the investment climate in japan and business opportunities ...japan 1. investment imbalance between...

The Investment Climate in Japan andBusiness Opportunities for Canadian Companies

Yasushi AkahoshiPresident

Japan External Trade Organization (JETRO)

1

Copyright (C) 2016 JETRO. All rights reserved. 2

Many things to share: Canada to Japan

Copyright (C) 2016 JETRO. All rights reserved.

Honda of Canada Mfg. (HCM) Plant in Brampton• Began production in 1986 as the 1st Japanese

automobile manufacturer in Canada• Annual capacity of 390,000 units• Employs approx. 4,000 associates

Toyota Motor Manufacturing Canada West Plant in Woodstock• Began production in 2008• Annual capacity of 220,000 units (RAV4)• Employs approx. 8,000 associates

© 2016 Honda Canada Inc.

© 2016 TMMC Inc.

3

Many things to share: Japan to Canada

44

1. Investment Imbalance between Japan & Canada

2. Japan’s Re-emergence

3. Why Japan? 4 Reasons to Invest in Japan

4. Making Japan the most business friendly country

in the world

5. Talk to JETRO FirstCopyright (C) 2016 JETRO. All rights reserved.

5

Japan – Canada FDI （2014 Stock）

1,484 million USD

16,987million USD

Source: The Ministry of Finance “Japan’s Balance of Payments (Direct Investment Assets/Liabilities)”

1. Investment Imbalance between Japan and Canada


66Copyright (C) 2016 JETRO. All rights reserved.

Japan’s FDI (Stock) to Canada is growing

0

2,000

4,000

6,000

8,000

10,000

12,000

14,000

16,000

18,000

2008 2009 2010 2011 2012 2013 2014

Japan -> Canada

Canada -> Japan

Japan ranks 8th as

an investor to Canada

Canada ranks 19th

as an investor to Japan

1. Investment Imbalance between Japan and Canada

77





in the world


2.3%Increase

Employment

GDP(Real GDP (seasonally adjusted))

Increase

Business conditions(Tankan current situation,

manufactures)

GreatlyImproved

Improving Economic Indexes Under Abenomics


517Trillion Yen

528Trillion Yen

Large firms -3Medium-sized firms -5SMEs -12

Large firms 12Medium-sized firms 5SMEs 0

Before the launch of Abe administration

Current

Operating profit of companies

Increase12.6

Trillion yen17.8

Trillion Yen


8

(2015 Oct-Dec)

(2015 Dec)

(2015 Oct-Dec)

(2012 Dec)

(2012 Oct-Dec)

(2012 Dec)

(2016 Jan)

(2012 Apr-June)

63.9Million

62.2Million

Positive Growth Cycle


Corporate Earning improvement

Expansion of

Investment

Salary

Improvement

Expansion of Consumption


1010

Structural Reform


Improving the approval process of medicine andmedical appliances

Opening up the electricity market Joining the TPP negotiations


11

Rapidly expanding Japanese tourism market


231,400

0

50,000

100,000

150,000

200,000

250,000

2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

Number of tourists from Canada

(c)2015 The Sankei Shimbun & SANKEI DIGITAL All rights reserved.


1212





in the world


1313

Source: Cabinet Office, “Report on Prefectural Accounts 2011" (FY2014)



Sophisticated Market

Source: Ministry of Economy, Trade and Industry, “FY 2014 Survey Report on Foreign-affiliated Companies' Attitudes toward Foreign Direct Investment in Japan”14


Reputation among Foreign-affiliatedCompanies in Japan

High Income level

Extensive infrastructure

Attractiveness of Business

Expansion in Japan?

MADE IN JAPAN

Soft Power(trend setter in Asia)

Test Market beforeEntering Asian markets



Source: Created from Ministry of Internal Affairs and Communication, “Survey Result on Science and Technology Research 2015” (Ministry of Internal Affairs and Communication)Data Source：OECD ”Main Science and Technology Indicators”,(OECD) etc.

