JapanGov Weekly

Monday, November 6, 2017

Japan-Micronesia Summit Meeting and Other Events

Cabinet Secretariat, Wednesday, October 25, 2017

On October 25, 2017, Prime Minister Shinzo Abe held a summit meeting and other events with H.E. Mr. Peter Martin Christian, President of the Federated States of Micronesia, at the Prime Minister's Office.

The two leaders attended a salute and guard of honor ceremony, and then held a summit meeting. Thereafter, the leaders held a signing ceremony and a joint press announcement.


Memorial Service for Members of the Self-Defense Forces Who Lost Their Lives on

Cabinet Secretariat, Saturday, October 28, 2017

[Provisional Translation]

On October 28, 2017, Prime Minister Shinzo Abe attended the FY2017 Memorial Service for Members of the Self-Defense Forces (SDF) Who Lost Their Lives on Duty at the Ministry of Defense.

The Prime Minister offered a silent prayer, delivered a memorial address, and offered flowers.

The Prime Minister said in his memorial address,

“I would like to to offer a memorial address on the occasion of the FY2017 Memorial Service for Members of the Self-Defense Forces (SDF) Who Lost Their Lives on Duty, for the souls of the SDF members who perished while carrying out their noble duty of protecting the existence of Japan.

This year, we are newly enshrining 25 souls.

They served the Japanese people with steadfast devotion. In each of their respective positions, they gave their utmost to their duties with a strong sense of purpose and duty. They are the pride of Japan. We shall never forget their bravery or their names.

At the same time, I feel unbearable grief when I think of the deep sorrow and heartbreak of those who have lost their precious family members.

I wish to once again express our profound respect and gratitude to the 1,934 souls who have been enshrined to date.

I pledge that the precious sacrifices of these individuals shall not be in vain. We will uphold their wishes and resolutely protect the lives and peaceful daily lives of the Japanese people. I promise here today that we will do everything in our power to contribute to global peace and stability.

I would like once again to pray for the repose of the souls of the fallen SDF members and for the peace of mind and everlasting good health of their bereaved family members.”


Mt. Fuji Dialogue Welcome Reception

Cabinet Secretariat, Friday, October 27, 2017

[Provisional Translation]

On October 27, 2017, Prime Minister Shinzo Abe attended the Mt. Fuji Dialogue Welcome Reception held in Tokyo.

The Prime Minister said in his address,

“I am delighted that the Mt. Fuji Dialogue is being held in such magnificent fashion. You have selected a great day for it. The weather is absolutely perfect. Actually it had been quite difficult to predict whether I would be able to attend this event in good spirits after the election, but fortunately I am able to attend with a smile on my face.

At this meeting, experts, company executives, and business people representing Japan and the United States are gathered together for a lively discussion on the shared issues of Japan and the United States. This Mt. Fuji Dialogue initiative is extremely beneficial for building a robust and unwavering Japan-U.S. relationship. I want to express my heartfelt respect for the hard work of everyone involved in this event, including the Japan Center for Economic Research and the Japan Institute of International Affairs.

The Japan-U.S. relationship is deepening in a variety of fields, including politics, economy, and security. The basis of that relationship is friendly relations and mutual understanding between people. The opportunity offered by the Mt. Fuji Dialogue for participants from Japan and the United States to have exchanges in a wide range of fields is extremely important for the future of the Japan-U.S. relationship.

Next month, on November 5, President Trump will soon visit Japan. Japan will be the first stop on his tour of Asia. I hope to offer President Trump and the First Lady, Melania, a grand welcome for their first visit to Japan. If the weather and their schedule allow, President Trump and I will play a game of golf once again. Who the winner is will be a state secret of our two countries. I hope to have a frank discussion with President Trump on the issues facing the international community, including North Korea, with the security environment in the region further increasing in severity. I also hope to coordinate in the lead-up to the Asia-Pacific Economic Cooperation (APEC) Economic Leaders' Meeting in Viet Nam, and the East Asia Summit in the Philippines. Concerning North Korea, Japan has consistently supported the position of President Trump that all options remain on the table. There is some worry about applying that much pressure on North Korea and whether this will not lead to war. Of course, I do not wish for a conflict. I don’t think there is anyone in the world who wishes there will be a conflict. However, dialogue with North Korea for the sake of dialogue is meaningless. Over the past 20 years, we have continued to make efforts to hold dialogue. Nevertheless, in the cases of both the Agreed Framework of 1994 and the agreement among the six parties of 2005, North Korea promised to abandon nuclear weapons and then betrayed those promises, and used them to buy time for the development of nuclear weapons and missiles. North Korea has a diligent labor force and a wealth of natural resources. If it follows a correct path, it should be able to see dramatic economic growth. However, it will not have a bright future without resolving the nuclear or missile issues, or the abduction issue.

