Microsoft PowerPoint - @Doing business in Japan 2013

Doing Business in Japan 2013

Thursday, 28th November 2013Marriott Hotel, Glasgow

Stephen BakerCountry Manager

Doing Business in Japan 2013

Country ManagerSDI Japan

SDI Locations in Asia

SDI in Japan Office in Japan for around 25 years. Significant local and international experience in SDI Japan

team :. Dr Stephen Baker 22 Years in electronics & intl

business development, 7 years with SDI Vince Kanatani - 20 years in gases/chemicals Akira Matsueda 30 years in Electronics and

business development Miwa Tomoda 20 years with SDI, Food & Drink & Miwa Tomoda 20 years with SDI, Food & Drink &

Textiles Emika Yoshitaki Office Support Emiko Sato - Marketing & Event coordinator

Close relationships with : GlobalScots UKTI, JETRO, BCCJ, SG International Division Japanese Corporations across all sectors Academic & Industry Associations

e.g. Tokyo University, Riken, JPMA, JTA, OEAJ

Images of Japan

Japan is Home to Many Familiar Global Companies

Japan at a Glance Worlds 3rd largest Economy

GDP US$ 5,068 bn Currency - Japanese Yen Population 126.6M Population Growth -.1% Average life span: 79.29 (M), 86.05 (F)

65 or over 28.22 M (22.1%) 65 or over 28.22 M (22.1%)

09 10 11 12 13 14GDP -5.2% 1.7% 1.1% 1.9% 1.8% 1.6%Inflation -1.4% -1.0% 0.4% 0.0% 0.4% 2.0%

Japan at a Glance Worlds 3rd largest Economy

GDP US$ 5,068 bn Population 127.1M Population Growth -.1% Average life span: 79.29 (M), 86.05 (F) 65 or over 28.22 M (22.1%)

09 10 11 12 13 14GDP -5.2% 1.7% 1.1% 1.9% 1.8% 1.6%Inflation -1.4% -1.0% 0.4% 0.0% 0.4% 2.0%

Japans regional GDP with Nearest country-equivalents

Abenomics End Deflationmonetary relaxation

Inflation Target of 2%Push for wage increases 1.5M over 10Yrs

Large Companies +1.8%Mainly through increased BonusHonda 6%, Toyota %.5%

heavy fiscal spending200Tr on public works / 10 yrsTokyo Haneda link

24Hr Metro service

May 11 May 138,000

14,000Nikkei 255

2012 Outward M&A

Key Drivers in the Japan Economy

24Hr Metro serviceTargeted growth strategies

Medical & New IndustriesWorking Environment business growth through deregulation

Apr 08 May 13

150

250

120

GBP Vs JPY

489 Firms / 6.9Tr Yen

2013 M&A?46.2% want to buy61.9% US & Eur.57.1% China + emerging

Access to MarketsNew businessNew Technology

Capital Investment31% SEA & India22.3% Japan16.2% China

Opportunities for Scotland and Japan Life Sciences

Developmental and clinical research. Disease specific research partnerships and stem cell technology development. Greying society.

Energy Advanced fuel cell research and development,

sustainable transport, offshore wind, tidal and wave technology.wave technology.

Financial Services Partnership opportunities with Japanese

Financial Institutions to manage company profits, retiring baby boomers lump sums and funds outsourced by Post Office reform.

Electronics Provision of advanced niche technologies in

semiconductor design, automotive, green tech, informatics, medical and communications area. Digital content and software.

Opportunities for Scotland and Japan

Chemicals & Advanced Materials Japan leads the world in this area and presents

great opportunities for Scottish companies. Tourism

12 million people will retire in the next 6-8 years. There is a huge opportunity to attract Japanese There is a huge opportunity to attract Japanese visitors to Scotland.

Food & Drink Opportunities for premium products.

Textiles Good opportunities for luxury products.

TAE ADM CI Sector opportunities

SensorsOpportunity: M2M / healthcare/ Social infra monitoring / Smart tech / environment / subsea

.

MOU signed between Scotlands CENSIS and Japans JISEDAISensor company catalogue put together with CENSISSensor Expo mission from Scotland Exhibition / Seminar .

