One of the undoubted treats of Koizumi’s new cabinet will be to watch the new Foreign Minister, Taro Aso, say a lot of dumb things that would be better left unsaid.

Three weeks ago, he suggested to reporters that Japan and Russia might jointly develop the four disputed islands north of Hokkaido. Maybe that’s a good idea, but it would have been nice had the new Foreign Minister actually mentioned this idea to his own ministry before he talked to the press.

Less than two weeks ago, he stated that "The only countries in the world that talk about Yasukuni are China and South Korea… We don't have to worry about whether Japan is isolated or is not being liked." That’s certainly a good start for Japan-East Asia relations!

Europe got the backhanded treatment about the same time when Aso suggested that Japanese ODA led to the economic development of Asia, but that European ODA in Africa was a failure.

Then, just a week ago, he informed Condoleezza Rice of his “personal opinion” that Japan’s Constitution would be revised within a couple of years, thus preempting any judgements that the Japanese public itself might give on this matter.

Taro Aso is regarded as one of the two leading candidates to succeed Koizumi as prime minister, trailing only his fellow LDP hawk, Shinzo Abe. But Aso has a very un-Japanese failing: He talks too much for his own good. Even worse, he very much wants to be taken seriously as an intellectual even though he is not actually that bright. In my view, it’s only a matter of time before Aso impales himself on a verbal gaffe of his own making. The MOFA bureaucrats won’t save this guy.

Yesterday -- on the auspicious date of December 7th -- Aso gave an extended lecture to the Foreign Correspondents’ Club of Japan (FCCJ) about “Asian Strategy.” Some of what he said is reasonable and sensible, but there are glaring flaws as well.

He described three roles for his country: Japan as the “Thought-Leader” of Asia; Japan as “Stabilizer”; and Japan as a country of equal relationships.

Each of these ideas are not quite consistent with reality. In regard to Japan as “Thought-Leader” and “Stabilizer,” there are elements of truth. Aso is right to point out that Japan’s early modernization has led this country to experience certain successes and failures earlier than many other Asian countries, and he is also right that the US-Japan Alliance has served to stabilize the region to some extent.

Problem is, these things are less true right now than in the past. Aso’s defense of Yasukuni visits and his recent assertion that “We don't have to worry about whether Japan is isolated or is not being liked,” do not easily fit in with what he has to say in this speech. An “Asian Thought-Leader” that is isolated from Asia is obviously no leader at all. Likewise, although the US-Japan Security Alliance in its traditional defensive posture was almost certainly a benefit to East Asia as a whole, the new American Neocon / Japanese Hard Right fantasies seeking to “Unleash Japan” and convert the relationship into an offensive global alliance are unlikely to have the same beneficent effect.

On the one hand, we have all this talk about “shared democratic values,” and on the other hand you have Aso telling Secretary Rice that the Constitution will be revised even before the general public has had anything to say about it. In addition, let’s not overlook LDP Secretary-General Tsutomu Takebe’s recent remark that Japan is an "emperor-centric country, whose national character is that everyone is willing to support the center" or the fact that the head of the committee to suggest revisions to the Constitution was none other than former Prime Minister Yoshiro Mori, well-known for his similar comments in May 2000 that Japan is the “Country of the Gods” (kami no kuni). Does any of this square with democracy?

As for Aso’s assertion that “Japan has interacted with the countries of Asia as true peers,” I can only wonder that he could say that with a straight face. The truth is almost precisely the opposite: Japan is a country that is almost obsessed with hierarchy in one form or another: Truly equal relationships of any kind are hard to find in Japanese society and politics.

Equally jarring for me personally is Aso’s praise of China, and in particular, this paragraph: “The question of how China will resolve these issues is, of course, one which all of China's neighbors, Japan included, must be concerned about. However, in my personal view, I do not find the situation to be cause for any great pessimism. The reason for this is that the middle class in China is already expanding day by day, with the younger generation in particular already longing for a lifestyle of abundance, and self-realization is now the dream.”

On the surface, there seem to be no problems with what he says here. The comment is inoffensive. However, I know for a fact that he was arguing exactly the opposite to American policymakers earlier this year.

In private discussions that I attended, Aso argued that geography determined that China and Japan would always be clashing and that Beijing could never be trusted. What he said in this speech was much closer to what I said at the meeting than what he said.

