Chiang Kai-shek's Republic of China was one of the 48 allied nations which signed the Treaty of Peace with Japan, in 1951. In the treaty, Japan forfeited all its overseas assets, including even those in neutral countries. Japanese assets in China were vast, including not only governmental monetary deposits, but also railroads, factories, even monetary deposits of private citizens and private property, which are not normally forfeited. It is impossible to know the total value, but the Bank of Japan estimated total overseas assets at 111.1 billion dollars immediately after the war, a majority of them in China. How these assets were later utilized have been up to the discretion of the individual governments.

The following year, Japan concluded a peace treaty with Chiang Kai-shek's nationalist China, with which Japan had fought the war, and not the present-day Communist regime of People's Republic of China which came to control China as a result of civil war in the years following World War II. The world also recognized nationalist China as the major fighter of the Chinese battlefront, as witnessed by the fact that Chiang Kai-shek's China had been given one of five permanent seats on the United Nations Security Council. In this treaty, China deemed it fit to renounce any rights to demand war reparations, reciprocating agreements concluded in the Treaty of Peace with Japan the year before.

In 1978, the Treaty of Peace and Friendship between Japan and the People's Republic of China was concluded, which normalized bilateral relations. Prior to this treaty, the two governments issued a joint communique (1972) in which China waived demands of war reparations from Japan. This is because the matter of war reparations between China and Japan had already been settled in peace agreements concluded in 1951 and 1952. In addition, People's Republic of China gained an international strategic benefit, of attaining recognition as the ruling government of China.

In order to create constructive relations with Asian countries, Japan has spent huge amounts of taxpayer money on development aid.

So far, China has been the recipient of 2.26 trillion yen worth of government aid (1997)*1 When President Ziang Zemin visited Japan last year, Japan agreed anew to provide 390 billion yen aid.

In recent years, Japan has been China's no.1 aid donor. The most recent figures available for international comparison (1994-1996) shows that Japan has provided more than one half of aid that China receives from foreign countries.

For 1996, Japan's official development aid was about 862 million dollars. The second donor, Germany, provided 461 million dollars. The third donor, France, provided 97million dollars. For 1995, Japan's aid was 1.38 billion dollars, and for 1994, 1.48 billion dollars. The sudden drop in the amount of aid for 1996 is attributed to the fact that Japan stopped certain grant cooperation from mid-1995 to mid-1997 in protest of China's nuclear experiments.

*1 Telephone interview with Ministry of Foreign Affairs

Unfortunately, the Chinese people remain totally ignorant of these facts. Apparently for political reasons, the Chinese government has made little effort, if any, to inform the public that Japan has been the greatest aid donor to China, and has constructed numerous facilities and infrastructure to contribute to the welfare of its citizens.

additional sources:
1. Sankei Shinbun, Jan.22nd 1999 issue / 2. Ministry of Foreign Affairs on ODA figures