World Economy

Abe Pledges $50b for Infrastructure in Indo-Pacific Region

Prime Minister Shinzo Abe (C) says the funds will be made available over the next three years.Prime Minister Shinzo Abe (C) says the funds will be made available over the next three years.

Japanese Prime Minister Shinzo Abe announced plans to establish a $50 billion fund to boost infrastructure investment in Asia.

Speaking at a dinner at the 24th International Conference on the Future of Asia, in Tokyo, June 11-12, which is hosted by Nikkei, Abe said the funds will be available over the next three years. It is part of his strategy to strengthen cooperation in the Indo-Pacific region.

Abe also said Japan would be ready to extend economic assistance to North Korea, but insisted that Pyongyang must comprehensively solve the issues of denuclearization, missiles and abductions of Japanese citizens for that to happen.

The prime minister added that, with or without North Korea, Japan is committed to making investments for the future of the region. “With a view to the long term, investing in the future is a matter of making investments in three key areas: first, education; second, knowledge exchanges; and third, improvements to connectivity and infrastructure,” Abe said.

In response to infrastructure needs extending over the Indian and Pacific oceans, Abe announced the launch of a new financial agenda within the government-owned Japan Bank for International Cooperation.

“This is a framework that will make it possible to provide funds of approximately $50 billion in total from Japan’s public and private sectors over the next three years,” he said. “We hope this will serve to assist in the building of high-quality infrastructure in the Indo-Pacific region.”

Abe defined “high-quality infrastructure” as investments that increase employment, expand educational opportunities for workers and attract even more foreign domestic investment—and as a result make Japan’s loans easy to pay back. His characterization of the infrastructure probably came in order to refrain from discouraging borrowers in using the program.

Meanwhile, Thailand’s industry minister said that his country is open to Chinese private investment in its much-touted special economic zone, but it will be cautious on receiving funds from Beijing for large infrastructure projects.

“We are open to discuss about Chinese private investment ... in various sectors,” Uttama Savanayana told the Nikkei Asian Review on Tuesday.

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