The global pandemic has forced countries to invest in their own internal affairs which has been a challenge for the aid industry. As a result, developing countries have been facing a lack of resources to deal with the pandemic, to which external aid has gained more importance. To account for this, development assistance must take steps to accelerate its effectiveness.

Japan’s Official Development Assistance (ODA) budget for 2021 increased slightly to $5.68 billion from 2020 levels. Besides that, Japan also promised to commit to an emergency aid package of up to $4.5 billion which contains massive loan programs to fight the pandemic launched in December 2020 in the country’s special account.

The 2021 ODA budget consists of endowments worth $5.13 billion and loans worth $470 million. The endowments are bilateral aid in the form of $4.19 billion to recipient countries and multilateral aid of $950 million designated for international organizations. In general, bilateral aid is composed of grant aid and technical cooperation projects. In 2020, Japan’s actual ODA performance was fourth in the world, behind the United States, Germany, and the UK.

Japan’s ODA budget is within the jurisdiction of 13 ministries and other government agencies, of which about 80% goes to the foreign ministry. The three pillars of the 2021 foreign ministry budget are pandemic response, promoting diplomacy, and contribution to global challenges.

In fact, internal and external motivations and expectations coexist in a large budget. Internally, opinion polls suggest that Japanese citizens are expecting the aid to contribute to Japan’s own national interest like security. Loans have recently been more tied with Japanese businesses. The government considers ODA a form of diplomatic leverage with developing countries.

An example of this leverage is Myanmar which has been under military control following a military coup in February. Though Western countries are putting pressure on the military government by imposing economic sanctions and supporting anti-government forces, Japan claimed that it is ready to suspend assistance which totaled $1.74 billion in 2019.

However, some warn that Japan’s dependency on ODA to maintain its influence over other countries is worrying as rising economies like China will soon overtake Japan’s contributions.

Another rationale for development aid is Japan’s self-understanding as a “responsible major player” encouraging the country to fulfill its leading role in the international community. In the White Paper on Development Cooperation 2020, the foreign ministry claims that the pandemic is a global crisis demanding support for developing countries with fragile healthcare infrastructures.

Understanding the pandemic as a crisis of human security, the bedrock of the 2015 cabinet decision on the Development Cooperation Charter, the foreign ministry promised that the pandemic response will handle distribution of medicines and vaccines through COVAX facilities, protecting Japanese residents abroad, and strengthening healthcare systems in developing countries.

In this budget, Japan’s diplomatic interest is represented by the Free and Open Indo-Pacific Strategy (FOIP), an economic and security partnership among participating countries. ODA bears the cost for FOIP conferences like the 9th Pacific Islands Leaders Meeting (PALM9) and the 12th Mekong-Japan Summit Meeting. Moreover, Japan is trying to work together with the international community for Sustainable Development Goals (SDGs) in sectors like education, climate change, health, and so on.

In short, development aid is in many ways connected to Japan’s foreign policy which aims to boost the country’s presence in the world.

On a practical level, the Japanese ODA is being challenged by the pandemic. Remote implementation of aid projects in general drastically lowers their effectiveness and efficiency, piles up expert fees, and prolongs the project period. New COVID cases in recipient countries often surge in just a few days and change the government’s restrictions on curfews, lockdowns, and immigration. Japanese experts recently resumed visits to other countries, which swells costs for safety measures like quarantines and PCR testing. An increase in the ODA budget does not directly mean an increase in assistance.

To deliver emergency aid effectively under these circumstances, Japan must make use of lessons learned from more than a year of remote implementation of the ODA projects. The pandemic has provided an opportunity for experts to rethink what they can and cannot do virtually. For example, some project planning surveys have been completed virtually with no physical visit, which has the potential to streamline the assistance’s planning process.

The pandemic has also encouraged the Japan International Cooperation Agency (JICA), a managerial body of Japanese ODA, and experts to start accepting digital transformations like doing away with physical stamps, introducing online platforms and chat tools, and teleworking.

Despite the global adversity, Japan’s 2021 ODA budget remained consistent. It has the potential to improve the situation in recipient countries, as well as satisfying the Japanese public’s expectation to contribute to the country’s own benefit. To do this, Japan must deliver the aid efficiently by reflecting on the challenges and findings posed by the yearlong pandemic.