Citing North Korea's August 1998 launch of a rocket over Japan and Pyongyang's refusal to allow outside inspection of a suspected nuclear weapons development site, the Ministry of Foreign Affairs' yearend report on global developments warned that Tokyo's relations with the closed, Stalinist country could take a turn for the worse in 1999. Even as the new year began, this unsettling prospect already had affected some positive developments in Japan's relations with the United States, South Korea and, to a lesser extent, the People's Republic of China the three other countries whose collective diplomatic efforts are critical to defusing the North Korean powder keg.
At the same time, though, Tokyo's efforts to address uncertainties in Northeast Asia could be complicated by the challenges of managing relations with these nations. The early October summit of Prime Minister Keizo Obuchi and South Korean President Kim Dae Jung was hailed as a breakthrough in the two countries' often prickly relations since the joint declaration included Japan's strongest apology to date to the South Korean people for 35 years of often brutal colonial rule. However, bilateral ties may continue to be clouded by persistent anti-Japanese sentiments in South Korea as well as by the divergent views of Tokyo and Seoul on tactics for dealing with Pyongyang and the role of China in the region.
Japan's relations with China appear even more problematic in the wake of President Jiang Zemin's disappointing November visit to Japan. Although the two countries concluded several not-insignificant economic development and environmental agreements, Mr. Jiang hammered relentlessly on Tokyo's refusal to offer Beijing an expression of contrition for its pre-1945 behavior comparable to that just extended to Seoul. Experts anticipate that the "apology issue" will exacerbate China's oft-expressed objections to the new U.S.-Japan defense guidelines as well as Tokyo's plans to cooperate with Washington on theater missile defense research and other initiatives designed to elevate Japan's leadership profile in the region.
Even Japan and its erstwhile American ally may lock horns on matters related to the volatile Northeast Asian scene. Washington undoubtedly will be piqued if Tokyo cannot deliver on its promise of timely enactment of the defense guidelines bills, which are aimed at handling contingencies on the Korean peninsula and elsewhere in the area. By the same token, the Japanese government may become increasingly testy over what it perceives as a warming of Sino-American relations at Japan's expense.
As if the complexity of managing responses to the often-competing agendas of the three major players in Northeast Asia were not demanding enough, Japanese officials could find themselves buffeted by unpredictable domestic policy developments. A crisis on the Korean peninsula, for example, no doubt would force Tokyo to make some difficult but long-overdue political choices and, as a result, could yield a less muddled foreign policy. However, no matter how frustrating observers at home and abroad may find Japan's frequently measured, sometimes contradictory approach to regional affairs, no one seems to want change in Tokyo to occur under such circumstances.
HIGHER INTEREST RATES RAISE ECONOMIC FEARS IN JAPAN by Douglas Ostrom
Only in Japan would a jump in interest rates to 2 percent create apprehension that rates had risen excessively. That development occurred in late 1998 as yields on long-term government bonds breached the 2 percent level after having been well under 1 percent in the early fall and still just 1.06 percent at the end of November. Even an early 1999 drop to around 1.7 percent did not ease fears that the run-up would put a crimp in an economic recovery that, even according to government officials, remained more hope than reality.
LDP, LIBERAL PARTY FORM RULING COALITION; COHEN, NOROTA DISCUSS NORTH KOREA by Barbara Wanner
From both a political and a policy standpoint, the week of January 11 was eventful in Tokyo. The ruling Liberal Democratic Party and the right-wing opposition Liberal Party finally stopped dickering January 14 and made good on their two-month-old pledge to launch a governing coalition. This union not only will help the LDP in the upper house, where it does not have a majority, but the Liberal Party's participation in the government also may shape more progressive policies, particularly in the security area.
JAPAN-EUROPE TIES OFF TO FAST START IN 1999 by Jon Choy
On the heels of the January 1 inauguration of the euro by 11 members of the European Union, Prime Minister Keizo Obuchi and top officials traveled to several European capitals in early to mid-January to discuss security, economic and political matters. The impact of the euro on world financial markets was one important theme, as were efforts to revitalize Japan's economy. Mr. Obuchi invited his European counterparts to visit Japan; a number said that they would be interested in doing so later this year.
FOREIGN MINISTER KOMURA CALLS FOR PEACE IN MIDDLE EAST by Marc Castellano
In a bid to help jump-start the stalled Arab-Israeli peace process, Foreign Minister Masahiko Komura traveled to London and then to the Middle East to discuss options for getting the talks back on track. In December, Israeli Prime Minister Binjamin Netanyahu froze implementation of the United States-brokered land-for-security accord he had signed with Palestinian leader Yasser Arafat at the Wye Plantation on Maryland's Eastern Shore in late October. Mr. Komura's nine-day trip, extending from January 5 through January 13, included stops in Egypt, Lebanon, Syria, Jordan, Israel and the Palestinian territories.