Japan is energetic and organised
After an hour-and-a-half delay in the airport of Ulan Bator due to strong winds - enough for a large windmill farm! - I arrive in Tokyo. It immediately strikes me how energetic and organised Japan is - from the customs officer with his fingerprint machine to the friendly man at the luggage belt, ensuring that cases don’t land on each other and the taxi driver who opens and closes the passenger door with a lever next to his chair.
“Now 22 years ago, I did an internship in Oita, a city on the southern most island of Kyushu. During those six months, I learned the ins and outs of a Japanese company and since then I have had a special bond with Japan. I also speak the language a bit, which is always highly valued in meetings with clients. When I lived in Singapore and Korea with my family, we visited Japan to see its highlights.
From my hotel room in Tokyo, I can just look beyond the skyscrapers and cranes above the constructions sites to see the imperial palace. In this metropolis of 38 million people (!) there is a serene tranquillity within the walls of the palace and its perfectly manicured gardens. The film Lost in Translation with Bill Murray and Scarlet Johansson is a perfect representation of the energy and simultaneous serenity that can thrive in a city. Estimates vary, but EUR 50 billion is a good indication of the value of the huge piece of land underneath the palace.
‘Go East’… In the second edition of his blog on a business trip through Asia on the website of “The Financieele Dagblad”, Jeroen Plag, head of International Corporate Clients ING, reports from Japan. Based on conversations with ING’s international client base in Japan, Plag paints a picture of Japan’s economic development under ‘Abenomics’.
Over the course of three days, I will be visiting - along with Japanese colleagues from the local office - several of our large international clients with whom we conduct business all over the world. It is of great importance to visit these clients with local colleagues, due to the cultural differences in business and the language barrier. Usually, English is the language of communication, but older Japanese clients in particular prefer to speak their own language.
Talks with our Japanese clients, such as so-called sogoshosha (trade houses), are mainly focusing on international projects, in addition to other current affairs. We intensively advice and arrange project financing in sectors in which Japanese trading houses are globally active, such as, oil & gas, offshore activities and other energy sources such as wind. Developments in Mongolia and shale gas in the US are high on the agenda, as these have impact elsewhere, for instance on decisions about the construction of industry complexes in the Middle East. Perhaps, it is becoming economically more attractive to produce in the US, as energy is becoming cheaper.
Abenomics, the monetary easing installed by current Prime Minister Shinzo Abe, is working out well for large exporting companies in particular. They are benefitting from the cheap yen which makes them more competitive. But apart from temporary monetary measures, structural changes are needed, especially bureaucratic changes. Political instability (seven Prime Ministers in seven years), low productivity of Japanese SMEs and uncertainty around nuclear plants, are impeding investments. Add to that the rapid aging of the population, and it become clear that monetary easing alone is not enough.
It is also becoming clear that the majority of the Japanese is positive about bringing in the 2020 Olympics Games.This means a boost for the construction sector and tourism, in which the government has set itself ambitious targets – 25 million foreign visitors in 2020, compared to just over 6 million in 2011 (in 2010, Japan had 10 million visitors, demonstrating the impact of the Fukushima disaster). In addition, there will be an increased focus on sports performances from now on, in order to set a new medal record in Tokyo. The United Kingdom set a new record in London last year: 65, of which 29 gold! The highest score since 1908.
The week ended with a dinner with American friends from Seoul at Gonpachi, the restaurant where Quentin Tarantino shot a scene with Uma Thurman for his film Kill Bill. The Japanese food was delicious of course. Tomorrow, I’m heading to Seoul to join the delegation of the Amsterdam mayor Van der Laan.”
Initially published by Dutch daily 'Het Financieele Dagblad', re-published with permission by ING.