During President Trump’s visit to Japan, the President will meet with the families of abductees. Together with me we will hear the stories of the families, and we will confirm that Japan and the United States will cooperate to resolve the abduction issue. We must exert maximum pressure and create a situation in which the North Korean side will ask us to hold dialogue in exchange for changing their policies.

An alliance that allows both sides to help each other will strengthen the bonds of that alliance. Based on the bonds of the Japan-U.S. Alliance, our two countries will continue to take a leading role in securing peace and prosperity in the Asia-Pacific region and address global issues hand-in-hand.

I hope that everyone here will have a lively discussion during this Mt. Fuji Dialogue on how to further strengthen the Japan-U.S. Alliance and contribute to world peace and prosperity. I also hope that amongst yourselves you will further deepen the bonds of friendship between Japan and the United States.

Although the weather tomorrow may not be very good, I hope that the participants who have come from the United States wishing for the great success of this Mt. Fuji Dialogue will enjoy Japan. In closing, I would like to express my hope for the tremendous success of this dialogue.”


Meeting of the Council on Economic and Fiscal Policy

Cabinet Secretariat, Thursday, October 26, 2017

[Provisional Translation]

On October 26, 2017, Prime Minister Shinzo Abe held the 14th meeting in 2017 of the Council on Economic and Fiscal Policy at the Prime Minister's Office.

At the meeting, there was discussion on the Integrated Economic and Fiscal Reform, as well as the continued increase and expansion of wages and disposable income.

Based on the discussion, the Prime Minister said,

“The Abe Cabinet has made great strides toward fiscal soundness by advancing Abenomics. We have been making a series of efforts to reduce expenditures, including reducing the amount of new government bond issuance by 10 trillion yen thanks to increased tax revenue and keeping growth in social security costs under 500 billion yen for three consecutive years.

At the same time, to powerfully undertake the revolution on developing human resources, the increased revenue from the consumption tax hike to 10% planned for the year after next will be allocated, half of it for measures such as reducing the educational costs of families and supporting families rearing children, and the other half for fiscal consolidation.

Although this will affect when the primary balance will achieve a surplus, we are by no means lowering the banner of realizing fiscal soundness.

We must indicate when we will achieve a primary balance surplus after carefully reviewing the initiatives taken to date. In doing so, we will simultaneously need to show a detailed plan on expenditure reform that supports this timeframe.

Today, we received opinions from private-sector members that an all-generation social security system should be established, and that efforts to reform social security aimed at fiscal soundness are very important.

I will take the lead and exert my best efforts in this regard.

Next, we discussed wage growth.

Over the past four years, we have seen continuing wage growth at the highest level of this century. In addition, the Abe Cabinet has increased the minimum wage by 100 yen over the past four years. The hourly salary of part-time workers is at its highest level on record. We must ensure that this trend becomes even more robust and sustainable.

As private-sector members also pointed out, wage increase can be considered as a societal request to companies. I hope that employer-employee negotiations next spring will realize a 3% wage hike amid solid efforts to advance productivity revolution. I ask the business community to make proactive efforts in this regard.

The Government will mobilize various policies including budget, tax, and regulatory reform in order to steer record high corporate earnings into wage growth and capital investment. We will work as one to develop an environment to do this and reflect these policies in the new economic policy package to be created at the end of this year. I would like Minister Kato, Minister Seko, and other relevant ministers to take thorough steps accordingly.”


Opening Ceremony of the GEA International Conference 2017

Cabinet Secretariat, Thursday, October 26, 2017

[Provisional Translation]

On October 26, 2017, Prime Minister Shinzo Abe attended the opening ceremony of the GEA (Global Environmental Action) International Conference 2017 held in Tokyo in the presence of Their Imperial Highnesses the Crown Prince and Crown Princess.

The Prime Minister said in his address,

“I would like to offer a few remarks on the occasion of the 11th GEA International Conference which is being held in the presence of Their Imperial Highnesses the Crown Prince and Crown Princess.

Last year, the Paris Agreement entered into force. With the effects of climate change becoming a reality, the sense of urgency felt by the international community has been rising to a level not seen before. Now is precisely when all countries are demanded to take bold actions to achieve sustainable development of the economy and society.

