Challenges, Changes, Chances
School of Advanced International Studies

 Ambassador Ichiro Fujisaki  

March 5, 2009

Ladies and Gentlemen,
I am happy to be here today.
After I arrived here 9 months ago, I have been speaking at many universities and think tanks.
But before coming to the famous SAIS, I thought I had yet to be admitted to the real Washington circle.
I hope people from other institutes are not here today.

The latter half of February was very special to Japan-US relations.
Secretary Clinton’s first foreign visit was to Japan.
The first invitation to the White House from President Obama to a foreign leader was extended to Prime Minister Aso.
And the decoration of the highest honor of the Emperor was presented to Ambassador Mondale.
For our embassy, it was a bit like Thanksgiving, Christmas, and Birthday coming at the same time.
Happy, but a lot to work on.

Let me touch upon these events.
First, Secretary Clinton’s visit.
Upon arrival at the airport, she had already impressed everyone.
From the special air force plane, she came down the steps all by herself.
No entourages, no secret service officers.
It looked very smart.
At the airport, Secretary Clinton met young athletes who just participated in the Special Olympics in Idaho and two female Japanese astronauts.
She told them that she had dreamed of being an astronaut when she was small.

The next day, she had a very full schedule.
A visit to a Shinto shrine.
A meeting and lunch with the Foreign Minister.
Their discussions covered Japan-US relations, North Korea, Afghanistan and Pakistan as well as other global issues including the world economy, environment, energy, and piracy in Somalia.
Next was the signing of the agreement on the realignment of some U.S. Forces from Okinawa to Guam.
An exchange of views with the Defense Minister.
A meeting with family members of North Korea abductees.
An audience with the Empress.
Discussions with Tokyo University students.
A girl asked how one can become a strong woman like herself.
A meeting with Komeito Party leaders.
A courtesy call with the Prime Minister, followed by dinner.
A meeting with the opposition DPJ leaders.

All this in just a single day!

It was a rigorous schedule, but the Secretary showed no fatigue.
The Japanese people were very impressed with her physical stamina, articulate arguments, amicable attitude, and her attentive manner when listening to others.
In short, Secretary Clinton did what I call a real CIA visit.
Charming, Impressive, and Admirable.

After seeing her off to Indonesia at Haneda Airport in Tokyo, I rushed to Narita International Airport 50 miles away to come back to DC to prepare for PM Aso's visit.

The PM’s visit was also a great success.
Of course, you may think ambassadors are paid to say such things, but it is true.
As I have said, this was the first invitation from President Obama to a foreign leader.
Before this invitation was extended, some of the Japanese media were grumbling about why the Japanese PM was not among the first few leaders to speak over the telephone with the President after the inauguration.
Now that we received the first invitation, they wrote that this may mean that we may have to pay a lot for this.
You just cannot win!

I met PM Aso on the evening of the 23rd and had dinner with him at my residence to brief him in preparation for the talks that next morning.
Regarding the talks, which were also attended by Secretary Clinton, General Jones, and Dr. Summers, some impressive points are as follows.

One, as the meeting was starting, in front of the press, the two leaders set the tone of the meeting and also sent very important messages to the world.
The President reaffirmed that our alliance was the cornerstone of security in East Asia and that his administration wanted to strengthen it.
He also said that Japan has been a great partner on issues ranging from climate change to Afghanistan.
The Prime Minister responded that as the world’s No. 1 and No. 2 economies, we will have to work together hand-in-hand.

Two, they spent nearly half of their time discussing the world economy.
It was truly substantive.
As the minutes continued to pass, I, who was sitting near the Prime Minister, started to wriggle because I was concerned that they may consume all their time on this single subject.

However, by the end of the meeting, which was extended for twenty minutes, they were able to discuss a whole range of issues.
This is the third point I wanted to make.
They covered issues from climate change to Afghanistan, Pakistan, and North Korea.

After the meeting, the Prime Minister told me that he was very impressed by the President, not only as an American leader but also as a world leader.

Prime Minister Aso then had lunch with some pundits of this town and visited Arlington.
After a press interview and a meeting with a US Senator, he departed from Andrews Air Force Base, finishing his 24 hour stay.
I saw him off and rushed to the State Department reception hosted by Secretary Clinton where I was able to hear her impression of the meeting.
Then we moved to the Capitol to hear the President’s speech.
It was a long but satisfying day.


Now let me turn to my original theme of “Challenges, Changes, and Chances.”

In short, we are facing many challenges.
The economy, climate change, terrorism, piracy, proliferation of WMD, etc.
We first need to review our system thoroughly.
We should not be shy in maintaining what needs to be maintained. 
Our system of democracy and market economy is the basis that needs to be kept.
We should, however, have courage to change our society as necessary.
Market failures have to be corrected or adjusted with adequate surveillance and regulations.
Adequate, because over-kill must be avoided.
Careful balancing is sought.
Appropriate changes will bring about new chances.
That has been proven by history.

Let us look at some fields and see what kind of challenges are there, what changes are needed, and what sort of chances can be expected. 