That suggests one of two possibilities: 1) My arguments and that of others so persuaded him that he completely changed his mind and adopted our point of view in the last six months; or 2) His optimistic vision of future Japan-China relations is entirely insincere, and just meant for public consumption.

I’m not holding my breath about my miraculous powers of persuasion.

Most of what I have said above relates particularly to Japanese-East Asian relations and not directly to Japanese-Islamic relations, but important connections do exist. To a certain extent, Japan’s relations with the Islamic world have always been a corollory of Japan-China relations. When ideas like Yukichi Fukuzawa’s “Escape from Asia” (Datsu-A-Ron) have gained ascendancy in Tokyo, it has usually led to a greater reliance on, first, the Anglo-Japanese Alliance, and now the US-Japan Alliance. This created a strong headwind that made the construction of Japanese-Islamic relations more difficult: Japanese leaders tended in these periods to identify with the strong over the weak, and the colonizer over the colonized.

However, when Japanese have gained relatively more sympathy with other East Asians, it has also tended to bring about more positive Japanese-Islamic relations as well. While one can easily argue that Japanese pan-Asianism has been mostly insincere, nevertheless, in such a climate of “Asian sympathy” some of the more well-intentioned Japanese individuals have taken these ideas more seriously than the officials. This has occasionally had a positive spill-over effect on Islam policy as well.

Also relevant to this discussion are the insights of John De Boer in an October 2004 article at Glocom Platform entitled, “The Dangers of Japan’s Modernization Discourse in Iraq.”

http://www.glocom.org/media_reviews/w_review/20041029_weekly_review144/

Said De Boer: “Japan's modernization discourse on Iraq could be interpreted as the construction of a ‘mission’ for Japan similar to that proposed by Okakura Tenshin in his 1905 book The Ideals of the East, which called for Japan assisting in the reconstruction of Asia… [Japan’s] officials need to be careful about positioning their country as the leader in Asia and as the depository of spiritual values and aesthetic qualities for this age. If this modernization discourse continues, without results, to be used as a justification for Japan's presence in Iraq and its cooperation with the US occupation, there is a distinct possibility that the Iraqis will come to recognize it as a structure of power that is compatible with occupation policies.”

In other words, Taro Aso’s notions of Japan as a “Thought-Leader” in Asia (which sound to me more Confucian than American) and his beliefs about the crucial role played by Japanese ODA in Asia could easily carry over -- at an ideological level -- to Japanese policies in Iraq and other parts of the Islamic world. Foreign Minister Aso and his successors may carry on a sort of “official rhetoric of friendship” while at the same time acting according to what may be called “neo-colonial” impulses.

This could apply to the Islamic world as easily as East Asia.

ASIAN STRATEGY AS I SEE IT: JAPAN AS THE “THOUGHT-LEADER” OF ASIA
By Taro Aso

Thank you very much for the kind introduction. I want to thank all the organizers of this event today for providing me with this opportunity to address you at this truly ideal timing. I hope the organizers accept my sincere thanks for making today's gathering possible.

Since my appointment as Foreign Minister, I have been hoping for the chance to present my views on a number of issues, particularly Japan's Asian strategy. I mentioned that it is truly ideal timing to speak to you, and this is because we are now watching nothing less than Asia on the verge of opening a new chapter written in its history.

It is the launch of the East Asia Summit process that will turn the page into this new chapter. Kuala Lumpur, Malaysia, which will be hosting the first of these summits, is, I am certain, now in the final stages of preparation for the occasion, and I myself will be heading to Kuala Lumpur tomorrow to attend the Foreign Ministers' Meeting that precedes the summit itself. I am very much looking forward to being a part of this event, which has been met with such tremendous enthusiasm.

The first East Asia Summit, in my view, will be leaving its mark on history in one important respect: this gathering, more than any other that the leaders of ASEAN have fostered over the years, will be the one in which we share a common dream for the future.

“ASIAN” AS ANOTHER WORD FOR “OPTIMIST”

Asia is now brimming with optimism. With such unshakable belief here that tomorrow will be even brighter than today, no one can argue against the claim that "Asian" is another word for "optimist." And dare I add that when I say that "Asians" equal "optimists," I can include the Japanese in that equation.

