit
think tank, the Tokyo Foundation will continue working to deepen understanding
and raise awareness of the primary care system in Britain and elsewhere in an effort
to contribute to the development of a sustainable community-based healthcare
system in Japan.

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Politics & Government
April 8, 2014

The Komeito’s Curious Journey
Katsuyuki Yakushiji

Established 50 years ago as the political arm of Japan’s largest popular religious movement,
the Komeito owes its longevity to a loyal, well-organized base and the ideological flexibility
needed to maintain advantageous alliances. Katsuyuki Yakushiji traces the Komeito’s journey from a left-leaning, pacifist minority party to a member of a conservative ruling coalition and discusses the dilemma it now faces as a result.
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T

he face of Japanese party politics has changed dramatically over the past
two decades. More than half of the nine political parties currently holding
seats in the House of Representatives were formed within the past 10
years. Moreover, only three of those nine parties have a history spanning 50 years.
They are, in order of age, the Japanese Communist Party, the Liberal Democratic
Party, and the New Komeito, or NKP. All three benefit from organizational strengthand a large nationwide membership. But only the NKP draws its membership andsupport from a specific religious sect.
Since 1999, moreover, this unique party has played a pivotal role in national
politics as the LDP’s faithful ally and junior coalition partner—notwithstanding
significant policy differences between the two parties. Today, as security policy
takes a sharp turn to the right under the leadership of Prime Minister Shinzo Abe,
the NKP finds itself at a major crossroads.
Moving Toward the Center
The NKP’s parent organization and loyal base is the Soka Gakkai, a Nichiren Bud-

Katsuyuki Yakushiji   Senior Associate, Tokyo Foundation; Professor, Toyo University.
Former editor of the Political News Department and editorial writer, Asahi Shimbun, andformer chief editor, Ronza magazine.
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Politics & Government
dhist lay movement that spread rapidly through Japan during the 1950s and 1960s.
Soka Gakkai established a political section in 1960 and in 1964—just 50 years
ago—and converted that unit into a nominally independent political party, theKomeito, or Clean Government Party. In 1967 the Komeito burst onto the national
scene by grabbing 25 House of Representatives seats in its very first general election. (At the time, the lower house had multiseat constituencies, which allowed
smaller parties to secure seats without winning the majority of votes in any district.)
Calling itself “the party of welfare and peace,” the Komeito took its place
alongside the Japan Socialist Party, the Democratic Socialist Party, and others in
the left-leaning anti-LDP opposition. Like the JSP, it opposed the Japan-US Security
Treaty and maintained that the Self-Defense Forces violated Japan’s pacifist Constitution.
However, the Komeito was not a party of rigid ideologues. As it established afirm foothold in national politics, it gradually moved toward a more pragmatic,
centrist stance, and by the early 1980s, it had formally recognized the constitutionality of the SDF and acknowledged the necessity of the Japan-US Security Treaty.
Driving this shift was a cooperative strategy that originated at the local level.
The Komeito had quickly established a major presence in the nation’s prefecturalassemblies, and in many cases these local Komeito politicians were joining forces
with their LDP counterparts in hopes of influencing policies with a direct impact
on people’s lives. This trend gradually filtered up and influenced party strategy at
the national level. The LDP and the Komeito began to find more and more common ground, and their relationship gradually shifted from an adversarial one to amore cooperative one, both in the Diet and during election campaigns.
Cultivating Cross-Party Ties
Within the LDP, the powerful faction led by Kakuei Tanaka led the way in cultivating cooperative relations with the Komeito. In July 1972, shortly after Tanaka
formed his first cabinet, Komeito Secretary General Yoshikatsu Takeiri traveled toChina and conferred at length with Premier Zhou Enlai regarding the prospects fornormalization of relations between Japan and China. Returning to Japan, Takeiri
relayed the content of those talks to Prime Minister Tanaka in detail. Apparently
Takeiri helped convince Tanaka that Beijing was sincere in its desire to establish
diplomatic relations with Tokyo and thereby helped lay the groundwork for Tanaka’s visit to China and the subsequent normalization of ties. From that time on, theKomeito enjoyed a special relationship with Tanaka and his faction—the LDP’s
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Politics & Government
largest—and was thus able to play an insider’s role in government affairs despite
its nominal status as an opposition party.
All that changed in 1993. With public support for the ruling party at a low ebb
in the wake of a series of financial scandals involving top LDP officials, Ichiro
Ozawa, a Tanaka protégé renowned for his fundraising prowess and behind-thescenes maneuvering, bolted the LDP with 50-odd followers following a vote of no
confidence against the cabinet of Prime Minister Kiichi Miyazawa. Ozawa formed
the Japan Renewal Party and succeeded in building a coalition from a fractious
collection of minority parties, headed by Prime Minister Morihiro Hosokawa. A
key member of this coalition was the Komeito.
The coalition collapsed in less than a year, after the JSP defected over security
policy, allowing the LDP to return to power once again. Komeito politicians faced
a choice: ally itself with the LDP or trust Tanaka protégé Ozawa to engineer another coup and shepherd them to a position of power. The issue created a schismin the Komeito, with the party’s lower house politicians opting to merge into the
New Frontier Party, a new group centered on Ozawa. This proved to be a mistake,as the NFP dissolved after just three years. In 1998 the divided Komeito reunited,adding the word “New” to its English name.
It was not long before opportunity knocked again. In the summer of 1998, the
LDP suffered a major setback in the House of Councillors election and lost its
upper house majority. Faced with the prospect of ongoing legislative gridlock, the
LDP leadership set about forging a coalition with the New Komeito. In 1999, as aresult of intensive backroom negotiations, there emerged a three-party coalition
consisting of the LDP, the NKP, and Ozawa’s Liberal Party. The Liberal Party quit
the coalition in 2000, but the LDP-NKP bloc held onto its majority until the Democratic Party of Japan took over in 2009. The LDP and NKP remained partners
while in the opposition and took the helm again as a coalition in 2012.
Anatomy of an Alliance
The partnership between the LDP and the NKP would never have endured these
15 years had it not conferred important benefits on both sides. The biggest attraction from the LDP’s viewpoint was the NKP’s proven ability to mobilize 7-8 million
Soka Gakkai voters (based on the number of votes the NKP receives in the lower
house’s 11 proportional-representation block districts). This consistent level of support is a testimony to the strength of the Soka Gakkai organization. Electoral cooperation with the NKP nets the LDP an average of 20,000–30,000 extra votes ineach of the single-seat constituencies (300 of the lower house’s 480 seats under the54

Politics & Government
current electoral system) where it fields candidates. Without the NKP’s backing, the
LDP could lose close to 100 of its 294 lower house seats.
Electoral cooperation is at least as important to the NKP, which would have nohope of winning in today’s winner-take-all single-seat districts were it obliged togo solo. By coordinating with the LDP, it is able to elect 8–10 candidates in these
local districts, in addition to the 20–25 NKP candidates elected from multiseat
block districts by proportional representation. As a member of the ruling camp,moreover, the NKP gets a limited share of cabinet positions and a seat at the policymaking table. This, in turn, strengthens the party’s position among voters andkeeps the organization strong.
Papering Over Policy Conflicts
The LDP has benefited immeasurably from the NKP’s cooperation in the Diet aswell. In many cases NKP votes have allowed the LDP to steer bills through bothhouses of the Diet even in the face of stiff resistance from the opposition and maintain control over the legislative process.
From an ideological standpoint, this cooperation cannot always have been easy
for the NKP. As noted above, the Komeito originally identified itself as a pacifist,anti-authoritarian “party of the people.” Like the other left-leaning opposition parties of the time, it swore to defend the war-renouncing Constitution, opposed theJapan-US Security Treaty, and regarded the Self-Defense Forces as unconstitutional.
To some degree, this ideological orientation reflected the anti-establishment rootsof the Komeito’s parent organization, the Soka Gakkai, whose founders had beentargets of a harsh government crackdown during World War II.
As a coalition partner, however, the NKP found itself supporting policies thatmany would consider incompatible with these founding principles. Under the cabinet of Keizo Obuchi (1998–2000), the NKP helped ensure passage of a law officially establishing the hinomaru as the national flag and “Kimigayo” as the national anthem (a step previously opposed by the Komeito and others on the grounds
that both the flag and the song had strong militaristic associations), as well as
legislation permitting limited wiretapping by government agencies for the purposeof criminal investigations.
In the wake of the attacks of September 11, 2001, the NKP worked with thecabinet of Jun’ichiro Koizumi to pass legislation allowing the deployment of SDF
units to Iraq and the Indian Ocean to support the US war on terror. Finally, in
2013, it helped the government push through a tough and extremely unpopularstate secrets law (Act on Protection of Specified Secrets). The Komeito of the 1960s
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Politics & Government
and 1970s—with its emphasis on democracy, peace, and human rights—would
never have dreamed of supporting policies so clearly geared to augmenting thepower of the state.
Why has the NKP been willing to subordinate its own policies to its partnership with the LDP? The answer is closely tied to the Komeito’s unique electoral
base. Thanks to the organizational support of the Soka Gakkai, the NKP is virtually guaranteed a certain number of votes in each general election, regardless ofpolitical circumstances. But its close association with the Soka Gakkai also limits
its potential growth. In opinion polls, the NKP consistently ranks alongside the JCP
as Japan’s most “toxic” party—that is, a party for which one would not vote under
any circumstances.
This means that the NKP lacks the capacity to attract new supporters regardless of its policies or its campaigning prowess. Even in an election with a higherthan-usual turnout, it is unlikely to attract swing voters in significant numbers. As
a result, it has virtually no hope of ever winning a Diet majority and seizing control
of government on its own. What it can do, however, is leverage its reliable vote-getting capacity to secure a supporting role for itself. This is the strategy the NKP has
adopted, and to pursue it, the party has been obliged to maintain maximum flexibility in matters of policy and ideology.
The Limits of Ideological Flexibility?
Today, however, the NKP is facing an issue that could strain its ideological flexibility to the limit. The issue pertains to the government’s official interpretation of
Article 9 of the Constitution, which states that “the Japanese people forever renounce war as a sovereign right of the nation and the threat or use of force asmeans of settling international disputes,” and further that “land, sea, and air forces,
as well as other war potential, will never be maintained.”
For decades, the Japanese government has interpreted this to mean that, while
Japan may maintain the minimum forces needed for its own self-defense, it may
not constitutionally participate in collective self-defense, meaning that its forces
may not engage in combat operations in support of an ally under attack. In thisway successive cabinets have sought to reassure the world that Japan would never
revert to the militarism of the past.
Now, however, Prime Minister Abe is intent on changing that interpretation.
Abe wants to lift the prohibition on the right of collective self-defense on the
grounds that advances in military technology have made it impossible for any
country to protect its own security individually. Public sentiment has begun to fa56

vor such a change, thanks in large part to North Korea’s ongoing nuclear tests andmissiles launches, as well as China’s military buildup and confrontational stancevis-à-vis the Senkaku Islands. Abe has stated his intent to adopt a cabinet resolution altering the government’s interpretation of Article 9 and push through legislation enabling collective self-defense operations within the year.
This poses a dilemma for the NKP. Notwithstanding its ideological flexibility
over the years, the party has consistently opposed any revision of Article
9 or any change in its interpretation.
Its position on the right of collective
self-defense is unequivocal. When I interviewed NKP President Natsuo Yamaguchi last year, he clearly conveyed
his disapproval of Abe’s plan, warningthat “the new laws could lack legitimacy if their only legal basis is a unilateral declaration by the government Election poster featuring NKP President Natsuo Yamaguchi.
that it’s changing its interpretation of
the Constitution.” Abe’s initiative has
been the subject of much criticism within the NKP, not to mention the Soka Gakkai. But a rupture with the LDP over the issue could jeopardize the government’s
entire agenda, including its all-important economic revitalization strategy.
The NKP has skillfully been navigating treacherous political waters to secure
its place as a member of the ruling camp. Now the Article 9 issue is forcing theparty and its base to take stock. Will the NKP stand up to Prime Minister Abe, orwill it put its relationship with the LDP ahead of its principles, as it has so often in
the past? A half-century into its curious journey, the Komeito is approaching a
crucial fork in the road.