Subsea ( non oil & gas, renewable )Opportunity: Port construction, civil engineering / Seabed resources, Governments Ocean Policy

Ocean Sensing WG with JISEDAI to identify industry challenges and make a proposal.Japan Sensor Seminar in Dec. 2013, Japan Mission to Subsea Expo in Aberdeen in Feb 2014 Cobalt rich crust

Methane Hydrate

Games and Informatics Opportunites

GamesOpportunity: Game contents biz in Japan is $10bn (70% online, 30% console)

Online market will saturate in 2-3 years then will expand into overseas. Joint event in planning with JOGA (Japan Online game association) to network major companies (April/May 2014)Dare to be DigitalOpportunity : Leverage visibility of Dare 2014 Japan team to raise awareness of Scottish Games Industry

Organization Committee, Japans top academia and creators (Mr. Iwatani Packman) Organization Committee, Japans top academia and creators (Mr. Iwatani Packman)Abertays potential alliance with Japans top Unis of game study (UoTokyo, Ritsumeikan

Uni)TGS Seminar and Exhibition

-- good opportunity to demonstrate contents e.g. Paper ZooInformatics

Opportunity: SIs activity in Scotland, R&D with Universities/Spin-offs; Bigger opportunity in Big Data / E-health / Smart Tech. Seminar in London in collaboration with JETRO and JCCI in planning (Feb 2014)

Industrial Textile Opportunities

Strategy / ObjectivesExpand the use of Industrial Textiles from Scotland in the Japanese market with a focus

on the transportation marketContinue to deepen the engagement with the supply chain for RailwayDevelop a testimonial business success with one of the companies Expand the project scope to explore opportunities in Automobile, Aircraft and ShipOpportunity: Japans high speed railway projects domestic and overseas, Interior material of different design / function from existing. Material with Unique function.

Participation Mass Transit Innovation Japan

Replin / Muirhead / Forbo /Transcal / Novografworking with Mitsui&Co.

Shared Services and Financial services Opportunities

SSC Opportunity : Japanese companies based in UK. Cost reduction , robust regional HQ

SSC seminar in London working with JETRO London and JCCI UK in Nov. Many high quality top company attendees (Hitachi EU, Idemitsu petro, Itochu EU, MHI, JAL, Mitsui&CO, Ricoh EU, Nikkei, Mitsui Zosen, Mizuho Bank, JRI EU.)

Asset management Opportunity : Quickly recovering Japanese economy - Abenomics.

Combined assets of Japanese households are worth 1,445trn

UK-TIs Asset management seminar in April. 5 companies participated: Martin curry, Scottish widows, Aberdeen, Standard life, Ignis

Energy Opportunities

Background - Nuclear strategy to Renewable Strategy Old strategy 30% to 50% Nuclear by 2030 13% Renewable to 40%? (Nuclear Plants idled)Solar FIT 42yen/kW-Hr, On-shore Wind FIT 23.1 Yen/kW-Hr

Off-shore to be incentivised240Gw farm launch targeted 2016Ocean Power receiving significant R&D Funding

Key-Opportunity areasOffshore wind sub-sea engineering, installation and maintenance, service vessel etc Offshore wind sub-sea engineering, installation and maintenance, service vessel etc and development of marshal port consulting Offshore wind floating system design, installation and servicing

Marine test field (Japanese EMEC) consulting Nuclear Decommissioning Deep sea development LNG and Shale gas engineering and consulting Small size biomass bio fuel cross over with chemicals Membrane technology H2 supply chain cross over with chemicals Machining and tooling for advanced material e.g. carbon fiber cross over with Aerospace

Life Science in Japan

Overview Japanese Companies are still rather domestic focused but are looking

to expand their activities on a global basis. Access to markets, access to new compounds There are moves to reduce the time required to certify new medical

devices and new drugs Award of the Nobel prize to Dr. Yamanaka in IPS stem cells has Award of the Nobel prize to Dr. Yamanaka in IPS stem cells has

invigorated activities and increased funding in this area NEDO is now providing funding for Japanese companies to be used for

development overseasOpportunity

Collaborations between Scotland and Kyoto ICEMS in the area of stem cells. Research, cell culture and processing supply chain

Establish Scotland as a base for production of stem cell material for research and future commercialization

