Japanese Policy Adaptation towards the New Status of China: The Case of the Termination of ODA Yen Loans to China in 2005

Abstract

This research was a qualitative research by means of collecting and analysing articles, documents and data to study changes in Japan’s Official Development Assistance (ODA) policy towards China by focusing on the case of the termination of ODA Yen Loans to China in 2005, since ODA had been one of the diplomatic tools utilised by Japan for pursuing international relations and progressing the relationship with China for a long time. In 1979, Japan began providing China with the ODA to support Japanese business in China and to establish a good environment for cooperation, which Yen Loans had the largest comparable amount amongst the other kinds of support. Yet, in 2005, Japan decided to terminate the loans to China, given the reason that China’s economy had developed sufficiently. But nonetheless, if considering the relationship between Japan and China since the late 1990s, it would seem that it was not only the economic factors that were pushing Japan to revise its ODA policy, but also factors in security and domestic political dimensions being of some significance contributing to such termination of Yen Loans to China.