57© manumenal (CC BY-SA 2.0)

Politics & Government

Partnership with Acumen
January 6, 2014

Dispatches from Ghana(4) Impact and Lessons Learned
Junko Tashiro

In November 2012, Junko Tashiro traveled to Ghana under an Acumen Global Fellowship
to launch Copa Connect, a social venture aimed at integrating smallholding rice farmers
into the value chain. In her fourth and final installment, Tashiro reports on the heartening
outcomes of the pilot program she organized and oversaw.
*

*

*

I

t was late March, almost five months since my arrival the previous November.
Since the start of the year, I had been working about 15 hours a day without
respite, weekends and holidays included. Even so, the challenges before me
remained so daunting that I barely had time to come up for breath. We progressedin fits and starts, three steps forward, two steps back. On some days we seemed
farther from our goals than ever.
In West Africa, progress is never easy. There were days when I could haveground my teeth in frustration. Sometimes I swam desperately against the current.
Other times I just let myself float downstream, accepting the fact that many forces
here were simply beyond my control.
The Darkest Hour
Take power outages. Ghana is plagued by chronic energy shortages, and every partof the country experiences blackouts lasting several hours a day. Above and beyond
that, Sogakope had its own 12-hour planned outages every other day. The timing
varied, but for me the worst blackouts were those that lasted from 6 pm until 6 am.
This completely disrupted my routine of visiting farms or meeting with program
Junko Tashiro   Tokyo Foundation–Acumen Global Fellow for 2012–13. Has worked at
McKinsey & Co. Received a BA in international relations from the University of Tokyo andan MPA in economic development and management from Columbia University.
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Partnership with Acumen
partners during the daytime and then settling down in the evening to work on mylaptop. In Sogakope, the sun goes down soon after 6 pm, and with the power off,
the whole village turned pitch black and still, without a breeze stirring.
Neither the office nor my residence had an electric generator, but I kept working as long as my laptop battery allowed. Flying ants made a nuisance of themselves, landing on the glowing laptop screen and on my perspiring face. A creepy
rustling filled the darkness around me as the family of geckoes that lived in therafters made themselves at home scampering about my room. (This I knew fromhaving come close to trampling one on several occasions.) Outside, the frogs struck
up a loud chorus, periodically joined by the howls of wild dogs.
But all this lasted for only an hour or so, until my laptop battery died. After
that, there was nothing to do but curl up on my damp, moldy-smelling bed and try
to sleep. I shut my eyes, determined to make the most of this opportunity to restand build up my strength. But I was not in a position to just forget my cares anddrop off at eight in the evening. And here I was with so much to do that a full 24hour day seemed insufficient.
Those Ghanaian nights were stifling. If I lay perfectly still in the heat, I would
eventually drift off into semi-consciousness—but only to be awakened by my repetitive dreams. Sometimes I was frantically trying to complete a financial model
on Excel; at other times I might dream about the dinner I had to skip that night.
(Ghana suffers from chronic shortages of gas and water as well as electric power,
and the housekeeper in our compound would frequently use the gas shortage as an
excuse not to make dinner. Meanwhile, I was often too engrossed in work to goout and buy food for myself.)
However, there was one recurring dream in particular that invariably jarred me
awake. In this dream, I’m walking along the side of a beautiful greenish-gold rice
paddy, when a farmer comes toward me, followed by another and another. They
converge on me, clamoring for answers. “When is my paddy going to be full ofbeautiful golden-green ears of rice like this one?” “How can I get some of the highyield rice seed my neighbor uses? I heard you can get it for me.” “Madam, pleasebuy my rice! I want my children to have plenty to eat and go to school.” “Timeafter time outsiders come here promising a better life, and then they leave and it’s
all gone. Our lives haven’t changed one bit since our parents’ time. Is Copa Connect any different? You’ve just come to make us dream for a bit and then abandon
us like all the rest.” “Please, tell us! We want answers!”
With that, I would awake with a start, my body bathed in sweat, the sheets
sticking unpleasantly to my skin.

59Partnership with Acumen
Dawning Impact
One morning, I rose with the sun and showered with cold water. I had an early
appointment to visit our pilot farm, which had just finished harvesting its first cropof jasmine. It was to be a banner day for Copa Connect, marking the pilot program’s very first purchaseof paddy rice from a smallholder producer.
I climbed into the front passenger seat of the
10-ton truck and, after a bumpy 40-minute ride, arrived at Eric’s farm in Afife. This was the field I had
visited most often in the past, partly because it was
relatively close to Sogakope.
Eric’s face beamed with pride as he greeted us. Behind him were sacks of premium-grade paddy, neatly packed and standing in orderly rows as if quietly awaiting our arrival.
The total harvest from Eric’s 1.6-hectare plot weighed in at 9.3 tons, for a crop
yield of 5.8 tons per hectare. The full yield potential for the cultivar of jasmine ricesupplied by Copa Connect is approximately 6 tons per hectare; Eric had essentiallyachieved that in his first growing season. Before enlisting in the Copa Connect pilot, Eric had been growing an inferior variety—the only kind generally available tosmall farmers in the area—and generally speaking, the yield potential for such rice
is substantially higher than for jasmine. Even so, Eric’s farm had been producing
only about 3 tons per hectare. To double his yield immediately after switching tojasmine was a stunning achievement.
The grain quality, moreover, was top grade. Fastidious winnowing had removed
virtually all foreign matter, including pebbles and dust, and contamination by ricefrom the previous season amounted to less than 3%. In addition, the moisture
content was well within the range considered optimal for milling. This is importantbecause if the paddy is too dry, it results in more breakage during milling. On theother hand, if the paddy contains too much moisture, it has to undergo further
drying at the processing plant prior to milling, which adds to costs. Moreover, atlarge automated facilities, drying is difficult to fine-tune, and the tendency is toover-dry—which, again, leads to more grain breakage and reduces crop value.
One key to Eric’s success was the fact that he had been able to avoid lodging,the collapse of ripening rice plants under their own weight. This is a perennial
problem for rice farmers, affecting both the quantity and quality of harvest. Whenthe rice panicles fall to the ground, they are apt to become soaked and sprout.
Harvesting becomes difficult, and the tissue of the grain is often damaged, resulting
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Partnership with Acumen
in a higher percentage of substandard or broken kernels. Rice is particularly prone
to lodging when farmers apply the wrong amount of fertilizer or delay the harvest
too long. Some smallholder farmers rush the harvest in order to avoid lodging andmaximize their yield, but this results in an unacceptably high percentage of immature grains. By following best practices for preventing and coping with such common crop-quality issues, Eric was able to meet the same standard of grain quality
as GADCO’s large-scale nucleus farm.
“I’ve never seen anything like it,” marveled Eric, his voice quavering. “I’ve been
growing rice for almost twenty years, but this is the first time I’ve ever seen mywhole field turn the same beautiful shade of green, and it’s the first time I’ve harvested this many sacks of paddy.”
After all the sacks had been loaded onto the truck, I invited Eric to jump in andaccompany us to GADCO’s processing facility. I
wanted him to see with his own eyes what was instore for the rice he had grown with such loving
care over the previous four months.
On the way, we were stopped repeatedly by police officers demanding payment—bribes, in otherwords—in exchange for “right of passage.” Moreover, no sooner had we arrived at the GADCO plant
than a power outage shut down the entire system. Still, for all its challenges andfrustrations, it was a richly rewarding day. As it drew to a close, we all sat in theshade of the GADCO silo and quenched our thirst with some sachet water,1 as weconversed with Eric at leisure.
“I owe it all to your help that I’ve done so well with my crop over the past few
months,” said Eric. “I’d be lying if I said I never had any worries about enlisting in
the pilot. It took some courage to change the way I’ve been farming for so many
years—especially with everyone warning me, ‘You’ll be sorry!’ every chance theygot.”
Eric turned to face the Copa Connect team’s lead agronomist, who had worked
so diligently to support Eric in every aspect of production.
“When you first told me about this program, you said, ‘We’ll give you everything you need in exactly the amount you need, exactly when you need it, so you

Filtered water packaged in plastic pouches, or sachets. Although bottled mineral water issafer and better tasting, sachet water is by far more popular in Ghana and is sold virtually
everywhere. In terms of unit price, sachet water is actually relatively costly, notwithstanding
the low price per pouch.

