Tokyo shows mettle in the race for Africa’s ore

Tokyo shows mettle in the race for Africa’s ore

By David Pilling

Published: May 21 2008 19:15 | Last updated: May 21 2008 23:28

Japan will play host next week to more heads of state than at any time since the funeral of Emperor Hirohito in 1989. Leaders and ministers from 45 African nations will descend on Yokohama for the Fourth Tokyo International Conference on African Development – “Ticad IV” in the ugly jargon of international diplomacy.

Japan is pouring huge financial and bureaucratic resources into the initiative. Yasuo Fukuda, the prime minister, whose pressing parliamentary duties this month forced him to cancel one-on-ones with Gordon Brown, Nicolas Sarkozy and Angela Merkel, has promised to hold bilateral talks with every African leader who attends. Frazzled bureaucrats have been doing the maths: even if they can shoo out their guests after 20 minutes – that is just 10 minutes of real chat, discounting interpretation – it would mean 15 hours of back-to-back meetings.

Nor is this the only sign of Japan’s keen interest in Africa. In January, a foreign office pinched of funds managed to find the budget to open embassies in Botswana, Malawi and Mali. Tokyo has also made African development a main theme of the Group of Eight summit it hosts in July. On Tuesday, Mr Fukuda announced that Japan would double its annual aid budget to Africa to $1.8bn by 2012, saying it would relax its ban on loans to nations that have benefited from debt relief.

Why all the sudden interest in Africa? The background of Ryoichi Matsuyama, recently appointed first ambassador to Botswana, provides a clue. A lifelong employee of Mitsui, one of the Japanese trading companies that scours the globe for the mineral and energy resources so lacking at home, Mr Matsuyama’s job will be to secure the rare metals needed to keep Japan’s electronics and car industries ticking over.

In November, Akira Amari, minister of trade and industry, flew to Botswana to conclude a deal whereby Japan would get preferential access to platinum, nickel and cobalt mines in return for providing satellite technology to help find them. Without such rare metals, Japan could not make the precision motors, mobile phones and other high-end electronics at which its manufacturers excel. Platinum is a vital raw material for car exhaust catalysts. So worried is Nissan, the carmaker, at the alarming price of rare metals that it aims to cut their use in half from next year.

The hunt for rare metals – not forgetting United Nations votes and oil, which Japanese power companies have quietly started buying from Sudan – has become more urgent for one big reason: China. In the past few years, Tokyo has watched aghast as China’s top leaders have crisscrossed the continent, cutting deals for oil from Sudan to Angola and courting banks in Nigeria and South Africa. As China’s industrial ambitions grow, the scramble will only get more intense.

Beijing even pre-empted Japan’s huge Ticad shindig, staged every five years since 1993, by hosting a splashy summit for 48 African countries 18 months ago. Then, it pledged to sink an astonishing $20bn into the continent over three years. (Last month, India also snuck ahead of Tokyo, holding a summit for eight African leaders in New Delhi and unveiling a blueprint for intensifying engagement.)

So much of a presence has China become that a mischievous rumour, vigorously denied by Japanese officials, has it that some African leaders sought Beijing’s blessing before agreeing to attend next week’s Yokohama gathering. A former Japanese cabinet minister said some African leaders preferred China’s no-strings-attached largesse, implying that more of it could be pocketed.

Japan likes to see itself as offering a mid-course in Africa, between what some officials regard as the cynical Chinese and the stars-in-their-eyes Europeans. While it contributes to emergency relief efforts and traditional drives to eradicate infectious disease, Tokyo also seeks to replicate Asian-style development as the best way out of poverty. That means putting money into roads, ports, wells and irrigation, and not being too finicky about what the Europeans call good governance.

But Japan has a problem. Its aid budget is down 40 per cent from 10 years ago, when it was the world’s biggest overseas aid donor. Now, it has dropped to fifth. Mr Fukuda’s doubling of aid to Africa is intended to help rectify that. But Japan is also hoping to increase sharply the role played by the private sector. Impressed by average African growth of 5.9 per cent in 2007 and sniffing a commercial opportunity, Japanese trading, mining, construction and energy companies have been lobbying Tokyo for more help in unfamiliar territory.

Masato Kitera, director-general for African affairs at the foreign ministry, says the government is considering ways of limiting private-sector risk and of putting more aid money into the roads, electricity grids and other infrastructure needed by Japanese companies thinking of setting up in Africa. He points to the success of Mitsubishi’s aluminium smelting business in Mozambique, a joint venture with BHP-Billiton, which the company says accounts for 7 per cent of Mozambique’s output.

Africa could certainly benefit from all this attention, although there is concern that the latest fight for resources could be as rapacious as Europe’s 19th-century colonial carve-up. But for Japan and other developed nations that had grown used to a relatively free flow of vital commodities from a continent on its knees, things can only get harder.