Japanese Prime Minister Sanae Takaichi on Wednesday announced financial cooperation totaling about USD10 billion to help countries and companies procure crude oil, amid the ongoing uncertainty in the Middle East.

Takaichi announced the measure at an online summit meeting related to the Japan-led Asia Zero Emission Community framework involving Southeast Asian countries and Australia.

“We are closely linked to Asian countries through our supply chains,” Takaichi told reporters after the meeting.

“Fuel shortages and supply chain stagnation in Asia have a negative impact on our nation’s economy,” she said, noting that Japan imports many dialysis devices and surgical gloves from Asian countries.

In the meeting, the prime minister launched the “Partnership on Wide Energy and Resources Resilience,” a new cooperation framework to establish a regional crude oil reserve and release system, support the construction of storage tanks and other infrastructure, diversify energy sources, and promote energy-saving investments.

“We will not be releasing Japan’s crude oil reserves,” Takaichi said. “(The aid measure) will not have any adverse effect on domestic supply and demand.”

Japan’s financial cooperation will be provided through the government-affiliated Japan Bank for International Cooperation and others.

Under the support, loans will be extended to companies in Asian countries with lower creditworthiness than Japan that are struggling to secure funds for crude oil procurement.

The funds Tokyo will provide are equivalent to the cost of procuring up to 1.2 billion barrels of crude oil, or the amount imported by members of the Association of Southeast Asian Nations over roughly a year.

The AZEC is a decarbonization initiative with 11 member countries. Wednesday’s meeting, dubbed AZEC Plus, was chaired by Japan and also attended by the leaders of South Korea, Bangladesh, and East Timor, which are not part of the framework.

Participating countries welcomed the new cooperation framework, according to the chair’s statement released after the meeting.

Amid the deteriorating situation in the Middle East, China has offered support to ASEAN members and is in discussions with some countries over energy supply cooperation.

Japan considers ASEAN a key partner in its product supply chains, as some 10,000 Japanese firms are doing business in its member countries. Tokyo hopes that offering aid will prevent China from expanding its influence in the region. (PNA)