161Partnership with Acumen
don’t have to worry about any of that. But in return, you need to follow our advice
and work your hardest. If you do that, we can guarantee good results.’ At first I
wasn’t sure whether to believe you, because other people have come here making
all kinds of promises, and none of them have delivered. But you were different. Thevery next day after I agreed to participate, you brought me the premium jasmine
rice seed you’d promised. That’s when I decided I could trust your word. Later you
drove up several times every week to visit and inspect my field. On the days when
I was supposed to apply pesticide or fertilizer, you would call and wake me up
before dawn, saying you were on your way, and I should be at work by the time
you got there. And an hour later, there you would be. You were pretty strict withme at times, but it was all about doing the best job possible in order to grow thefinest rice. And thanks to you, I was able to do that.”
Eric’s gaze turned solemn. “I hope with all my heart that everyone else has thesame opportunity I’ve had. Whatever your line of work, it takes sweat and tears to
do a good job. But if you do your work well, your efforts will be rewarded. That’s
the truth, and I want everyone to know it.”Courage, Conviction, Effort
A few days later, we headed out to Afife again to pay Eric the purchase price forthe paddy we had bought, together with a premium reflecting the market value ofthe polished rice. We explained the pay formula to him in plain language. Next toa slightly tense-looking Eric sat his older brother,absorbing every word.
At last, I produced a sheaf of bills and set it infront of Eric, saying, “According to the agreement
we reached, this is the payment we owe you foryour crop.”
Eric’s face broke into smiles. “For me . . . ? Thisis so amazing! I’ve never seen so much cash in one
place in my life.” Eric continued to grasp the roll of money in both hands, as if
feeling its heft over and over.
By dramatically improving his output, both quantitatively and qualitatively,
Eric had basically doubled his revenue from the previous harvest. Better yet, his net
proceeds after additional expenses (machinery rental and the cost of hiring seasonal workers) were a full four times what he had typically earned.
Eric told us that each harvest usually left him with a little over $400 in readycash—meaning that his annual net income from rice farming was less than $1,000.
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Partnership with Acumen
This is by no means unusual for smallholders. In fact, many farmers subsist on
smaller plots than Eric’s, and their productivity is inevitably lower.
“Until now, I always found myself with so little money left over after expenses
that I could barely pay off my debts. We were always living hand to mouth, and wenever had enough money for the kids’ education. Now we can finally build a life
for ourselves!”
Eric’s gratitude was flattering, but I believe that his success was the reward for
his own courage and tireless effort. He was the one who had plunged in, unafraidof change, when everyone else had hung back. Moreover, he
had stood by his decision to the end, ignoring the many naysayers around him.
The very low rate of contamination by inferior rice was a
testament to Eric’s perseverance. When a rice farmer switches
to a new variety, seeds from the old rice will usually keep germinating for another two or three seasons. To produce 100%premium rice fit for Ghana’s end-consumer market, Eric
needed to weed out all the unwanted seedlings. We explained
GADCO’s quality standards to him at length and warned himthat GADCO could not purchase mixed-variety rice from him; any of the old rice
plants that sprouted up while he was growing jasmine had to be culled. For a Ghanaian smallholder farmer, accustomed to being rewarded for quantity, not quality,
this required a courageous change in mindset. Other farmers in the neighborhood
who dropped by out of curiosity would say, “What a waste!” But Eric had thestrength of his convictions. He believed he was doing the right thing in order tobuild a better future for himself and his family. And he was able to make thatdream come true.
The Journey Begins

Eric shares his experience with other farmers
at a Copa Connect workshop in March 2013.

Two weeks later, around the end of March, wewere driving around the Volta region trying to
get farmers to sign up for Phase 1 of Copa
Connect’s commercial launch. Our goal for the
first half of 2013 was to enlist 600 smallholders. We were beginning to hold workshops ineach district for prospective participants in order to introduce the program, answer questions, and hold small-group discussions regard63

Partnership with Acumen
ing the challenges facing local smallholders. At one key meeting, we looked up to
see Eric entering the room. He had come, keen to share his experience in his own
words.
Eyes glowing with energy and self-confidence, Eric stood in front of a few
dozen farmers and single-handedly turned the meeting into our liveliest and mostproductive session yet. The farmers hung on his every word. When he nodded, hisaudience nodded, too. When he laughed, chuckles rippled through the room. A
farmer who had been sitting silently in the back of the room stood and began asking questions. And Eric answered each question with complete sincerity. I had the
feeling I was witnessing the birth of a true leader.
This kind of personal transformation, though difficult to quantify, is surely themost important way in which a program like Copa Connect can hope to impact
people’s lives. When people like Eric realize their leadership potential, they not onlytransform their own lives but bring ongoing change to the entire community as rolemodels for the people around them.
As of this writing at the end of August 2013, Copa Connect is partneringwith approximately 600 smallholder
rice growers. The goal is to bring that
number to 1,000 by the end of the year,
when Phase 2 begins.
Needless to say, doing business with
one farmer (Eric) and doing businesswith 600 to 1,000 smallholders are two
A three-day training workshop for local “aggregacompletely different matters. Alreadytors” in the town of Ho in the central Volta Region.
the program has encountered a host of
The training covered best agricultural practices
based on our production protocol, use of portabledifficulties that never emerged during
information and communications technology, andthe pilot. Prominent among these are loa range of business skills. Each aggregator serves asgistics issues. To overcome these, Copaa hub for input distribution, monitoring, and crop
collection in a given cluster, allowing Copa Connect
Connect needs to scale its business operto operate efficiently in areas without access to irriations sustainably. It also needs to shift
gation, where small farms tend to be scattered overto an innovative business model thata wide area.
leverages community networks.
One of the most pressing challenges Copa Connects faces at the moment is thatof securing and training extension officers to provide the kind of individual attention and support Copa Connect smallholders need to meet GADCO’s exacting
quality standards. The rapid growth of demand for rice in Ghana is a very recent
phenomenon, which is one reason Ghana itself has so few rice specialists compared64

Partnership with Acumenwith India or other Asian countries that have been growing rice as a staple formillennia. A cross-sectoral effort will be needed to bring about a real paradigm
shift in Ghana’s rice industry.
We have barely begun to tackle these challenges. This is just the beginning of along and rocky road. But we are determined to forge ahead. After all, if not us, thenwho? Since the kickoff of Phase 1, GADCO’s Copa Connect team has expanded,
one position at a time, and its dedicated members fill me with hope and confidence.
The Right Stuff
It would be almost impossible to convey all that I learned in the process of launching and developing Copa Connect, an agribusiness designed to integrate impoverished smallholder farmers into the value
chain. But one of the most important
things I came away with was a first-handappreciation of what it takes to succeed
as a social entrepreneur in a developing
country like Ghana.
Good intentions, passion, a carefully
crafted business model—all these things
are necessary, but they are not sufficient.
The most important asset of all is resil- The author with members of the Acumen leadership team in late March 2013, when they visited theience—the ability to recover from set- town of Weta to observe a Copa Connect workbacks, the flexibility to adapt to change, shop. (Left to right: Chief Operating Officer Carlyle
Singer, the author, West Africa Director Godfrey
the toughness to pick yourself up and Mwindaare, and Chief Executive Officer Jacqueline
keep going. Social entrepreneurs need the Novogratz.
grit to grapple with the immediate issues
confronting them and plow through their daily tasks, even amid a dearth of resources and a corrupt or dysfunctional system. They need the courage to keep
trudging forward one step at a time, without letting themselves succumb to the fearof failure or the uncertainties all around them. And above all, they need the conviction to approach their work with a mixture of realism and optimism and an
unshakable commitment to their own vision and worldview.
To meet people possessed of these rare qualities in a variety of settings over thecourse of a year was a truly invaluable experience for me. The nine other 2013
Acumen Global Fellows; the East Africa Fellows with whom I spent time at the
Acumen midterm meeting in Kenya; the social entrepreneurs I met through a variety of events; and last but not least, Eric and people like him around the world who
65Partnership with Acumen
grab life by the horns in the tenacious belief that they can alter their future for the
better—these are the people who have fueled my hope and kept me going. Thanks
to their inspiration, I discovered the confidence and courage to tackle challenges I
would once have dismissed as too risky; to celebrate each small step toward thesolution of a problem; and to humbly acknowledge and deal with my own weaknesses.
I am grateful above all to the nine other Global Fellows in my cohort. There
are so many things I would never have understood, faced, and surmounted had it
not been for them. In good times and bad, whenever one of us was bereft, fearful,or confused, we were always there for one another, extending our support acrossnational boundaries and time zones. Although our situations may change, I firmly
believe that this fundamental relationship will endure.

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Views on China
May 15, 2014

China’s Foreign Policy under Xi Jinping
Rumi Aoyama

One year after China’s 2013 power transfer, Waseda University professor Rumi Aoyama
plots the trajectory of Xi Jinping’s diplomacy and foreign policy.
*

*

*

A

fter more than three decades of “reform and opening up,” China is approaching a major bend in the road. The government today must copewith a host of pressing domestic challenges, including a drop in economic
growth, a shifting social structure, and above all, social unrest stemming fromgrowing socioeconomic inequality.
When President Xi Jinping came to office a year ago, in March 2013, his government inherited a daunting policy agenda from the previous regime. This is precisely why the Chinese had such high hopes for a fresh approach that would cut
through the web of vested interests and follow through on much-needed reforms.
It is also the reason so many foreign observers are anxious to forecast the courseof Chinese policy over the next 10 years.
In the following, I offer a quick review of Chinese diplomacy over the past year
and a brief characterization of the Xi regime’s foreign policy, seen against the backdrop of its urgent domestic priorities.
Taking Charge Domestically
A number of new domestic policies have already come into effect in the year since
Xi Jinping took power. Among the most significant are initiatives to rein in shadowbanking, root out corruption, and strengthen controls over the media and public
opinion.

Rumi Aoyama   Professor, Faculty of Education and Integrated Arts and Sciences,
Waseda University.
67Views on China
Shadow banking, the collective term for nonbank financial dealings, has expanded rapidly in recent years, raising fears that a rash of bad loans could precipitate a credit crisis. The government has begun tightening oversight of shadowbanking services to discourage incautious lending and avert a crisis.
At the same time, it is taking steps to steer the economy away from the investment-driven growth model that has prevailed in recent years. Amid slowing growth
and rising fears of a credit crunch, the world is watching anxiously to see whether
the economic policies of Premier Li Keqiang can pilot the Chinese economy towarda soft landing.
The new leadership has also taken a tough stand on corruption. The central
government has set up more than 10 regional and sector-specific inspection teams,
each led by a former governor or similarly high-ranking retired official under theage of 70. In this way, the Communist Party is taking the initiative in a “mass line”
anti-corruption campaign targeting its own members, instead of relying on the legal system. While the aim is doubtless to shore up the party’s legitimacy and help
ensure the regime’s continued stability, there are intrinsic limitations to such an
approach.
This effort to strengthen the party’s self-purification mechanisms has been accompanied by measures to tighten government control over Chinese society. Media
censorship has tightened, and intellectuals have been instructed to steer clear ofsuch sensitive topics as “democratic reform,” “human rights,” and “universal values.”
Active Diplomacy
The Xi regime has also been extremely active on the diplomatic front over the past
year, as the following summary will attest.
The first foreign country Xi visited after taking office was Russia, where hearrived on March 22. From Russia, Xi headed to Africa to attend the fifth summitof BRICS (Brazil, Russia, India, China, and South Africa) in Durban, South Africa,
stopping also in Tanzania and the Republic of Congo. The Chinese official media
heaped praise on all three of Xi’s African host countries, calling them “China’s
good brothers, good friends, and good partners.”1 In Tanzania (an “old friend”
whose support “China will never forget”), Xi and President Jakaya Kikwete signed
a package of agreements that will clear the way for Chinese financing and construcXinhuanet, March 18, 2013. http://news.xinhuanet.com/world/2013-03/18/c_115067812
.htm

