Abe speaks in Singapore (Kantei)

By Alex Calvo

SNA (Tokyo) — Following his party’s victory in the House of Councillors election, Shinzo Abe embarked on a trip to Southeast Asia. After Malaysia, the prime minister traveled to Singapore and the Philippines.

In the former, his agenda was mainly economic, featuring also relations with ASEAN. This year Tokyo and the regional organization are celebrating forty years of relations. Abe took the chance to explain his grand strategy in depth, emphasizing the close relationship between a strong and dynamic economy, stable political leadership, and national defense.

In the Philippines, military issues took center stage. One of the cornerstones of Japanese national security is propping up the naval capabilities of Vietnam and the Philippines, in order to prevent Beijing from concentrating its forces near Japan. This also fits with New Delhi’s and Washington’s strategies in the region.

At a speech in Singapore’s Ritz Carlton, Abe stressed that relations between ASEAN and Japan were a “Win-Win Relationship” and described his economic plans for the country. He started by underlining that, following the House of Councillors election, “change has returned to Japan, and so has strength. The ‘revolving door’ politics with its high turnover for which Japan is now known has disappeared and is now a thing of the past.” He also pointed out that this was his “first opportunity since the election to deliver a structured talk on Japanese economy” and reminded his audience that Japanese officials had taken part in the Trans-Pacific Partnership (TPP) negotiations just three days earlier in neighboring Malaysia. He also said that the approaching 40th anniversary mark was “a truly ideal opportunity to consider the future of ASEAN-Japan relations.”

Abe said that the election had meant “a strong mandate from the Japanese people,” adding that, “Over the past few years an anemic economy in Japan has engendered feeble politics, which in turn weakens the economy further.”

The Japanese prime minister linked this to the country’s diplomacy and national security. Although he referred only to the need to “strengthen the economy while working towards greater stability and robustness politically,” the message was clear: Abe sees a stronger government, with himself at the helm, a more dynamic economy, and a robust defense posture as a single package made up of interdependent and mutually reinforcing aspects. And he added: “We have still done nothing more than head to our starting point.”

It is interesting to note how Abe has a habit of sending national security messages under the cover of economic policy comments. His frequent references to Margaret Thatcher are a case in point, a strong reformist in the economic realm who did not hesitate to send a military force to confront what she regarded as aggression.

Another example was that in Abe’s Singapore speech, he stated that, following an annualized rate of minus 3.6% in the third quarter of 2012, Japan’s economy had grown at an annualized rate of 4.1% in the first quarter of this year “under my economic policy.” To make the significance clear to his audience, Abe added, “If the Japanese economy were to continue to grow at this pace for a year, it would be equivalent to the new emergence of an economy the size of Israel’s.” Thus, a comparison with a leading technological power where innovation is the norm, but at the same time a country with strong military capabilities. In case anybody still did not get the message, Abe explicitly stated that “without growth, a strengthening of our diplomacy or national security will also be simply impossible.” Employing another Margaret Thatcher reference, the Japanese prime minister asserted that “these are cases of ‘TINA’ — ‘There Is No Alternative.’”

Concerning how to achieve growth, Abe stressed the need for innovation and a “bold reform of our regulatory regime,” which he would make use of an “external catalyst, much like the TPP negotiations.” He acknowledged that such a strategy would require taking on “vested interests.”

Abe’s Singapore speech seemed to sum up quite well his grand strategy. Economic revival, combining unorthodox monetary policies with a strong push for deregulation (including trade liberalization) under the strong leadership of a much-reinforced ruling party and prime minister, a wide network of regional alliances with fellow maritime democracies (plus Vietnam), a pragmatic relationship with Russia, a fiscally sustainable yet unmistakeable rearmament, and clears signal to Beijing and Taipei that any military occupation of the Senkaku-Diaoyu Islands will lead to an amphibious counterstrike.

Abe also nodded to his hosts when he announced his goal to turn Japan into “the most business-friendly country in the world,” for which Japan would need to “catch up to Singapore in this regard and, if possible, even overtake Singapore.” He also referred to Singapore as a key bridge between the Indian and Pacific Oceans and stressed that “in recent years, Singapore and Japan have incorporated India, a great democratic power, into the grand tapestry of the East Asia Summit.”