Rank CountryResearch funding

($100 million)Percentage of

GDP (%)

1 Japan 1,802 3.87

2 Germany 1,010 2.85

3 U.S. 4,570 2.73

4 France 552 2.23

5 U.K. 399 1.63

6 Canada 246 1.62

7 Italy 265 1.26

8 Russia 407 1.12

Rank CountryNumber of researchers

(unit: 10,000）Number of researchers

per 10,000 people

1 Japan 68.3 53.8

2 Canada 15.7 45.0

3 Germany 36.0 43.9

4 U.K. 25.9 40.5

5 U.S. 126.5 40.3

6 France 26.5 40.2

7 Russia 44.1 30.8

8 Italy 11.8 19.5

Research funding by country and percentage of GDP (G8 comparison)

Number of researchers per 10,000 people (G8 comparison)

Innovation Hub


16

Business Friendly Infrastructure


Source: World Economic Forum, “The Global Competitiveness Report 2014-2015”

Source: Ministry of Economy, Trade, and Industry(METI), “Survey on Attitudes of Foreign Companies toward Direct Investment in Japan Report 2014”

Easy environment for business

Foreign companies validate Japan’s infrastructure

16


17Copyright (C) 2016 JETRO. All rights reserved. 17

Business Friendly Infrastructure3. Why Japan? 4 Reasons to Invest in Japan

RANK

Source: MONOCLE, UK

18

1. Tokyo2. Vienna3. Berlin4. Melbourne5. Sydney6. Stockholm

7. Vancouver8. Helsinki

：

Safely and Pleasantly


Most livable Japanese cities as chosen by the world


1919





in the world


Japan’s Business Cost

20

Office Rent (Monthly) (per sq.m)

Housing rent for expatriates (Monthly)

(USD)(USD)

Source : JETRO Source : JETRO


0 50 100 150 200

Hong KongSingaore

SeoulShanghai

San FranciscoNew York

Toronto

Tokyo0 1,000 2,000 3,000 4,000 5,000

Hong KongSingapore

Seoul

Shanghai

San FranciscoNew York

Toronto

Tokyo

4. Making Japan the most business friendly country in the world

Opportunities in regions


Case from Canada: Rooftop solar power generation company. Constructed photovoltaic stations in 4 local Prefectures.

Fukuoka

Niigata

Gunma

ShizuokaPhoto Provided by Solar Power Network

4. Making Japan the most business friendly country in the world

http://www.google.ca/url?sa=i&rct=j&q=&esrc=s&source=images&cd=&cad=rja&uact=8&ved=&url=http://solarpowernetwork.ca/&bvm=bv.103388427,d.dmo&psig=AFQjCNEq9XmCkCJTOZj6n_hqdhr-GkBHUg&ust=1443137024111391


2222





in the world


23

JETRO’s Overseas and Domestic Network

73 Overseas Offices

43 Domestic Offices


5. Talk to JETRO First!

Investment projects supported by JETRO(2003～2015)Supported

projects 14,000

1,400Foreign companies’ startups

over


US 29%

Europe 31%

Asia 32%

Pacific 4%

Central & South America 1%

Middle East & Africa 1%

Canada 2%

Canada: 33 companies


Invest Japan Business Support Center (IBSC)

IBSC KobeIBSC Tokyo

IBSC Yokohama

IBSC Nagoya

IBSC Osaka

IBSC Fukuoka


Invest Japan Business Support Center (IBSC)5. Talk to JETRO First!

JETRO’s inward FDI promotion activities

Conference room

Consultation

Private office space

Invest Japan Business Support Center (IBSC)Temporary offices

Consultation service

Specialists give advises about how to start up business in Japan

・Business culture・Human resources・Real estate

Temporary offices in 6 major Japanese cities are available for

free of charge for 50 business days

・Legal advise・Business cost・Market regulations



Recent Examples of FDI from Canada to JapanRecent Examples of FDI from Canada to Japan supported by JETRO



http://www.google.ca/url?sa=i&rct=j&q=&esrc=s&source=images&cd=&cad=rja&uact=8&ved=0CAcQjRxqFQoTCO_59ZujjsgCFY-4HgodgoMBYQ&url=http://www.aaada.ca/index.php?page=memberpage&memberid=192&psig=AFQjCNGx5RyVbAqao-Lf-qm_76Dh6lXvmQ&ust=1443136115654393

http://www.google.ca/url?sa=i&rct=j&q=&esrc=s&source=images&cd=&cad=rja&uact=8&ved=0CAcQjRxqFQoTCO_59ZujjsgCFY-4HgodgoMBYQ&url=http://www.aaada.ca/index.php?page=memberpage&memberid=192&psig=AFQjCNGx5RyVbAqao-Lf-qm_76Dh6lXvmQ&ust=1443136115654393

http://www.google.ca/url?sa=i&rct=j&q=&esrc=s&source=images&cd=&cad=rja&uact=8&ved=0CAcQjRxqFQoTCMS_kqujjsgCFY24Hgodc3cMCw&url=http://www.redknee.com/resources/downloads/media_kit.aspx&psig=AFQjCNHhcXwOS0FKA8aS6zoogZ7DXUP_VA&ust=1443136163952278

