Japan pledges support to rebuild Iraq

By Teruaki Ueno

TOKYO (Reuters) - Japan assured the visiting Iraqi prime minister on Monday it would keep helping his country to rebuild, as Iraqis back home staged a big anti-U.S. protest in the city of Najaf on the fourth anniversary of Baghdad's fall.

"There is no change in our policy to actively help with the reconstruction of Iraq through official development assistance and activities of the Self-Defence Forces," Japanese Prime Minister Shinzo Abe was quoted as telling Nuri al-Maliki.

"We want to forge a long-term strategic partnership," a government official quoted Abe as saying.

Earlier in the day, Maliki told Defence Minister Fumio Kyuma that Iraq hoped to see Japanese firms return to the country soon, a Japanese official told reporters.

"We hope the security situation becomes stable quickly so that both Japan's government and businesses will be able to make more contributions," the official quoted Kyuma as replying.

Baghdad spent Monday's anniversary under curfew, but tens of thousands of marching Iraqis, mostly men and young boys, staged a peaceful rally in the southern Shi'ite holy city of Najaf, chanting "No, no to the occupation, no, no to America".

Sadiq Al-Rikabi, a senior adviser accompanying Maliki, brushed off concern over the protest, saying Iraqis should be allowed to express opinions if it was done peacefully.

"A protest today is no problem. This is just one of the democratic results of the new Iraq," he told Reuters.

Maliki thanked Japan, a staunch backer of the U.S.-led war in Iraq, for its efforts to help rebuild the country. Tokyo sent some 600 ground troops on a humanitarian and reconstruction mission and has provided financial aid and debt relief.

Iraq, which sits on the world's third-largest proven crude oil reserves, is struggling to rebuild its shattered economy after four years of war following the U.S.-led invasion in 2003. Japan depends on the Middle East for nearly all its crude oil.

Maliki and Oil Minister Hussain al-Shahristani, in a separate meeting with Japanese Trade Minister Akira Amari, said Iraq was keen for Japanese investments in the electricity sector, a Japanese trade ministry official told reporters.

YEN LOANS

Japan has already pledged to provide more than $1.5 billion (765,000 pounds) in grant aid and up to $3.5 billion in yen loans.

Of the loans, Tokyo has allocated $1.6 billion to eight projects.

Ahead of the leaders' meeting on Monday, the two countries signed a contract for Japan to extend 102.8 billion yen (439 million pounds) for four projects as part of the total loan aid.