The Japanese prime minister acknowledged that agriculture may be a sticking point in his liberalization agenda. However, he chose to seize the initiative, stressing the potential for innovation in the Japanese economy with an example from that particular industry. He told his audience about “Yumechikara,” a variety of wheat flour suitable for bread-making. Meaning “the power of dreams,” it will allow Hokkaido producers to compete with importers. Abe said that “by stimulating innovation and seeking markets outside Japan, even agriculture will become an industry that can go forward successfully,” something which “already happens with our fruit and with wagyu, i.e., Japanese beef.” He added that on his visits to Moscow and Abu Dhabi he had noticed that there was “a great deal of demand for Japan’s agricultural products.”

Just as he did in Malaysia, Abe cited medical services as a growth industry. He explained that Japan would “sell our know-how in hospital operation and management and in medical insurance to emerging countries in package form.”

After describing how Japan and ASEAN’s economies were complementary and benefited each other, Abe said he was “delighted that ASEAN and Japan have gone beyond their economic relations to forge a relationship that takes on responsibility for the security of the region, particularly freedom of navigation on the seas.” The latter point is a key thread connecting most countries in the region, and, together with the American presence, provides the background against which Tokyo can gradually rearm with de facto acquiescence.

Abe in the Philippines

Abe’s third and final leg in his trip took him to the Philippines. Once there, economic issues remained important, but attention was focused on bilateral security and defense cooperation. Manila is trying to rearm and Japan’s offer to provide ten cutters to its coast guard, together with the associated equipment and training, is an important aspect of its plans. As expected, Abe confirmed that the deal would go through.

The United States is supporting this move. And, in relation to it, India has announced a US$100 million defense equipment credit line for nearby Vietnam, which Hanoi will employ to acquire four patrol boats. Thus Abe’s policy seems to be part of a wider policy trend whereby South China Sea littoral states are being helped in building up their naval capabilities.

The Philippines, long considered to be Southeast Asia’s weakest country in terms of military power, is trying to develop an “Active Archipelagic Defense Strategy.” In the words of Vice Admiral Jose Luis Alano, this means the capability to “secure and protect the country’s massive waters.”

Both the Philippines and Japan have seen vessels belonging to the newly-created China Coast Guard enter disputed waters. These moves, in which China brought together four separate agencies with different powers and responsibilities regarding maritime affairs, and then deployed some units to the South China Sea, were criticized by Manila’s foreign affairs spokesman Raul Hernandez as “inconsistent with the spirit of the declaration of the conduct of parties in the South China Sea.” He was referring to a non-binding code of conduct between ASEAN and China.

Some observers, on the other hand, see a positive side to Beijing’s move, stating that the consolidation of previously separate government agencies may facilitate command and control, thus reducing the scope for an accidental crisis and unintended escalations.

This is the position, for example, of Susan L. Shirk, a former US deputy assistant secretary of state who recently organized a conference on maritime safety in Beijing. The event was held under the aegis of the University of California Institute on Global Conflict and Cooperation and brought together Chinese officials, four retired American admirals, and three retired American defense attachés. Shirk considers the newly-unveiled Coast Guard to be a “positive development” reigning in the “particularly aggressive” behavior of the Fisheries Law Enforcement Agency’s ships. She said that the new agency was “good for China’s neighbors and the United States because we know who is responsible and who we can hold responsible” in the event of trouble.

Despite such attempts to bridge the gulf between China and other maritime powers, suspicions are still running deep. This was clear in a piece by China’s Global Times claiming that the “feeble Japanese-Philippine ‘axis’” is “doomed.” The text accused the two countries of “forming an ‘axis’ to confront China in its neighboring waters” and to create “the illusion that China has been isolated” while stressing that the strategic influence of the “axis” is, in fact, quite limited. The article also doubted Japan and the Philippines’ “will to launch a serious contention with China” and stated that they had no “plans to tackle the territorial dispute at the cost of economic cooperation with China.”

This is an interesting, and not often discussed aspect of Sino-Japanese relations. To what extent may Tokyo be trying to steer China-bound foreign direct investment by its enterprises to other, friendlier countries, including the Philippines? Just days after Abe’s trip to the Philippines, Japan’s Brother Industries opened a factory there. It was, according to Japanese Ambassador Toshinao Urabe, “the third Japanese factory opening in a period of one month” in the Philippines.

