HL Deb 19 May 1998 vol 589 cc1515-33

7.37 p.m.

Viscount Trenchard

rose to ask Her Majesty's Government what steps they are taking to promote relations between the United Kingdom and Japan.

The noble Lord said: My Lords, 1998 is a special year for British-Japanese relations. Most importantly there is the state visit by the Emperor and Empress of Japan which takes place during next week. This will be the first visit by a reigning Japanese Emperor since 1971. The intervening 27 years have witnessed an enormous broadening and deepening of our relationship with Japan. In January the Prime Minister visited Tokyo and opened Festival UK 98, a year-long programme of events and activities designed to bring British culture, business and scientific achievement closer to the Japanese people.

I look forward to hearing the speeches to be made by other noble Lords, in particular that of my noble friend Lord Howell of Guildford, who makes such a positive contribution to British-Japanese relations through his chairmanship of the UK-Japan 2000 Group. I also look forward to hearing the reply of the noble Baroness, Lady Symons of Vernham Dean, to whom I am grateful for her interest.

On the one hand Japan and Britain have much in common. We are both island nations situated close to great continents from which we have imported most of our cultural traditions, including much of our language, script, music and art. We are both constitutional monarchies whose reigning sovereigns maintain strict political neutrality.

There are also many respects in which Japan and Britain are different. I believe that Japan's enforced isolation from the world, which lasted for more than 200 years and ended with the Meiji restoration in 1868, still has some lasting effect on Japanese society. The excessively consensus-orientated decision-making process and individual reluctance to state publicly an opinion on any specific subject prevent the emergence of "leaders" in the western sense in politics, business or other fields. Indeed, there is a well-known proverb, deru kui wa utareru—the stake that sticks out will be hammered down. Japanese society is extremely corporatist and an individual's social position and his or her very identity own much to the company or institution to which he or she belongs. Recent years have seen a rapid increase in "twinning" arrangements between Japanese and British schools and universities, involving the exchange of students and in some cases teachers. There are at any one time about 1,000 young British graduates in Japan, spending at least a year on the Japanese Government's Japan exchange teacher scheme.

Japan's recovery from the ashes of defeat in 1945 has been remarkable. In several industrial sectors, such as cars and electrical appliances, Japan's great companies have become household names almost everywhere and their products, of high quality and sold at affordable prices, have done much to improve the living standards of many millions of people. The structure of its government, civil service and business has provided a stable framework for what we were beginning to call "the Japanese miracle" until the "bubble" burst in 1990. The Japanese Government last month adopted an economic rescue package involving the injection of £77 billion into the economy through public works spending and fiscal stimulus; 1st April 1998 also marked the beginning of Japan's version of "Big Bang", involving the liberalisation of financial markets and the abolition of much cumbersome and bureaucratic regulation. The objective is to ensure Tokyo's future as one of the great financial centres of the world providing efficient, free, innovative and transparent markets, a centre in the Asian time zone to complement London and New York.

However, market reaction to the government's economic recovery package was lukewarm and the impact of the "Big Bang" seems evocative of T. S. Eliot's words, Not with a bang but a whimper". Confidence and optimism are commodities in short supply in financial and business circles and it is not clear who is able to provide the commitment and strong leadership necessary to complete the reforms. What is necessary is for the government to take bold and radical action quickly, for example in completing their privatisation programme and reforming the post office savings system.

I believe that British financial firms are uniquely qualified to play an important role in assisting Japan in this area. Japanese financial institutions desperately need to improve the poor returns they derive from their investments and British investment managers have a golden opportunity to introduce their professional approach and international expertise, which I believe should win for them a significant share of an enormous market. Indeed, Japan's current difficulties provide an opportunity for improved market access in several areas by British and other non-Japanese firms and it may be that deregulation and the weaker yen will lead to some correction to the enormous imbalance between Japanese direct investment in Britain and British investment in Japan. Japan's trade surplus with Britain was £4.7 billion in 1996, but that was more than compensated for by a surplus in services and investment earnings, giving us a current account surplus of £1 billion.

In the year ended March 1997, Japanese investment in Britain amounted to more than £800 million, representing 40 per cent. of Japanese investment in EU countries in that year, and created or saved 8,000 jobs in total. There are more than 1,000 Japanese companies operating in Britain, including 271 manufacturing companies which employ 65,000 people directly and secure the continued employment of many others. Investment by Japanese companies in certain regions of Scotland, the North East of England, South Wales, and elsewhere have played a significant part in their regeneration.

Japan and Britain are increasingly co-operating in third countries through partnership in development assistance and collaboration in the provision of aid in developing countries.

British-Japanese co-operation in third countries is, of course, not a new phenomenon. It may not be widely remembered that Japan and Britain were military allies from 1902 until 1923 and fought together in the First World War. Many former Imperial Japanese Navy officers remember to this day with pride and affection the links that existed with and the traditions that they inherited from the Royal Navy. The letter from Mr. Sam Falle published in The Times on 29th April, describing his treatment at the hands of the Japanese navy as its honoured guest, on being taken prisoner in 1942, bears witness to the fact.

Unfortunately, the Anglo-Japanese alliance did not last longer. As your Lordships are well aware, Japan's disastrous involvement in the Second World War led ultimately to its catastrophic defeat that followed the destruction of Hiroshima and Nagasaki by atomic bombs.

