Rome, February 19, 2002

Mr. Chairman,
President Mr. Bage,
Distinguished Governors,
Ladies and Gentlemen

It is my great honour to address the 25th session of the Governing Council on behalf of the Government of Japan.

First of all, I would like to pay my tribute to the President, Mr. Bage, for his strong efforts towards the further strengthening of IFAD activities since he assumed the presidency.

Mr. Chairman,

IFAD has been focusing its activities on rural poverty reduction since its inception. My government also recognizes the importance of agricultural and rural development for poverty alleviation and sustainable development. This emphasis in our aid policy is clearly stated in an official policy statement of Japan entitled "Japan's Medium-Term Policy on ODA", which was adopted in 1999.

In recent years, the international community has set goals and targets for concerted action to meet the challenge of global poverty. Following the World Summit for Social Development in 1995, a commitment was made at the United Nations Millenium Summit in 2000 to reduce extreme poverty by half by the year 2015. I am sure IFAD could be a striding flag-bearer in tackling this global challenge.

Mr. Chairman,

Being the world's second largest economy and the largest donor of official development assistance, Japan shoulders the important responsibility of contributing to sustainable social and economic development in developing countries. As a nation whose prosperity is closely linked to world peace and stability and which is highly dependent on overseas resources, energy, food and other basic materials, ODA plays a significant role in ensuring Japan's own stability and prosperity. It is our firm conviction that development assistance promotes Japan's best interests.

We are dreamers, but at the same time we should be realists. The current situation in the world surrounding the development assistance is not encouraging. Although the need and expectations of international organizations, including IFAD, for increasing amount of ODA are keenly felt, the global economy, which has been slowing down makes it difficult for many donor countries to fully meet them. In the case of Japan, which is suffering from economic and financial difficulties, the government was obliged to take a painful decision of cutting ODA by 10% for the fiscal year 2002, within the overall framework of structural reform policy. The policy which aims at making Japanese economy recover soon, and thus enabling Japan to be more active in the development assistance. Unfortunately, our case is not very exceptional.

Under these circumstances, it is required more than ever that projects under aid programs be carried out in a more efficient and effective manner. This, on the other hand, could enhance the understanding of the people of donor countries towards the development assistance.

In this regard, Mr. Chairman, may I refer to an aid method to which Japan attaches importance in recent years and which IFAD might be interested in.

That is what we call "South-South Cooperation". The development of developing countries is a challenge that should be addressed by the entire international community. As such, aid programs should not be carried out only by developed industrialized countries. Rather, it is desirable that advanced developing countries and developing countries with adequate experiences and technologies actively participate in helping other developing countries. This form of assistance will contribute to bolstering global aid resources and will also stimulate intra and inter-regional cooperation.

Our experience shows that development assistance provided by developing countries in cooperation with traditional donor countries, or "South-South cooperation", can be particularly effective in facilitating the transfer of technologies among countries at similar stages of development or that have common backgrounds, such as language and culture.

Mobilizing private investment will be another possible means to cope with the situation. Although the introduction of private money into the process of rural development might not be very easy, IFAD, having profound experience and know-how in this field could play a catalytic role in promoting this movement.

Mr. Chairman,

In concluding my statement, I reiterate that IFAD is one of the most important partners of Japan in tackling the issue of rural poverty in developing countries. And I sincerely hope that IFAD will continue to move ahead to be an innovative and an effective vehicle for rural development in developing countries.

Thank you very much.