Top Aid Donor Japan Releases Figures for ’89

Japan replaced the United States as the world’s largest donor of official foreign aid in 1989, the Finance Ministry formally announced Friday.

“It’s an epoch-making development,” a ministry official said.

Japan’s official development assistance payments totaled $8.95 billion in 1989. The United States was next at $7.66 billion and France third with $7.46 billion, the ministry said.

Japan’s 1989 total, at 1.235 trillion yen, was the country’s largest ever in yen terms, up 5.6% from a year earlier, the official said. But it dropped 1.9% in dollar terms, ministry data show, to $8.95 billion because of yen depreciation against the dollar.

The average 1989 exchange rate was 137.96 yen to the dollar in 1989, compared to 128.15 in 1988, the ministry said.

The ministry official said that growth in Japanese foreign aid spending was less important in Japan’s becoming the world’s No. 1 donor than a corresponding slowdown in U.S. aid spending. He said that U.S. development aid spending declined to $7.66 billion in 1989 from $10.14 billion in 1988.

Japan increased the value of its bilateral grants by 4.4% to $3.03 billion in 1989 from 1988 and increased loans by 6.3% to $3.73 billion, ministry figures show.

Japan’s loans to international institutions to be used for development purposes decreased by 19.4% to $2.18 billion in 1989 from $2.71 billion in 1988.

These loans should increase again in 1990, but the Finance Ministry official did not say by how much.

He said he was unsure whether Japan would stay at the top of the league of official foreign aid donors because money budgeted for the current year would not necessarily be spent in 1990. “But our commitment is on the right course,” he said.