I believe that history shows that mankind is capable both of great bravery and savage cruelty in war. In the Second World War, prisoners of war and civilian internees suffered horribly in both Asian and European theatres. The treatment of British prisoners in Japanese prisoner-of-war camps was often atrocious. The San Francisco Peace Treaty of 1951 recognised the extreme nature of suffering endured by allied prisoners and, in addition to the customary sequestration of overseas assets, required Japan to make direct reparations to former prisoners, which was a new departure in a peace treaty and I think remains the only case of direct payment of reparations by a former enemy to individuals. Inadequate though the payments were, the matter was settled by the treaty which became the rock on which we have rebuilt our very successful relationship. I do not think it right that Britain should try to renegotiate the treaty now.

I believe that many Japanese still feel an obligation to redress the wrongs inflicted on their prisoners. The Japanese Government have recently instituted a scheme to provide scholarships to grandchildren of former prisoners of war for sixth-form education. They have organised a number of successful reconciliation visits to Japan for former prisoners and their families which have been welcomed by the Royal British Legion, which is itself involved this week in a joint memorial visit to Burma and Thailand. Many Japanese companies operating here are exemplary corporate citizens and make a full contribution to deserving causes in their localities. The community obligations observed and constructive social participation shown by managers of Japanese companies here have been a tremendous force for good in many cities and towns across the country. Their conduct has helped to heal the wounds which remain so deeply felt by many, in spite of the passage of more than half a century since the end of hostilities.

As a trustee of the Royal Air Force Benevolent Fund, I am pleased that we were able to disburse £14 million in direct charitable expenditure during 1997. Of course, what we and other similar organisations give is not enough and our beneficiaries' needs are increasing with their age. We will continue to try to give more and we depend on the continued support and generous benevolence of the thousands of individuals and companies who give us donations regularly year after year. Among our supporters are Honda and Mitsubishi Motor which save us several thousand pounds a year by providing courtesy vehicles at the Royal International Air Tattoo.

I do not think it will encourage them if those they wish to help insult their own head of state while he is here as a guest of our head of state. I suggest that to be discourteous to the Emperor at his welcoming ceremony would certainly be discourteous to the Queen. I agree with the views expressed by the noble and gallant Lord, Lord Bramall, who is unable to be here today, in his letter to the Daily Telegraph of 24th May. The noble and gallant Lord expressed the hope, with which I hope and trust that noble Lords will agree, that when the Emperor arrives in London he will be received with the courtesy and understanding for which this country is renowned.

We will not, and we must not, ever forget the appalling suffering endured and the sacrifice made by British and allied prisoners during the Second World War. There are those who, understandably, cannot forgive or forget. However, I hope that they will not feel it right to attempt to put their interests above those of the country as a whole. It is not in their interests or those of any of us to jeopardise the development of closer relations between our countries as we look forward together to the new millennium.

There are still those who will not accept the sincerity of the apologies given on various occasions by Japanese Prime Ministers. The point was addressed in another place on 29th April by the honourable Member for Reading East. Miss Jane Griffiths is, I believe, correct in her statement that the word used by the Japanese Prime Minister to express apology, owabi, is an appropriately strong and serious word. The representatives of the prisoners of war who want the word shazai to be used may be misled or they may misunderstand. Shazai is a rather legalistic word not commonly used in the spoken language. The actual words used by Mr. Hashimoto expressed his "deep remorse and heartfelt apology" and should be taken as sincere and at face value. I hope that the noble Baroness the Minister and other noble Lords will agree with Miss Griffiths' call for all of us to accept that the 1951 San Francisco Peace Treaty cannot be reopened.

Your Lordships may have noticed, and I trust will have welcomed, the investiture by the Queen of Mrs. Keiko Holmes, a Japanese woman, with an honorary OBE on 28th April. Mrs. Holmes has worked tirelessly over the past seven years to bring about reconciliation between former British prisoners and their captors.

We have heard that the Queen has decided to invest the Emperor as a member of the Order of the Garter, an honour also granted to his three immediate predecessors. I believe that the granting of this singular honour to His Majesty should be seen by the Japanese people as evidence of the importance we British attach to the relationship between our two countries and that it will inspire many to continue to work for national reconciliation and the further development of good relations.

I cannot agree with the opinion expressed by Mr. Simon Heffer in his recent articles in the Daily Mail and Daily Telegraph in which he attempts to draw similarities between the award of an honorary GCMG to the late former President Ceausescu of Romania and the award of the Garter to the Emperor. I cannot think of a less apt parallel. Ceausescu was a communist dictator who ruled his people with a rod of iron. The Emperor of Japan is a constitutional monarch, as was his late father, and acts only on the advice of his Ministers. The Emperor was 12 years old at the end of the war and reigns over a state which has renounced the right to use military force except in self-defence. His interests include the protection of the environment and wildlife. To link his name with that of Ceausescu is quite absurd. The Emperor and Empress are coming here as the Queen's guests bearing the goodwill of the Japanese people. I believe that your Lordships' House and the British people will give Their Majesties a warm welcome and that the visit will lead to the further enhancement of the close relationship between Japan and the United Kingdom.

7.52 p.m.

Viscount Slim

My Lords, I am grateful to the noble Viscount for introducing the debate. I am a little perturbed that noble Lords have been gagged to the extent of having only five minutes each in which to speak. This is a big economic, commercial and political subject. It involves the people of our country who fought for our country, who suffered and who made great sacrifices. They are the veterans. No one understands better the word "veterans" than Members of your Lordships' House. There are many in your Lordships' House but hardly any in the other place. No one sitting here, in the other place or in Downing Street would be doing the jobs they do today had it not been for the great sacrifice made by the veterans and their will to win a war against probably the most courageous enemy in Asia that Britain has ever fought.

