ABSTRACT
Japan’s role in official development assistance is quite significant. Most of the increase in Japanese aid came in late 1980s. Much Japanese aid has historically been directed to Asia. This chapter examines the question of Japanese aid effectiveness in a limited geographical context, namely for parts of South and Southeast Asia. It reviews the available evidence at the macroeconomic level to ascertain to what extent Japanese aid has promoted development related expenditures and projects in the South and Southeast Asian regions. Southeast Asia, along with China, is clearly Japan’s favorite region for channeling aid flows. The overall effectiveness of total aid from Japan depends on whether aid has been effective in Southeast Asia. In the late 1990s Japan announced a new approach to aid management, based on transparency and efficiency. In terms of the diversity of aid schemes and formulas, the recipients perceive a lack of transparency on the part of the Japanese government.
