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TOKYO -- The lights are burning late these autumn evenings in the offices of
the Japan External Trade Organization (JETRO) across the street from the
American Embassy in
this largest city in the world.
JETRO strategists are mapping ways to fully exploit their "advantage"
over other nations--most notably the United States and Australia--following
the election of Indonesia's new President
Abdurahman Wahid.
The Japanese advantage is twofold: a leading business and investment
presence and prime donor of official development assistance.
"Everyone, including Japanese, expressed surprise at Mr. Wahid's
victory," said a Western diplomat. "But it means more democracy and less
political uncertainty than if either (B.J.) Habibie or Megawati
(Sukarnoputri) had been elected. The army will be a force, but less
obvious."
Takashi Shiraishi, a professor at the Center for Southeast Studies at
Kyoto University told reporters "The election of Mr. Wahid is good
domestically and internationally as he can pursue national reconciliation."
Other Japanese and foreign businessmen say it is "too early" to tell
much about which direction policies will go under the new government.
Another uncertainty is what role the Japanese government will play in the
soon-to-be established United Nations body that will put East Timor on its
path to independence.
JETRO says there are 613 Japanese or Japanese-affiliated companies
in Indonesia, plus 207 representative offices of Japanese companies.
Japanese manufacturers accounted for 23.2 percent of Indonesia's total
export production in 1996.
Japan is already the leading foreign investor in Indonesia with
1,105 projects worth $35.04 billion.
Another dozen large projects are awaiting approval after a slowing of
the investment pace during the first-half of 1999.
Japan long ago recognized Indonesia's size--741,096 square miles on
13,500 islands, 6,000 inhabited--and population (world's fourth largest) of
212,941,810 as having great economic and diplomatic development potential.
It is the key nation of the Association of Southeast Asian Nations(ASEAN)
grouping.
Indonesia sits astride sea lanes through which 40 percent of world
shipping passes, including 80 percent of Japan's oil supply and 70
percent of South Korea's.
Given this impressive profile, Indonesia is the main benefactor of
Japanese official development assistance, with cumulative economic aid
amounting to $14.9 billion at the end of 1998, topping the $13.25 billion
Japan provided to China.
There area host of aid and cooperation projects that never show up in
the official government-to-government books or win headlines.
One example: The Tokyo Metropolitan government found it would have an
excess of 72 subway cars when it finishes upgrading the Mita line next year
and decided to donate the cars to Indonesia.
The savings to cash-strapped Indonesia will be about $2 million for the
20-year-old cars which are believed to have a further 20 years of life. It
would cost $30,000 each to dispose of the cars. The Tokyo government wants
to modernize the Mita line and buy new cars. Converting the used cars for
other lines in Japan would be too costly.
The gift of the cars, with Indonesia bearing the shipping charge, solved
the problem to everyone's satisfaction.
Constructed by the Imperial Japanese Army during World War II, Jakarta's
metropolitan railway system has the same rail gauge and voltage as Tokyo's
Mita line.
One JETRO research team has suggested that Japan put less emphasis on
doing business with "kajin shihon" or Chinese-Indonesian enterprises and
expand ties with Moslem companies.
The United States, meanwhile, wants to sell more to the Indonesian
market. Indonesians purchased over $2 billion in U.S. exports in 1998
which one U.S. think tank said supports over 30,000 American jobs.
Edward Neilan (eneilan@crisscross.com) is a veteran journalist, based in Tokyo, who covers East Asia and writes weekly for World Tribune.com.