Japan and the Middle East: Japan can be a bridge in an era of global fragmentation and conflict

The world is at a historic turning point. We have witnessed increasing fragmentation between and within nations and worldwide polarisation. Geopolitical disturbance and the conflicts in Ukraine and Gaza, in particular, have overshadowed trust and mutual respect for a safe and stable future.

When the Group of Seven countries’ gross domestic product (GDP) represents just 30% (29.6%) of the global economy (GDP based on purchasing power parity), the gravity of the world is shifting from north to south due to the rise of emerging countries from the Global South.

Yet, the world faces multiple difficulties and challenges, from climate change and energy transition to global health and supply chain disruption, which require cooperation despite differences in systems or values. The only way to tackle those global issues is to foster international collaboration at all levels based on trust.

Japanese Prime Minister Fumio Kishida said at a conference in January 2023 at Johns Hopkins University in the United States, “We need to be more committed to our values. At the same time, when engaging with the Global South, we need to remain humble while putting aside preconceptions and then have a firm understanding of their respective historical and cultural backgrounds.”

In a world of complexity and fragmentation, Japan is uniquely positioned to foster dialogue between the Global North and South that can help revitalize international collaboration. As Taro Kono, Minister for Digital Transformation of Japan mentioned during “Japan’s Bet on Cooperation” at the Annual Meeting in Davos in 2024, “Japan’s religious neutrality set its position apart from major European countries. Japan can serve as a bridge between different groups”.

Experts, including Yuichi Hosoya, a political scientist at Keio University in Tokyo, share similar views: “Japan intends to establish a dialogue based on respect for international norms and values such as respect for human dignity, and not just human rights.”

Prime Minister Kishida also proposed at the UN General Assembly in September 2023 that we can overcome differences in national regimes and values and steadily advance “human-centred international cooperation” by shedding new light on “human dignity” as a common language that resonates with us all.

The Global South includes most emerging countries and one of the critical players at the intersection of these two country groupings, the Middle East, notably countries of the Gulf Cooperation Council (GCC), is in an important position to work with developed and developing markets to reach their long-term goals, particularly in the context of international trade, development finance and energy.

Japan has been in cordial relations with the Middle East. Stability in the region is crucial as Japan depends on 95% of oil imports from the Middle East; it takes a different approach to the area than Europe or the United States. Keidanren, the most influential business association in Japan, addressed the importance of economic relations with the Middle East and proposed to strengthen strategic ties with Gulf countries in 2022 in view of energy transition and security as well as promoting international trade and investment.

While the Middle East continues to influence the global oil and gas market regarding revenues and power generation, it is also accelerating the energy transition by promoting renewables and becoming a leader in the renewable energy sector.

Many countries in the region have implemented plans to increase the share of renewable energy in their power mixes. According to the International Renewable Energy Agency, the energy transition towards renewables is underway in the Middle East. The region has advanced and ambitious energy investment and diversification plans driven by the need to meet growing energy demand, promote economic growth, maximize socioeconomic benefits and meet decarbonization objectives.

There are a lot of opportunities for Japan to further collaborate with the Middle East in the areas of energy transition towards renewables. Mitsubishi Power, a group company of Mitsubishi Heavy Industries, completed the region’s largest hydrogen fuel blending project.

Mitsubishi Heavy Industries and ADNOC, a leading diversified energy and petrochemicals group wholly owned by the Emirate of Abu Dhabi, agreed to explore low-carbon collaboration opportunities to Build Blue NH3 and Blue H2 Value Chains (part of the hydrogen value chain) in 2023.

JERA, Japan’s largest power generation company, announced that it would accelerate green hydrogen development with PIF (Public Investment Fund, Saudi Arabia). Given the Middle East's significance in its operations, JERA established the JERA Middle East & Africa Management Co. in Dubai in 2021. The company aims to develop combined cycle power plants, large-scale renewable energy projects and green fuel production initiatives.

Kishida visited the region for the first time since becoming prime minister in July 2023, and new collaboration areas of green transformation and energy transition between Japan and the Middle East were agreed upon.

Last September, the First Japan-GCC Foreign Ministers’ Meeting and the Ministerial Working Lunch were held in Riyadh, Saudi Arabia and both regions agreed to deepen cooperation to strengthen the economic relationship – with long-term plans in various sectors in the Middle East – pursue initiatives toward peace and stability in the region including Palestine, and double-down on efforts toward maintaining and strengthening the free and open international order based on the rule of law.

From encouraging free trade agreements to boosting technology, energy transition and climate change cooperation, this is the opportunity for Japan as an intermediary to bridge the Global North and South by strengthening its partnership with the Middle East to improve stability and prosperity in their regions and the rest of the world.

The momentum is there for Japan and the Middle East to work together on energy transition, industry transformation and peace.