Economy

The world economy is facing great challenges.
Japanese industries are also hard hit.
During the last quarter of 2008, Japan’s GDP dropped by 12.7%.
In the month of January, our export has gone down 45.7% compared to the same month of last year.
But as people say: However long the night, the dawn will break.
Our task is how to make the dark night shorter, how to bring about the dawn more quickly.

We need three things.

First, to take concrete measures to boost the economy.
The economy is nothing but a self-fulfilling prophecy.
You have to give confidence to people and industries in order for them to feel comfortable enough to consume or invest.
It is not helpful only to say that this is a once in a century tsunami.
We can and should cope with it.
In situations in which private sector funds do not shift into investment despite reduced interest rates, sizable fiscal stimuli are necessary.
The US is coming up with a stimulus package which is historical in size.
Japan has decided on an economic stimulus package on a scale of approximately 75 trillion yen (US$840 billion).
Of which fiscal measures total some 12 trillion yen (US$135 billion), corresponding to approximately 2% of Japan's GDP.
Aberrational economic circumstances call for exceptional responses.
That is what Japan learned from its experiences in the 1990's.
Cooperation between the No. 1 economy and No. 2 economy is required.
Concerted action around the world is needed.
In order to fortify international financial institutions, PM Aso, at the G20 of last November, announced readiness to provide an emergency loan of up to 100 billion dollars to the IMF. 

Second, we all have to stick to basic principles of free trade and market based currencies.
There is a temptation to go “Buy American” in this country.
If all of us started such moves, we will just make the pie of world economy smaller and smaller.
The key concept here should be “stand-still.”
I am encouraged by the President’s strong statement regarding this matter.
Senator McCain showed his leadership as well.

Also, no country should keep its currency intentionally low, thereby pouring goods into other countries.
The ‘beggar-thy-neighbor’ policy is not what we should be seeing in the 21st century.

Third, sharing experiences with each other is significant as well, as seen in the leadership meeting I referred to.
Japan has gone through a so-called “lost decade.”
It is true that we took too much time to fix our economy.
But because we did not have securitization of mortgages, the picture was simpler.
Leverage was far smaller as well.
This made it easier to address non-performing loan problems.
Because of the difficult experiences we had, our financial institutions are in somewhat better shape than those in some other countries.
To share both good and bad experiences is what we have to do.
This is exactly what the two leaders did in their meeting last week.
The Prime Minister elaborated on the Japanese experience of the financial difficulties we faced a decade ago.
The President ardently listened to this and told his account of what went wrong in the US before WWII.
They agreed to fight against protectionism and maintain the credibility of the dollar as the key currency.
They also agreed to cooperate in the coming G20 meeting in London.

The world economy has gone through several big changes in the past.
The industrial revolution, depression, globalism.
All of these changes gave chances to those who adapted to the changes sooner than later.
It opened up a new horizon to those who worked for it.
This time cannot be an exception.
We need to firmly grasp these opportunities. 

Environment and Energy

Climate change is another critical issue.
The good thing is that people are trying to tie this into the economy in a positive manner.
It is possible for industries to say that they are concerned more about tomorrow’s bread than the global temperature decades from now.
However, by looking at green jobs as tools to boost our economy, we can turn this into an opportunity.
In this area, Japan is not without experience.
Poor in natural resources and hard hit by two oil shocks, Japan has developed an energy-efficient economy.
We have transformed our economy utilizing these challenges.
With retrospect, these challenges provided Japan with chances.
Here are some statistics from the International Energy Agency.
In order to produce one dollar of GDP, if Japan needed one unit of energy, the US and EU need 2 times, Russia 17 times, China 9 times, and India 8 times that of Japan.
Thus Japan, the No. 2 economy, is emitting only 4.3% of the world’s CO2 whilst the No. 3 economy China is emitting 20.2 %.
In such areas as energy conservation, new batteries including fuel cells, and nanotechnology, Japan and the US can and should collaborate.
The importance attached to some of these areas in the President’s inaugural speech was encouraging.
These new technologies may lead us to new chances.
Our two countries’ positions regarding the post-Kyoto framework are close compared to many others.
Ambitious but pragmatic.
Japan is currently examining its mid-term target, and it intends to announce the target by June.
Japan and the US can also work hand-in-hand in the development of clean energy.
On clean energy, the Prime Minister explained to the President that more than 70% of commuters in Tokyo were dependent on mass transportation and also explained the importance of high speed trains.
The President recalled that he has taken the bullet train in Japan when he was young.
They agreed to start bilateral consultations on clean energy and also set up an official level dialogue for the post- Kyoto framework.



Asia-Pacific


This is a region of growth but also of difficulties.
Changes that have occurred in Europe twenty years ago are yet to happen.
However, with the right engagement we can change this into chances to move forward in the region.

