The country will cut the time it takes to get a loan from three years to between 18 months and two years, and end its practice of requiring government guarantees for each loan, Abe said, and Japan will aim to provide US$110 billion of infrastructure funding in Asia over the next five years.
Abe's statement comes as the China-backed Asian Infrastructure Investment Bank (AIIB) prepares to launch. Japan, along with the US, has chosen not to follow countries including the UK, France and Australian in joining the AIIB.
Project finance expert John Yeap of Pinsent Masons, the law firm behind Out-Law.com said: "Japan, through its Japan Bank of International Co-operation (JBIC) or the Asian Development Bank, has been an important source of funds for Asia’s much needed infrastructure developments and the many successes across Asia can be attributed to Japanese funding. However, it has also been generally accepted that involving the likes of JBIC is likely to mean a significant investment of time and therefore costs for potential borrowers."
"Furthermore, the requirement for government guarantees limited opportunities. The award of the Indonesian high speed rail project to China instead of Japan recently has been attributed by some to Japan’s requirement for a government guarantee. Abe's announcement of plans to streamline the processing of loans and the removal of the need for government guarantees will therefore be positive for the market," he said.
"As for the AIIB, the availability of a further multilateral or development agency can only be positive for the market as well," Yeap said. "However, will the AIIB just be 'more of the same' or will it be able to distinguish itself from other agencies through bolder policies and lending practices?"
"For instance, would the AIIB be willing to go beyond some of the limitations that are being imposed by the likes of Asian Development Bank, such as the reluctance to finance coal fired power projects? Power developments across much of Asia’s developing economies have been and will continue to be based on coal, and the AIIB has an opportunity to play a meaningful role in this area. The AIIB could potentially be a differentiator, but the market will have to wait and see," he said.
Abe aims to promote Japan's reputation for quality and safety, Bloomberg said.
"The pursuit of short-term profits through only sales without support is not the way Japan conducts itself. We will also not spare any effort to share Japan’s sophisticated technologies or know-how, or the reliability of 'Made in Japan'," he said, according to Bloomberg.