Japan Prints Money to Buy Foreign Assets

Source: LTN
Japan, the world’s 3rd largest economy that is trapped by its stagnant economy, is venturing into new overseas market to boost its investments so as to revitalize the sluggish economy and seek more international influence.
The East Asian country, now, holds a large international conference from this Saturday to Monday participated by African leaders to discuss the development of the continent, which now maintains a high speed of economic growth rate.
The Fifth Tokyo International Conference on African Development (TICAD V), under the theme of “hand in hand with a more dynamic Africa,” attracted leaders and delegates from over 40 of 54 African countries.
Compared with 13 firms in last fair, more than 70 Japanese companies, covering water purification, transportation, communication, health care and food industry, attended the African Fair 2013, an affiliated event of the TICAD V, showing their ambitions to pioneer the dynamic African market.
African countries as a whole remain a world’s powerhouse with an average 5.8-percent growth rate in gross domestic product since Y 2000, while overseas direct investment in the continent tripled from US$15-B in Y 2002 to about US$50-B in Y 2012, according to official figures.
Since Japan suspended its nuclear power facilities after the Fukushima Daiichi nuclear plant disaster in Y 2011, the resource- poor country is eager to discover more energy deposits worldwide to meet its tremendous shortage.

The energy crisis made Japan re-recognized Africa’s role in energy support to Japan as several African countries such as Libya, Nigeria and Angola are oil and natural gas giant exporters in the world. Both on investments in and trade with Africa, Japan is way behind countries like the United States, France, India and China.
The continent preserves a great number of minerals, particularly rare earth that Japan needs badly for its high-tech industries. Japan and South Africa last month agreed to accelerate a joint rare earth program in an effort to diversify its import channel.
Besides economic co-operation, Japan also focuses on enhancing political ties with African countries so as to increase the countries global influence.
Japanese Prime Minister Shinzo Abe hosted a special session under the TICAD V on situation in Somalia Friday and will chair a meeting between leaders of Africa and Japan to address U.N. Security Council reform Monday.
The Japanese government has approved a revision of the SDF law to allow the forces use land vehicles to transport Japanese and other nationals overseas and the government is also planning to revise the country’s constitution to allow the SDF exercise collective self-defense rights.
Not only with the consideration of booming Japan-Africa ties, but also in a more deeply geopolitical thinking, Japan’s “out- going” diplomacy attempts to change its awkward position in neighborhoods as its right-deviation and repeated provocative words, indeed, angered neighboring countries.
Under such circumstances, Japan has to focus on other destinations to blanket its weak performances in Northeast Asia.
Indian Prime Minister Manmohan Singh just concluded his 4 day visit to Japan Thursday with about a US$700-M Japanese loan for Mumbai’s subway project and another US$3.48-B for other 8 projects in hand.
New Delhi and Tokyo said they will finish a nuclear co-operation agreement that started in Y 2010 as soon as possible in a move to boost India’s nuclear energy generation, as well as Japan’s economy under Abe’s growth strategy.
“I would like to strengthen relations between Japan and India based on a strategic and global partnership,” Mr. Abe told a joint press conference after met with Singh Wednesday.
Mr. Singh, for his part, said India attaches “particular importance to intensifying political dialogue, strategic consultations and progressively strengthening defense relations including through naval exercises and collaboration on defense technology.”
Following the 2 countries’ 1st joint-naval drills in last June, Messrs Abe and Singh “decided to conduct such exercises on a regular basis with increased frequency,” according to an official statement released after their meeting.
The 2 nations will also discuss ways to cooperate on using Japan’s US-2 amphibious aircraft designed for air-sea rescue operations.
On the back of Abe’s recent trip to Myanmar, the latest talks with Mr. Singh could be interpreted by Japan’s neighbors as “locking down” its maritime security alliances amid a changing environment in the East China Sea, analysts said.
On 26 May, also following his “economic diplomacy,” Abe, who was accompanied by about 40 business leaders, ended his visit to Myanmar, the 1st time for a Japanese prime minister in 36 yrs.
During his meeting with Myanmar President Thein Sein, Abe said Japan will support the Southeast Asian country’s development through both governmental and civil channel by providing official development assistance worth 900 million dollars and further waiving US$1.98-B debt that Myanmar owed to Japan.
Analysts say that although Japan seeks to enhance its economic ties with Myanmar, it is really trying to improve its influence in the country, even in the Association of Southeast Asian Nations ASEAN, out of geopolitical reasons, as political and security thinking is always behind economic co-operation.