Newsletter No. 595
News-Analysis
April 30, 2007

 

SHINZO IN SAUDILAND

Our next account of this week’s politico-peregrinations and their associated addendum takes us to Saudi Arabia, where Prime Minister Shinzo Abe has completed a two-day visit.

Photo: Abe in Saudi Arabia met by Crown Prince Sultan
Source: Kantei

Abe met with both King Abdallah and Crown Prince Sultan. After meeting the king, a joint statement was issued that said “Further development of economic relations is a main driving force towards the development of strategic relations between Saudi Arabia and Japan.”

Photo: Abe is given medal by King Abdallah
Source: Kantei

The keyword that Japanese laid stress on was “multilayered,” meaning that Japanese policy vis-a-vis the Saudis should be about more than just oil. Abe also described Saudi Arabia as “the leader of the Gulf.”

Photo: Shinzo Abe and Crown Prince Sultan Drink Coffee
Source: Unknown

Aside from the usual platitudes, it appears that Abe did have one concrete proposal that he pulled out of his bag. The Japanese prime minister suggested that Saudi Arabia might use an oil reserve facility on Henzajima Island in Okinawa Prefecture.

According to an Asahi report written by Naohito Maeda: “Japanese officials said oil reserve facilities in the prefecture store about 5.25 million kiloliters of petroleum, which is equivalent to what Japan consumes in ten days… Analysts believe the deal could benefit the [Saudi] kingdom, which has no major reserve facilities in Asia. Keeping oil on the island would thus enable it to deliver oil to Asian countries much faster.” Japan would also hope to have preferential rights to purchase any oil that would be stored there.

The Saudis have agreed to discuss the Japanese proposal in the coming weeks and months.

So far, that’s the only interesting development that has been reported about the visit of Shinzo Abe to the Saudi kingdom. After leaving Saudi Arabia, he then moved on to the UAE.

But more on that tomorrow…

THE MITSUBISHI CORPORATION ENTERS THE LEASING BUSINESS IN SAUDI ARABIA

Another story on Japanese-Saudi relations that we haven’t reported yet is that Mitsubishi, Japan’s largest trading company, will take a 20% stake in the Saudi leasing firm Ajil. Mitsubishi UFJ Lease and Finance Company will also take another 5% stake. The purchase cost to the Mitsubishi Corporation is expected to exceed US$8.4 million, and they will dispatch a director to the company.

Ajil currently leases construction machinery and automobiles, but under its new management it hopes to expand into medical equipment, printing machinery, information technology, and desalination facilities.

In their press release on the deal, the Mitsubishi Corporation explained: “As license from the local authority is required to enter into a general leasing business in Saudi Arabia, it is thought that business competition will be limited. On the other hand, leasing services are essential for a growing country, and therefore we consider that our business chances are huge in Saudi Arabia.”

Joint Statement between the Kingdom of Saudi Arabia and Japan
April 28, 2007

At the invitation of the Custodian of the Two Holy Mosques King Abdullah Bin Abdulaziz Al-Saud, His Excellency (HE) Mr. Shinzo Abe, Prime Minister of Japan, made an official visit to Riyadh, from 11 to 12 Rabi' II 1428 H corresponding to April 28 to 29, 2007 G.

HE Mr. Shinzo Abe held meetings with the Custodian of the Two Holy Mosques King Abdullah Bin Abdulaziz Al-Saud and His Royal Highness (HRH) Prince Sultan Bin Abdulaziz Al-Saud the Crown Prince, Deputy Prime Minister, Minister of Defense and Aviation and Inspector General. The leaders of both countries expressed their heartfelt satisfactions with the great development of the bilateral relations. Both sides issued the following statement towards the development of the strategic multilayered partnership between the Kingdom of Saudi Arabia and Japan.

1. Both sides expressed their willingness to enhance high-level political dialogs between them including ones between the Foreign Ministers of the two countries.

