Munich Personal RePEc Archive

International Comparison of Japan’s Official Development Assistance (ODA) policy

Furuoka, Fumitaka (2009): International Comparison of Japan’s Official Development Assistance (ODA) policy.

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Abstract

The introduction of the ODA Charter in 1992 can be seen as Japan’s official pledge to pay more attention to political conditions in recipient countries and to impose political conditionalities on them. However, in practice, the Japanese government has continued using foreign aid as a diplomatic tool to pursue own economic interests. In this paper, in order to determine the quality of Japanese foreign aid, Japan’s ODA will be compared with the foreign aid of other countries. In term of quantity, the amount of Japan’s ODA is impressive. In 1989, Japan topped the US as the biggest donor of foreign aid among all aid donor countries. Despite the impressive quantity of Japanese foreign aid, the ratio of Japan’s ODA to GNP in 1999 was 0.27 percent, which was lower than the average ODA ratio to GNP among DAC members (0.39 percent). Denmark was the country with the highest ratio (1.06 percent) followed by the Netherlands (0.82 percent). In term of geographical distribution, a prominent characteristic of Japan’s ODA is that Asia, especially East Asian countries, receives the biggest share of Japanese aid. Far East Asia received 54.5 percent of this amount, and South and Centra Asia received 19.2 percent. African countries in South of the Sahara were left far behind receiving only 9.5 percent of total Japanese bilateral aid, while the African countries in North of the Sahara received only 2.1 percent. Furthermore, Grant Share (GS) of Japan’s ODA was 39.6 percent, while the DAC’s average rate of GS that year was 77.8 percent. Among DAC members, the Scandinavian countries, Australia and New Zealand had a very high GS, almost 100 percent. Germany’s and France’s GS were nearly 80 percent. These figures show that Japan’s GS has been one of the lowest among DAC members. Also, Japan’s untied aid ratio became one of the highest of the DAC

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