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July 22, 2023

Japan-ASEAN's 50th Anniversary of Friendly Relations

(This is a translation of the original article in Japanese in July 4th Newsweek Japan)

The Emperor and Empress of Japan have completed their first overseas visit to Indonesia. Watching it on TV, I thought, 'That's great, they were able to leave an impression of the relationship between the two countries overcoming the enmity of World War II. But why Indonesia now, and why only Indonesia?' However, I soon came to realize that this year marks the 50th anniversary of Japan-ASEAN friendship, and Indonesia is the current chair of ASEAN.

ASEAN may not be highly recognized, but it has been an important arena for Japan's post-war diplomacy. During World War II, Japan had marched through much of Southeast Asia, so after the war, there were compensation issues to address. It took over 20 years for negotiations regarding compensation and alternative economic cooperation to settle.

At that time, Southeast Asian countries were crucial to Japan as a replacement for the Chinese market, which had been lost after the war. Pre-war, the Chinese market (including "Manchuria") had absorbed nearly 30% of Japan's exports, but it vanished entirely due to the communist takeover in 1949.

Moreover, Southeast Asian countries were considered the world's poorest nations, and apart from Vietnam War-related matters, the United States had little interest in these countries. For Japan, therefore, Southeast Asia became a crucial platform for its independent foreign policy.

ASEAN was formed in 1967 when North Vietnam posed a threat by attempting to spread communism to countries like Thailand in a domino effect. Japan expanded its official development assistance (ODA) and Japanese companies built factories in the region, prevailing their economy. In 1973, ministerial-level talks between Japan and ASEAN countries were held for the first time to address the issue of Japanese synthetic rubber exports pressuring ASEAN's natural rubber exports. This marked the beginning of Japan-ASEAN friendship.

In 1977, then-Prime Minister Fukuda visited Southeast Asian countries and announced the "Fukuda Doctrine." Japan pledged to provide investment and economic assistance for the improvement of living standards in Southeast Asian countries, moving away from condescending aid and investment. Japan's cumulative ODA to ASEAN countries has exceeded 180 billion dollars, and its annual direct investment is about three times that to China, significantly aiding in the remarkable development of these nations. Japan's ODA and corporate investments are now highly regarded globally, and this success story started with ASEAN.

The author's first travel to Southeast Asia was around 1975. The outskirts of Bangkok still had dusty, unpaved roads reminiscent of Japan's post-war days, and in Cambodia's rural areas, people lived in simple huts made of rattan--well-ventilated structures. Now, ASEAN has a population of 650 million people and a combined GDP of 3 trillion dollars.

It is hoped that ASEAN, with Japan's efforts, will become an important member of the free and democratic alliance and the "free and open Indo-Pacific region." However, reality is not that sentimental. Some ASEAN pundits believe they have achieved greatness on their own and that Japan's influence has waned. Many prefer China, which provides generous funds, over the US, which often demands democratization and internal cleansing. Vietnam and the Philippines are the only ones fearing political pressure from China, but they still maintain a delicate balancing act between China and the West.

In recent years, trade between ASEAN countries and with China has grown significantly. Some ASEAN countries have even started thinking, 'We don't need the US anymore; we can survive with our relationship with China.' However, they fail to recognize that a substantial portion of ASEAN's intra-regional and ASEAN-China trade consists of components and semi-finished goods for products destined for export to the US, Europe and Japan.

Economic development usually brings about an increase in the middle class and fosters democratization. However, many ASEAN countries find themselves trapped in the "middle-income trap." Myanmar and Thailand have their military firmly in control, while other countries have ruling elites forming conglomerates that exacerbate income disparities or are unable to tackle corruption. Some are too concerned about fairness among various ethnic groups within their countries, hampering productivity and holding back dynamic moves.

ASEAN is not always united, nor does it stop practicing diplomacy to maintain a balance between major powers. Nevertheless, as a significant bloc in South Asia, it should be treated seriously in all aspects: politics, economy, and defense. Collaboration with the substantial networks and resources of overseas Chinese and Indians should be included in this equation as well.