Under the Paris Agreement, Japan has established the ambitious goal to lower its greenhouse gas emissions by 26% by FY2030. Japan’s economy and society are now undergoing rapid changes towards meeting our targets, which include more than doubling the number of eco-friendly cars and more than quintupling photovoltaic power generation over the next five years.

Efforts are also underway aimed at a future hydrogen society. In March 2017, buses with high capacity fuel cells began operating in Tokyo for the first time in the world. By spring of 2018, a network of 100 hydrogen stations will be completed nationwide, and electricity generated from hydrogen will be supplied in Kobe for the first time in the world. Japan will continue to resolutely take on the challenge of developing globally pioneering, cutting edge innovations.

We will also share the outcomes of these innovations with countries all over the world. Through the combined efforts of the public and private sectors we will actively deploy Japan’s outstanding environmental technologies and infrastructure in developing countries, which will contribute to lowering greenhouse gas emissions and mitigating the adverse effects of climate change on a worldwide scale.

The battle with climate change will continue until 2050 and beyond. We will establish a long-term strategy that carefully looks ahead to the future, and aim to realize a carbon-free society that is unmatched in the world.

We will hoist high the banner of proactive contribution to peace and contribute even more to world peace and prosperity. Japan is are determined to demonstrate strong leadership and work hand-in-hand with the international community to tackle various issues facing the world, including climate change and sustainable development.

It is the responsibility of those of us alive today to leave a beautiful earth to the future generations. Bold reform is necessary to solve environment, economic, and societal issues simultaneously and in parallel with each other in order to create a sustainable society. To this end, we must pool the world’s wisdom and take actions together.

In this sense, the GEA International Conference has an even growing role as a forum for bringing together corporate leaders, researchers, and government officials from Japan and other countries and discussing responses to climate change issues.

I have high expectations that fruitful and active discussions will take place regarding the future that the world should be aspiring towards.

In closing, I would like to wish all of you in attendance today even further success in your endeavors.”


Nuclear Emergency Preparedness Council

Cabinet Secretariat, Friday, October 27, 2017

[Provisional Translation]

On October 27, 2017, Prime Minister Shinzo Abe held the ninth meeting of the Nuclear Emergency Preparedness Council at the Prime Minister's Office.

At the meeting, there were reports on the outcomes of the verification of emergency response plans in the Ohi area.

Based on the reports at the meeting, the Prime Minister said,

“The emergency response plans for the Ohi area that were compiled through the joint efforts of the national and local governments were approved today.

This region has peninsula and upland areas, making it especially vital that there is close collaboration among the relevant municipalities, including Fukui, Kyoto, and Shiga Prefectures.

The Government will collaborate even more closely with relevant municipalities and businesses to continuously verify and improve emergency response plans through actual training that includes operational forces.

It has been the consistent policy of the Government to respect the decisions made by the highly independent Nuclear Regulation Authority (NRA) regarding the nuclear power stations for which the NRA conducted scientific and technical examinations and found to be in compliance with the new regulatory standards that are the most rigorous in the world, and to restart only these power stations while gaining the understanding of the host communities.

The Government has the responsibility to implement this policy.

Should a nuclear power accident occur and it could develop into a disaster, it is the Government’s important responsibility to protect the lives, physical wellbeing, and property of the people, and the Government will do so responsibly. The Government will provide maximum support to municipalities and do all that it can.

I would like to ask relevant municipalities including Fukui Prefecture for their understanding and cooperation for this policy.

Even now, approximately six and a half years since the accident at Fukushima Daiichi Nuclear Power Station of the Tokyo Electric Power Company, we have not been able to dispel the people’s concerns about the use of nuclear power.

Humbly accepting this situation, the Government will carefully explain the nuclear power safety measures and nuclear disaster measures to gain public understanding. I would also like to ask all relevant ministers, including the Minister of State for Nuclear Emergency Preparedness, to make ceaseless efforts to listen to the various opinions of the people and reflect them appropriately in Government initiatives.”


The Adoption of the Draft Resolution on Nuclear Disarmament submitted by Japan to the First Committee of the United Nations General Assembly (Statement by Foreign Minister Taro Kono)

Foreign Affairs, Saturday, October 28, 2017

1. On October 28, at around 5:42, (October 27 16:42 p.m. local time), the draft resolution “United action with renewed determination towards the total elimination of nuclear weapons,” submitted by Japan to the First Committee of the United Nation (UN) General Assembly, was adopted with the support of 144 countries including 77 co-sponsored countries. Co-sponsored countries include nuclear-weapon States, such as the United States and the United Kingdom, and 86 states that supported the adoption of the Treaty on the Prohibition of Nuclear Weapons. The draft resolution is scheduled to be put on a vote in a plenary meeting of the UN General Assembly in early December.