It is certain that the economic sluggishness that Japan experienced in recent years didn't end quickly enough, and Japanese may indeed have become somewhat too pessimistic over those years.

But, I tell you, if you look at the business performance of Japanese companies, particularly that of major corporations, what you actually see is that nowhere in the past, not even in the postwar years of high economic growth, do we find anything as good as this. I was a businessman, before I entered the world of politics, so I hope you give that statement proper consideration keeping that fact in mind. The efforts of the Japanese people are bearing fruit spectacularly, and the Japanese economy is once more moving forward, resolute and unshaken.

Upon reflection, it just might be that Japanese were the some of the world's leading optimists for many years in the postwar era. The stronger the belief in the promise that the future holds, the greater your ability to look past their many toils and hardships and wave them aside. You might call it old-fashioned if I would say the following, but it is that exact outlook on life that is held by the main character in the TV drama Oshin, which has been so enormously popular even in Saudi Arabia, Iran, and Iraq.

So, we have first of all this forward-looking life credo through which people believe that the future looks bright. Second, we have the fact that because of this brighter tomorrow, people don't shy away from the hard work they have in front of them today, resulting in a solid work ethic. It is exactly these two aspects that the Japanese demonstrated to the world earlier than anyone else in modern Asia. And it seems to me that the people who derived the greatest impetus from this were, not surprisingly, our Asian neighbors. If it really is the case that the Japanese experience has made us deserving of being considered groundbreakers in the area of Asian optimism, I am not embarrassed to have a little pride in that.

So on this occasion I'd like to encourage you once more to take interest in this upcoming Summit, and emphasize that the East Asia Summit should really be a Council of Optimists.

We should now be rigorously discussing what kind of integration we desire in Asia, politically and economically. This Summit needs to be cultivated such that it leads to a future East Asian community. There are many possible paths forward that are different from the kind of integration that we have been witnessing in Europe in recent years. In the areas of political systems and national security, the countries of Asia are still extremely diverse, meaning that our approach should emphasize individual areas of functional cooperation, starting with economic, finance, and anti- and counter-terrorism cooperation.

However, as a gathering of optimists, the East Asia Summit is really at its core an open gathering of leaders. And thus, the East Asia community can move forward, thanks to this open form of cooperation with various partners.

I am especially pleased that Australia, New Zealand, and India are able to participate as full members from the very start and that these countries, who share with us the fundamental values of democracy, will join us as new peers who will also share a common dream for Asia's future. In addition, we must remember that cooperation with the United States, the EU, and others, as well as cooperative tie-ups with larger groups such as APEC, will also be important.

I said just a minute ago that in the past Japan has really been the leader of the field when it comes to being optimistic. But now I would ask you to look at China. Or, consider Vietnam. In the area of optimism right now, if we were to have a competition, today's Japan wouldn't stand much of a chance against the countries currently enjoying real momentum from their middle classes, which are now growing by leaps and by bounds. We would be hard-pressed to dare call the Japanese the world leaders in this area any more.

So as we go about getting onto closer and closer terms with the other countries of Asia, the question is then whether Japan even has the ability to serve in a leadership position anymore. If indeed Japan does, then what form is it taking exactly? My remarks earlier preface a more in-depth response to this question, which I'd like to start into now.

If I had to put it into words, I'd have to say that it's like having your reflection in the mirror and taking a good hard look at yourself, life-sized. If Japan is seen as having some strengths, then first and foremost Japan itself needs to be conscious of that strength, that power, as everything starts from there. Then, the crucial point becomes utilizing it well in order for it to impact meaningfully upon yourself and others.

Now, that right there is the essence of what constitutes strategic diplomacy. In contrast, if you are unaware of your strengths-and thus unable to make proper use of them-you end up being in a position in which you are merely reacting passively to events, and that is true in the case of both people and of course nations.

DEFINING JAPAN: JAPAN AS A THOUGHT LEADER

So here I would like to broach the question of what exactly Japan is within the context of Asia. I will be answering that by defining Japan in three different ways. After that, I'll be looking at some of the key issues that I consider to be among the most important ones that Japan is facing in Asian diplomacy right now.

First and foremost, Japan is, for the countries of Asia, a "thought leader," and, indeed, it must be one.