Life-science and Chemicals Opportunities

Key Opportunity areasPotential Drug compoundsPharma service in general Manufacturing of pharmaceutical active ingredients - currently Kaneka supply the product

to major pharmaceutical l companies in Food related research - functional fool, hospital food

R&D and manufacturing of food additives for feedstock - e.g. farming of high quality fishR&D and manufacturing of food additives for feedstock - e.g. farming of high quality fishBiologics - Anti body - Bio/Life ScienceNatural based ingredients from marine or woodImaging technology 3DChemical composite for 3 D printing Chemical composite for power storage e.g. battery and EV cars

Japan Fashion Textile Industry and Opportunities 2013-14

Characteristics of the Japanese Market: Highly sophisticated consumers market

Very diversified consumption -- constantly oversupplied

Severely competitive open market

Consumers demand high quality products

Appreciate stories behind the brands/products

Consignment sales to retailers, which are very traditional business practice in Japan, is still carried on in some retailers.

The SPA (speciality store retailer of Private label Apparel) type of companies are on the increase.

Opportunities:

British trends remains, particularly for A/W season tartan, Harris Tweed, cashmere, knit ware etc

British made items are recognized as high quality goods. Consumers start appreciating long lasting high quality luxury products rather than cheap low quality one season clothing.

E-commerce / TV shopping

Interior markets

Key fashionistas and retailers are valuing and supporting Scottish fashion products.

Japan Fashion Textile Key Activities for 2013-14

Event/activity name Description of Event/Activity Date

1 Textile promotion at Isetan Shinjuku Stores New Corporate Tartan launch event

SDI Japan supported Isetans New Corporate Tartan (MacMillan Isetan) launch and raised awareness of Scotlands textile industry overall among the media as well as Isetans customers.

30 Oct 13

2 British Fair at Hankyu Department Store in Hakata & Osaka

Scottish textile companies (knitwear, apparel, accessories) participated in the Fair by selling products. Hankyus British Fair is a well recognized Fair in Osaka region and is a good opportunity for Scottish textile companies to promote their products.

2-6 Oct 13 (Hakata),9-15 Oct 13 (Osaka)

3 Article for ANA in-flight magazine, focused on Tartan.

Freelance journalists article on Tartan and its industry in ANA in-flight magazine December 13

issue. SDI assisted the journalist visited Scotland

For December 13 issueissue. SDI assisted the journalist visited Scotland

by arranging meetings with relevant companies/organizations.

13 issue

4 TV Shopping (focused on Scotland and Scottish products)

SDI assisted Jupiter Shop Channels TV shopping programme which is focused on Scotland. In prior to the preparation of the programme, SDI helped Jupiters buying visit to Scotland. This is to follow their 1st programme focused on Scotland last winter.

8 Dec 13

5 Support to Scottish companies who wish to enter the Japanese market

On-going support to Scottish companies in the Japanese market by making introduction to potential Japanese companies.

On-going

KEY MARKET FACTSJapan imports 61% of food & beverage.

Food retail revenues $492.9 bn in 2012

2010-2015, fresh food sales up 4.3%Consumers increasingly conscious of health and wellness, fuelling the demand for top quality, fresh foods.

KEY OPPORTUNITIESBeverages (cordials, beers and wines)Confectionery (snacks / biscuits / chocolatesSpecialty foodsOrganic foodsSausages and baconSeafood (salmon / lobster / mackerel)

KEY MARKET REQUIREMENTS

Japan Food and Drink Market

The Retail Environment in Japan

Large Market for Functional foods and nutraceuticals $27.1bn

UK brands perceived positively. 96M in 2012, up 12% from 2011

KEY MARKET REQUIREMENTSHigh-quality productsQuality packaging and presentationClear and obvious link to the UKProduct/company with an authentic storyFlexible approach to meeting consumer needs

Major department store operators capitalizing on customers' fondness for local specialty goods.

Fish industry in Tohoku Region has been badly affected (- 60%) by the 3.11 earthquake and related incidents.

Salmon has overtaken tuna as the

The Retail Environment in Japan

Salmon has overtaken tuna as the preferred variety of raw fish.