No one is ever rude about the courage of a Japanese soldier, sailor or airman. What is resented is his behaviour. Many believe that this leopard has not changed its spots. The veterans require more proof. One can quibble over the use of Japanese words. It is difficult to find a word for "sorry" as we understand it. But I hope that we can come to terms with a proper apology as we see it, not as the Japanese see it.

There is the question of the loss of face if the Japanese use our terminology for "sorry". I believe that the Japanese would gain great face world wide and in this country—certainly with the veterans—if they made a proper, strong apology at the highest level. The omens should be good. Of course, we veterans support closer commercial and political relations. Veterans behave with great dignity and are also wise. They are more experienced than many of the young people involved in commerce, industry and politics today. They see a need for change, so little is required to bring them on side. But their resentment goes deeper because Britain today does not appear to bother about veterans. Naturally, it is the young who get into the frame.

The Government should pay greater attention to the veterans. I believe that since the end of the Second World War this nation and successive governments have lost face. We do not look after our veterans as countries like America, Canada and Australia do. We do not have veterans' hospitals, villages or all the other things provided for veterans. A man who has managed somehow to cling to life is brought back, given a tin of 50 cigarettes, a new suit and a railway warrant to his home. We send him off and forget about him. I speak completely non-politically. No government of Great Britain since the end of World War II have paid the degree of attention to the wellbeing, care and recognition of veterans that they deserve. I hope that this Government will listen and do something about it.

I support anything that furthers relations with Japan. I am a businessman. I also spend much time helping veterans in a small way. I believe that we should concentrate very much on the young. Young Britons and young Japanese should get to know each other. We should not preach to the veterans about whether to stand and shout or behave with their usual dignity. No one in your Lordships' House, the other place, the Church, or anywhere else, is in any position to preach to a veteran, particularly one who fought in Asia, and tell him what to do. He knows exactly what to do. Come the visit of the Emperor there may be a dignified silence. Not many veterans will be waving flags. But there will be no problems.

Only those among the civil internees are pushing hard for some form of compensation. I am worried. Most of the people affected are now dead and will not get compensation. Therefore, it is perhaps a rather pointless exercise. Maybe they were prisoners who suffered in a harsher and more barbaric way. For a number of political reasons of which noble Lords are aware perhaps compensation has had its time.

It has been suggested that the two governments should work together on these matters.

Baroness Ramsay of Cartvale

My Lords, I apologise for intervening. I appeal to the noble Viscount to note the time.

Viscount Slim

My Lords, I have one more sentence. It is up to the governments of today to look after their veterans and those who were prisoners. It is up to us to look after our own people.

7.57 p.m.

Lord Montague of Oxford

My Lords, in the late 1960s and early 1970s I had the good fortune to be responsible for exports to Asia, particularly to Japan. When we mounted British Week in 1969 I remember the accusation that it was rather difficult to sell coal to Newcastle, and so it would be when it came to selling to Japan. It is heartening to hear from the noble Viscount, Lord Trenchard, who has so ably reminded us of the benefits of our current relations with Japan and its great success, with a surplus in the past year of over £1 billion. There are other successes. I refer to the number of tourists who come to our shores. In the past year 700,000 came here. That is a sign of interest in this country and a further reflection of the identity between our two great nations.

I should like to make a few points in the brief period that is allotted to me. They may sound rather trivial but I hope that they are of help. What have we to learn? This debate reminds us about the future. What should we change? I have been reading that the Japanese are not as knowledgeable as they might be about our culture. But, equally, we are not as knowledgeable as we might be about their culture. Therefore, there is room to improve our understanding of the Japanese. I shall give a few examples which may seem rather petty but I hope that they will be helpful to those who have day-to-day relationships with the Japanese.

Japanese people do not like what I would call the hail-fellow-well-met, back-slapping endearments which we sometimes use with each other. They are a very reserved race and they expect that of others. Strangely enough, the Japanese do not welcome eye contact. It is more respectful when you are dealing with the Japanese slightly to avert your eyes than it is to stare them out, as it were, with a feeling of great sincerity.

Of course, when it comes to putting on a great spread for your Japanese visitors, I strongly advise that, however good your culinary skills, you do not try them on the Japanese because they are really completely at home with their own palate. Japanese people like Japanese food. Therefore, if you wish to make friends, it is better to make contact with somebody who can provide the Japanese with the food which they like so much.

I mentioned the fact that in the late 1960s I had dealings with Japan. At that time, there was one Japanese restaurant in London. Today there are 150. That is an example of how things have changed.

It was my good fortune at that time to meet the now Emperor, the then Crown Prince, and to hear how impressed he was with our country and what great respect he has for it. Those were not just words. He was to go on to do something which no Japanese Emperor has ever done before: he decided that his son should be educated in our country. There could be no stronger personal example of his respect for this country.

I was most pleased to hear the noble Viscount, Lord Slim, indicate that he anticipated that, in spite of the difficulties of which he justifiably reminded us, a warm welcome would be given to the Emperor. That is very encouraging. That would be extremely helpful as regards the way in which the press deal with this matter. We know that the press must sell newspapers and that colourful headlines are the main means by which they do that. Therefore, if our veterans do, very understandably, engage in gestures which draw attention to their feelings, I believe that that may be misrepresented by the media and will not do our country the certain good which will otherwise come from the Emperor's visit.