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tion of a port at Bagamoyo on the Indian Ocean, part of Beijing’s co-called Stringof Pearls strategy.
Premier Li Keqiang followed this up with his own maiden tour (May 19–27),
traveling first to India and Pakistan, then to Switzerland and Germany. Just three
weeks before he arrived in India, tensions had spiked as a result of a standoff between Chinese and Indian troops along a disputed border in eastern Kashmir.
Fortunately, a series of high-level talks had defused the situation by arranging asimultaneous withdrawal prior to Li’s visit. Before Li left New Delhi, the Chineseand Indian governments issued a35-point joint statement setting forthareas of agreement on the border dispute, trade, and other pending issues.
Pakistan has emerged as a major
focus of Chinese foreign policy eversince Washington announced its intent
to “rebalance” strategic resources toward Asia. This was apparent as earlyas 2012, when a spokesperson for
China’s Ministry of Foreign Affairs
referred to Pakistan as a key “political ally, security shield, and economic market”
and characterized the China-Pakistan relationship as “stronger than steel.”2 In the
joint statement issued on the occasion of Li’s visit, the Pakistani government agreed
to join with China in condemning the East Turkestan Islamic Movement in Xinjiang as a common threat to stability and peace.
On the eve of Li’s visit to Switzerland, the Neue Zürcher Zeitung carried asigned article by the Chinese premier titled “Why Switzerland,” explaining whythat nation was chosen as the first European stop on the Xi government’s diplomatic itinerary. In the piece, Li notes that Switzerland was one of the first European
countries to recognize China’s status as a free market and extols the impending
China-Switzerland free-trade agreement—then in the final stages of negotiation—
as the first such pact between China and any continental European nation.
Li arrived in Germany just as the European Union was deliberating anti-dumping measures against imports of Chinese solar panels, and he was able to extract apromise from German Chancellor Angela Merkel to help avert the imposition of
any permanent tariff. (The following July, the EU and China settled the dispute by
Luo Zhaohui, “2011-nian Zhongguo de Yazhou waijiao” (China’s Asian Foreign Policy
in 2011), People.cn. http://fangtan.people.com.cn/GB/147553/237748/index.html

269© APEC 2013 (CC BY 2.0)

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Views on China
concluding a minimum-price agreement.)
No sooner had Li returned home than Xi embarked on his second official overseas tour as president (May 31–June 6), this time heading for Latin America. Of
the 23 countries that continue to maintain diplomatic relations with Taiwan instead of the People’s Republic of China, about half are located in Latin America
and the Caribbean. In 2008, the Chinese government issued a policy paper on Latin
America and the Caribbean stressing its determination to place greater emphasison the region. President Xi put this policy into action with state visits to Trinidad
and Tobago, Costa Rica, and Mexico. As China’s official media explained it, thesethree countries were chosen in part for their positive response to Beijing’s proposal
for the creation of a China–Latin America cooperation forum.
In Trinidad and Tobago, Xi had the opportunity to meet with the leaders ofeight Caribbean countries. Costa Rica was a natural choice as the only Central
American nation with which China has official diplomatic ties (established in2007), and as the partner in an FTA concluded in 2010. Mexico, a member of theGroup of Twenty, has also assumed a position of importance in China’s foreign
policy. In Mexico, President Enrique Peña Nieto and President Xi signed a 33-point
joint statement.
The final stop on Xi’s second overseas tour was the United States, where hespent a newsworthy eight hours in tête-à-tête with President Barack Obama. The
conversation reportedly ranged across a number of key topics of bilateral concern,
including cyber spying, North Korea’s nuclear weapons, and global warming. Unfortunately, the only substantive progress announced by the two leaders was anagreement to discuss ways of reducing emissions of hydrofluorocarbons, or HFCs,
used in refrigerants.
Neither American nor Chinese media reports on the Xi-Obama summit revealed the specific content of the Xi-Obama talks. Xi left his American hosts withno gratifying memento in the form of a surprise agreement or concession, and as aconsequence, the summit was widely deemed a disappointment in terms of concrete
results. However, the official Chinese media offered a more sanguine assessment,
claiming that it had served its purpose of helping to “build a new type of major-power relationship” and minimizing conflict between the two nations.3
Certainly it would be unrealistic to expect longstanding tensions and disagreements between Beijing and Washington to be resolved overnight, or for the two
For more on the “new type of major-power relationship,” see Bonji Ohara, “Japan in the
New Era of US-China Relations.” http://www.tokyofoundation.org/en/articles/2013/japanin-new-era-of-us-china-relations

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governments to reach a groundbreaking accord as a consequence of one summit
meeting. China and the United States have already opened more than 90 channels
of intergovernmental dialogue—far more than Tokyo has with Beijing. If Washington and Beijing can take advantage of these channels in the coming months toadvance negotiations and minimize conflict, then those eight hours of talks between Obama and Xi will have been worthwhile.
Xi Jinping’s Foreign-Policy Priorities
The government of Xi Jinping has its work cut out on the domestic front, though,as it attempts to navigate the shift to a new industrial structure and economic
growth phase while containing social unrest and maintaining stable one-party rule.
Given these domestic challenges, the overriding imperative for Chinese foreign
policy today is to ensure a peaceful and stable international climate.
At the same time, China must cope with the challenges of a changing international environment. In recent years it has come into mounting conflict with someof its neighbors over territorial and maritime issues, and the US administration’s
decision to refocus its strategic resources on East Asia has complicated the regionalsituation further. The diplomatic activity described above reflects the foreign-policy
priorities that the Xi Jinping regime has embraced in response to these circumstances. They can be summarized as follows.
(1) Maintaining a stable international environment: This posture is apparent
in the Xi regime’s emphasis on cooperation with the United States and its determination to “minimize conflict” between the two powers, as revealed in theupbeat official evaluation of the Xi-Obama summit. It is also reflected in remarks on maritime policy delivered by Xi in July 2013, in which he became thefirst Chinese leader to suggest in this context that “maintaining stability” wasa priority on a par with that of “safeguarding rights.” As M. Taylor Fravel has
pointed out, this is a potentially significant departure, suggesting that Beijing
may be prepared to adopt a more cooperative approach to territorial disputes,
even if it refuses to compromise on sovereignty per se.4
(2) Actively cultivating relations with “old friends” in response to WashingM. Taylor Fravel, “Xi Jinping’s Overlooked Revelation on China’s Maritime Disputes,”
The Diplomat, August 15, 2013. http://thediplomat.com/2013/08/15/xi-jinpingsoverlooked-revelation-on-chinas-maritime-disputes/

471Views on China
ton’s rebalancing policy: Chinese officials and media reports have made a pointof identifying the countries on Xi’s and Li’s itinerary as old friends that “dugthe well”—that is, countries that stood by China at some critical juncture, andto whom China owes a debt of gratitude. Not all of those countries have responded with equal enthusiasm to China’s overtures, and Beijing may havemade less progress on this front than it had hoped. But it may have at leastachieved the goal of sending a strong message to the Obama administration
regarding the latter’s “pivot to Asia.”(3) Expanding China’s international clout in the emerging developing world:
This, too, is apparent from the prominent place of South Asia, Africa, Latin
America, and the Caribbean on the diplomatic itinerary. Conscious of its own
growing power, China has been working energetically to strengthen its relations with G-20 and BRICS countries, such as India, Mexico, and South Africa,that are playing a rapidly expanding role on the international stage. The new
regime also seems particularly keen to boost ties with energy-producing countries.
As noted above, the Xi regime is devoting most of its energy to the difficult
policy issues it faces on the domestic front. Given the extent of these domestic
challenges, it seems likely that the government will continue to chart a cooperative
foreign-policy course with a view to maintaining a stable and peaceful international climate.
To be sure, one cannot rule out the possibility that the current government will
shift at some point to a hardline, hawkish stance in hopes of fanning nationalist
sentiment and strengthening unity at home. At present, however, the essence of thecurrent government’s foreign policy is to carry on the previous regime’s campaign
to expand China’s clout in the global community, while redoubling its efforts tomaintain a stable international environment.

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April 22, 2014

Worsening Water Shortages
Kunio Takami

Water shortages in Shanxi Province, China, are impacting seriously on agricultural production. As rivers and wells have dried up, some villages lack even enough drinking water. Kunio Takami writes of the efforts to provide water to parched villages, including throughwell-digging schemes involving his environmental NPO, as well as of major infrastructure
projects designed to supply water to Beijing and other major cities.
***

Nine Years of Drought, One Year of Floods
In one of the farming villages near the city of Datong in Shanxi Province, where
Midori no Chikyu Nettowaku (Green Earth Network) has been involved in reforestation projects for many years, there is a folk song called “How High the Mountains.” For generations local people have sung this song that describes the harshnessof the natural environment around them: “The mountains are close by, but there isno firewood with which to cook. There’s drought in nine years out of ten, and in
the other comes floods.” It is a short verse—just 16 characters long in the original
Chinese. After visiting the region for 22 years, I feel that the words reflect withremarkable accuracy the problems people here face.
The second line of the song is borne out by statistics. Average annual rainfall
is 400 millimeters, although in some years more than 600 mm of rain falls. The
year 1995 was one such example. There was severe drought until mid-July, but
toward the end of the month it began to rain. The rains normally come to an end
in mid-September, but that year they continued into October. Many of the local
houses are made of earth; rainwater drenched the roofs and walls of these structures, causing many to collapse. The tragedy affected 60,000 households—some
240,000 people in all.

Kunio Takami   Executive Director, Green Earth Network.
73Views on China
But such years are the exception. Much more frequent are years in which it
hardly rains at all. In 1999, for example, the region suffered the “worst drought
since the founding of the People’s Republic.” Local farmers got almost no harvest
from their maize that year. In upland areas like the Huangtu plateau, many farmers
did not even bother to plant a crop that was clearly doomed from the start. The
drought, which happened to coincide with the fiftieth anniversary of the People’s
Republic, can be fairly described as the kind of drought that comes once every 50
years. The situation was made even worse when another drought hit in 2001, andthe mountains were singed brown into the summer months. The scale of thisdrought was even worse—people said a drought like this came just once a century.
The region, hit by a “once-every-50-years” drought, thus suffered from a “once-acentury” disaster just two years later.
Rivers That No Longer Flow
Flowing water has all but disappeared
from the major and minor rivers of
the province. The Sanggan River rises
in Mt. Guancen in the northwest of
Shanxi Province, and transects thecenter of Datong City from west to
east. In Datong County, Route S203
crosses the Sanggan via a bridge. Every time I cross the bridge I pause to
take a photograph and check the water level. The last time I saw any substantial amount of water in the river was inJuly 1997, when I watched a local farmer drive his flock of sheep into the fast-flowing waters of the river for a bath. Since then, the running stream of water has
vanished, and often the riverbed is absolutely dry.
In Ying County a little farther upstream, the entire riverbed is given over tofields planted with maize; there would be no room for a flowing river here anymore. Here too I take photographs whenever I pass through. In the summer of2012 I was chased away by farmers who were working in their fields. There arewatermelons growing at the back of the fields of maize, and apparently they had
mistaken me for a watermelon thief. In the spring of 1993 poplars were planted
here to strengthen the riverbanks. When the trees were saplings, the surging watersof the river sometimes used to rush up over their roots. Today, the poplars havegrown but the river has dried up.
74Views on China
According to local accounts, this drop in the water level came suddenly. The
Yuhe, which flows north to south through the easternmost extremity of downtown
Datong, is one of the largest of the Sanggan’s tributaries. Thirty years ago, locals
say, there was always plenty of water, and it would have been impossible to ford
the river on foot. Now, the flowing stream has disappeared altogether and people
have built weirs like pools that serve the park situated on both sides of the river,where treated waste water from the city is stored.
Until recently an iron image of a bull stood in the grounds of the ancient Shanhua Temple. The image, which dates from the Ming dynasty, was apparently placedon the west bank of the Yuhe to pacify the river, which used to flood repeatedly.
Now it has been moved to a museum in Datong ready for public display. In Eastand West alike, it is the job of the bull to fight back against the powers of the
dragon who rules the waters.
Digging Wells in Farming Villages
In the drought year of 1993, only 4 of the 11 villages in Sunjiadian, Tianzhen
County, produced more than 200 kilograms of grain per person, producing between 293 kg and 528 kg per person. All four were places where undergroundwater makes irrigation possible. In 5 other villages, per capita grain production
ranged from just 39 kg to 79 kg. In these villages, almost no irrigation was possible.
The minimum amount of grain required to sustain one adult is 200 kg
per year. To obtain this, irrigation isessential, and once a village starts on
irrigation there is no turning back.
Declining underwater water levels area problem throughout the region.
Drinking water is also a problem
in some villages. When we carried out
a survey in 21 villages in seven counties in 2000, the most common responses were, “We have no shortage of water and practice irrigation” (42.6%) and“We have water sufficient for our daily needs, but no irrigation is possible” (47.4%).
Far fewer respondents chose “We have sufficient drinking water but need to becareful how we use it” (18.3%) or “We lack sufficient water and must get waterfrom other villages” (3.6%).
At first glance, these responses may make it look as though the water shortage75