You might not have heard the expression "thought leader" in Japanese before, but recently it is being used in business English, and I personally translate it into Japanese by saying, "trailblazers through hands-on practice."

The idea of a "thought leader" comes from American business, and I may not have the true definition in the strictest sense of the word, but as I perceive it, a thought leader is one who through fate is forced to face up against some sort of very difficult issue earlier than others. And because the issue is so challenging, it is difficult to solve. But as the person struggles to somehow resolve the issue, he/she becomes something for others to emulate. That is a "thought leader."

Moving forward not only through successes, but also through failures, and not embarrassed to fail-this is why I translate it into, "trailblazers through hands-on practice" in Japanese. And to expose one's failings? Well, that takes a lot of courage. While I believe that Japan does in fact have the ability to have its wrong turns exposed, but of course as I talk about this I want to tell you not just stories of failures but also some of truly impressive skill in problem resolution.

So let me tell you now a few examples that will demonstrate to you how Japan has been a thought leader, a trailblazer.

I would think that perhaps the issue about which Japan has paid the greatest cost to learn would be in the area of how to handle nationalism.

For the fact that Japan has, in history in days gone by, seen heightened nationalism, we must continue to reflect deeply and with a spirit of humility, because it brought great suffering to innocent people in the countries of Asia, notably the Republic of Korea and China. The ensuing war brought untold suffering to our own people as well.

Of course, that is not the only issue. Modern Japanese history also teaches us the fact that the intense emotion of democracy is quite capable of shifting into nationalistic furor. Young democracies -- or rather, indeed, young hearts that aspire towards democracy -- are, we know, quick to become passionate and intense.

From the end of 1950's into the 1960's, Japan was experiencing exactly that kind of situation. I must say that I see in several countries of Asia, both politically and economically, a current situation very similar to what Japan had experienced at that time. How Japan was able to weather this very dangerous period -- that is what we need to be explaining to our neighbors.

However, nationalism, beyond being a troubling annoyance, also carries with it the problem that it can easily spiral among neighboring nations. I don't believe that Japan is so long-established a country that nationalism wouldn't get its blood pressure up at least a little. So, the fact is that this as an issue has certainly not disappeared.

But of course, in Japan we have a climate of vox populi and a system of democratic debate. In order to correct the provincialism and insular thinking of nationalism, here too Japan should show through its own experience exactly how important it is to have these institutions being truly sound. It is clear that this is an issue too important simply to say nonchalantly, "Learn from our mistakes."

Japan has also been forced to cover enormous costs in the area of environmental issues. In the shadow of our great economic growth was hidden profound environmental damage. That is one aspect of modern Japanese history.

Yet Japan is also a country that has shown the world that it is, after a fashion, overcoming these problems. Currently, if we say that to increase output by one unit of GDP, the major nations of Asia, including China, require an oil input of 1, North American nations require an input of only 0.5 to generate the same output. Yet in Japan we need only 0.25 to generate the same results. The energy efficiency of the Japanese economy is double those of the countries of North America and some four times those of the major countries of Asia.

It is often said in Japan that Asia is separated only by a strip of water, or ichii-taisui. The fact is that if the water in China or its air is polluted, we too suffer the impact. The Japanese experience of taking our battle with environmental problems and turning it into a means for boosting productivity -- well, that is something that we really must share enthusiastically with our neighbors.

In addition to these difficult challenges of nationalism and environmental destruction that Japan has grappled with, we can next look at the case of its aging population coupled with its declining birthrate. It is widely recognized that this is really the greatest issue that Japan is facing. How Japan is attempting to solve this problem-or, perhaps, how it has failed to solve it and is now grappling with it-this will certainly be of great value to the countries of Asia, particularly China, which will soon be seeing a rapid aging of its population.

So, with regard to "what Japan is" for the countries of Asia, I believe that we can say that it is a country that has been grappling with various issues at an earlier time than others and adopting approaches that continue to set an example.

Now, why is it that Japan has been able to become a source of learning for others in both positive and negative ways and to deserve to be called a thought leader?

Well, I believe that there is a very straightforward response to this. The simple fact is that since the mid-19th century, and at an earlier date than the other countries of Asia, Japan has been experiencing a modernization of its politics, economy, and its society. With regard to the establishment of both democracy and a market economy, Japan has amassed a wealth of experiences without comparison anywhere else in the countries of Asia.

