Japan's larger role

The tentative decision by Western trading nations to make Japan the second-largest shareholder in the World Bank - behind the United States - is a long-overdue and fitting recognition of Japan's economic importance. Japan is now the noncommunist world's second-largest economic power. It is also the second-largest donor to the International Development Agency (IDA), the arm of the World Bank that provides low-cost loans to developing nations.

Currently, Japan, which provides some 14 percent of the agency's overall resources, has under 4.5 percent of the voting power of the World Bank's executive board. Japan thus has less voting power than Britain, West Germany, and France - all of whom contribute less to IDA than it does and have smaller economies. In other words, the voting strength of the bank is still geared to power-sharing arrangements made after World War II, when Japan's economy had not yet recovered from the ravages of war.

As the Western nations are making clear in proposing that Japan be given a larger shareholder status, there is a quid pro quo: namely, that Japan boost its subscription to IDA. Such a hike is considered vital, since the Reagan administration intends to put a ceiling on the total US contribution. The US, which has about 20 percent of the voting power on the bank's executive board, has said that it will hold its contribution for the next three-year replenishment for IDA to $750 million annually. But since the US has said that it would pay 25 percent of the agency's budget, the total replenishment for the three years would be limited to $9 billion. That is far less than the $12 billion to $16 billion that bank officials and many European nations believe will be necessary to meet loan needs of the developing nations.

A larger contribution from Japan would help offset a shrinking US subscription.

There are ample reasons for Japan to boost its contribution. The nation has been able to develop a thriving economic system in part because funds that might otherwise have to go into defense - as is the case in the US and among Western NATO nations - instead go into manufacturing and research. Moreover, much of Japan's current foreign aid is dispensed based on ''strategic'' considerations, going to nations that for one reason or other have special links to the island nation.

There have been vigorous efforts by recent Japanese governments to sharply step up Japan's foreign aid. Since 1970 Tokyo has tried two ''aid doubling'' programs. The first was successful. But the current program, for the years 1981 to 1984, seems unlikely to meet its target, because of the weakness of the yen in relation to the dollar, as well as domestic budget constraints. While Japan ranks fourth among major industrial nations in terms of overseas development assistance, it ranks 13th if foreign aid is measured as a percentage of gross national product.

Japan has proven itself a resourceful, enterprising nation.

Its trade emissaries can be found just about anywhere in the noncommunist world. It is only fitting that Japan now fill an international role equal to its economic status - and its proven ability to get things done.

of 5 stories this month > Get unlimited stories
You've read 5 of 5 free stories

Only $1 for your first month.

Get unlimited Monitor journalism.