I end with a closing thank-you note to the Foreign Office and the Japanese Embassy for one of the arrangements that has been made. I was present when the previous visit of the last Emperor took place in the 1970s and I remember that he put on his reciprocal state banquet at Claridges. Some vision on the part of the Japanese Embassy means that on this occasion it will take place in the Victoria and Albert Museum. It may be that we shall see each other there and have a good evening.

8.2 p.m.

Lord Sandberg

My Lords, it is perhaps difficult, perhaps even arrogant, for those who did not have first-hand knowledge of Japanese atrocities to seek to suggest to those who did that they should now forgive and forget. But we must remember that it was a long time ago. When I was posted out east in the late 1940s, many of my British colleagues had suffered privations and suffering in camps, having been captured in Malaya, Singapore or China. They had fearful tales to tell. Indeed, British commercial companies which had opened up in Japan very often told their employees that if they did not wish to serve in Japan, they need not do so. The staff may not have appreciated that gesture, but I do not know anyone who asked not to be posted there.

Indeed, during the three-and-a-half years which I spent in Japan, I cannot remember anyone speaking gloatingly to the Japanese about their humiliation and occupation. That was a lesson which I certainly took to heart. The Japanese man on the street was under no illusions because as a private soldier he had probably been thoroughly abused by his NCOs and officers, who had very little regard for the private soldiers.

Why have the Japanese Government never really said sorry or mea culpa? I do not know the reason. Why has the compensation been so derisory? Among other things, I believe that the Japanese find that it is difficult to articulate the shame. We are taught that it is not difficult to say sorry, but the culture of the Japanese world and the western world are not the same. The noble Viscount, Lord Trenchard, made a good point—that Japanese culture makes it difficult for individuals to emerge as leaders and, therefore, it is also difficult for them to apologise on behalf of their country. Ideally, for the Japanese everything must be done by consensus. That is well illustrated by a Chinese thought, and the Chinese are nothing if not individuals. It is said that if one pits one Chinese against one Japanese, there is a Chinese victory; two Chinese against two Japanese, there is a draw; and three Chinese against three Japanese and it is a Japanese victory. It is a difficult position for Japanese leaders to take.

One must remember that there has been the same lack of apology to the inhabitants of Asia whose countries were occupied. Perhaps that is nowhere more apparent than in China, where people suffered more grievously and far longer than anybody else. As the noble Viscount, Lord Slim, said, the Chinese are ever mindful of leopards and spots and they are fearful of anything which suggests re-arming by the Japanese. But they have accepted that the atrocities are of the past and there is no real benefit to continue harping on them and about that period.

It is now well over 50 years since the end of the war, and I suggest that it is no longer appropriate, even for those who suffered directly, to continue to carry that torch. Many of those who were in Japanese camps were adamant that the Korean guards were more brutal than the Japanese. Korea was a colony of Japan at that time. But we do not seek apologies or restitution from Korea. Nor do we seek apologies from North Korea or Vietnam for the sufferings experienced in those more recent wars. Indeed, much suffering was experienced.

I began by saying that it is not easy for those of us who did not suffer directly to tell people to forgive and forget. It is not easy, but now I do appeal to them not to continue their protest and especially not to do so during the coming visit of the Japanese Emperor.

8.8 p.m.

Lord Dearing

My Lords, the noble Viscount, Lord Slim, spoke movingly on behalf of the veterans and his words merit our respect. Our concern is the relations between our country and Japan and I have two points which I wish to make.

First, I believe those relations would be enhanced to our benefit if there were open and generous recognition of the contribution that the Japanese manufacturing industry has been making over the past 20 years to the regeneration and renaissance of the economies of the old heavy industry areas of Britain. I speak with some knowledge of the north-east of England where so much has been contributed. The headlines are made by major investors, by companies like NSK, the first to come to the north-east, Komatsu, Nissan, Fujitsu, Sanyo and many others. They have contributed to the lives of families in cities. That is very clear and obvious. However, less obvious is the influence that they have had on our thinking about manufacturing.

I was impressed by the commitment of the Japanese to quality. I remember being present in a large audience of north-east businessmen who were electrified by a senior manager of a Japanese company saying to them all those years ago that, by the year 2000, 100 per cent. quality would not be a competitive advantage; it would be the entry ticket to the marketplace. I have seen Japanese companies practising just that. I have seen the respect that they have for their workforce and their commitment to training those people. I have visited their factories and have seen that, for every man and woman, there is a training plan for the year. I have seen their progress being ticked on the charts. I have also seen their commitment to the development of long-lasting relationships with suppliers in this country.

I remember so well talking to a company which was tendering to one of those Japanese companies. It had been told that its prices were too high. The Japanese company said, "Trust us, supply at our prices, and we will re-engineer your manufacturing processes. You will prosper". The company did so and won contracts in other parts of the world. It is that kind of unseen and unsung contribution which has permeated so much of our thinking. I am not saying that many British companies do not think that way, but it has not always been the common practice. I believe that the Japanese have enriched our attitude as regards working effectively with people. It will help if we recognise that fact in terms of our relationship with Japan. Indeed, it will help if the Japanese people know that we are respectful of their contribution.

