Yen Loans: Between Norms and Heterodoxy

Yen loans are long-term, low-interest loans provided to developing countries as part of Japan’s Official Development Assistance (ODA), mainly for infrastructure development as a foundation for the economic growth of recipient countries. They have been a continuing object of criticism based on dominant norms, championed by the United States and European countries, that development assistance is a form of charity by rich countries for the sake of poor countries, and thus should take the form of grants and technical assistance. Yen loans have become symbolic of the heterodoxy that flows through the history of Japan’s ODA, and was adapted for assistance to less developed countries in Southeast Asia. This chapter questions the nature of this heterodoxy and examines how discord has been navigated between Japan as norm-taker and norm-makers—the United States and European countries—who generally lack flexibility with respect to different ways of providing development assistance.