Craft Beers popular

Cheese sales are increasing 300,000 T t

Prepared meals sales through retail are increasing

Hotel, Restaurant, Institutional, (HRI) Food Service Sector was nearly $360. 4 billion in 2011 Restaurants 42.3% $152.6bnDrinking Estab. 16.3% $58.9bnInst. Food Service 11.4% $41bnHotels 9.0% $32.5 bnTransportation Rel. 0.8% $2.9bn

ImperialOkuraNew OtaniTokyo HiltonConradSheraton Miyako

Hyatt Regency

Dai-ichi HotelHotel SeiyoKeio PlazaPenninsulaMandarin OrientalRihga RoyalPan Pacific

Focus Hotels

The Foodservice Environment in Japan

Prepared Meals $72.5 billion,

Major hotels are attractive for exporters. More oriented toward Western food and frequently have food fairs & promotions

Hyatt RegencyHyatt ParkHyatt GrandRitz CarltonANA InterContinentalWestin

Pan PacificHappoenFour Season ChinzansoPalace (re-opening soon)Capitol TokyuRoyal Garden

Continue to work with Scottish companies to broaden participation and breadth of product in the market.

Focus on seafood, especially salmon, and premium groceries.

Position Scottish salmon as a premium food with its own positioning.

Mar 4-7th 2014

In market activity what key happenings for SDI Team

premium food with its own positioning.

Identify the supply chain for targeted food outlets and establish relationships with the key players.

Set of promotions and fairs with Key retailers to raise the visibility of Scottish product.

Aug 2014

Japan Food & Drink Key Activities for 2013-14Event/activity name Description of Event/Activity Date

1 Visit to Scotland by Representatives from All Japan Chefs Association (AJCA), accompanies food medias

As a part of global WAC sponsorship, SDI invited representatives from AJCA to a visit to Scotland.

21-14 July 13

2 International Seafood & Technology Expo Tokyo

Seafood focused exhibition. SDI hosted a rep stand in partnership with Scottish industry organization(s). Showcased high quality Scottish seafood products and offer edtasting samples.

21-23 Aug 13

3 Food & Drink promotion at Isetan Shinjuku Department Store (New Store Tartan Launch)

Smoked salmon tasting at Isetans Grand Carve during new Tartan launch week. Scottish food & drink promotion at the Scottish Night event for their VIP customers in cooperation with Japanese

importers. 1 sheet flyer of Scottish F&D industry

30 Oct, 1 Nov 13

importers. 1 sheet flyer of Scottish F&D industry and information on the Scottish products used at the Night event was distributed to the event participants.

4 FOODEX Japan 2014 Large food & drink exhibition in Japan. Target Scottish Food & Drink companies: Seafoods, Sweets, Preserves, Crisps, Processed food and drink companies which showcase at the show. Participation with own stand.

4-7 March 14

5 Mackerel in-store Promotion, Tokyo

In-store promotion at key supermarket chain in central Tokyo to promote high quality Scottish mackerels. Sample tasting + sales of Scottish mackerel products.

March 14 (tbc)

6 Scottish e-commerce page Support for Scottish e-commerce Page on Dress Table or other shopping site

2nd half

7 Support to Scottish companies who wish to enter the Japanese market

On-going support to Scottish companies in the Japanese market by making introduction to potential Japanese companies.

On-going(FOODEX

2013)

Targeting the Japan market?

Is E-CommerceAn Option?

e-commerce in Japan

Scale of the e-commerce marketIn Japan, the total number Internet user was 95 million in 2010, and 83% of them used

Internet shopping. B2B e-commerce was 258 trillion yen (100.6% cf previous yearB2C e-commerce was 8.5 trillion yen (108.6% cf previous year

Japanese language site recommendedFor Japanese customers, Japanese language gives them more security when shopping.

They look for detailed information on products , quality and makeThey look for detailed information on products , quality and make

Payment Methods Credit card 70% & COD

Site hosted in Scotland visibility?, language, currency

Own Site hosted in Japan - must have a registered status as a corporate business entity to host an on-line shopping site, Visibility?

Third party site in Japan Major portals have the traffic, use their promotion systems to get Visibility, Shop owner needs to be a registered company

Japans top 10 retailers

About the major Portals

Apart from Amazon Japan, shopping portals dont provide warehousing option. Products should be delivered to customers directly from a location in Japan. Shopping portals dont allow products to be delivered from overseas location.