Views on China
problem is not too severe. When we asked about the amount of water required perperson per day, however, the average across the 21 villages was 23.8 liters, with ahigh of 31 liters and a low of 15.6 liters. And 61.6% of respondents said that water availability was decreasing. The percentage was higher in villages that used lesswater, rising to 70% in Yujiashan, where the average water use was 15.6 liters perperson per day.
Wishing to do what we could to help, our organization cooperated with awell-digging project. The village of Yuanxizhuang in Guangling County originallyhad 20 wells but these gradually dried up so that by 1997 only 4 were still producing water, with local people being able to draw only 100 buckets of water per day.
This was divided among 150 villagers and their livestock.
Using donations collected in Japan, we dug a well capable of producing 15,000liters of water per hour from a depth of 176 meters. This was not enough to support irrigation, but villagers started to plant vegetable plots in their gardens, cultivating tomatoes, cucumbers, and green beans, which they had previously had tobuy. We also cooperated on another well-digging project in Shiweng, Lingqiu
County, where we reached water at a depth of 183 meters, enough to supply drinking water to three surrounding villages.
Since then, as part of the process of poverty relief, wells have been dug in more
villages that were struggling to meet their water needs, and there are no longer
villages without adequate drinking water. In this sense, it is fair to say that the effects of economic development are reaching even these poor villages. The last placeremaining without sufficient water was the village of Yujiashan, which I mentioned
briefly above. The natural spring near the village has hardly produced enough tomeet the villagers’ needs, and they were forced to travel long distances to get waterfrom other villages. Using grant assistance for grassroots human security projects
provided by the Japanese Ministry of Foreign Affairs, we cooperated on a well-digging project. Although the first attempt was unsuccessful, a second attempt in adifferent location struck water at 140 meters.
In April 2008 a ceremony was held to mark the successful completion of thewell with the participation of a tour group from Japan. The whole village danced
together with smiles on their faces after the ceremony. After a while, the sound of
sobbing was heard from somewhere in the crowd. Before long it had spreadthrough the entire group. An executive at the county’s water authority told me,“Only outsiders like you could have succeeded in digging a well in that village.”
Numerous attempts had been made to dig a well there in the past, all of them unsuccessful.

76Views on China
Datong: Source of Beijing’s Water
The Sanggan River flows east into Hebei Province, merging with the Huliuhe and Yanghe to become the Yongding. The Yongding flows on until it isstopped just outside Beijing by the
Guanting dam and reservoir, whichalong with the Miyun dam is one ofjust two reservoirs serving the capital.
In this sense, Datong can be describedas the source of Beijing’s water. For
the region to experience such severe water shortages is therefore a serious problem
indeed.
Beijing has pinned its hopes on the central route of the South-North Water
Diversion Project. This will bring water from the Danjiangkou reservoir on the
Yangtze River system to Beijing and Tianjin along a channel some 1,432 km long.
Construction work on the main part of the project is now complete, and in late2013 the media started to report that the project would begin operations in 2014.
After some delays, the construction work has finally been completed.
But Beijing could not wait. It accelerated work on the final stage of the SouthNorth project, linking Shijiazhuang in Hebei Province and Beijing, and this section
has been bringing water to the capital from four dams in the cities of Shijiazhuang
and Baoding since September 2008,
just after the Beijing Olympics.
The water in the Guanding reservoir comes from the northern part ofDatong; since then, the southern partof the city has also provided water to
Beijing. The Tanghe River, which has
its source in the southern part of
Hunyuan County, collects rainwaterthat falls in Lingqiu County and thencuts through the Taihang mountain
range before emptying into the Xidayang reservoir in Tang County, Hebei Province.
The Shahe-Dashahe River that flows through the southern part of Lingqiu County
empties into the Wangkuai reservoir in Quyang County, Hebei Province. The Hutuo
River is also dammed in two places, at the Gangnan and Huangbizhuang reser77

Views on China
voirs. The river rises close to the border between the cities of Datong and Xinzhou
in Shanxi Province. Water from these four reservoir dams is transported to Beijing.
It is often the case with a huge project that people’s expectations and hopes forthe benefits it will bring grow and grow during the long years before the project iscompete, only for problems to come to the surface once it actually starts functioning. It remains to be seen what results the water diversion project will really bringwhen it is finally complete.

78International Affairs
April 3, 2014

Growing the Japan-Europe Partnership
Akiko Fukushima

Only a few decades ago, Japan and Europe were embroiled in a highly contentious “tradewar.” In the years since then, though, ties have expanded well beyond the domains of tradeand investment, Senior Fellow Akiko Fukushima notes, and we are now cooperating in areas ranging from politics and security to education and cultural exchange. Negotiations are
now underway on a free-trade agreement, and the two regions are emerging as importantpartners with shared values. The following is reprinted with permission from the April 2,
2014, edition of the Japan News.
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O

n March 10, 2014, about 200 representatives of government, academia,
business and media from EU member states, Japan and other Asian
countries gathered at a hotel in the European Quarter of Brussels for a
conference titled “EU-Japan: Ready for a New Stage in Relations?” which I also
attended as a panelist. Hosted by Friends of Europe, a Brussels-based think tank,the conference explored several questions: “What are the roadblocks in fostering
Japan-EU relations?” “How can Japan and the EU move to the next stage of cooperation?” and “What is the grand future vision for the relationship?”In order to answer these questions, we must put Japan-EU relations in a historical perspective. Only a few decades ago, Japan and Europe were embroiled in ahighly contentious “trade war.” In the years since then, though, both the EU andJapan have tried to expand their relationship well beyond the domains of trade andinvestment to areas ranging from politics and security to education and cultural
exchange.
The decisive “Battle of Poitiers” between Japan and Europe was fought not in
1356 but in 1982, when Japanese VCRs claimed almost 90 percent of the French
Akiko Fukushima   Senior Fellow, Tokyo Foundation; Research Fellow, Joint ResearchInstitute for International Peace and Culture (JRIPEC); Aoyama Gakuin University, andLecturer, Graduate School of Aoyama Gakuin University.
79International Affairs
market. In order to stop the massive ﬂood of imports from Japan, France shut
down the customs clearance office at Le Havre and moved it to Poitiers, a development symbolizing the trade war between Japan and Europe during the 1980s.
We have come a long way since then.
There are lingering differences between Japan and Europe over certain issues,
such as capital punishment, but they are certainly not ﬂagrant enough to constitutea “war.” Instead, we tend to focus today on shared universal values, such as freedom, democracy, respect for fundamental human rights and the rule of law, as wellas on common principles like a market economy. In fact, Japan and Europe see
great potential for further collaboration, going beyond the traditional domains oftrade and investment.
In 1991 Japan and the European Community adopted a joint declaration that
expanded our areas of cooperation to political and security areas. Ten years later,in 2001, the two sides adopted an action plan to promote cooperation in areas
ranging from politics and security to education and cultural exchanges. Throughthese steps, relations between Japan, the EU and its individual member states havegrown steadily.
Now the relationship is about to move up to the next stage. Japan and the EU
are currently negotiating two new instruments, namely, a strategic partnershipagreement (SPA) and a free trade/economic partnership agreement (FTA/EPA). Japan and the EU may not have identical economic interests, but when agreement isreached on an FTA/EPA, this will no doubt beneﬁt not only our two economies but
also the global business community.
An SPA, meanwhile, should offer a new paradigm for cooperation on a varietyof political and security challenges. Security issues are no longer conﬁned to traditional concerns about territorial integrity, although these are still very important,as we are witnessing in Ukraine. Worries also include fragile states, terrorism, theillegal trafficking of humans and narcotics, the proliferation of weapons of mass
destruction, pandemics, climate change, natural disasters and cyber-attacks, toname a few. These security concerns are not only diversiﬁed but also intertwined
and indivisible, thus requiring a synergistic approach to ensure an effective response.
When examined closely, Japan and the EU have long been working on similar
agendas at similar locations, although such cooperative efforts have often goneunnoticed. Both have contributed to peace and stability in such areas as the Balkans, Afghanistan, East Timor and the Horn of Africa through the mediums of
diplomacy, security cooperation and development assistance.
Japan’s dispatch of Self-Defense Forces to Djibouti to conduct antipiracy oper80