My second point relates to my consciousness derived from my dealings with Japan on visits to that country. For example, I recently visited Japan as the guest of the Japan Society for the Promotion of Science. I was struck by the commitment of the Japanese to learn from other people and by their respect for British education. I was invited to go across and, when I went to the Monbusho, I was astonished to find that a report of some 400 pages, which we had recently produced, had been translated into Japanese. Indeed, the Japanese had not only read it, they also understood it and debated it vigorously. I am not talking about just two or three chosen specialists; I am talking about the whole of the top brass of the ministry.

I have recently been impressed by the way in which Japan, notwithstanding its success in the international league tables in performance, has become concerned about its national language and mathematics and about its need to develop creativity among its people. Japan realises that its future competitiveness will depend upon that. There is also the admiration from the Japanese for the way in which we have engendered that among our people. The Japanese see us as being a creative and inventive people. Their response to that is to come here and learn.

I was invited to take part in a conference two weeks ago at which the Japanese were interested to see how they could learn from us; indeed, I was interested to know how we could perhaps best learn from their strengths. It would make for good relations between our two countries if we on our side were as anxious to learn from them as they are to learn from us. We have much to learn. For example, we are now concerned about developing citizenship, and about respect for other people and communities; in other words, a feeling of obligation to our fellows. That is engendered in children in the very earliest years in the kindergarten/primary schools in Japan. Perhaps we have something to learn from that example.

Perhaps in the British Council, for which I have much respect and admiration, we have a bridge which should become a broad highway and across which we can exchange information and learn from each other to our mutual advantage, thereby improving relations between our two countries.

8.13 p.m.

Lord Howell of Guildford

My Lords, like other speakers, I am extremely grateful to the noble Viscount, Lord Trenchard, for promoting tonight's debate. I am also grateful to the noble Viscount, Lord Slim, for his most moving reminder to us that we must respect our veterans and that it would be an impertinence to preach to them about what they should think after what they suffered and in view of the memories that they hold.

This is a difficult debate because the truth is that such issues have to be put in separate compartments. Indeed, the truth is that these atrocities happened and unspeakable brutalities occurred. No sweet words or preaching of reconciliation can wipe those facts from the memories of families in this country, nor, indeed, from the memories of veterans. Similarly, it is not acceptable to say, as many Japanese argue, that the whole score was settled by the dropping of the atom bombs.

Nothing we say can change Japan's past. It had a dark side and a bright side. Countries are what they are and what they have grown to be. Perhaps that is something that we could more usefully remember in the European context. Cultures are important; they do not just vanish, nor can they be brushed away.

In the Imperial War Museum there is a recipe which was written by my grandmother. It explains how you can survive on the daily Japanese rations in an internment and labour camp, like the one in Shanghai where my grandmother was detained. She was dragged there by the Japanese troops when they came storming up the driveway of her home. Colonel Shingo took all of her possessions—her car, and so on—and gave her a little note, which I still have. It is a rather small note, which, curiously enough was signed by Colonel Shingo but not in Japanese, promising to return all those things at the cessation of hostilities. Needless to say, my grandmother never saw any of her property again. Incredibly, although she lived to be over a hundred, she died without having received any compensation from Japan and was penniless.

I described that because it must have been the experience of many other people as civilian property was not compensated under the 1951 treaty. I should add that, although it cannot be forgotten, nothing of this kind should get in the way of the facts of today. As the noble Viscount, Lord Trenchard, described, we have received enormous benefits from our contacts with Japan as regards their investment here. Indeed, we have learnt a great deal from our cultural, business and scientific exchanges, and we need to learn massively more from Japan about relationships in the modern industrial society. The co-operation of the Japanese with us in third world countries has been brilliant and dedicated, as well as being highly effective. Their co-operation with us in security matters is something which is often not so prominent, but in surveillance and in handling the Middle-East problems of Iraq and the Gulf War their efforts have all been dedicated and efficient.

The Japan of today may be in a different compartment to that of the Japan of the atrocities of Burma. Indeed, the people today are dedicated to helping build a better world and stabilising extremely difficult situations. Even now, with Japan in recession—indeed, perhaps more so now—this is the moment for us to build on that friendship. To put it crudely, it is directly in our national interest to do so and to gain greater access to the Japanese markets and to Japanese internal investment. Moreover, when a country is down—and we are friends with Japan—it is the mark of a true friend to offer help at that time.

Above all, at this time of very dangerous turmoil in Asia, perhaps we need to ensure that our support for, and bilateral links with, Japan reinforce degrees of stability and provide some kind of rock upon which Asia can be stabilised. As I have said before in this House, this is a moment of colossal danger. There will be many worse effects to come as a result of the Asian turmoil and there will be huge difficulties. It is vitally important that Japan should not be dragged down.

I do not agree with those who say that we should brush out the past; indeed, the past will remain fresh in many memories—and an awful past it was. In a separate compartment of life we have to build for the future with Japan, which is a brilliant nation. It has much in common with us: we are two islands with two monarchies. These people are our friends. Therefore, on that basis, we should not forget the past but we should build constructively for the future. We have an enormous amount to gain for all our people, including the children and grandchildren of all those who suffered and died, if we take a positive view.

8.20 p.m.

Lord Gillmore of Thamesfield

My Lords, I, too, want to congratulate the noble Viscount, Lord Trenchard, on having introduced tonight's debate. His speech demonstrated his knowledge and experience of Japan which he brings in an unrivalled way to your Lordships' House. It is a particular pleasure also to follow the noble Lord, Lord Howell of Guildford, who has so admirably led the UK/Japan 2000 Group for many years.