http://www.google.ca/url?sa=i&rct=j&q=&esrc=s&source=images&cd=&cad=rja&uact=8&ved=0CAcQjRxqFQoTCMS_kqujjsgCFY24Hgodc3cMCw&url=http://www.redknee.com/resources/downloads/media_kit.aspx&psig=AFQjCNHhcXwOS0FKA8aS6zoogZ7DXUP_VA&ust=1443136163952278

http://www.google.ca/url?sa=i&source=imgres&cd=&cad=rja&uact=8&ved=0CAkQjRwwAGoVChMImuj55qOOyAIVyTweCh3LpgSY&url=http://logosandbrands.directory/startech-com/&psig=AFQjCNFI_YX-2jkCzNQzmJV5Blbn3hghvg&ust=1443136303224460

http://www.google.ca/url?sa=i&source=imgres&cd=&cad=rja&uact=8&ved=0CAkQjRwwAGoVChMImuj55qOOyAIVyTweCh3LpgSY&url=http://logosandbrands.directory/startech-com/&psig=AFQjCNFI_YX-2jkCzNQzmJV5Blbn3hghvg&ust=1443136303224460

http://www.google.ca/url?sa=i&rct=j&q=&esrc=s&source=images&cd=&cad=rja&uact=8&ved=0CAcQjRxqFQoTCM32yaykjsgCFcxaHgod-JMCpg&url=http://www.macarrieretechno.com/fr/carrieres/entreprises/audiokinetic-inc&psig=AFQjCNFynhdYdompc-XvFsHmI018J2Eo_A&ust=1443136428384609

http://www.google.ca/url?sa=i&rct=j&q=&esrc=s&source=images&cd=&cad=rja&uact=8&ved=0CAcQjRxqFQoTCM32yaykjsgCFcxaHgod-JMCpg&url=http://www.macarrieretechno.com/fr/carrieres/entreprises/audiokinetic-inc&psig=AFQjCNFynhdYdompc-XvFsHmI018J2Eo_A&ust=1443136428384609

http://www.google.ca/url?sa=i&rct=j&q=&esrc=s&source=images&cd=&cad=rja&uact=8&ved=0CAcQjRxqFQoTCPrUpMykjsgCFYGUHgoduB0Lcw&url=http://www.techvibes.com/company-directory/accedian-networks&psig=AFQjCNGukjX3TqtaF4kl5YACGiXrNTEh9g&ust=1443136507761438

http://www.google.ca/url?sa=i&rct=j&q=&esrc=s&source=images&cd=&cad=rja&uact=8&ved=0CAcQjRxqFQoTCPrUpMykjsgCFYGUHgoduB0Lcw&url=http://www.techvibes.com/company-directory/accedian-networks&psig=AFQjCNGukjX3TqtaF4kl5YACGiXrNTEh9g&ust=1443136507761438

http://www.exfo.com/

http://www.exfo.com/

http://www.google.ca/url?sa=i&rct=j&q=&esrc=s&source=images&cd=&cad=rja&uact=8&ved=&url=http://www.averna.com/en/company/careers&psig=AFQjCNFuQtxa9A0TykCX6MGRwaYktoxAoQ&ust=1443136858213059

http://www.google.ca/url?sa=i&rct=j&q=&esrc=s&source=images&cd=&cad=rja&uact=8&ved=&url=http://www.averna.com/en/company/careers&psig=AFQjCNFuQtxa9A0TykCX6MGRwaYktoxAoQ&ust=1443136858213059



http://www.google.ca/url?sa=i&rct=j&q=&esrc=s&source=images&cd=&cad=rja&uact=8&ved=0CAcQjRxqFQoTCIWTn5SkjsgCFUOqHgoddAgEqA&url=http://retailbakersindustrysearch.com/Listing/Index/Equipment/Bakery_Machines/276/140&psig=AFQjCNGvcY0ELz4ylZWcf-PvkixEUWxEFg&ust=1443136373836840

http://www.google.ca/url?sa=i&rct=j&q=&esrc=s&source=images&cd=&cad=rja&uact=8&ved=0CAcQjRxqFQoTCIWTn5SkjsgCFUOqHgoddAgEqA&url=http://retailbakersindustrysearch.com/Listing/Index/Equipment/Bakery_Machines/276/140&psig=AFQjCNGvcY0ELz4ylZWcf-PvkixEUWxEFg&ust=1443136373836840


“Golden Opportunity”“This year has seen developments in Government policy, regulation and international trade that could at last pave the way for a more open and competitive business environment in Japan. We are cautiously optimistic that, finally, some of the many barriers stifling growth and investment here might fall, benefitting not only individual companies but also the economy as a whole”. Danny RisbergChairman, European Business Council in Japan


Talk to JETRO First!


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