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ations in the Gulf of Aden is one illustration. On Jan. 18, 2014, the EU’s antipiracy
Operation Atalanta, with the support of a Japanese Maritime Self-Defense Forcepatrol aircraft and a helicopter from the Japanese destroyer Samidare, apprehended
ﬁve suspected pirates in a dhow. In the Horn of Africa, the EU has been training
coast guard members at the Jazeera Training Camp in Mogadishu, Somalia, while
Japan is offering training for the Djibouti Coast Guard. Such capacity-building
assistance can be combined in the future to establish a robust and seamless law
enforcement presence along Africa’s eastern coast.
The EU is pursuing its initiatives in fragile and conﬂict-affected countries in theHorn of Africa and the Sahel region under a “comprehensive approach” combining
a wide array of policies and tools at its disposal spanning diplomacy, security, defense, ﬁnance, trade, development cooperation and humanitarian aid.
Japan, too, is taking a holistic approach under the label of “human security,”
aimed at promoting freedom from fear, freedom from want and freedom to live indignity. Some argue that Japan and the EU have different interpretations of humansecurity, with the EU’s focus being on human rights and freedom from fear while
Japan’s is on freedom from want. Both, though, endorsed the U.N. resolution on acommon understanding of human security in September 2012, which embraces
both freedoms. The concept of human security, moreover, enables us to perceive thecomplex and interdependent nature of people’s anxieties and the importance of
involving a broad spectrum of sectors to address a full range of such anxieties.
While Japan’s traditional geographical focus has been on the Asia-Paciﬁc, thishas recently been expanding to cover broader areas, as exempliﬁed by Japan’s
hosting of the Tokyo International Conference on African Development. Indeed,Japan has deployed an SDF engineering unit comprising approximately 400 personnel to the U.N. Mission in the Republic of South Sudan since 2011, and lastyear, members of the SDF, Japan International Cooperation Agency and nongovernmental organizations worked together to rebuild the main road in the Nabali
district of Juba, the nation’s capital.
Local people had been unable to use the road due to ﬂooding during the rainyseason, and this was considered a factor in the area’s persistent epidemics. But withthe road rebuilt and drainage ditches provided, the road can be used year-round.
The mayor of Juva remarked that, for the people, the project symbolized the arrivalof peace. Sadly, though, conﬂict has returned. Even so, Japan feels that combining
different actors in addition to dispatching SDF personnel, as in the South Sudancase, is an effective approach and has utilized it in several multinational operations,starting with Samara, Iraq, in 2003 and Haiti in 2010.
In its ﬁrst National Security Strategy announced in December 2013, Japan81

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outlined a policy of using the tools and policy instruments of diplomacy, defense,and development assistance to promote the peace, stability, and prosperity of its
own country, the Asia-Paciﬁc region and the international community. Japan has
also announced a commitment to make a proactive contribution to peace based oninternational cooperation.
Thus, despite the differences in terminology—human security versus comprehensive approach—Japan and the EU are two soft-power partners with a common
agenda and common values. Countries that “threaten” each other or do not sharevalues cannot be partners. In the globalized world, many of us may have a common
agenda but not necessarily common values. Capitalizing on our respective strengths
and shared values, Japan and the EU should be ﬁghting alongside one another,rather than against each other. The battles today are not over VCRs but should be
waged against threats to the peace, stability and prosperity of our respective countries and regions, as well as of the global community.
Taking our partnership to the next stage requires imagination, wisdom, political will and leadership to clear the roadblocks to a broad-based coalition, not onlyin traditional economic areas but also in our political, security and cultural relations. We will need to coordinate our activities in putting the pieces of the jigsaw
puzzle together. When the pieces ﬁt, Japan and the EU will emerge as even stronger
architects in the building of a resilient international society. In the age of unpredictability, resilience—the capacity to manage crisis rather than be overwhelmed by
it—will henceforth be a key component of our ties as well as for the international
community.

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International Affairs
March 28, 2014

President Obama’s April Trip
With a Focus on US-Japan-ROK Relations
Chris Nelson

Chris Nelson, the editor and publisher of the influential Nelson Report on Washington’sforeign policy, particularly toward Asia, was a featured speaker at the Tokyo Foundation
Forum held on March 19, 2014. He discussed President Obama’s upcoming trip to Japan,
South Korea, Malaysia, and the Philippines and the administration’s views of Japanese domestic and foreign policy with Akio Takahara, Tokyo Foundation senior fellow and University of Tokyo professor, and Tsuneo Watanabe, the Foundation’s director for foreign and security policy research. The Forum was moderated by Research Fellow Takaaki Asano. The
following are notes prepared by Nelson prior to the presentation, reprinted here with the permission of the speaker.
*

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W

hen I started to draft these remarks, the initial working subtitle was“The Crisis in US-Japan and Japan-Korea Relations.” Indeed, throughalmost lunchtime last Friday, that’s what most of us thought we’d bedealing with, following the apparently unsatisfactory event of Vice Foreign Minister Akitaka Saiki’s visit to Seoul earlier in the week.
Frankly, most of us in DC thought we were really in for trouble between Tokyoand Washington and between Seoul and Tokyo, and there were increasingly public
calls for US “shuttle diplomacy” (former Assistant Secretary Kurt Campbell) and“mediation” (former National Security Advisor Tom Donilon).
But then, almost like a form of divine intervention, considering the enormous
anxiety generated by the December 26 visit to Yasukuni Shrine by Prime Minister
Shinzo Abe, and more recently the announcement by Chief Cabinet Secretary
Yoshihide Suga of what sounded like a reexamination of the entire basis of theKono and Murayama apologies, suddenly we saw the prime minister stand in theChris Nelson   Senior Vice President, Samuels International Associates.
83International Affairs
Upper House and, speaking as prime minister, and not in some personal, informal
remarks, for the first time give a very firmly, plainly worded pledge that he and his
cabinet would not revoke either Murayama or Kono.
As you know—or should know by now—our friends in Seoul monitor every
word from senior officials in Japan. Indeed, they parse every syllable, much as
sometimes the Japanese media and officials scrutinize every utterance by President
Barack Obama or, say, Ambassador Caroline Kennedy.
Let me risk a mixed metaphor by saying, when you get a gift from heaven,
don’t look a gift horse in the mouth! Translation: I was inundated, literally, withvery informed messages from scholars, journalists and political activists in Japan,
Korea, and the US explaining in excruciating detail all the possible nuances that could end up destroying themeaning and effectiveness of Abe’s
pledge.
So I say to them and ask you:
Does anyone think for one minute
President Park Geun-hye doesn’tknow all those possible reasons for
doubt, even cynicism? For us, the botChris Nelson
tom line now is very clear:
President Park welcomed what
she heard from the prime minister, because after months of saying she would nevermeet with Abe-san until there was a full acceptance of the truth about history as
seen by the ROK (and, indeed, most of the world), hours after the prime minister’s
speech to the Upper House was conveyed to Seoul, we see her express a willingness
to meet and to try to find a common ground to work for the future, rather thanbattle over the past.
In fairness to the second Abe administration, the malaise in US-Japan relations—in terms of confidence in each other—predates the difficulties between Tokyo and Seoul. Years of US frustration with weak prime ministers culminated in
the near disaster of the first couple of years of Democratic Party of Japan government.
It started with what seemed like half the Diet traipsing off to Beijing with Ichiro
Ozawa to kiss Hu Jintao you-know-where, and you remember the media speculation about Japan “tilting” to China. Hard to recall how anyone could have beenthat naïve, isn’t it!
But despite the continued stalemate over Futenma, US-DPJ relations got better
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during the course of the Yoshihiko Noda administration, and officials like then-Foreign Minister Seiji Maehara helped restore Japan’s reputation as a serious partnerand player.
But if I launch into all this now I’ll never get to the Malaysia and Philippines
parts of the Obama mission, which I want to do as the Philippines serves as a“might have been” or, indeed, as an emerging “worst case” for what Japan-China
could become if we don’t all handle things correctly.
So let’s start down south and work our way up, and I should start by saying
my original “crisis” title also was based on my full agreement with Abe-san’s remarks at Davos that so upset the Europeans. Asia is increasingly at risk of a“1914”-style mishap leading to a catastrophe that, of course, no one wants.
Malaysia
The “good news” part of my original speech was going to start with Malaysia andSoutheast Asia because Prime Minister Abe and his team are universally seen in DC
as doing a great job of reaching out and solidifying Japan’s relations throughout
the region, so this is a good place to begin now.
To be frank, the US needs to do a better job with “KL,” as us Asia-types like tocall Kuala Lumpur, and it really goes back to the Bill Clinton era, specifically to avisit by then-Vice President Al Gore. Horrified White House staff told us at the timethat Gore basically made an ass of himself, bullying, hectoring, and playing the
Ugly American role as though following a bad script.
It wasn’t that he was wrong to be focusing on the environment, human rights,
democracy, and so forth, but there are ways to do it and then there are stupid ways
to do it, and Gore managed to do it so badly, the government to government level
relationship was thrown into a pit from which, in many ways, it’s never quite recovered.
Obama took office in early 2009 and came to announce the “pivot” to Asia,
which was then and is still today largely misunderstood and not entirely satisfactorily explained by the administration, although its “messaging” has improved overthe last year or so.
The fact is the pivot was always more about a re-focus on Southeast Asia,
ASEAN especially, since then, as now, there was never any drop-off in US focus on
Japan, China, Korea and, especially, North Korea. The vast majority of US forward-based armed forces of every branch then and now remain in Northeast Asia
(as, indeed, our friends down on Okinawa always remind us!)But for years under George W. Bush, Southeast Asia was an afterthought, with85