My experience of Japan is no doubt less deep and probably more recent than that of the noble Viscount. It goes back to 1982 when I led a small team of two to talk to the Japanese about strategic planning and arms control issues. At that time discussion of such matters with the United Kingdom was regarded in Japan as highly sensitive and almost taboo. While we had made great strides in our contacts on commercial and economic matters, this was the first time since the war that the Japanese had had direct official contacts on defence related issues with anyone other than the Americans. In 15 years we have come a long way.

A large part of the credit for this goes, I believe, to successive British Governments who have persisted in their efforts to establish not only a more open dialogue but a more co-operative and productive relationship. I recall a visit by the noble and learned Lord, Lord Howe of Aberavon, in the early days of 1988 which marked a watershed in this development. Since then our contacts have grown at great speed across a whole spectrum of our relations, not just at official level. I shall not repeat the points made by previous speakers as there is not time, but I endorse the point that Japan is, and will remain, a vastly important country as regards the United Kingdom, as an economic player, as a market, as an investor, as a partner across a whole range of international issues, and as a partner too in a range of youth and cultural exchanges to which reference has already been made.

Not all of these matters are wholly, or even perhaps mainly, matters for governments. But, just as it took a concentrated effort on the part of the two governments to start a process which is now beginning to yield its fruit, so it will need the active stimulus and encouragement of governments to build on what has already been achieved. The visit to Tokyo of the Prime Minister, then leader of the opposition, shortly before the previous election is, I hope, a signal of the importance which this Government attach to Japan. I am confident that the Minister will be able to give us this evening an assurance that the expansion of Anglo-Japanese ties will remain one of Her Majesty's Government's top priorities.

Important as these bilateral programmes of co-operation are, they are not, however, the whole story. Other noble Lords have referred to the crisis now affecting the Japanese economy and its financial system. It is easy, not least in Japan itself, to underestimate the dangers of soldiering on, undertaking only minor tinkering with a system which has appeared to serve Japan so well for so very long. However, there is a need for major reforms, most of which will have to be carried through over the protests of deep and vested interests. It is in the British—indeed the wider international—interest that these reforms should be implemented, and soon. They will have to be targeted at the opening up and the deregulation of Japanese markets and, above all, the thorough cleansing of its financial system. The latter must include the establishment of clear and enforceable rules for the new regulatory authority prior to Japan's "Big Bang".

In this context it is essential that pressures from vested interests to delay the implementation of "Big Bang" should be resisted. The power of the yakuza or gangster must be curbed. Above all, the reforms must include legal requirements for transparency in business and banking and proper measures for corporate governance. It is a measure of how considerable these steps are for Japan that in Japanese there is no proper translation of the word "accountability".

Moreover, it cannot any longer be said that such matters are internal to Japan (or indeed to any other major economic power) in these days of globalisation. They matter deeply to the UK, to our industrial, scientific and banking businesses, just as Britain's intentions on economic and monetary union matter to Japanese businesses, particularly those with a significant investment in this country. Japan's industrial base is immensely strong, especially in industries with a major interest in exporting. But the self-perpetuating Japanese managerial oligarchies so common in large swathes of Japanese business will have to be reformed if Japan is to avoid major economic damage, with all the consequent and dire effects on the rest of the world.

As the noble Lord, Lord Dearing, has so eloquently pointed out, we have over the past two decades learnt much from Japan. I believe that there is every indication now that many influential Japanese think that they can with advantage pick our brains too. I hope that the Government will be ready to assist where they can—through sharing our experience of both general deregulation and the creation of non-governmental regulatory authorities, of the use of the private finance initiative, of reforms in systems of corporate governance and so on.

I know from personal experience that the Japanese are ready to listen to us. I hope very much that the Minister will give us an assurance tonight that this is in our national interest.

8.25 p.m.

Lord Moynihan

My Lords, I greatly appreciate the excellent introduction to the debate by my noble friend Lord Trenchard for which I most sincerely thank him. While modern Japan has flourished economically and democratically, this debate has highlighted one hindrance to Britain's close friendship with Japan, one barrier in which a chapter of our joint history has not yet been fully closed on a terrible past. One of the most sensitive, difficult and painful issues of our time is the story of our former prisoners of war in Japan, many of whom still seek a formal and unequivocal apology from the Japanese Government as well as compensation so that those remaining survivors can end their days at peace with the past.

The pain and atrocity they suffered as captives in Japanese prison camps is still a vivid and daily experience for the survivors. One-quarter of those taken prisoner did not survive. It is incumbent on those of us too young to remember and those of us who were not yet born to ensure that we never forget what was endured by others so that we could know the blessing of freedom. In that context I fully endorse the remarks made by the noble Viscount, Lord Slim.

Prime Minister Hashimoto gave an expression of deep remorse to people who suffered in the Second World War during the Prime Minister's trip to Tokyo and he announced that further resources would be made available to promote reconciliation. We on these Benches wholeheartedly welcomed that statement but regret the subsequent confusion about whether it was collective and made on behalf of the Cabinet or whether it was made personally by the Prime Minister. We on these Benches welcome the same active dedication shown by the present Government in continuing to work to resolve this most sensitive of issues. We regard the progress made on apologies as a natural advance on top of the work of successive governments.

