Japan's revised Development Cooperation Charter: Adapting to contemporary challenges

What is Japan’s ODA Development Charter?

The revised ODA Charter of Japan serves as an integral policy document delineating the principles and guidelines that govern Japan's ODA program. The Charter is vital for ODA operations as it offers a coherent decision-making framework, ensuring that Japan's ODA aligns with its national interests and international obligations.

The Cabinet approved the revision of the ODA Charter in June 2023, marking the first modification since 2015. In the revision, Japan restated its steadfast commitment to human security, sustainable development, and international cooperation. At the same time, the revised Charter pledged to foster an internationally favorable environment for Japan and the broader global community. It also set out goals to fortify foreign relations based on trust, safeguard the peace and safety of Japan and its citizens, and further national interests, including the pursuit of prosperity through economic growth.

The revised Charter introduces a suite of novel priorities for Japan's ODA program, including:

• Attainment of "high-quality growth" in the new era: The Charter strives to tackle immediate challenges faced by developing countries, including climate change, public health emergencies, and humanitarian crises, while addressing economic resilience sectors such as digital transformation, food, and energy security; and
• Conservation and enhancement of an international order rooted in the rule of law: The Charter explicitly advocates for efforts to realize a Free and Open Indo-Pacific.

Improvements in ODA implementation are also central to this revision, including:

• Co-creation with various actors: The Charter underscores the necessity of bolstering cooperation with an array of stakeholders, including private corporations, public financial institutions, other donors, international organizations, and civil society, to maximize the effect of development initiatives; and
• Reinforcing strategy through proactive cooperation: The Charter promotes the active proposition of cooperation avenues that harness Japan's unique strengths, such as ‘offer-type’ cooperation and investment in human resources.

The revised Charter also prioritizes the transparency and accountability of Japan's ODA program, acknowledging the perception that Japan had not adequately considered debt sustainability in its lending by certain emerging donors.

With a marked increase in private financial flows and a diversification of development actors, the revised Charter commits Japan to continually fostering public-private partnerships. This involves incorporating various private entities, including startups and SMEs into the development platform to address the developmental challenges of partner countries.

More specifically, Japan will seek to promote impact investing, ESG investing, and blended finance. The new approach will involve constructing economic foundations in partner countries, facilitating training for private personnel, supporting legal system enhancement, providing conducive business environments, proposing development models, and strategically leveraging public funds, including overseas investment and financing.

Why was the Charter revised, and what was the process?

Several driving factors prompted the revision of the Charter. Key amongst them was the evolving security context in the Indo-Pacific region and Japan's expanding role in international security cooperation. Since 2015, the global landscape experienced significant shifts, particularly as climate change and the COVID-19 pandemic exerted a substantial impact on partnercountries.

In response to these challenges, the nature of Japan's development cooperation required a significant transformation. Where the previous charter’s primary focus was enhancing economic growth, the current mandate aims to respond to urgent global challenges such as climate change and the COVID-19 pandemic. MOFA spearheaded the revision process, soliciting perspectives from an advisory council comprised of academic experts, NGOs, economic organizations, and representatives from international institutions.

How will the revision change Japan’s ODA?

Foremost, Japan's revised ODA Charter signals a commitment to increase ODA. While the government has not stated a concrete target, it is implied that allocations will be made with reference to the international goal of the 0.7% ODA/GNI ratio.

Another critical aspect of the ODA Charter revision is the maintenance of the principle that ODA should be "non-military". Simultaneously, the government, separate from ODA, initiated a framework in April 2023 to support the militaries of "comrade nations", known as “Official Security Assistance.” This marks a significant shift from Japan's longstanding policy of not providing aid for military assistance or weapons exports.

The decision to segregate OSA from ODA is a broader effort by Japan to strengthen its security posture. The Japanese government anticipates that OSA will bolster Japan's security cooperation with its Indo-Pacific region allies and partners. It also holds that OSA will contribute to a more stable and secure regional environment.

The specifics of OSA support are as follows:

• Target of cooperation: Cooperation is aimed at those military entities of countries which would significantly benefit from enhanced security capabilities. This grant-based cooperation prioritizes low- and middle-income partner countries. The selection of target countries is comprehensively judged based on democratic consolidation, rule of law, respect for basic human rights, socioeconomic conditions, security needs of our country and the region, and bilateral relations.
• Areas of cooperation: Cooperation is limited to areas unlikely to be directly related to international conflicts. These include: 1) activities contributing to the enhancement of capabilities for securing peace, stability, and safety based on the rule of law, including maritime and airspace surveillance, counter-terrorism, and counter-piracy, 2) humanitarian activities such as disaster response, search and rescue, medical care, transportation of aid supplies, and 3) international peace cooperation activities including capacity building for peacekeeping operations.

How will the revision impact different development sectors?

The revised ODA Charter holds implications for the following sectors: agriculture, climate, gender equality, education, and global health. Specifically, the Charter:

• Aims to enhance the autonomy and resilience of socioeconomic systems, including food security, in partner countries. It advocates for cooperation to strengthen and diversify supply chains, diversify economies, ensure the sustainable supply of resources, foster and protect technology, improve investment environments, and enhance food production and nutrition;
• Commits to providing ODA to help partner countries adapt to climate change and mitigate its effects. This includes aligning Japan's development assistance with the goals of the Paris Agreement and contributing to both addressing developmental issues in developing countries and promoting measures against climate change. Efforts will also be made to mobilize private capital and strengthen cooperation with international organizations to expand the scale of international support;
• Promotes an inclusive society and ensures fairness, including mainstreaming gender. It pushes for gender equality and female empowerment through gender mainstreaming at every stage of development cooperation;
• Supports universal access to quality education and continuous promotion, taking into account women, children, and youth empowerment and securing educational opportunities in conflict and disaster situations; and
• Pledges to provide ODA to help developing countries improve their health systems. In line with the new Global Health Strategy, announced in May 2022, Japan aims to contribute to the construction of a global health architecture and enhance prevention, preparedness, and response to future public health crises. Through strengthening health systems in developing countries, including training health personnel, it aims to promote more robust, fair, and sustainable UHC.

Japan’s revised ODA Development Cooperation Charter comprises a response to major geopolitical shifts and changes in the environmental and health landscapes. The previous Charter’s focus on economic growth is diminished, while increasing regional security and stability is foregrounded. At the same time, the document also advances new strategies for sectoral priorities such as food security or gender equality, while promises for increased quality and quantity of ODA acknowledge the urgency of contemporary challenges.