## (b) Policy formulation and institution building

In addition to assisting in the development of economic and social infrastructure, assistance in areas such as macroeconomic stabilization, development of policy and institutions on trade and investment, and development of policy and institutions for information and communication society, is indispensable for promoting private-sector led sustainable growth.

To promote macroeconomic stability, Japan will assist in the formulation and implementation of appropriate and sustainable fiscal and monetary policy, public debt management, and economic policy, and will place an emphasis on assisting the formulation of industrial policy designed to expand trade and investment, and of rural and regional development policy in the light of decentralization. In concrete terms, assistance will be provided for institution building in the fields of economic management, finance, tax, customs and the development of human resources, and the development of local and supporting industries. To developing countries that are in transition to a market economy, particular support will be provided for policy formulation, institution building, development of legal systems, and the fostering of human resources to facilitate such transition.

In order to develop institutions to promote trade and investment, Japan will assist the improvement of systems and institutions that are in accordance with international economic rules taking into account each country's economic situation. This includes, for example, assistance with government procurement standards and certification systems, protection of intellectual property, and improvement and operation of physical distribution networks. Eradicating corruption, implementing legal and institutional reforms, improving the efficiency and transparency of public administration, and strengthening the administrative capacity of local government are important to building a fair and democratic society and also to improving the investment climate. For this purpose, Japan will assist the capacity-building of governments to improve governance.

## (c) Assistance in human resources development

Developing human resources improves the quality of labor force and provides an impetus for yielding technological innovations. In view of Japan's own experience of economic development, development of the human resources necessary for national economic and social development and for science and technology in both the government and private sectors played a major role in economic growth. Support will be provided to improve basic education, higher education and vocational training in developing countries, and to assist the development of human resources in a wide range of fields by, among other things, providing scholarships to study at higher education institutions in Japan. Through the dispatch of experts to developing countries and training programs, Japanese technology, knowledge and human resources will be utilized for the development of human resources in a range of fields, such as industrial development including the development of small and medium enterprises and information and communications.

## (d) Support to strengthen economic partnerships

Promoting trade and investment at the regional level contributes directly to the economic growth of countries in a region, and contributes to mobilizing finance required for development and raising technical standards in the private sector. In addition to providing support for the development of infrastructure that spans countries and regions, the capacity development of institutions and human resources in the areas of trade and investment will be assisted. In the case of countries and regions with which Japan is promoting economic partnerships, support will be provided to improve legal systems relating to the protection of intellectual property and competition policy, and to improve and strengthen enforcement of customs and immigration control, and in fields such as information and communications technology (ICT), science and technology, small and medium enterprises, energy, agriculture and tourism.

## (3) Addressing global issues

Global issues such as global warming and other environmental problems, infectious diseases, population, food, energy, natural disasters, terrorism, drugs and international organized crime pose a threat to humanity around the world, irrespective of national borders. In order to achieve the stability and prosperity of the international community, Japan will play an active part in addressing these issues by using its ODA. Of these issues, the Medium-Term Policy will focus particularly on