Successive British and Japanese governments have regarded the question of compensation as legally settled by the 1951 San Francisco peace treaty which ended the state of war between the UK and Japan, although a number of former PoWs and civilian internees are pushing individual claims in the Japanese courts for additional compensation from the Japanese Government. The 1951 treaty gave the Allies the right to seize and to dispose of Japanese property within their jurisdiction, although this was done according to financial prosperity. The proceeds of Japan's overseas investments were taken in settlement of claims for compensation. However inadequate the terms may have appeared—indeed, they still appear so—Japan, economically ravaged by war, discharged its legal obligations. Whatever its historical rights and wrongs, its practical difficulties, and indeed the moral issues involved, the 1951 peace treaty continues to define the legal position on compensation today. Successive British governments have accepted that the question of compensation is covered by it.

I wish to mention the recent claims by veterans that they have uncovered documentary evidence in the Public Record Office at Kew that merits a new challenge to the compensation paid to surviving prisoners under the 1951 treaty. Article 26 of the 1951 treaty states that, should Japan make a peace settlement or war claims settlement with any state, granting that state greater advantages than those provided by that treaty those advantages should be extended to all other parties to the treaty. I understand that the Foreign Office has been conducting research into the historical facts and the legal implications of the documents, which we welcome. Can the Minister give the House an update on the Foreign Office's findings so far? As I understand it, the Government's preliminary legal advice suggests that nothing has changed and there will be no reopening of negotiations with Japan over payments. However, it would be most helpful if the Minister could give further details of what the Government's legal advice suggests and when the Government will receive a final opinion.

Whatever the legal buttress of the 1951 treaty, however, the previous administration took the view that it was not enough to close this sad and shameful chapter in history. Conservative Ministers discussed former prisoners of war with their Japanese counterparts. They expressed concern and explored possibilities for alternative, non-governmental initiatives. Our embassy in Tokyo, although unable to become directly involved in legal cases, has always helped ex-prisoners of war by offering advice and arranging meetings. I am pleased that under the present Government that is continuing.

The issue is once again in the spotlight as a result of the Emperor of Japan's impending state visit. Given that the Emperor has a non-political role under Japan's constitution, what steps have the Government taken to ensure that next week's state visit of their Majesties the Emperor and Empress of Japan will indeed be seen as testimony to the excellent state of Anglo-Japanese relations and that it will be a celebration of what the citizens of the two countries have achieved, as clearly outlined by the noble Lord, Lord Dearing, and what they can go on to achieve in the future?

From these Benches we fully support any action which ensures that while we never forget the horrors of the last war and honour those who suffered and those who died, at the same time we build strong new ties with Japan that make such hostility unthinkable in the future.

I conclude by saying that differences between our two countries, whether historical or contemporary, should not be allowed to obscure the vast amount that Britain and Japan have in common. The twin histories of our two countries have shaped a common outlook on many issues. As island powers, Britain and Japan are, by history and by nature, trading nations. We are leaders of international commerce. As constitutional monarchies, as rightly pointed out by my noble friend, we share a commitment to democracy and a respect for tradition and stability, coupled with the capacity to evolve to meet new challenges. We share a belief in the continuing role of sovereign independent states and a sense of the international duty that properly falls to any major country.

We wish the visit of the Emperor and Empress of Japan every success. We warmly welcome the good relations between Britain and Japan that the previous government worked so hard to encourage, a relationship which I hope will be equally cherished and valued by the present Government.

8.32 p.m.

Baroness Symons of Vernham Dean

My Lords, I, too, am most grateful to the noble Viscount, Lord Trenchard, for tabling this debate about our relations with Japan. Japan today is a key partner for the UK. The closeness of our relationship, which was highlighted by the Prime Minister's visit to Tokyo in January, reflects the transformation that has taken place in Japan over the past 50 years.

Japan is now the world's largest bilateral aid donor and the second largest contributor to the United Nations. It is a prosperous, peaceful and democratic country. In the field of international diplomacy, our shared values and similar objectives increasingly lead us to work together, sometimes bilaterally but more often in multilateral fora such as the G8 and the United Nations.

As the noble Lord, Lord Howell of Guildford, reminded us, in the recent Iraqi crisis, for example, it was close co-operation between our diplomats in New York which produced consensus on the final Security Council resolution. On Indian nuclear tests today we are consulting closely. That does not happen by accident. It is the result of both our countries having similar approaches to solving the great problems facing mankind today.

The close relationship between Britain and Japan underpinned the success of the second Asia-Europe meeting in London last month. As co-ordinators for the summit preparations, we were able to share with our respective regional partners our experience of co-operation and the rewards it brings.

In many other fields, we can see partnerships between Britain and Japan. As the noble Lord, Lord Dearing, mentioned, there are exchanges on science. Our scientists are now engaged in some 200 collaborative projects. Britain's exports to Japan have risen rapidly in recent years, reaching a record of £4.3 billion in 1996. We export innovative products at the forefront of technology as well as more traditional items. We are working hard, with the support of the Japanese Government, to promote British goods in Japan.

A natural consequence of our growing commercial links is to find British and Japanese companies working together around the world. Our overseas aid agencies have similarly found ways to co-operate on projects from Bosnia to Africa, combining our skills and resources for the benefit of other nations.

The noble Viscount, Lord Trenchard, mentioned the contribution which Japanese inward investment has made our own prosperity. Just as important, perhaps, have been the new technologies and management styles which they have introduced to Britain, as instanced by the noble Lord, Lord Dearing. This genuine partnership across cultures has been outstandingly successful.

