Japan to fund Vietnam's satellite project

The first such aid funds are expected to be offered to Vietnam to help Japanese companies secure business related to a planned satellite launch by the Southeast Asian country.

The government had previously opposed disbursing ODA funds for satellite projects on the grounds that the ODA programme should primarily serve the goal of eradicating poverty.

But Tokyo has changed its mind after seeing European countries successfully use ODA funding to benefit their aerospace industries. Japan now plans to extend low-interest, yen-denominated loans to emerging economies to support Japanese firms in the race to secure satellite-related deals abroad, they said.

Since Seiji Maehara became foreign minister, the ministry has shifted its position on funding foreign satellite projects with aid funds as Maehara believes the government should help to promote Japanese infrastructure exports.

Vietnam earlier asked Japan for loans to carry out its 30 billion yen project to build a space centre and launch a weather satellite.

Among Japanese companies, NEC Corp and Mitsubishi Electric Corp manufacture satellites.

French and Belgian firms have already been awarded contracts in connection with the Vietnamese space programme, apparently aided by their respective countries’ ODA.

Japanese companies are afraid of falling behind Western competitors and only one Japanese satellite, with key components made by Japanese firms, has been delivered to a foreign buyer.

Japan is aiming to export five to 10 satellites in five years’ time.

The government earmarked funding for the development of advanced small satellites in its draft budget for the year from April. It will also send a delegation of government and corporate officials to Mongolia and Cambodia in February in the hope of winning satellite-related business.