June 26, 2013
The International University of Japan, Niigata, Japan
Chairman Kobayashi, Chairman Hidaka, President Kitaoka, Trustees, members of the Faculty, distinguished guests, family members, friends, and above all, graduates. Congratulations!
I am honored to have this opportunity to speak at the commencement of the International University of Japan, a great institution where the world gathers. As a long-time academic studying international politics, it is my personal pleasure to come here where I can get together with many of my professional colleagues. More personally, I love this part of Japan for its scenery, ski resorts, hot springs, and, above all, great sake.
Professionally, as president of the Japan International Cooperation Agency, JICA, I am privileged and honored to join others to celebrate the new graduates of IUJ. As you may know, IUJ accepts more JICA trainees as degree candidates than almost any other university in Japan. In fact, the mission of the IUJ, "To train leaders who can contribute to the practical resolution of global problems facing people living in various countries and regions in the world, as well as organizations including governments, companies, and NGOs, and to extend public and social benefits globally," is perfectly consistent with the mission of JICA. I would like to thank Chairman Kobayashi, President Kitaoka, members of the faculty, administrative staff, and members of the local community for their support for and contribution to Japan's international cooperation activities.
But, obviously, today's heroes and heroines are the graduates. Congratulations, again, on your achievements. The world you are confronted with is full of opportunities and challenges. As global leaders, you are expected to make your own contribution to the betterment of the world. The world you face is not static; it is dynamic. Today, I would like to highlight two important aspects of this dynamic change: one, power transition and the other, power diffusion.
Power transition is a phenomenon in which the distribution of power among states and economies undergoes significant changes. The rise and fall of great powers constitute power transition. Today, many academics and journalists talk about the implications of the rise of China for international politics. But economic growth is not occurring only in China. In fact, much broader changes are taking place in many parts of the world. In addition to China, we are now observing the rise of India, the rise of Southeast Asia, the rise of South Asia, the rise of Latin America and the rise of Africa. In this sense, we witnessing a historic shift of economic power distribution that occurs only once in a few centuries. According to Professor Angus Madison's famous estimates, the share of Asia in global production was more than 50 percent in the 18th century; it went down to 18.6 percent in 1950. But it went up to 43.8 percent in 2008, and it is estimated to go up to more than 50 percent by 2030.
The power transition offers opportunities. The power transition we are witnessing in the beginning of the 21st century, in particular, has introduced great benefits. First, the growth of many economies has contributed to a historic reduction of extreme poverty. One of the targets of the Millennium Development Goals was to halve the population of people living on less than 1.25 US dollars a day between 1990 and 2015. This goal was achieved three years ahead of schedule. China alone lifted 510 million out of extreme poverty. Second, the growth that has been achieved is expanding global markets. The emerging and re-emerging economies are not just the workshops of the world; they are becoming the consumers of the world. Much of the foreign direct investment in developing countries is in the manufacturing sector, which is targeted at local markets as well as exporting to neighboring countries.
However, power transition also offers serious challenges. First, it affects global governance. As emerging powers increase their stakes in global transactions, they are likely to assert viewpoints that are not necessarily similar to those of the status quo powers. How to create an effective mechanism for global decision-making that reflects the new and emerging distribution of economic power is one of the greatest challenges in this age of power transition.
Second, expansion of economic size in many countries may bring about serious social problems if the expansion is not inclusive enough, that is, if the growth does not provide benefits to all segments of society. Unemployment and underemployment, especially of the youth, can pose serious social problems. Many successful countries have to take measures not to fall into "middle income traps." Without steady development in social safety nets, R&D capability, efficient tax systems, and other growth-generating conditions, these economies may not be able to go beyond "middle income" status. Other countries are overly dependent on minerals and natural resources. Despite an average annual growth rate of 5 percent in Sub-Saharan Africa over the past decade, the ratio of the manufacturing sector in African GDP has actually fallen during the same period.
Third, despite the remarkable success of many countries, there are some countries that have not been able to get on an accelerated growth path. Fragile states have made limited progress on many MDG-related targets, and their challenges remain serious for the foreseeable future. Severe threats to "human security" still exist in many parts of the world.
