Geo-politics and oil: Japanese leader visits the US and Middle East

By John Chan
8 May 2007

More than six months after assuming power, Japan’s Prime Minister Shinzo Abe finally made his first trip to Washington on April 26. He then travelled on to visit five major oil producers in the Middle East, demonstrating that one of the fundamentals of the US-Japan alliance is energy.

Unlike previous Japanese prime ministers, who invariably made Washington their first overseas destination, Abe went to Beijing and Seoul last October. Under pressure from business, he was compelled to try to improve relations with China and South Korea, where Japan has huge economic interests.

However, for Abe, like his predecessor Junichiro Koizumi, Japan’s alliance with the US remains the foundation of an increasingly assertive foreign policy. While Japanese corporations have large investments in China, the two countries are also in competition for global energy sources, as well political influence in Asia. For the US, Japan is at the centre of containing China, which Washington also regards as a long-term threat to its dominance.

Abe’s visit to Washington was billed as cementing the US-Japan alliance through personal friendship. Instead of a formal state dinner, a more intimate gathering was held in the White House. Abe publicly demonstrated his support for the Bush administration’s wars in Iraq and Afghanistan by visiting a naval hospital and a military cemetery.

Discussions at Camp David centred on the issue of North Korea. Abe and his government only reluctantly agreed to the deal reached in Beijing in February for North Korea to dismantle its nuclear programs in return for economic assistance and the normalisation of relations. While Washington is focussed on the Middle East, the Japanese government has used the threat of North Korea to whip up militarism at home and adopt a more aggressive posture in North East Asia.

Abe pressed Bush to step up the pressure on North Korea after the Beijing agreement stalled over the unfreezing of North Korean funds from a Macau bank. Before Abe’s departure to the US, Tokyo police raided a North Korean group—the General Association of Korean Residents in Japan (Chongryon). The police questioned three of the group’s officials over a case involving the abduction of Japanese children by North Korean agents in 1974. Abe rose to political prominence on the issue of the abductions, which is a cause célèbre in right-wing militarist circles in Japan.

After meeting with Abe, Bush made gestures of support for Japan’s stance on North Korea. Pointing to Pyongyang’s failure to meet a deadline to shut down its nuclear reactor, he declared: “Our patience is not unlimited.” While he “hoped” North Korean leaders would make the “right choice”, the president warned that the US and Japan “have a strategy to make sure the pressure we already applied is even greater”. Bush also expressed support on the issue of the abductions.

Bush’s preoccupation, however, was not with North Korea, but the war in Iraq. He praised Japan’s support for, and participation in, the US occupations of Iraq and Afghanistan as “helping these young democracies survive in a troubled world”. Japan is the second and third largest donor, respectively, in helping to prop up the US puppet regimes in Iraq and Afghanistan.

Tokyo recognises that its continued backing for the Bush administration’s military adventures is necessary to retain Washington’s support for Japan in Asia. A Japanese official told Yomiuri Shimbun: “The United States won’t give consideration to Japan over the North Korean issues unless Japan maintains its Iraq policy, which was inherited from the administration of Koizumi.”

Koizumi joined Bush’s “war on terror” and used it as a pretext to undermine the constitutional and political constraints placed on Japanese military. Despite overwhelming opposition in Japan, he sent ground troops to Iraq in 2004—the first time Japanese soldiers had been sent to an active overseas war zone since the end of World War II. Although Japan pulled its troops out of southern Iraq last year, Abe has maintained Japanese naval vessels in the Indian Ocean to support US operations in Afghanistan and air support in Kuwait to assist in Iraq.

Abe told the media he had explained to Bush that his primary mission was “to move Japan beyond the post-war regime”. Just before his visit to the US, Abe established a panel to reshape “the legal foundation for national security in a way that will benefit—that will befit the times, now that the security environment surrounding Japan is undergoing major change”. In particular, he is seeking to remove the constraints on the Japanese military imposed by the so-called pacifist clause of the country’s postwar constitution.

One of Japan’s prime reasons joining the Bush administration’s “war on terror” was to ensure access to the Middle Eastern oil. Abe’s subsequent trip to Saudi Arabia, the United Arab Emirates, Kuwait, Qatar and Egypt sought to increase Tokyo’s political and economic influence in this increasingly volatile region. Abe carefully avoided Iran, which supplies 11 percent of Japan’s oil. In its bid to isolate Tehran, the Bush administration has been pressing Japan and other countries to cut their economic ties with Iran.

As in the period before World War II, energy supply has become the most sensitive foreign policy issue for Tokyo as the major powers scramble to secure oil and gas. Japan, the world’s second largest economy, is totally dependent on imported oil, with the Gulf states accounting for 76 percent. In Saudi Arabia, Abe declared: “We do not need any words to say how important the Middle East is for Japan.”

Japan’s energy security is under threat. In 2000, Japan’s Arabian Oil lost a huge concession in the giant Khafji oilfield in Saudi Arabia and Kuwait, followed by the termination of another 40-year Kuwaiti concession in 2003. Last year, under US pressure, Tokyo cut back its stake in Iran’s massive Azadegan oilfield from 75 percent to 10 percent. In the Far East, China has outbid Japan for an oil pipeline from Siberia, while Russia cut Japan’s stake in a major gas project on Sakhalin Island.

Rather than relying on the open market, Japan is adopting an energy strategy similar to China’s: offering infrastructure projects in exchange for raw materials. Abe signed an agreement with Saudi Arabia for preferential access to its oil in emergencies, while allowing Saudi oil to be stored on Okinawa island for the Pacific markets. In the United Arab Emirates, the Japan Bank of International Cooperation offered a $1 billion loan to cover long-term oil contracts. Japan already has substantial investments in the Middle East, including a $9.8 billion petrochemical project in Saudi Arabia, a $4.7 billion gas pipeline in Qatar, a $2.7 billion power and water project in the UAE and $3.4 billion in the Dubai Metro system.

Accompanied by 120 top business leaders, Abe wanted to encourage more Japanese industrial investment in the region in order to create a “multi-layered” economic relationship going beyond oil and thus strengthening Japan’s position in the Middle East. Japan’s powerful business association Keidanren urged Tokyo to sign a free trade deal with the six-member Gulf Cooperation Council.

In its comment on Abe’s trip, the Financial Times noted the intimate connection between Japan’s support for the war in Iraq and its need for oil. “Mr Abe has been at pains to emphasise that Japan’s involvement in Iraq, where it deployed ground forces, was motivated by purely humanitarian aims. But, whether or not it is made explicit, lurking below the surface will be the age-old subject of oil.”