2. Both sides shared the view that further development of economic relations is a main driving force towards the development of the strategic relations between Saudi Arabia and Japan, while noting with satisfaction the recent development of economic and commercial activities between the two countries. Both sides affirmed that utmost efforts should be made by both government and private sectors for the sake of comprehensive development of their economic relations. For that purpose, the leaders of both countries, in collaboration with the private sector, decided to start an active initiative to establish a pertinent and specialized joint Task Force with the objectives of facilitating industrial investment opportunities in both countries, making the best use of resources available in both countries including financial, institutional resources and technologies.

3. Both sides welcomed the ongoing negotiations to conclude the Free Trade Agreement (FTA) between Japan and Gulf Cooperation Council (GCC). Both sides share the view that early conclusion of this agreement will further enhance the economic relations between the two parties.

4. Both sides shared the view on the importance of strengthening and enhancing their cooperation in the fields of economy, investment , aviation , environment, culture, education and science and youth and sports, to enhance their partnership. To this end, both sides welcomed the conclusion of the draft agreement on the air services in February 2007. Both sides emphasized the importance of the early conclusion of the negotiations regarding the agreement for liberalization, promotion and protection of investments between the two countries. Both sides decided to facilitate support and encourage the studying of Saudi students in the universities and technical institutes in Japan and the Japanese side welcomed the tremendous increase of these Saudi students.

5. Both sides reaffirmed the importance of the stability of the world oil market. The Japanese side expressed its appreciation and understanding for the Saudi Arabia's balanced oil policy, which is a secure and reliable source for providing oil supplies to the international markets in general, and to the Japanese market in particular. In this regard, both sides praised the Second Asian Ministerial Energy Roundtable meeting for ministers of oil, energy and transportation which will be held in Riyadh from 14-16/4/1428 H corresponding to 1-3 May 2007, jointly hosted by Saudi Arabia and Japan, while stressing the significance to further promote bilateral cooperation in energy, based upon mutually complementary relationship between Saudi Arabia, with its largest hydrocarbon resource in the world, and Japan, with its advanced energy-related technologies. The Saudi side expressed its intention to continue to assure stable oil supply to Japan, and the Japanese side expressed its appreciation for this.

6. Both sides decided that the international community should adopt appropriate measures against a possible global warming, based on the principle of common but differentiated responsibilities as stated in the international agreements on climate change. In this regard, the Japanese side expressed its willingness to develop its cooperation in both levels of government and private sectors to promote the clean development mechanism (CDM) that contributes to combating the possible global warming as well as achieving sustainable developments in the Kingdom of Saudi Arabia. Both sides reaffirmed the importance of the roles of the private sectors in both countries for promoting CDM projects.

7. Both sides stressed the importance of continuing to hold, periodically and when necessary, meetings of the Joint Committee between the two countries, and instructed the Joint committee, of which the 9th meeting will be held in Riyadh on May 1, 2007, to follow up the outcomes of this visit. Both sides recognized the importance and significance of enhancing cooperation between private sector in both countries and highlighted the holding of "the Japan-Saudi Arabia Business Forum", which was addressed by HE Mr. Shinzo Abe, and both sides welcomed the fruitful outcomes of the 8th meeting of the Japan-Saudi Business Council in February.

8. Both sides shared the view on the importance of enhancing and developing their cooperation in the field of technical cooperation and vocational training and recognized the positive role played by the specialized Japanese agencies in this field.

9. Both sides stressed the importance of the Saudi-Japanese joint efforts to achieve peace and stability throughout the Middle East as follows:

10. With regard to the Middle East peace process, both sides reaffirmed that a just and comprehensive solution to the Arab-Israeli conflict based on the internationally legitimate resolutions would be the bedrock of the stability in the Middle East and would eliminate a main source of tension and the threat to international peace and security. In this connection, both sides stressed their support for the creation of an independent and viable Palestinian state, stressing the importance of the Arab Peace Initiative as approved at the Beirut Summit in 2002 and confirmed by the Arab Summit in Riyadh in 2007 and the Roadmap. The Japanese side highly appreciated the efforts by the Custodian of the Two Holy Mosques, King Abdullah Bin Abdulaziz Al-Saud as seen in the Mecca Agreement in February 2007. Both sides welcomed the announcement of the formation of a government of the Palestinian national unity on March 16, 2007. Both sides called on the international community to facilitate and increase their assistance to the Palestinian people while confirming to continue their assistance to the Palestinians. The Saudi side expressed its appreciation for Japan's efforts in supporting the Middle East peace process, such as the concept of the "Corridor for Peace and Prosperity".

