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Japan considers cutting aid to China

By Hu Yang (chinadaily.com.cn)
Updated: 2011-03-03 16:36
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Japanese officials are considering cutting the county's financial aid to China after China's GDP has overtaken Japan to become the world's second largest, Japanese media reported Wednesday.

Japanese Foreign Minister Seiji Maehara has ordered his staff to review whether or not to cut the overseas development assistance (ODA) to China by June, the Kyoto News reported.

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China is now the world's second largest economy after the United States, and some Japanese officials think ODA is reserved to help developing countries. That means it is no longer suitable to continue giving ODA to China, the report said.

Since 1979, Japan has granted loans to China. Other assistance includes grants and technical cooperation. The issuance of loans was halted in 2008, but grants and technical cooperation continued.

The Japanese Embassy in China told the Beijing News that the government will think the question over. Some experts said there is still space for Japan to issue loans as despite its rapid growth, China still lags behind in terms of per capita GDP, which ranks outside the top 100 countries.

The Japanese Embassy in China said future aid to China will mainly focus on environment protection and education, the Beijing News reported. Future cooperation will include new forms in addition to ODA.