As the Japanese aid program grew rapidly after 1955, so did the tasks of ministries and agencies with a policy interest in economic cooperation and aid. The present chapter describes this growth and considers what made Japan's aid bureaucracy so divided. In assessing Japan's aid performance it is important to know whether administrative change kept pace with aid flows.
Some existing explanations will be explored. John White maintains that the choice of one type of aid administrative structure rather than another "is usually the outcome of historical accident combined with the administrative conventions of the country
concerned".^ Certainly a wide variety of donor structures existed in 1977. Patterns of aid administration within DAC member nations ranged from that of the United Kingdom under the Labour Governments of the 1960s and 1970s, where a minister was responsible for aid and in charge of an aid ministry, to the extremely decentralised French or Japanese situations, where a number of ministers controlled different
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parts of the aid program.
We point out how reparations and the need for export growth led administrators to focus on economic cooperation, a concern which was later heightened by the influence of domestic argument about policy directions and appropriate forms of development financing. The
competition between ministries to assure their presence in the aid field reached its peak in the early 1960s, but after this final spurt in its growth the bureaucracy was not reorganised, even though the demands on
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however, accident and convention do not fully explain administrative change over twenty years. The unsteady relationship between aid and politics was decisive in linking diverse official motivations with actual policy mechanisms. How this occurred and with what result profoundly affected the making of aid policy.
The Early Years: Reparations and Exports
An administration for Japan's economic cooperation appeared without ceremony when an Economic Cooperation Division was established
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in the International Trade Bureau of MITI in 1953. MITI was
responsible for promoting and regulating trade, administering foreign exchange in relation to commerce and furthering economic cooperation
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in trade. As part of the economic reforms carried out under the Occupation, the former Ministry of Commerce and Industry (Shokosho) was reconstituted as MITI in May 1949, a move which one writer claims
to have revealed a clear shift "from an emphasis on the domestic
economy and increased production to an emphasis on international trade 5
and the promotion of exports". The primary goal of export growth was well reflected in MITI's early structure, in which trade functions were given to all the commodity bureaus. The Economic Cooperation Division of 1953 (formerly the Export Commodities Division) was a catch-all section, designed to manage international cooperation,^ but responsible also for the administration of customs for commodities handled by MITI, the export and import of internationally scarce commodities, and arrangements for expositions and trade fairs.
Apart from exports, long-term economic policy and reparations led to expansion of the aid bureaucracy in this early period. The EPA
was created in 1955 and an Economic Cooperation Office was set up in the Director's Secretariat from the beginning, to fit foreign economic policy into the long-range economic planning with which the new Agency
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was charged. In July 1955, the MFA formed a Reparations Department in
g
its Asian Affairs Bureau, marking official administrative recognition of Japan's postwar economic relations with developing countries. The Department replaced the Special Reparations Office which had been
established in the Asian Affairs Bureau some time before (see Chart 2-1).
This Department eventuated after the MFA had spent eight years slowly setting up a more active foreign affairs bureaucracy. Japan's international tasks had been first acknowledged when an International Cooperation Division was set up in the Treaties Bureau in April 1947 as part of a general overhaul of the Ministry after the war. The Division, created mainly to handle negotiations over the Peace Treaty, was retained in the MFA reorganisation of 1949, when the new Foreign Ministry Law (Gaimusho setchiho) was passed. The MFA's interest in economic policy was affirmed by the creation of the International
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Economic Affairs Bureau in June 1951. It was intended that the Bureau would improve the administration of Japan's overseas economic and
commercial policies as a prelude to the approaching San Francisco
Conference, and its responsibilities included liaison with international organisations and economic agencies.1^ A further change in December
1951 consolidated the MFA's economic administration but introduced overlapping jurisdictions. The International Economic Affairs Bureau was renamed the "Economic Affairs Bureau" and the International
Cooperation Division in the Treaties Bureau was expanded to full bureau status to manage relations with the United Nations and other international bodies. While those reforms signalled the end of the
5 1.
Occupation period and the beginning of the new era of the Peace Treaty, with its emphasis on reparations and independent relations with other nations,^"*" they also laid the grounds for future disputes.
The Reparations Department therefore followed naturally from postwar changes in the MFA. It was set up in the Asian Affairs
Bureau, rather than in one of the functional bureaus, because reparations were then considered only with Asian nations. The Department
administered the Reparations Agreement with Burma (concluded in April 1955), negotiations under way with Indonesia and the Philippines and relations with other domestic ministries involved with reparations. These included MITI, because of its control of export licences and
trade in general, and the MOF because of its regulation of budgeting 12
and international finance.
The first large administrative unit for international
financial management was the MOF’s Foreign Exchange Bureau, created in August 1952. This accompanied a widespread pruning of various
commissions and agencies which was intended to reorder economic management. The Foreign Exchange Control Commission and the Foreign Capital Commission, which supervised exchange policy under the Occupation, were both abolished. The new Foreign Exchange Bureau took over the foreign exchange functions of these commissions and assumed responsibility for policy towards the International Monetary
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