Japan steps up ties with Mekong region at summit

By Yoko Nishikawa

TOKYO, Nov 7 (Reuters) - Japan stressed on Saturday the development needs of the resource-rich Mekong River region where Japan, China and the United States are competing for influence in an area seen as a last frontier of emerging Asia.

At the first leaders' summit among Japan and five Mekong region nations -- Cambodia, Laos, Myanmar, Thailand and Vietnam -- Tokyo vowed to expand aid and assistance to the sub-region in areas such as infrastructure and climate change challenges.

The summit came at an awkward time for Thailand and Cambodia, which are embroiled in a row over Cambodia's decision to make fugitive former Thai Prime Minister Thaksin Shinawatra an economic adviser. [ID:nBKK246900]

But the dispute was not mentioned at the summit and did not affect the atmosphere, a Japanese official said.

In recent decades, Japan has been the biggest outside source of aid to the sub-region, but in the past 10 years China's influence in the region has increased significantly, driven by its quest for resources and a readiness to invest in infrastructure and industry. [ID:nHAN427961]

After years of neglect under the Bush administration, Washington has also signalled a renewed interest in Southeast Asia.

"It will be very meaningful to keep holding this kind of leaders' summit every year given changes in the international climate," Japanese Prime Minister Yukio Hatoyama told a joint news conference after the summit.

But he played down the notion of competition between Washington and Beijing.

"The fact that the United States and China are trying to increase cooperation with the Mekong region is not bad for Japan at all. Rather, it is desirable to create a win-win relationship with them by cooperating further."

Tokyo, keen on the region viewed as strategic for its proximity to shipping lanes and abundant natural resources, on Friday offered over 500 billion yen ($5.5 billion) in aid over the next three years to the sub-region. [ID:nT232908]

Japan's direct investment in the Mekong region more than doubled to around $6.3 billion in 2007 from 2003.

In a joint declaration and 63 action plans to boost their cooperation, the leaders agreed to start works under "a decade toward the Green Mekong", in which Japan will assist the region's climate change challenges, such as enhancing sustainable forest and water resource management and clean energy technology.

Hatoyama, who took power in September, said the Mekong region would play a key role in his idea of forming an East Asian Community, inspired by the European Union. [ID:nSP165012]

"The Mekong region is the key to an East Asian Community. The region still faces a big development gap and by having them overcome such difficulties will raise the momentum and spirit for the community," Hatoyama said.

On Myanmar, the leaders urged all players to take part in the next year's election, but stopped short of mentioning detained opposition leader Aung San Suu Kyi.

(Editing by Jeremy Laurence)