WATCHING THE WORLD GORBACHEV'S TOKYO VISIT

With Roger Vielvoye from London Soviet President Mikhail Gorbachev arrives in Tokyo this week for 4 days of high level talks that could lead to a warming of the cool relations between the two countries that have existed since the end of World War 11. The Japanese hope the first visit by a senior Soviet leader in nearly 100 years will culminate in the return of a group of small islands off Hokkaido that were seized by Soviet forces in 1945 and are still occupied.

April 15, 1991

3 min read

Soviet President Mikhail Gorbachev arrives in Tokyo this week for 4 days of high level talks that could lead to a warming of the cool relations between the two countries that have existed since the end of World War 11.

The Japanese hope the first visit by a senior Soviet leader in nearly 100 years will culminate in the return of a group of small islands off Hokkaido that were seized by Soviet forces in 1945 and are still occupied.

In economic terms the islands are of little importance. Etorofu, Kunashiri, Shikotan and Habomai cover a little less than 2,000 sq miles and have a population of about 25,000 plus 8,000 Soviet troops.

WHAT COULD HAPPEN

A binding deal on the return of the islands is not expected during Gorbachev's visit. But if there is progress on a subject that is close to all Japanese hearts, the ruling Liberal Democratic party may be prepared to offer economic aid to Moscow.

And on the back of economic support for the ailing Soviet economy could come a new wave of interest in the Soviet Union by Japanese groups. That certainly will have implications for many companies from Europe and North America that are trying to negotiate deals in the Soviet Union.

Easing of the tension between Japan and the Soviet Union could have immediate effects on possible field development projects off Sakhalin Island (OGJ, Mar. 18, p. 33). Sakhalin lies directly north of the occupied islands.

Sakhalin Oil Development Co., a combine of Japanese companies led by Japan National Oil Corp., has been active in the Sea of Okhotsk since 1976. It has turned up a number of potential oil and gas development prospects.

Japan's Export-Import Bank has earmarked money for any development, but the final stages of bringing the offshore projects to fruition have proved tortuous.

The Soviets deny the territorial dispute is a factor in delays. But there is little doubt in Japanese circles that progress on the dispute over the occupied islands would remove any constraints emanating from Tokyo.

Removal of the island obstacle to better relations also could improve prospects for selling natural gas from Sakhalin Island to Japan.

Commercial companies are keen to buy the gas, but this enthusiasm needs the official backing of the Japanese government.

JAPANESE PRESENCE

Outside Sakhalin Island, the Japanese have made very little progress in exploration and production in the Soviet Union. Japanese sources do not expect the Japanese to become serious competitors to Europeans and North Americans who are striving to tie up joint ventures in attractive areas in the face of growing administrative chaos.

The biggest changes are likely to be seen in refining and petrochemicals, where Japanese companies have taken tentative steps toward joint ventures for new projects and for upgrading manufacturing units.

If this week's presidential visit goes well, Japanese Prime Minister Toshiki Kaifu may make a reciprocal visit to Moscow in the summer. He also will visit Beijing in June just to reassure the Chinese leadership that improvements in relations with the Soviet Union will not harm Japan's relations with China.