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nearly no significant summit visits to the region, despite the increasingly vocal pleasof the US business community then, as now, largely good Republicans, I’d note. All
that changed under Obama and, stimulated by his personal participation in APEC
and the ARF, TPP has helped achieve much of the “re-focus” that was the original
intent of the Pivot, pending, of course, successful results.
So back to Malaysia and the Gore visit; when you throw last week’s depressing
recurrence of the Anwar persecution—not prosecution—into the pot, or pit, maybe,
here we are again, and this time it’s not our fault. Even so, we’re hoping that
Obama, a far more sophisticated analyst than most, will speak and act in ways
which reflect the importance of Malaysia and the ASEAN region per se.
That, of course, is why Obama has rescheduled and persevered with his longstanding plans to visit, but which the budget wars with Congress made initially
impossible. This time let’s hope that Ukraine and who knows what won’t intervene!
A special focus is expected to be on improving chances for Malaysia to workout its remaining issues on TPP, and Malaysian friends say they badly need to hearfrom Obama himself how important that is to the US. That includes giving the
local business community a boost and offering the example of US companies as bestpractices on health, education, clean energy, entrepreneurial spirit, and so forth.
As you know, reform is never easy, and Prime Minister Najib Razak is underserious domestic pressure to quit TPP (alas the downside of Anwar’s domestic opposition).
Still, like Abe-san, Najib knows he needs TPP to help push domestic economic
reform and growth. Unlike US-Japan, America’s trade with Malaysia can be diverted elsewhere, and the postponement of an FTA back in 2008 puts even moreemphasis on TPP this time. So the White House knows all this, and we’ll see how
Obama handles it.
The Philippines
The Philippines is a former US colony, most Americans conveniently forget, since
our people are not taught much about our own Imperial Age, preferring a national
myth that grants pure motives and positive outcomes to a great deal of the nineteenth and early twentieth centuries.
(Conservatives in Japan and China aren’t the only ones who prefer to use “history” as a form of psychological identity therapy, if that’s any consolation to thoseworking to overcome the current tensions with Seoul, in particular. But we’ll get tothat shortly.)
We suspect that no matter what may be on the official agenda, what Obama
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and President Benigno Aquino are going to most seriously focus on will be China.
And while the situation of the Philippines “versus” China in superficial ways resembles that of China-Japan, the differences are what have helped create the on-going, largely depressing situation Manila now faces.
While the US-Philippines mutual defense alliance is in many ways similar to the
US-Japan arrangement, the determining fact is the fundamental weakness of thePhilippines in virtually every area that counts for strategic strength, starting ofcourse with air and naval forces.
Manila basically had nothing with which to resist the Chinese use of paramilitary “civilian” ships and aircraft to carve out areas of dominance in traditional
fishing grounds, and lately the overt use of PLA Navy and Air Force assets to enforce the takeover. One old Coast Guard cutter, barely armed, and one more on theway from the US, present no deterrent, and the reality of the situation remains thatthe 7th Fleet is not about to steam around defending anyone’s fishermen from
China except under pretty dire circumstances that we all hope we’ll never see.
But that reminds us—you saw last week the Chinese block a food shipment tothe brave Philippine Marines holding out on a ship wrecked on a reef within territory now taken-over by the PLA Navy. Our good friend Ralph Cossa of the Pacific
Forum CSIS in Hawaii has a great idea about how to make a point and do something at the same time:
The US Navy should respond to an SOS call from that Philippine crew as required by international maritime law on a humanitarian basis and airdrop foodand medical supplies to those guys before they are starved out. What do you thinkof that idea? I like it.
To short-hand what we could spend an hour on, there is only one upside to thevery sad downside now facing Manila: a Chinese “fait accompli” of forcing accessto and basically assuming control over traditionally international and/or Philippine
maritime resources.
And that upside is frankly pretty scary:
There is now general acceptance in the US that Beijing is trying the same set oftactics, the same strategy against Japan in the Senkakus. Only unlike poor Manila,
Japan has perhaps the largest, most modern, up-to-date and effective air and sea
military of anyone in North Asia save the US, although of course China is rapidly
building up assets and capabilities across the board.
(And we don’t want to slight our South Korean allies, and let’s remind ourselves—both Americans and Japanese—the Koreans are our allies!)
Our Chinese friends, as Kurt Campbell always calls them, only slightly tonguein-cheek, for most of the 2000’s seemed on a roll: Beijing’s “soft power” campaigns
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seemed to be making friends all over, China’s always-growing economy seemed topromise a new model for everyone in Asia, and the 2008 financial collapse, coming
after the catastrophe in Iraq, seemed to presage the rapid decline of the UnitedStates, with all that implies.
But, perhaps like Mr. Putin in Ukraine with his takeover of Crimea, China got
overconfident and arrogant. It began pushing around neighbors like Vietnam, thePhilippines, and, finally Japan, in ways so overtly military, and using argumentsthat sounded like a return to nineteenth century national state imperialism, thatfrankly, the US now finds itself more in demand as a strategic partner than at any
time in recent memory.
ASEAN for nearly 10 years has been in on and off again efforts to seriously
negotiate a Code of Conduct for maritime exploration, rights of passage, and how
to handle confrontations, and for the past couple of years it’s been Beijing, using
its proxies to block a real agreement.
Clearly we all have to keep trying. No doubt this will come up throughout
Obama’s trip.
Now having said all that...let’s step back a bit and try to see if we can encourage a less emotional reaction to China. It is not the first rising power to start behaving like one, it is not the first rising power to demand that the existing power
or powers—call it the “hegemon,” if you want—move over a bit and cede rule-making and interpretation power, share them, at least.
And it is not the first rising power to spend a hell of a lot of money on armaments and the physical tools of both offense and defense, and likely it won’t be thelast. Indeed, Japan—pacifist by experience and Constitution—after all spends a lotof money on arms, equipment, and a very fine military.
The point, as Don Rumsfeld so memorably asked many years ago, is what
China plans to do “with all this military”!
So what does worry a lot of us—scare a lot of us, to be frank—is an increasing
sense that for all its “lecturing” of Japan about “history,” the Xi Jinping administration seems to be following an almost nineteenth century model of imperial domination: if you want and need resources, you have to physically control the resources.
Why anyone would want to repeat the worst aspects of the twentieth century
is hard to understand. (And I have to say, to be put in the position where Chinafeels justified in lecturing about “history” is like being called ugly by a frog. The
day that Chinese authorities allow an honest discussion of Mao, the Great Leap
Forward, the Cultural Revolution, and Tiananmen Square is the day China canlecture Japan about anything, but we’ll get into that more below.)88International Affairs
To sum up quickly on the China risk: We in DC may be kidding ourselves, but
the sense is that for all its bullying, the leadership has a good bottom line sense of
its real interests, and there will remain another generation of regional peace andstability and economic growth. So in reality, what we fear most isn’t “1914” bydesign, but by accident.
On balance, there’s evidence that the PLA Navy is getting more sophisticatedin risk management. We understand from good sources that the recent USS
Cowpens incident had one bit of important good news: At some point, the two
directly involved ships’ captains talked directly, something the PLAN has not allowed before.
The greatest risk of accident leading to escalation therefore remains the PLA
Air Force, whose pilots remain less a known factor than a senior ship’s commander.
This has been true since well before the 2001 Hainan Island confrontation between
a PLAAF pilot and an EP3 US surveillance aircraft.
South Korea
We’re going to keep this section brief, as a great deal of the Obama/Park discussion
we can be pretty sure will be about “Japan” and Abe specifically. So let’s hope that
nothing untoward happens between now and then to change the conversation in
directions no one wants.
The Korea-US FTA has had its second anniversary, and you’ve likely seen thecriticisms of US auto interests, led not just by the usual folks on Capitol Hill but
also NGOs, who have increasingly lined-up against TPP for a variety of reasons.
We can talk more about that in the
Q&A if you want. Seoul of course isin a “watch and learn” mode on TPP,
as it’s already got its FTA with the US,
and it’s doing RCEP with you and ourChinese friends.
Whether that’s ever going to see
the light of day I’d love to know, but
perhaps my visit this week will help
shed some light.
Always a major focus of any USROK meeting is what’s up with North Korea and, basically, what the hell are wegoing to do! I’d prefer to leave the Pyongyang analysis to the Q&A’s for fear I’ll
talk for another hour and we’ll all be late for dinner.
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Quickly for now: Kim Jong-un is increasingly seen as a potentially unstablesource of risky decision-making. His late father, for all his personal brutality andaggressive actions, always seemed to have a sense of limits: just how far he could
go with “provocations” short of a real risk of war. The “Norks” as we call the
North Koreans in DC have, for example, never publicly admitted sinking theCheonan.
But the young Boy Marshall’s recent decision to execute his uncle—and intelligence sources generally agree that Kim also ordered the deaths of the entire family and many top supporters down to distant cousins—this isn’t “just” brutal by
any standard, its unprecedented by DPRK standards as well.
Not since 1955 has a “Kim killed a Kim,” we are told by experts. And theirconclusion from this is that the young man may be dealing with internal instability
he himself has created—with unforeseen consequences.
Last but not least on North Korea—for US policy, it always comes back to
China—what can we get Beijing to really do about their unfortunate client. Increasingly over the past couple of years, most China experts agree that the leadership iscoming closer and closer to some possible break point with the DPRK, but it neverquite happens.
Beijing’s fundamental calculus remains to preserve stability at almost any cost,
although the past two years have seen China willing to vote for and to enforce, tosome extent, various UN sanctions.
Last week, senior Chinese officials actually talked about a “red line” on the
Korean Peninsula in ways which seemed definitely aimed at warning Kim Jong-un
not to start something really dangerous.
For now, it seems that Obama’s policy will remain letting President Park takethe initiative in developing Kim’s intentions and then to see if any return to negotiations are possible.
Japan
So let’s move to the Tokyo stop. My old editor at UPI first taught me about the“news”: He said, “Chris, when the airplane lands safely that’s not news.” So muchof the US-Japan relationship, indeed, probably most everything about it, has solong been in the “no news” category that I think this causes us to do two dangerous
things: First, to take the good stuff for granted and only focus on the “difficult”;
second, to forget that the “difficult” stuff is largely a government-to-government
thing and not a problem with “Japan” or the “United States,” and especially notpeople to people.
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Our two countries are now so intertwined socially, economically, and intellectually, that we take for granted that my cousins in rural Ohio can buy sushi in
Buehler’s Market in Wooster, in the center of the Amish farm belt. Granted it’s
terrible sushi, but it’s there, and probably half the farmers are driving Toyota andNissan trucks and using Yamaha farm equipment to grow the locally produced
vegetables and meat.
The Japanese-American community is now so fully integrated into the American community that no one thinks twice about it, although there’s a downside for
the GOJ sometimes in that the old community has lost any sense of political cohesion. One obvious, over-due “remedy” is to vastly increase—or actually to workand spend to refurbish—the enormous educational and cultural exchange programs which have been allowed to lapse so that very few major universities now
have serious Japan study programs on anything but art.
A really important point: in many ways, this integration is fully operational at
the international cooperation level, at the UN, in the international financial institutions, and at the professional level between Gaimusho and State, or DOD andMOD. Maybe not so much at the Agriculture Department, come to think of it. Oh
well, let’s see if TPP can help at least a little bit!
Before getting to the “crisis” issue, there is of course much “good news.” There’s
no question of many successes over the past year or so, and the current security
guidelines review really does offer a historic opportunity to expand our alliancecapabilities in ways that we never dreamed of previously.
Talk to any administration player and once you get through the Abe/Park issues, the prime minister’s new National Security Council, the Secrets Protection
Act, and the possibility that Japan might exercise the right to collective self-defense
and relax self-imposed limitations on defense industry cooperation with US companies, all are seen by US officials to offer important new opportunities for cooperation on regional and global security.
TPP of course is the very definition of opportunity and crisis, since failure toaccomplish the deal, whether this year or not, will be a huge setback for the US“rebalance” strategy, and, we’ve been assured by economists as well as Abe himself,a blow to Abe’s “third arrow” and the reforms needed for economic growth.
I’ll be glad to talk about the DC part of the TPP conundrum during the Q&A’s
if you want.
Checking with the USTR just before I left on how things went last week between Wendy Cutler and her Japanese counterparts, we heard the same as you here
in Tokyo: Negotiations on the TPP have come to a crucial crossroads, and from theDC perspective, from Obama on down, the administration is looking to Japan’s
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leadership to carry the negotiations across the finish line. Conclusion of this process will support new jobs, foster new business opportunities, and promote economic growth.
Overall, speaking privately and informally, a senior Administration official
stressed this to us in language we want to underscore:“Strengthening our alliances, and particularly our trilateral cooperation withJapan and the ROK, remains one of our most important policy priorities for the
Asia-Pacific. Improving ties between the two countries is in our strategic interest,
and we have encouraged both countries to work together to take steps that would
contribute to reconciliation. We were encouraged by Abe’s March 14 remarks to
the Diet, which were a positive step for the relationship. We don’t want to mediate
between our two friends, but remain closely engaged with both in making progress.”
Americans don’t do “nuance” all that well, and compared to Japanese, we don’t
do nuance at all. So note please that our administration friend isn’t declaring victory and scheduling a parade. Strengthening alliances and “particularly trilateral
cooperation with Japan and the ROK remains” is followed by words that show theadministration’s appreciation of this as a work in progress, work still to be done,
and so far something to be “encouraged” so long as “both countries” work to takesteps that “would contribute to reconciliation.”“Would,” not “have.” All these action verbs and adverbs are conditional, aren’t
they! What we’re being told is that the Obama Administration is just as worried
now as it has been for the past two or three years that the senior leadership levels

From left to right, Tsuneo Watanabe, Akio Takahara, Chris Nelson, and Takaaki Asano.