DEFINING JAPAN: JAPAN AS A STABILIZER

Now, to touch on my second point regarding how we can answer this question of what Japan is, I would say that, as the oldest democratic nation in Asia, and as the oldest market economy in Asia, Japan is also an internal stabilizer for the region. To borrow a word from economics, we can think of Japan as a "built-in stabilizer." This needs to be examined from the security viewpoint as well as the economic viewpoint, but with regard to both, Japan's role is the same; Japan is a stabilizing force.

First I will take up the economic aspect, and I would like to cite a few numbers for you. 8.35 billion US dollars to the Republic of Korea, 4.35 billion dollars to Malaysia, and 2.93 billion dollars to Indonesia. To Thailand, 2.87 billion US dollars, and to the Philippines, 2.5 billion dollars. These figures are numbers from 1998 to 1999, when the countries of Asia were facing an all-round financial crises, and they indicate the amounts that Japan pledged in assistance. Now as you all remember, that period was just when Japan was in the middle of its own economic recession. Yet when it saw its neighbors facing economic hardship, the country that extended this kind of aid, even if it would worsen its own financial woes or its own recession, was Japan.

As for the role of Japan's ODA, there is no need to dwell on it at length here. But wouldn't it be something if Asia had no countries that had fallen through the cracks? In the future as well, in the context of Japan continuing to assist in the integration of ASEAN, it will also presumably be the case that among the countries of ASEAN themselves, Japan will be emphasizing ODA for the countries which are less well-off.

At the same time, Japan's role as a stabilizer in the area of security clearly stems from the weight that the Japan-US military alliance holds.

If this region had not been one of peace and stability, the development of the Asian economies would never have been possible. In the Cold War and throughout the post-Cold War period, there can be no doubt that the presence of the United States both politically and militarily has been and will continue to be a major factor securing peace and stability in Asia.

It is Japan that has continuously provided a secure place for the forward deployment of the United States military forces. The recent announcement on the issue of realignment of US forces in Japan should be viewed in this light: in addition to making the Japan-US security arrangements able to respond with increased effectiveness within the world's new security environment, through the lessening of the burden that accompanies the presence of the US military, the foundation for the Japan-US alliance aims to become even stronger.

After the war, Japan consistently kept central in its foreign policy the maintenance and strengthening of the Japan-US alliance, and it turns out that this was indeed the right path. The reason I call this a good decision is that as a result, the waters of Asia were waters of peace. Those of us living in Asia are all peoples with a tremendous heritage in commerce. The security and order that has been given to us so that we could continuously trade with peace of mind-that is the power of the United States military, and the thing that ensured its viability was the existence of the Japan-US alliance.

Utilizing this as a major form of infrastructure, the United States provided expansive markets first to Japan and later to the other countries of Asia. Not just in trade but in investments as well, the United States and Asia have a solidly intertwined relationship. The importance of the United States for Asia is not something that will be changing anytime soon.

Currently, Japan and the US are connected in a global alliance and taking on global issues hand in hand, which is heightening the importance of Japan-US cooperation yet more.

I said earlier that the two factors which have made it possible for Japan to be a stabilizer in Asia were in its identity first as a democratic state and second as a market economy, and I emphasized that on both fronts, Japan has been the Asian country with the longest track record.

Generally it is the case that the relationships between liberal democracies are stable and our trust-based ties are quite strong. This is because in liberal democracies the people's will exerts control over the policies of the country to maintain the observance of international rules, good faith relationships with other countries, and a strong belief in fairness and justice.

In this respect, our neighbor the Republic of Korea is one of our reliable partners that shares our basic sense of values. I hope that Japan and the Republic of Korea will cooperate with each other to promote stability and development in Asia as the two major democratic powers in the region, and that our values will soon be shared among many other Asian countries. Japan intends to give continuous support for strengthening democratization and good governance in Asia.

I also hope that the number of countries that share the value will be increased as much as possible in the near future.

DEFINING JAPAN: JAPAN AS A COUNTRY RESPECTING OTHER NATIONS AS PEERS AND EQUALS

The third aspect that defines Japan is its approach to other nations as partners on equal footing, rather than viewing them as above it or below.