President Benigno Aquino III declared, “Your decision to set up shop here assures us that we are doing the right thing, that the country is on the right track — towards the resurgence of industry, the creation of more jobs, and a future of sustainable, broad-based growth. We are happy that you have recognized the unique capabilities of the Filipino worker.” Brother Industries President Toshikazu Koike, on the other hand, said, “As a result of about a year of careful examination of several countries, mainly in Southeast Asia, we selected the Philippines due to its developed infrastructure, abundant labor force, attractive tax benefits, high capability of Filipinos in English communication, and of course, the hardworking and cheerful attitude of Filipinos.”

There are powerful factors, from diversification to rising wages, pushing companies to consider various options when it comes to overseas manufacturing investment. It is thus possible that Japanese companies, which some years ago would have chosen China, are now moving elsewhere, without such decisions being politically motivated. However, it is also possible that the Abe government is welcoming such a development. It is also possible that countries like the Philippines, eager to attract foreign direct investment, are quietly appealing to Japanese national security concerns when competing with China in the industrial arena.

Nevertheless, while bilateral relations between Manila and Tokyo are on the right track and are gaining depth, history is still an issue. This is one of Japan’s problems in Southeast Asia, where war-time memories linger, in particular concerning extremely sensitive matters such as sex slaves, also known as “comfort women.”

Abe could not avoid this issue on his trip, as six Filipino former sex slaves protested near the presidential palace as he met Benigno Aquino III. One of them, 84-year old Virginia Villarma, shouted “President Aquino, this is your chance. If you truly support us, convey our message to your friend, Shinzo Abe” and “Justice for the grandmothers! Shinzo Abe, we are here, proof of the Japanese military’s sexual slavery.” While she has received compensation from the Asian Women’s Fund in 1996, set up by Tokyo, and has also heard apologies from Japanese private citizens and officials, Villarma believes it does not amount to “redress from the Japanese government.” The traumatic events “remain fresh in my memory,” she says.

Villarma and her fellow protesters, who were also supported by relatives and a women’s rights group, demanded a clear apology and financial compensation from the Japanese government. In addition, they want Tokyo to officially acknowledge that sexual slavery took place and they demand that this be explained in textbooks.

Abe used his trip to Southeast Asia as an opportunity to present his grand strategy, whose main pillars are economic revival, reinforced political leadership, and rearmament.

On the economic front, in addition to the much-discussed reflation, Abe is apparently getting ready for a major confrontation against vested interests in his quest for a more dynamic, innovative Japan. Politically, he wishes to appear as a strong leader with a clear agenda, to which there is no viable alternative. Concerning national security, he is aware of the need for it to rest on a strong economic foundation, while working on a wide network of regional alliances with fellow maritime powers and a pragmatic relationship with Moscow.

His constant references to Margaret Thatcher seem to signal, on the one hand, a clear determination to push through a reformist agenda, while on the other they may constitute a subtle way of telling Beijing than a military assault on the Senkaku-Diaoyu Islands will lead to a counterstrike.

With his appeals to shared economic interests and the importance of open access to the commons, in particular to sea lanes, Abe is moving cooperation with Southeast Asia into a broader context, going beyond trade and investment — although both remain important in and by themselves.

Concerning the final leg of his trip, Abe’s visit to the Philippines was an occasion to confirm both countries’ policies of closer security links, both in a bilateral and in a wider regional context. The transfer of ten cutters is its most visible aspect, but we can expect transfer of many other weapons systems in the future, with maritime patrol drones an area to carefully keep an eye on.

Reinforcing the Coast Guard of the Philippines not only fits with Japan’s own national security concerns, but also with those of the United States. While Beijing is employing its recently-consolidated Coast Guard to press its territorial claims, Washington is not deploying, at least for the time being, its equivalent force in this region. Instead, American defense planners seem to be confiding in the coast guards of Japan, the Philippines, and Vietnam, while keeping their own Navy in reserve in the event of a more serious clash.

Alex Calvo is a Professor of International Relations and International Law, European University in Barcelona.