As indicated by the noble Lord, Lord Gillmore, a quiet revolution is taking place in our relations with Japan which is laying the foundations for an even closer partnership in the future. Exchanges between the young people of Britain and Japan are blossoming. There are thousands of Japanese students studying in British universities and under the Japanese Exchange and Teaching programme there are over 1,000 British graduates in Japan at any one time teaching English in Japanese schools. These exchanges are creating a pool of thousands of young British and Japanese people with direct experience of each other's culture and each other's society. This familiarity is pervading our countries, encouraging contacts and co-operation at all levels.

Japan today is going through a period of economic difficulty, but that has not diminished the long-term commitment of world-class companies such as Toyota and Sony to the UK, as the noble Lord, Lord Dearing, reminded us in a timely intervention. Such companies are part of the fundamental strength of Japan's economy. And, of course, they bring benefits to us, too. Over 40 per cent. of Japanese manufacturing investment into the European Union comes to Britain. Now more than 270 Japanese manufacturers are in Britain providing employment for over 65,000 people.

Short-term economic prospects, however, have been clouded by bad debts and financial markets and the reluctance of Japanese consumers to spend. The Japanese Government recognise this and have taken politically difficult measures to address the problems. We welcome the fiscal package announced last month to boost economic activity and improve confidence.

The noble Lord, Lord Howell, reminded us, as he has done in previous debates in your Lordships' House, of the seriousness of the current Asian financial crisis. The Japanese Prime Minister, along with other G7 leaders, confirmed last weekend in Birmingham the importance he attaches to growth and stability. This is not only for our economies—that is, the G7 economies—but also for other economies in the world, particularly those in Asia.

In the medium-term Japan's deregulation programme has an important role to play in increasing efficiency and securing the economy's return to sustainable growth. Much has been done towards deregulation in Japan which we welcome. But we also have a unique expertise to share with Japan as its own version of the so-called "big bang" gets underway.

Several noble Lords, particularly the noble Viscount, Lord Trenchard, today referred to the forthcoming state visit by their Majesties, the Emperor and Empress of Japan. This visit will be a celebration of the modern partnership between our countries and of the links which have been described in our debate this evening. The visit coincides with the British festival of arts, science, commerce and personal links which is underway in Japan. Already the festival has confirmed the rich vein of affection for Britain among Japanese people. Some 2 million of them have already visited festival events.

But, of course, there are the wounds from the past. Reference has been made in our debate this evening to the concerns of former prisoners of war and civilian internees. I am sure we all agree with the noble Viscount, Lord Slim, that we must never forget the dreadful suffering and sacrifices by those held in Japanese prison camps. The noble Viscount was right to remind us that we all owe a debt to the courage of those who fought, who died and who suffered appallingly at that time.

On taking office, the Government raised the subject with the Japanese Government and made clear the feelings which it still arouses in this country. My right honourable friend the Foreign Secretary, other colleagues and officials had intensive talks with their Japanese counterparts. The Japanese Government said that they fully appreciated the sensitivity of the matter, but stressed that the question of compensation had been settled by the 1951 peace treaty. When the Prime Minister visited Tokyo in January, the Japanese Prime Minister responded to our representations by making an official apology on behalf of his Government for the damage and suffering of the war. He repeated that to a British newspaper with a large circulation, and he announced a new package of measures to promote reconciliation between Britain and Japan.

These developments have been welcomed by the Royal British Legion and other organisations. Of course we understand and respect the views of those former prisoners for whom all of this is not enough, but we believe that it represents a significant step forward, as the noble Lord, Lord Moynihan, indicated.

As Derek Fatchett said in another place on 29th April, we will continue to raise these matters with the Japanese Government as occasion offers and we maintain close contact with all groups that represent former prisoners.

The noble Lord, Lord Moynihan, asked specifically about current legal advice on the reopening of the 1951 peace treaty. Whatever the rights or wrongs of the 1955 decision not to reopen the treaty, our legal advice is that it is not now in fact open to the Government to reopen the peace treaty, mainly because of the length of time that has elapsed.

However, I believe that there are other ways in which we can try to help. When the Prime Minister visited Japan in January, the Japanese Prime Minister announced a package for reconciliation. It included memorial visits to South-East Asia. The first of those trips is under way. The theme is remembrance and reconciliation. Groups of British and Japanese veterans will meet in Burma. There will be a chance for them to build friendships where once they were enemies. Central to this visit will be the joint memorial services in both British and Japanese cemeteries. We are very pleased that the visit is being organised by the Royal British Legion which has so much experience in arranging such trips. It offered to do so following its members' first ever and highly successful visit to Japan in March.

We have heard and discussed some of the many areas which constitute our special partnership with Japan today. There is much to celebrate when the Emperor and Empress of Japan visit Britain next week. I hope that they will be welcomed with warmth by the British people. There has been much written in the British press, and no doubt there will be a great deal more, about the tragic history of the war. We will never forget the sacrifices made by those who suffered in the Japanese prison camps. But there is also a time to look forward to the future, while never, ever forgetting the past.

I should like to end by quoting from the letter which the noble Viscount, Lord Trenchard, mentioned at the beginning of the debate, written by the noble and gallant Lord, Lord Bramall, to the Daily Telegraph last week. The noble and gallant Lord said: We should now be looking forward in a spirit of reconciliation … For this country's good, as well as well as Japan's, we need to extend the hand of friendship. I hope therefore that when the Emperor … arrives in London, he will be received with the courtesy and understanding for which this country is renowned". That is the hope of Her Majesty's Government, too.