Now, let me move on to the second aspect of dynamic change in the world: power diffusion. In contrast to the world of 19th century, the 20th century, especially the latter half of it, saw the emergence of non-state actors on the global arena: business firms, international governmental organizations, non-governmental organizations, and sometimes influential individuals. Leading companies are operating in many countries. Their production networks are multinational and their markets are global. The amount of money and resources they mobilize are much larger than medium-sized sovereign states. The power of inter-governmental organizations is on the rise; the EU Commission is the most powerful among the regional organizations, but the power of ASEAN secretariat and the AU Commission are not insignificant. Non-governmental organizations, or Civil Society Organizations, are making a great difference in economic and social development in many parts of the world.
In this sense, power diffusion offers opportunities for many individuals to participate constructively in the global community. Once out of this business school training, some of you may engage in the creation of multinational production networks for automobiles and electronic products. This will enhance the living conditions of many developing countries. NGOs specialized in microfinance help women farmers start their own businesses in many countries in Africa. Information technology and social media are empowering those who have previously been deprived of social influence.
On the other hand, on a darker side, power diffusion also means the growing power of terrorist groups, criminal organizations, and other "uncivil society organizations." They are notoriously active in fragile states and areas. The recent episode in Mali clearly demonstrates a case where terrorist or extremist groups took advantage of its fragile conditions in the north. Now the entire Sahel region is becoming vulnerable to activities of terrorists, extremists, or criminals. IT and social media can work against the interest of the public, too. Malicious use of such technology can destabilize societies.
The international community, in other words, is confronted with challenges from power diffusion. We need to increase cooperation to counter the activities of terrorists, extremists, and criminals. We also need to create a society resilient to such uncivil activities. Peace-building in post-conflict or conflict-affected countries is especially important because about half of all civil wars are post-conflict situations gone wrong.
TICAD V, or the 5th Tokyo International Conference for African Development, held in Yokohama from June 1 to June 3, highlighted these dual characteristics of the current world system. 51 representatives of African states, as well as many other countries, international organizations, non-governmental organizations, and the private sector, participated in the meetings, and promising opportunities as well as serious challenges were discussed. Many African leaders emphasized the importance of investment as well as ODA. The private sector leaders discussed the multiple business opportunities in Africa. But a large number of pitfalls were the subject of serious discussion, too: jobs, agriculture, energy, health, nutrition, education, cross-border infrastructure, and disasters. Furthermore, the issues of human security and the specific cases of peace-building in countries such as Somalia attracted attention. Africa has significant potential but, in order to realize that potential, we need to tackle many challenges.
You must have specialized in areas at least somewhat related to the opportunities and challenges that I have just outlined, and your knowledge and expertise are valuable assets for your countries and the global community. To repeat what I have said, power transition and power diffusion in today's world both offer great opportunities. Now the global community is discussing how to set the global development agenda after 2015. Given the progress made by the MDGs, the real eradication of extreme poverty, that is, zero percent extreme poverty, can be achieved in the coming decades. The world may be transformed into a more equitable place where more and more people have economic opportunities. I would like you to join the global efforts to achieve this ambitious goal.
In order to realize this, however, we need to prevent instability and dangers emanating from power transition and power diffusion in the 21st century. Many countries are rising, but the rise of any country must be peaceful. We need talented diplomats. Economic growth should be promoted, but such growth should be inclusive and sustainable, both environmentally as well as socially. We need active entrepreneurs and good economists to stimulate economies, but we also need social planners, NGO workers, and political leaders who are attentive to people's social and political needs.
Fragile conditions should be reduced and conditions of human security should be improved throughout the world. We need peace-keepers and peace-builders. We need capable technocrats and responsible democratic leaders. In addition to instability and danger from power transition and power diffusion, there are numerous challenges from nature, as well as the interaction between humans and nature. We need scientists and engineers to discover innovative solutions. And, if I may, we need people working in an organization like JICA.
Regardless of your area of expertise, I am convinced that your work at the IUJ has prepared you to step out into the world, to make a contribution, and to have an impact.
Congratulations again and thank you in advance for your valuable contribution to the global community. I am very much looking forward to working together with you to create the future we want.