ODA: No time to lose

China and Japan signed a final agreement for a 46.3 billion yen (US$409.4 million) loan to fund environmental projects in central and western China, the official Xinhua news agency has reported.

The loan, signed by China's deputy finance minister and the governor of the Japan Bank for International Cooperation, carries an interest rate of 0.65 percent to 1.4 percent and has a term of 25 to 40 years, according to Reuters. The loan will fund air pollution reduction and urban waste projects in six cities and provinces in central and western China.

With more production moving from Japan to China, it makes sense to help the Chinese with pollution issues. I hope other countries will follow suit over the next few years. There is no time to lose.

JBIC Today is the English newsletter of the Japan Bank for International Cooperation. There will be big changes for Japanese ODA in 2008, as JBIC will merge with the Japan International Cooperation Agency. The December 2007 issue has more details:

JBIC Today December 2007 (pdf)

For ten years, from 1991-2001, Japan was the world's number one provider of ODA, much of it going to China. But Japan dropped to third in 2006, and OECD recently predicted that Japan will slide to sixth place by 2010. Be that as it may; Japan's ODA is expected to stand at $10.09 billion in 2010. Asahi notes that Japan has sought to use the money effectively by focusing it on such fields as the environment, agricultural development and measures to prevent infectious diseases.

Asahi: Japan's ODA rank expected to slide to 6th

The primary purpose of some JBIC loans are to secure stable supply of crude oil to Japan, for example with Abu Dhabi. So, the next time you fill up your car at a Cosmo gas station, you can appreciate how Japanese ODA helps you buy gasoline at a reasonable price. 'Tis the season to be jolly!

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