How to engage China constructively is a challenge.
Last weekend, Japanese Foreign Minister Nakasone paid a visit to China and met with his counterpart Minister Yang Jiechi as well as Prime Minister Wen Jiabao.
They agreed to further strengthen the “mutually beneficial relationship based on common strategic interests” through high level dialogue.
They discussed not only bilateral and regional issues but also global issues like the current economic crisis.
In addition, while supporting China’s economic development, democracy and freedom of speech need to be enhanced.
Growth of its military build-up is what we have to be concerned about.
China has just announced that their military spending is increasing by double digits consecutively in the last 21 years.
Since 1988, it is has grown 16 times.
It is not solely a transparency issue as a lot of people would like to sketch. 
North Korea remains a great concern because of their attitude regarding nuclear and missile development and the violation of basic human rights such as the abduction of foreign citizens.
On North Korea, the Prime Minister emphasized at the meeting the importance of taking a comprehensive approach in addressing nuclear, missile, and abduction issues as a whole.
To this, the President expressed his agreement.
Regarding the reported possible launch of missiles by the North, the two leaders agreed that North Korea should not take any measures which would heighten tension in the area.
The launch of a ballistic missile by North Korea, whether or not it is labeled as satellite launch purposes, will constitute a violation of relevant Security Council resolutions, namely number 1718.
The international community should stand together and urge North Korea to refrain from performing any provocative actions.
Japan will consult closely with the United States on this matter.
ASEAN has been a symbol of stability and prosperity.
India’s weight is increasing.
Russia is an important partner but at the same time needs careful attention as we have seen from time to time.

Secretary Clinton stated a month ago in the Senate hearing:
“Our alliance with Japan is a cornerstone of American policy in Asia, essential to maintaining peace and prosperity in the Asia-Pacific Region and based on shared values and mutual interests.”
What more is there to add to this?
The important concept here is “shared values”.
If we are able to promote our shared values in the region without imposing them on others, it will provide chances for creating a more stable, predictable, and prosperous Asia-Pacific region.

All of the developed countries are suffering.
But developing countries are suffering more.
We cannot let them go down the slippery slope.
Japan is extending approximately 100 million dollars in our supplementary budget as emergency assistance to Asia.
This is on top of the 107 billion dollars Japan has extended to Asia so far.
Furthermore, PM Aso in Davos stated that Japan is ready to provide ODA of not less than approximately 17 billion dollars for mobilizing funds to Asian countries.

Middle East and Southwest Asia

Japan has been doing its part in this region, and not just because we are dependent on this region for more than 80% of our oil.
It is because of the following reasons.
One, we cannot let terrorism and WMD prevail.
Two, we cannot let people in the region suffer any longer.
Three, we cannot let this strategically crucial area remain unstable.
These are the reasons why Japan sent altogether about 5,500 ground forces to Iraq from 2004 to 2006 and air force planes to conduct airlifting between Iraq and Kuwait.
We have continued to refuel coalition ships engaged in
Operation Enduring Freedom in the Indian Ocean since 2001.
In Iraq, we have implemented 5 billion dollars of assistance and 6 billion dollars of debt relief.
That is next only to the US.
In Afghanistan, we have pledged up to 2 billion dollars of grant aid and already implemented more than 70% of that.
We have built 550 schools, trained 10,000 teachers, given literacy to 300,000 people, and established more than 50 clinics.
We have also contributed to infrastructure including the Kabul airport and 650 km of roads.
Last month, a supplementary budget was adopted which included 300 million dollars for Afghanistan assistance and half of which was related to security fortification such as police training.
We are determined to fortify our efforts voluntarily.
In the summit meeting, the President thanked Japan for the support it has extended to Afghanistan up to now and expressed appreciation for the positive role played by Japan.
He also appreciated Japan taking the initiative to convene the Donor’s Conference on Pakistan in April.
The Prime Minister’s special envoy is coming to DC early next week to talk with Ambassador Holbrooke.
We have been cooperating to develop an agricultural complex in the West Bank.
Iran’s nuclear development is of great concern to Japan as well.
We are faithfully implementing UN Security Council resolutions in this regard. 
To bring about peace and stability in the Middle East and Southwest Asia is a big challenge for all of us.
But it is also true that the world has no chances without adequately addressing the problems of this region.

There are of course more issues of mutual concern.
Arms control is one of those.
Japan has been advocating the ultimate elimination of nuclear weapons in the UNGA for the last ten years.
We hope that the US will join the Comprehensive Test Ban Treaty (CTBT) without delay.

We look forward to working with the US in many fields as global partners.
We know that this is not an easy time for anyone.
We also know that how we cope with these situations will define our future.
As I have said, challenges can be transformed into chances.

President Obama has expressed this philosophy very well in his address to the Joint Session of Congress said that “if we confront without fear the challenges of our time... then someday years from now our children can tell their children that this was the time when we performed."

I think that to have a President like Mr. Obama gives hope not only to Americans but to people around the world.
Especially, kids and youngsters no longer have any excuse for not working hard because his or her future is limited.

Japan is no exception.
People are jubilant.
After the election, 79% of people said they think the result was positive, and only 4% said ‘no’ according to a poll done by a leading newspaper.
Don’t these figures look almost like a poll in a communist country?
We are grateful to Americans for once again setting a good example.
We share this hope, and in this spirit, let us work together to overcome the current challenges.

You should be proud of yourselves.
Especially the younger generation who are here today.
You must feel that you are lucky to be present during this period of change.
You all have chances.
We all do, and we can all be winners 
Thank you.