I've already discussed today the need for Japan to exemplify a Thought Leader and have also explained Japan's identity as the stabilizer of Asia. If I were to expand upon a third characteristic of Japan, I would emphasize to you that Japan has interacted with the countries of Asia as true peers, building relationships with them as equal partners until now and remaining committed to doing the same in the future.

To rephrase this in one of the catch-phrases of the computing world, we call this kind of relationship "peer to peer," or "P2P," and I admit to knowing more than just a little about this, since before assuming my current position I was serving as the Minister for Internal Affairs and Communications. Japan is indeed a country working to create P2P relationships in the truest sense with the other countries of Asia.

There is one philosophy that Japan has incorporated into its ODA policy since long ago. With an appropriate environment, suitable incentives, and ongoing encouragement from peers, people will undertake great efforts to attain growth. Assisting people's efforts towards a better future for themselves-that is what defines Japanese-style ODA policy. Simply relying on aid alone without efforts from the people to foster a brighter future themselves only hinders the ability of developing nations to have full autonomy.

I think you can see that inherent to this kind of thinking is the stance that ODA recipient countries are partners with whom we walk alongside. In 1977, on the occasion of the tenth anniversary meeting of the founding of ASEAN, then-Prime Minister Takeo Fukuda delivered an address in which he called for the building of a heart-to-heart mutual relationship of trust with ASEAN countries as a true friend. This has been handed down as what we call the "Fukuda Doctrine."

Now, after almost 30 years, we find some four million people traveling between Japan and the Republic of Korea each year, and the same number traveling between Japan and China. Youth culture has crossed national borders to become something shared by the region as a whole. And we are now, for the first time in history, heading towards an era in which the various peoples of Asia will enjoy similar lifestyles and dream the same dreams. My own belief is that now is the time to take advantage of this momentum, and for that reason I will be working to strengthen further the youth exchanges Japan has with China, the Republic of Korea, and the countries of ASEAN.

As I mentioned earlier in my remarks today, I am sincerely aware the fact that Japan in the past caused sufferings to many in Asia, and to the peoples of the Republic of Korea and China in particular as a result of Japan's actions in past history, and I believe that it is necessary for Japan to maintain continuously a spirit of deep remorse as well as thoughtfulness as a neighbor to them. Yet at the same time, I hope very strongly that the people of both the Republic of Korea and China look at this issue within the overall context of the road Japan has taken over the past 60 years.

There is an English expression I often cite which goes, "Peace and happiness through economic prosperity." It is this which has been the motto of post-war Japan, which we have pursued so single-mindedly over the last 60 years, is it not? The facts in the history of post-war Japan prove the sincerity of our aspirations for peace and our determination not to repeat the mistakes of the past. I very much hope that the people of the Republic of Korea and the people of China look at this statement with an open mind.

There are three more points which I would like to address today before I close. One is how I view the rise of China, the second is how I perceive the regional security environment, and the third is how I look at the situation surrounding the economy and investments.

WELCOMING THE RISE OF CHINA

For Japan, past and present, China has been one of the most important nations. And the fact is that the rise of China is something that we have been eagerly waiting for. Ever since the modern era dawned in Asia, would you not think that too long a time has passed during which Japan had few running mates both in terms of economic construction and in regard to developing modern political systems? Now with the emergence of a China that is developing its economy in a powerful fashion, Asia in a sense is finally back to its time-honored normality.

Competition is almost always a good thing for socioeconomics. When you encounter a strong competitor, you are able to improve yourself. For that reason, we celebrate the rise of China and welcome it sincerely. Already we are seeing moves in both countries towards active competition on the economic front. It is thus something regarding which we should extend our warmest congratulations. We will be stimulated by each other and grow further as a result.

What would be even more beneficial is the expansion of this competition into the political and social fields in the years to come. If Japan and China are able to develop in these fields through friendly competition and select the "high road," by which we impel each other to greater heights, Asia as a whole will reap tremendous benefits. For that reason, it is important that we do not merely push our own line of thinking but rather make sincere efforts, in good faith, for each of us to understand the other.

It is important first, that we do not allow isolated issues to impair progress as a whole, and second, that we overcome the past through a spirit of reconciliation and collaboration, so that the happenings of the past do not harm our future.

