Japan Could Still Join China Infrastructure Bank, Abe Ally Says

(Bloomberg) -- Japan could consider joining China’s Asian Infrastructure Investment Bank if it makes some changes, a ruling coalition party executive said in an interview in Tokyo on Wednesday.

Yoshihisa Inoue, secretary general of Japanese Prime Minister Shinzo Abe’s junior coalition partner, Komeito, was speaking ahead of a trip to Beijing later this month with Liberal Democratic Party counterpart Toshihiro Nikai. They hope to meet China’s President Xi Jinping.

“If certain conditions are met, such as the establishment of proper rules on financing decisions and consideration for the environment, I think it is all right to consider joining,” Inoue said of the AIIB. “One issue would be cooperation with the Asian Development Bank, which is led by Japan.”

The AIIB, which started operations almost two years ago, now has 80 approved members, from India to Australia to the United Kingdom. Japan has so far steered clear of the bank, following the lead of its only treaty ally, the U.S.

Strong Signals

Inoue’s China visit is aimed at bolstering ties between Abe’s coalition partners and the Chinese Communist party. It comes as Japan redoubles efforts to smooth often rocky ties with its largest trading partner.

Abe met both Xi and Chinese Premier Li Keqiang last month, and this week he told business executives from the two countries that Japan was willing to cooperate on Xi’s signature Belt and Road infrastructure initiative.

Inoue said he saw particularly strong signals from China of a willingness to improve ties.

"They are actively setting up opportunities to explain their thinking and their policies for the future," Inoue said. "We didn’t see this much in the past. I think the Chinese side has a policy of improving ties since the party congress," he said, referring to the Chinese Communist Party’s once-in-five-year leadership reshuffle held in October.

Abe has said several times that he wants to host Li and South Korean President Moon Jae-in for a trilateral summit in Japan by the end of the year. With time running out, Abe said this week he still hoped to hold it soon and reiterated his desire to visit China next year to mark the 40th anniversary of a friendship treaty between the two countries.

To contact the reporters on this story: Isabel Reynolds in Tokyo at ireynolds1@bloomberg.net, Takashi Hirokawa in Tokyo at thirokawa@bloomberg.net, Emi Nobuhiro in Tokyo at enobuhiro@bloomberg.net.

To contact the editors responsible for this story: Daniel Ten Kate at dtenkate@bloomberg.net, Jason Koutsoukis

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