11. Reaffirming their commitment to assist the Iraqi people to realize their aspirations for a better future, both sides decided to coordinate with each other more closely to bring security, stability and territorial integrity of Iraq and to promote national unity and equality among all categories of the Iraqi people. Both sides confirmed that the national reconciliation , along with the disbandment of all armed militant groups, would be an important bedrock for the stability of Iraq, and stressed the need to respect the unity, sovereignty and independence of Iraq The Saudi side expressed its appreciation for Japan's significant contributions for the reconstruction and stability of Iraq, including the holding of a "Seminar on National Reconciliation in Iraq" in March 2007.

12. As for Lebanon, both sides stressed the importance of the solidarity with Lebanon and of providing political and economic support to the Lebanese government that preserves the national unity, security, stability and sovereignty of Lebanon over its entire territory. Both sides called upon all the Lebanese groups and forces to the national dialogue, on the basis of similarity among all the Lebanese people as well as on the basis of what has been achieved in building a national consensus to resolve the political crisis in Lebanon and to preserve its unity, security and independence.

13. Both sides stressed the importance of urging all the states in the Middle East to accede to the Treaty on the Non-Proliferation of Nuclear Weapons and making the Middle East a region free from all weapons of mass destruction and their delivery means in conformity with relevant internationally legitimate resolutions. Both sides placed a great emphasis upon the importance of a diplomatic solution to the Iranian nuclear issue, and urged Iran to comply with the United Nations Security Council Resolutions 1696, 1737 and 1747 and to cooperate constructively with the International Atomic Energy Agency.

14. Both sides expressed hope that progress will be made on the Six-Party Talks and in the talks between Japan and North Korea on bilateral issues, including early resolution of the abduction issue.

15. Both sides condemned terrorism in all its forms as a threat to international peace and security, and confirmed that the international community must be united in the fight against terrorism. In this regard, both sides reaffirmed their commitment to the firm application of the thirteen conventions and protocols on counter-terrorism and the related United Nations Security Council resolutions. The Japanese side valued the initiatives made by the Kingdom of Saudi Arabia in the fight against terrorism, including the International Conference on Counter-Terrorism held in the month of February 2005 in Riyadh, Kingdom of Saudi Arabia, in which Japan also participated. Both sides stressed the importance of the recommendations of the conference, including the proposal of the Custodian of the Two Holy Mosques to establish an international center to combat terrorism, .as well as the urgent need to conclude the negotiations of the Comprehensive Convention on International Terrorism to promote international cooperation on counter-terrorism.

16. Both sides shared the view that the United Nations must be comprehensively reformed to reflect new realities of the 21st century, recognizing the increasingly important role of the United Nations in promoting world peace, stability and prosperity. Both sides also affirmed cooperation toward renewing and revitalizing the UN organs including the General Assembly, the Security Council, the Economic and Social Council and the Secretariat, particularly underlining the significance of early reform of the Security Council as an essential element of overall reform of the UN. The Saudi side also expressed its support for Japan's permanent membership in the Security Council, when the expected reforms of the Security Council include the enlargement of its membership. The Japanese side expressed its deep gratitude for the support provided by the Kingdom of Saudi Arabia.

17. HE Mr. Shinzo Abe expressed his deep appreciations for the hospitality and good reception accorded to him and his accompanying delegation, and extended an invitation to the Custodian of the Two Holy Mosques to visit Japan at a time of mutual convenience.