GRAPHICS

Japan's Changing Investment Patterns in Africa

Feb 17, 2014 | 19:58 GMT

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Japan's Changing Investment Patterns in Africa

In February, the Japanese Foreign Ministry will release a white paper on official development assistance that will outline Tokyo's plan to devote more funds to African natural resources and growth. The sectors Japan is targeting reflect a shift in its strategic aims in Africa. Before Japan's 1990 financial crisis, development aid consisted overwhelmingly of commodity loans. Since then Tokyo has increased the already substantial shares going to transport and telecommunication, while surging aid for electricity and natural gas and building a respectable presence in irrigation, flood control and a range of social services.

Increasingly Japan has focused on building African "human security" and social development, with projects in health care, water, sanitation and education. Since 2009, commodity loans have plummeted in frequency, while financing for transportation, electric power and natural gas, irrigation and flood control have surged. These sectors reflect Japan's interest in building steadier and more sustainable consumer bases and transport corridors that are less vulnerable to disruption from power shortages, poor public services and inadequate road and rail.

Despite these aims to lay the foundation for new industrial economies, the interest in resources remains inseparable from the eastern, central and southern African states. This is not only because of these countries' resources but also because of the access they provide to the interior, where more resources can be exploited. Japanese construction firms get contracts to process resources or bring them to port, and these infrastructure projects aim to build up the stability and vitality of a number of transport and logistics corridors that seek to merge critical African ports with their adjacent interior regions.