Does Tokyo or Beijing Build Better Roads?

There is more than goodwill behind Japan’s growing role in infrastructure investment across Asia. Tokyo just trumpeted a high-profile aid package of $9 billion for the Philippines. A similar program was announced for Myanmar in November. These generous cash infusions set the stage for Japanese companies to make further inroads into these high-growth nations. This year, the IMF expects that GDP will expand by 6.7% in the Philippines and 7.7% in Myanmar. Tokyo intends to upstage Beijing. But there is a bonus for Japan’s enormous pool of pension assets. OECD standards now allow governments to channel official development assistance on an unrestricted basis through development finance institutions. Those entities in turn become targets for private-sector capital because of their creditworthiness.

Learn more at the Nikkei Asian Review.

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Image: Philippine island of Mindanao may benefit from infrastructure outlays. Credit: Fleyeing at Can Stock Photo Inc.