As Japan Ups Foreign Aid, Critics Call for Standards

JAPAN'S overseas development assistance (ODA) surpassed that of the United States last year to become the world's largest. But Japanese aid insiders are concerned because they see insufficient development-aid policy and expertise in Japan to handle the increase, even as more requests pour in from around the world. Overseas aid reached $8.96 billion last year.

``Compared to the increasing amount of money, neither the Japanese aid system nor personnel situation have improved,'' says Yasuo Uchida of the International Development Center of Japan.

A senior economist at a government research facility says, ``Japan should improve the way it handles ODA.''

In Japan, there is no single agency, such as the United States Agency for International Development, that specializes in aid policy and project evaluation.

Seventeen ministries and agencies request ODA-related budget items.

Loans need approval from four different government offices - the Foreign Ministry, the Finance Ministry, the Ministry of International Trade and Industry, and the Economic Planning Agency. Grants are extended by the Foreign Ministry and technical cooperation and loans are provided by two other organizations.

But calls for a review of this system have mounted, especially as the reach of overseas development aid is expected to stretch beyond Asia.

Starting as war reparations in 1956, most of Japan's aid has gone to Asia. In 1988, about 63 percent went to Asia, 14 percent to Africa, 9 percent to the Middle East, and 6 percent to Central and South America. But Asia particularly has criticized Japan for the quality of its aid.

One recent debate raged about a dam construction project for India's Narmada River, which environmentalists claimed would have displaced up to 250,000 people. Faced with strong opposition, the Japanese government last month decided for the first time to halt the financing of a project that was already begun.

Critics say the case may indicate a deeper problem with Japan's evaluation of projects. Mr. Uchida worries about the shortage of aid experts.

``More requests for aid are coming from other countries,'' Uchida says. But for the development needs in Africa, Latin America, and Eastern Europe, ``Japan has less ability,'' in designing and evaluating projects.

The government remains cool to these voices. ``We acknowledge criticism, but most of them are not necessarily correct,'' says Kazuhiro Nakai, a Foreign Ministry official in the Aid Policy Division.

``Considering that Japan has owed its economic development to aid, we may have a bigger responsibility than other aid givers [to help develop other countries],'' says Mr. Nakai says. Just this year, Japan finished paying off the last of its postwar loans from the World Bank.

Last July, opposition parties won a majority in the upper house of the Diet, Japan's parliament. They are now preparing to submit a so-called ``ODA basic bill'' to demand that all the Japanese aid projects be disclosed and approved by the Diet before being carried out. Currently, Diet members lack access to information on projects and recipient countries until after the project is approved.

``Japan provides aid with a haphazard manner,'' argues Tamako Nakanishi, a Komeito (Clean Government Party) representative who is the central figure behind the bill. Though she says not all of the projects are bad, ``we have no way to prevent such cases [as the Narmada Dam] unless information is disclosed to the Diet.''

The government is opposed to having aid projects approved in the Diet, saying plans are based on requests from potential recipient governments.

``It's a big diplomatic problem to disclose aid plans to the Diet,'' says Nakai.

Tatsuo Hayashi, executive director of the Japan International Volunteer Center, argues that requests from a developing-world governments often seek infrastructure improvements to ease the export of commodities. The current ODA, he says, ``is used to facilitate their economic relations with Japan.''

An example often cited by those who are critical of Japan's ODA is a cultural center constructed in 1987 in Thailand to commemorate the 100th anniversary of the establishment of diplomatic ties between the two countries. Since the project was financed by grants in aid, only Japanese companies were involved in the construction.

To counter criticism that Japanese companies destroy the environment and profit from aid projects, the Federation of Economic Organizations proposed last month that the government should formulate an ``ODA Charter'' to specify Japan's aid philosophy and set standards.

Meanwhile, the government is planning an international development college that will network aid-related courses at universities, but few schools in Japan have experience training aid experts.

Professor Yoshinori Murai at Tokyo's Sophia University attributes the Japanese aid situation to an overall lack of interest among Japanese in the third world.

He says that historically the Japanese have not respected Asians and Africans, and stresses the need for education to eliminate such feelings in Japanese and in their institutions.

Otherwise, he warns, ``When Japan tries to make friends by using aid, it may work to an adverse effect.''