In addition, I call for China to ensure the same level of transparency as Japan, not just with regard to economic aspects, but with regard to military budget and military activities, and indeed, the broader social and political systems as a whole. It is this lack of transparency in the military sector first and foremost that makes it necessary for China to continuously explain to the world community that its rise is a "peaceful" one. It should normally be unnecessary for China to have to say this. This is because the opposite of "peaceful" is "warlike," or, alternately, "hegemonic."

China is on the verge of ending its status as an aid-recipient country and starting to assume a position of assisting other developing countries in their socioeconomic development, and this of course is a very welcome transition. However, with regard to aid as well, transparency that is in keeping with international practice will certainly be required. We must hope that China will move closer to other nations with regard to this point. Furthermore, from the point of view that in regional and international society China needs to fulfill an even greater role with more significant responsibilities, I can also state that I hope that China sheds its stance as a "veto power", who tends to say "no" at almost every turn and shifts towards more constructive means of leverage. In this regard as well, with Japan as a "thought leader" in Asia, I think that Japan and China can find many opportunities for cooperation.

The question of how China will resolve these issues is, of course, one which all of China's neighbors, Japan included, must be concerned about. However, in my personal view, I do not find the situation to be cause for any great pessimism. The reason for this is that the middle class in China is already expanding day by day, with the younger generation in particular already longing for a lifestyle of abundance, and self-realization is now the dream.

Our neighbor the Republic of Korea has even become a model in this regard not only in Asia but also in the world, and an increasing number of the countries of ASEAN are moving down the path of "Peace and Happiness through Economic Prosperity" that I mentioned earlier and are now emphatically taking steps towards the market economy and democracy. Our own experience in Japan has shown that once you start this process you can never go back. As far as I can see, in China, the development of the market economy and the growth of the middle class will link to a movement to demand more substantial political participation and freedom.

That said, China is a country which transitions on a very long time frame, so we need to take an approach by which we follow China's progress and its various changes over the long term, showing warmth as a friend.

It is certainly true that the process of democratization takes a lot of time, and the process itself depends on a number of factors particular to each nation. On the other hand, I must say that the rejection of the very principle of democracy and the intentional delaying of the democratic process are both totally out of step with the new trends of Asia. From that standpoint I am deeply concerned about the situation in both North Korea and Myanmar.

REGIONAL SECURITY ISSUES

Next I would like to touch on a couple of important points regarding the security situation in the region.

First of all, I would like to talk about the issue of North Korea.

With regard to North Korea, it would be impossible for me to overemphasize that North Korea must undertake verifiable denuclearization, and, equally importantly, that it must resolve various issues which are of extreme importance to Japan, including the abduction issue and the missile problem, among others. Japan continues to call strongly on North Korea for the immediate abandonment of its nuclear weapons and its nuclear program in their entirety, as North Korea has already agreed to do. For North Korea, in addition, normalizing relations with both Japan and the United States is in its own best interest. Moreover, if the Six-Party Talks are to be successful, I believe that the six-party framework can find ongoing application in ensuring peace and stability in Northeast Asia.

As for issues regarding the Taiwan Strait, I very much hope for peaceful resolution through dialogue between the parties on either side of the strait. Neither Japan nor the other countries of Asia wish for any unilateral change in status-quo, or this issue to trigger military or political confrontation. Taking this opportunity I would also like to reiterate the fact that Japan will keep the position that was stipulated in the Japan-China Joint Communique in the understanding that there is but one China.

Looking at Asia as a whole, we know that we have not yet achieved sufficient regional military confidence-building or transparency of information regarding national defense and military readiness, the fundamental issue upon which confidence-building rests. The ARF-that is, the ASEAN Regional Forum, is the framework by which such confidence can be built in Asia. The ARF is an organization which enjoys participation from not only Japan and the United States, which are so crucial to the peace and stability of the Asia-Pacific region, but also the countries of ASEAN, as well as China, Russia, India, and North Korea, among others. The ARF represents the region's sole intergovernmental forum for dialogue on security issues. The ARF is currently transitioning from its first stage, which focused on mutual confidence building, to its second stage, during which the organization will work to develop tools of preventative diplomacy. However, institutional strengthening is indispensable if the ARF is to perform a more substantive role, developing from a forum for dialogue into an institution capable of taking concrete action.