2. In addition to the worsening international security environment including an unprecedented, grave and imminent threat posed by North Korea’s nuclear and missile development, we are currently facing the divergent differences in position as to the way to advance nuclear disarmament not only between nuclear-weapon States and non-nuclear-weapon States, but also among non-nuclear-weapon States due to their respective security environment of each state. This year’s draft resolution aims at providing a common ground which enables all states, including nuclear-weapon States and states confronting security threats, to renew their commitment towards nuclear disarmament, by rebuilding trust among all states and bridging gaps among states with different positions, in order to make substantive progress of nuclear disarmament even under such severe circumstances. I feel encouraged that the draft resolution was adopted with a wide spread support including nuclear-weapon-States and the countries in favor of the Treaty on the Prohibition of Nuclear Weapons.

3. Japan will continue to devote its every effort to make steady progress to achieve a world free of nuclear weapons.


Exchange of Notes Concerning Yen Loan to the Philippines

Foreign Affairs, Monday, October 30, 2017

1. On October 30, Mr. Taro Kono, Minister for Foreign Affairs of Japan, and H.E. Mr. Alan Peter S. Cayetano, Secretary of Foreign Affairs of the Republic of the Philippines, exchanged notes concerning on the provision of a yen loan for the Cavite Industrial Area Flood Risk Management Project (loan provision of up to 15.928 billion yen) in the presence of Mr. Shinzo Abe, Prime Minister of Japan, and H.E. Mr. Rodrigo R. Duterte, President of the Republic of Philippines, in Tokyo following the Japan-Philippines Summit Meeting.

2. Overview of the target project
This project aims to reduce flood damage in the Cavite Province, which is mainly an industrial area, by implementing measures to counter flooding in this flood-vulnerable Province, and is thus expected to help overcome vulnerability and contribute to sustainable economic growth in the Philippines.

3. Loan terms

(1) Rate of Interest : 0.3% per annum
(2) Repayment period : 30 years after the grace periode of 10 years
(3) Procurement terms : Untied
*Rate of interest of the consulting services will be 0.01% per annum.

[Reference] Japan-Philippines Relations (Basic Data)
The Philippines covers an area of approximately 299,400 square kilometers (roughly 80% the size of Japan). It has a population of 100.98 million (Philippines national census, 2015) and a gross national income (GNI) per capita of 3,580 U.S. dollars (World Bank, 2017)


Signing of Japanese ODA Loan Agreements with Iraq: Building a base toward inclusive growth and supporting administrative and financial reform

JICA, Friday, October 27, 2017

On October 26, the Japan International Cooperation Agency (JICA) signed loan agreements with the Government of the Republic of Iraq in Baghdad to provide Japanese ODA loans of up to a total of 57.22 billion yen for two projects.

Having the fifth largest crude oil reserves in the world and the 12th largest natural gas reserves, Iraq is blessed with natural resources, and the country’s economic structure depends heavily on the oil and gas sectors, which account for 93 percent of revenue and 98 percent of exports. Given this situation, the reduction in crude oil revenue accompanying the dropping price of oil in recent years, increased public expenditure for maintaining security in response to armed insurgents and other factors have resulted in a fiscal deficit from 2013 to 2016 while the sovereign debt ballooned from 32 to 64 percent between 2014 and 2016, making administrative and financial reform a priority.

Due to repeated wars and economic sanctions since the 1980s, the country’s infrastructure facilities have seriously deteriorated. Despite being the base for all socioeconomic activities, electrical power is chronically short in supply, greatly hindering the restoration of social stability and economic reconstruction.

Given these conditions, the Government of Iraq has set the objectives of strengthening the power supply system, which is the country’s social foundation, to meet the power demand in the “National Development Plan 2013–2017,” and is advancing administrative and financial reform as laid out in “Strategic Priorities in Ministries: 2014–18 Action Plan.”