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International Affairsof both Tokyo and Seoul have taken turns doing and saying things which theyknew could not possibly contribute to “strengthening trilateral cooperation” andthe alliances.
Speaking personally, what truly mystifies me is why the Abe administration
until last Friday seemed indifferent to the negative effect in Seoul, especially, of
provocative remarks and actions. Either the alliances are important or they aren’t.
Why do something that just gives a free club to hit you with, especially to China?
I don’t get it.
I have to note that administration officials are being just a tiny bit disingenuous
when they say “we don’t want to mediate between our two friends.” Well that’s
certainly true in the sense that the person who jumps into a family fight rarely gets
thanked, and sometimes gets punched in the nose.
But the fact is that the Obama administration has been “closely engaged” since
the Noda/Lee administrations and deeply since President Park and Prime Minister
Abe took power, and we can tell you that everyone involved at State, DOD, theNSC, and in each embassy, has been worried as hell, and often equally frustrated.
So it’s no exaggeration to say there was a palpable feeling of relief in DC whenword came, first, of Abe-san’s remarks in the Upper House and then, the longhoped for positive response from Seoul. Washington didn’t “mediate” all that, but
it sure was in the middle of it.
Back to “nuance” for a minute: We understand that Ambassador Kennedy hascome under quite a bit of quite personal criticism for her very nuanced expressionof “disappointment” over the prime minister’s Yasukuni visit. I can tell you that thereaction in DC across the board from every friend Japan cares about there was“that is one hell of a Christmas present.”
In my Report and since then, I characterized Kennedy’s “disappointment” as“anodyne,” which is a fancy $2-dollar word meaning, among other things, emotionally flat—colorless even. So I was as surprised as the Obama folks when we
began to hear that Japanese of all political persuasions seemed to be stunned at
how rude and kind of scary and frankly inappropriate was that word “disappointment.”“How could you say that to us, you know the Chinese are kicking us around,you know the North Koreans are still holding our people, you know our South
Korean friends are mad at us.” This serial lament came in from all sides in Japanand we all were frankly a bit stunned.
To be frank, the real reaction of senior US players, and, we suspect but do not
know, the president, was forcefully expressed in a vernacular not appropriate forpublic events. Knowing this as we all did, when State decided to issue the very
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bland “disappointment” remarks through Ambassador Kennedy, most of us were
surprised something far, far stronger wasn’t said.
The reaction to Kennedy dramatized a private conversation we’d been having
ever since last year and the first glimmer of statements in the Diet and in local political campaigns surfaced which featured what are called “denier” views on the
Nanjing catastrophe, the invasion and occupation of much of China itself, and ofcourse, the increasingly personal attacks on the veracity of surviving comfort
women.
That debate, which continues to this day, is: granted we are Japan’s best friendinternationally, that we are each other’s partners in so many things, but how do weachieve a balance between cooperation and constructive commentary and, whennecessary, constructive criticism when we see Japanese leaders doing things that we
think affect our legitimate interests.
More succinctly, what do friends of Japan say in private versus what do they
say in public, with the goal of being effective, and not just sounding like Al Gorein Malaysia in 1999?
Believe me, we’ve seen the polls showing that while the majority of Japanese
don’t believe the version of history preached by the most conservative elements of
the Abe coalition, by far a majority of Japanese resent being “lectured” on morality
by not just the Chinese, the Koreans, and other Asians, but especially by their mostimportant ally, us Americans.
And until last Friday, there was no consensus on what “method” is intellectually honest, and, most especially, what method “works.” There was until Friday
great concern that based on the evidence, unless the American critics approachedactual rudeness in public, there would be senior Japanese officials who concluded
that private remonstrations were not serious and therefore there was no real penalty for visiting Yasukuni despite the crystal clear US opposition because of ourconcerns over the ROK alliance and our conviction that the visit handed Beijing aclub to beat us both over the head with and was stupid! Sorry, no “nuance” there.
Well I didn’t mean to go on at such length on this, but given the past few weeks,
I thought it might be useful for you to hear how the dilemma is being analyzed
back in DC.
And it helps lead to my final point—the frequent expressions of doubt we hear
about how many Japanese are worried that despite the Mutual Defense Treaty, you
won’t be able to count on us if there really is a military crisis with China. The gistof the doubter’s school seems to be that because China trade is so important andbecause China has nuclear weapons, the US won’t actually fight for Japan if we’re
asked to.
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We could spend the next hour on this, but for now, let me say that ever sincethen Secretary of State Hillary Clinton said very clearly that if China used militaryforce against Japan to try to take control of the Senkakus, Article 5 of the MDT
would apply.
Before they cut off the mike, let’s conclude by saying of course President Obama
is going to be dealing with all of the above, and more, during his visit here and inSeoul, and further south. He will likely have the traditional joint press appearancesin each stop. And he will have to be prepared to say things in public things about
topics which likely the professionals would far prefer remain in private.
I will take the liberty of predicting a private remark from Obama to Abe: “Mr.
Prime Minister, the United States welcomes your pledge made to the Diet that you
will not take back the Kono and Murayama apologies which are so vital to thefunctioning of our alliances and our mutual goal of good relations throughout
Asia. And Mr. Prime Minister, I will hold you to them, with my thanks.”
For the first time in many months, the events of last Friday offer all concernedthat the current positive tone will be borne out by events. Fingers crossed.

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May 1, 2014

Moscow and Beijing Likely to Become Closer
Paul J. Saunders

Russian President Putin will be visiting China in late May at a time when Russia increasingly finds itself isolated following its annexation of Crimea. Western sanctions are driving
Moscow and Beijing closer together, and this could prove awkward for Japan, Paul Saunders notes, which seeks Russian gas but is also receiving signs from Washington to limit
commercial ties with Russia.
*

*

*

D

espite some disappointment that the United States and Japan did notreach an understanding on the Trans-Pacific Partnership trade agreement,
President Barack Obama’s recent trip to East Asia has apparently helped
to reassure US allies and partners and produced some modest accomplishments,
such as a new defense cooperation agreement with the Philippines. Nevertheless,Obama’s personal diplomacy is one effort among many in the region—and it may
soon be overshadowed by another leader’s visit, when Russian President Vladimir
Putin arrives in Beijing for talks with China’s Xi Jinping, now expected on May
20–21.
Putin’s trip comes at a tense time in East Asia. But, of course, everything seems
to be coming “at a tense time in East Asia,” and it is far from clear when this “tensetime” will end because it is far from clear whether, when, or how the two main
drivers of the region’s uncertainty—China and North Korea—will alter their conduct.
With this in mind, it may actually be more important that Putin’s meeting with
Xi comes at a tense time in Europe, where many believed that the arrival of thetwenty-first century had put an end to such problems. Russia’s annexation of
Crimea has forced an unwelcome change in this thinking.

Paul J. Saunders   Project Member, Tokyo Foundation’s Contemporary American Studies
Project; Executive Director, Center for the National Interest (Washington, DC).
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Deepening Standoff
This matters in Asia because the confrontation between the United States, Europe,and Russia over Ukraine continues to escalate with no obvious resolution. The
April 17 Geneva agreement on de-escalating the crisis offered brief hope but now
appears to have collapsed due to a combination of Moscow’s unwillingness or inability to influence Russian-speaking groups occupying government buildings ineastern Ukraine and the Kiev government’s creative legal maneuvers, such as incorporating right-wing militias into a new National Guard so that they are no longer“illegal armed groups” and need not be disarmed under the deal.
The United States and the European Union have responded to this with new
sanctions on Russian officials, legislators, and others; Washington has also sanctioned many new banks that US officials allege are connected to Putin associate
Gennady Timchenko. American and Russian officials don’t appear to be communicating effectively with one another, and expanding violence in Donetsk and other
cities in the country’s eastern regions could spiral beyond anyone’s control.
The deepening standoff—especially between Washington and Moscow, as European governments are more reluctant to risk a conflict—is putting heavy pressure
on Russia’s weak economy, producing massive capital flight, a softening stock market, and a sliding ruble. Russia’s economic officials have also acknowledged negative GDP growth in the first quarter of 2014.
In practical terms, this likely has less to do with sanctions against Russia thanit does with Russia’s conduct and the uncertain endpoint of the crisis, both ofwhich deter foreign investors even as they encourage Russia’s wealthy to seek safe
havens for their money, ideally beyond the reach of both Western and Russian officials.
New Gas Deliveries to China?
Worse from the Kremlin’s perspective are US threats of so-called “sectoral sanctions” that could target Russia’s energy and/or banking sectors. When combinedwith growing EU resolve to cut energy imports from Russia by exploring options
for new domestic production and expanding imports from alternative suppliers,
this could send Russia’s federal budget—in which over half of revenues come fromoil and gas taxes—into deficit.
Before the crisis, the Russian government already faced some unpleasant decisions in the oil sector, where excessive tax rates are discouraging new production
to replace disappearing output from aging oil wells. Moscow’s problem is that the97

deep cuts in tax rates necessary to boost investment would sharply reduce revenues
at a time when the Kremlin’s budget commitments to social spending are only increasing.
As a result, top Russian energy experts told me in Moscow last week that Gazprom is virtually certain to make significant price concessions so that Russia andChina can finally sign a long-awaitednatural gas deal under their existing
framework agreement when Vladimir
Putin visits Beijing later this month.
Gazprom’s deputy chief executive Alexander Medvedev has since thenpublicly stated that he expects to sign
the agreement. Executives at Novatek,
Russia’s second-largest gas producer,
also expect to sign a contract for liquified natural gas deliveries to China.
Russian officials increasingly appear to believe that growth in the Russia-China
economic relationship may offset any damage to Moscow’s trade ties with Westerncountries. Russia is prepared to conduct this trade in Chinese yuan, if necessary, tostay beyond the reach of dollar-oriented financial policy measures.
Russia’s efforts to expand its non-US and non-European markets is likely to
put Japan in an especially awkward position, with strong economic imperatives
arguing in favor of expanded energy relations—especially if Russia’s energy companies are somewhat more flexible on pricing—and equally strong political signals
from Washington to limit commercial ties to the country. In addition to the narrowissue of new sales for Russia’s firms and new taxes for its government, US officials
are also concerned about Moscow’s access to key technologies.
Russian experts believe their country’s energy sector can get most of the technology it needs from China but acknowledge that only the United States and Japan
can provide some LNG equipment.
A broader question is how far this new Russia-China cooperation may extend
beyond energy exports. Of perhaps greatest importance to the United States andits allies in Asia is that Russia’s arms exports to China have slowed significantly inrecent years, in part due to Moscow’s intellectual property concerns. Renewed hightech arms exports could contribute substantially to China’s military modernization.
Though Russia itself may have reservations about stepping onto this path, aworsening confrontation over Ukraine may lead them to conclude that they are
already on it—whether they want to be or not.
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