Obviously, Japan also has to make as much of a contribution as possible in the area of conflict prevention. That said, I do believe that ultimately it all boils down to human resources. Asia needs more specialists in the area of peacekeeping, peace building, reconstruction, and recurrence prevention. Japan intends to develop fervently persons who have the knowledge and capability necessary for these activities.

Not all the threats that we confront in our daily lives are derived from traditional and military veins. It is certain that the threats we face do not necessarily come into existence as a result of confrontation between nations. Avian influenza is such an example of non-traditional threats that could jeopardize our security. Japan is playing a leading role to promote the concept of "human security" to cope with problems which are related to human life in the broadest sense of the word.

Japan will make untiring efforts towards the prevention and containment of such infectious diseases as HIV/AIDS and SARS as well as avian influenza. So-called "non-traditional threats," such as terrorism, piracy, and international crimes, which go beyond national borders, cannot be solved without cooperation among nations. I hope in the future Japan will be leading the team of cooperating nations as the key player.

When I talk about security in Asia, in addition to touching upon these non-traditional topics, I have to mention that there are also certain issues that have not been resolved for long time. One example of a particularly regrettable part of Asia's historical legacy involves the issue of the Northern Territories. I would like to point out here that the conclusion of a peace treaty between Japan and Russia and the creation of a qualitatively new relationship between Japan and Russia would provide a means by which Russia could be accepted as a full-fledged member of Asia. It is not too much to say that for Asia, and, in a broader sense, for international affairs in general, such a move would have broad strategic implications.

SITUATION SURROUNDING THE ECONOMY AND INVESTMENTS

The economy is the last of the issues I want to address in greater detail today. Japan has either already concluded or is currently negotiating economic partnership agreements with the countries of ASEAN and with the Republic of Korea. We are also promoting joint study with India and also with Australia. In addition, with regard to economic tie-ups among Japan, China, and the Republic of Korea, academic research by specialists has already been launched.

What we are aiming for here as a true thought leader is to be exemplary in the coverage of issues such as investment and intellectual property rights in the trade talks. When you take steps to liberalize trade, it is a given that there will be voices of opposition raised domestically, but that, you see, is the proof that you have a democratic society. And, as I mentioned earlier, I believe very strongly that competition is as a general rule always beneficial, in that it is a way to make yourself stronger.

However, here I want to add a qualification to that statement. In Asia, the fact is that there are multiple factors inhibiting investment, including the existence of direct restrictions on investment, insufficient domestic legal frameworks, difficulties in the implementation of laws, inadequacy of the credit system, and others, particularly, the complete inadequacy of protections for intellectual property rights. I very much want to expedite work on these topics with China, the Republic of Korea, and the other countries of Asia.

To expand upon this list, Japan believes we should bring into being the East Asia Free Trade Area and the East Asia Investment Area in order to move us even one step closer to regional economic integration.

The countries of ASEAN, as they head down the path towards democracy by means of the market economy, represent the captain of a ship called "regional cooperation." This ship is now setting its direction toward the overarching goal of creating an East Asian community. We now must expect ASEAN, as the captain of the ship, to undertake further and enhanced contributions in this area.

CONCLUSION

Today, I have spoken to you about my vision for Japan in a variety of potential situations, including Japan as a thought leader that can teach others even through its failures, and Japan as a stabilizer whose readiness enables it to provide security, the cornerstone for Asian prosperity, in the areas of both economic and regional security. In this area, the solid, lasting nature of the Japan-US alliance is the most critical aspect of all. And then, thirdly, I discussed Japan as an equal peer of Asian countries, entering into P2P relationships and assisting them through working in partnership with them.

None of what I have said today is unreasonable. I would argue, in fact, that the large role Japan plays within Asia makes this a summary of nothing more than the minimal obligations Japan should fulfill.

As I mentioned at the very beginning, Asians are optimists. Even Japanese appear to have already returned to the optimism they originally held. Sixty years ago, we could count only seven independent countries in all of Asia. And in about 1951, the region equivalent to that of the current ASEAN+3 had an average GNP per person of roughly a mere $200 per annum.

That amount now stands close to $4000. A belief in the future that enables us to make continuous efforts is what brought us here. When the Council of Optimists gathers, Japan would like to play even a small role there as a leader once more.

Thank you very much for listening.