A summary of the two Japanese ODA projects provided by the loan agreements is as follows:
(1) Electricity Sector Reconstruction Project (Phase 3) (loan amount: 27.22 billion yen)
(2) Fiscal Reform Development Policy Loan (II) (loan amount: 30 billion yen)

Details for the projects are provided below.
(1) Electricity Sector Reconstruction Project (Phase 3)
(a) Objective and Summary
The project will construct substations (132 kilovolts) in Baghdad Governorate and surrounding areas, a power supply hub in Iraq, and install mobile substations (132 and 33 kilovolts) in Anbar Governorate, which has been affected in recent years by combat with extremist organizations, with the objective of improving the stability of the power supply. The loan funds will be allocated to the construction of the substations, the supply of the mobile substations, and consulting services (including basic design work, bidding assistance and construction supervision).
(b) Background and Necessity
Due to the effects of three wars and many years of economic sanctions since the 1980s, destruction and deterioration of the power infrastructure is marked, and only around 62 percent of the domestic demand for power can be supplied. Areas, such as Anbar Governorate in western Iraq, that have been directly affected by combat with extremist organizations have in particular had severe damage to the power facilities, especially substations, and improving the power supply in conjunction with returning internally displaced persons is a priority.

The power supply in Iraq is dependent on power generation facilities in the central and southern parts of the country where security is relatively stable. The central part of Iraq, where Baghdad Governorate is located, plays the role of a hub that supplies power generated in the central and southern areas throughout the country on 400-kilovolt and other high-voltage transmission lines. The central area is also experiencing an increase in population due to an influx of internally displaced persons affected by combat with extremist organizations and has a rising need for power facility infrastructure.

The project is expected to quickly restore the power supply capacity to conflict-affected areas.

(c) Executing Agency
Ministry of Electricity
Address: MOE Building, Baghdad, Republic of Iraq

(d) Planned Implementation Schedule
1. Completion of project: August 2021 – when the facilities are put into service
2. Issuing of letters of invitation for consulting services (including basic design work):
January 2018

3. Tender announcement of initial procurement package for international competitive bidding on project construction:
Procurement package title: 132kV Mobile Substation
Planned release date: February 2018

(2) Fiscal Reform Development Policy Loan (II)
(a) Objective and Summary
By streamlining the public expenditure of the Government of the Republic of Iraq, improving energy efficiency, and addressing reform issues in state-owned enterprises, the program will improve the country’s fiscal condition, thereby promoting economic stabilization in Iraq. The first stage of this program (loan signed in March 2016 for 25 billion yen) was co-financed by the World Bank.

(b) Background and Necessity
There is an on-going fiscal deficit in Iraq due to issues that include a reduction in crude oil revenue accompanying the drop in the price of oil in recent years, increased expenses for maintaining security in response to armed insurgents, and rising expenditures to provide emergency aid to internally displaced persons, and the sovereign debt has ballooned, making administrative and financial reform for fiscal reconstruction a priority. If the fiscal deficit is to be reduced, management of the budget, expenditures and the sovereign debt must be strengthened, and steps must be taken to streamline and increase the efficiency of state-run enterprises and the natural resource and energy fields, which involve a large fiscal burden.

One of the major factors in the fiscal deficit is the amount of salaries and pensions paid to current and retired government and state-owned enterprise workers, which account for approximately half of the labor force in Iraq. Reforms are needed in the public worker employment and pension systems due to problems that have arisen, such as fraud in the payment of wages and pensions.

Due to increased borrowing to finance the ongoing fiscal deficit, Iraq faces the challenge of addressing public finance management and debt management.

The import of natural gas as a fuel for thermal power stations and power tariff subsidies are also a large strain on the country’s finances. Because no progress is being made on the provision of equipment to capture associated gas that escapes during the crude oil production process, approximately 70 percent of that gas is lost to the atmosphere. If that incidental gas could be captured and used for the production of electricity, it is estimated that approximately six billion dollars worth of natural gas imports could be reduced from fiscal expenditures each year while producing approximately 6.5 gigawatts of additional power, making the effective use of associated gas a priority.

There are approximately 170 state-run enterprises in Iraq in which administrative transparency is an issue and which compete with the private sector. Reforms to such companies are therefore needed to advance economic efficiency.

(c) Executing Agency
Ministry of Finance
Address: Ministry of Finance Building, Baghdad, Republic of Iraq

(d) Planned Implementation Schedule
1. Completion of plan: January 2018, with completion of the loan disbursement
2. Issuing of letters of invitation for consulting services: No hiring of consultants is planned for this program.
3. Tender announcement of initial procurement package for international competitive bidding on construction: No work in conjunction with bidding is planned for this program.