Amazon Japan have FBA (Fullfilment By Amazon) service which provide a storage space for shops ambient products due to products expiry dates. This enables purchased products to be delivered to the customers on next day delivery.

In order to open a shop within Rakuten, companies need to be a registered company with an address in Japan (self or Partner). Product must be delivered from within Japan. Financial transaction can be made within the Rakuten site.

Flow of transaction is:-Customer orders on Rakuten site and makes payment -> Rakuten sends order to shop owner -> Shop owner arrange delivery of purchased products and informs Rakuten when delivery has been made -> Rakuten credits the shops bank account

Key things to consider when thinking about e-commerce in Japan

A list of key things Scottish companies should consider when thinking about e-commerce in the target marketTo understand the market opportunity as well as issues surrounding e-commerce businessTo provide Japanese language site to attract more Japanese customers and give detailed product informationTo understand demand in the market for Scottish companys productTo partner with a suitable Japanese company/agent to become an importer to the Japan

market. Then Scottish company and the Japanese import work together with companies market. Then Scottish company and the Japanese import work together with companies who operate on-line shopping sites. To understand the market structure

Targeting the Japan market?

What can you expect?

Scottish Organisations assists in Japan by Sector FY2012

Food & Drink 36Energy 11F&H Education 4Financial Services 1Tourism 0Lifescience 18Lifescience 18Chemicals 4Construction 2Textile 35Non-sector or unknown 6DMET / ETICT / Creative Industry 17

134

SDI maintains a set of relationships with Japanese companies in each key sector

ELECTRONICSSeiko Epson Corp.Rohm Co., Ltd.Sony Corp.Hamamatsu Photonics K.K.Brother Industries, Ltd.Fujitsu Ltd.Panasonic Corp.Sharp Corp.Denso Corp.

PHARMATakeda Pharmaceutical Co., Ltd.Astellas Pharma Inc.Eisai Co., Ltd.Tsumura & Co.

Shionogi & Co., Ltd.Daiichi Sankyo Co., Ltd.Kyowa Hakko Kirin Co., Ltd.Chugai Pharmaceutical Co., Ltd.

BANKINGSumitomo Mitsui Financial Group, Inc.Mitsubishi UFJ Financial Group, Inc.Mizuho Financial Group, Inc.The Sumitomo Trust and Banking Co., Ltd.Aozora Bank, Ltd.Shinsei Bank, Ltd.Mizuho Trust & Banking Co., Ltd.

Denso Corp.Yokogawa Electric Corp.

Casio Computer Co., Ltd.NEC Corp.Yaskawa Electric Corp.Mitsubishi Electric Corp.Pioneer Corp. Yokogawa Electric Corp.Casio Computer Co., Ltd.NEC Corp.Yaskawa Electric Corp.Mitsubishi Electric Corp.Pioneer Corp.Canon Inc.

Chugai Pharmaceutical Co., Ltd.Mitsubishi Tanabe Pharma Corp.Taisho Pharmaceutical Co., Ltd.Dainippon Sumitomo Pharma Co., Ltd.Hisamitsu Pharmaceutical Co., Inc.

TRADING COMPANIESCanon Marketing Japan Inc.Marubeni Corp.Itochu Corp.Toyota Tsusho Corp.Sumitomo Corp.Mitsui & Co., Ltd.Mitsubishi Corp.

SecuritiesMizuho Investors Securities Co., Ltd.Mizuho Securities Co., Ltd.Daiwa Securities Group Inc.Nomura Holdings, Inc.

SDI Helping Scottish Companies in Japan

Outward Opportunities:Initial enquiry Smart

Outward Opportunities:Initial enquiry Smart

Introductions Knowledge Understanding Strategic Planning

Initial enquiry Smart exporter, Business Gateway

or your account manager

Initial enquiry Smart exporter, Business Gateway

or your account manager

Strategic Planning Market Research Press and P.R Events Identification of business partners Support for visit programmes Logistical support (translation etc) Partners and networks

SDI and our partners

SDI works with all our partners to make sure you get access to all relevant support you need

Prefectural T&I Offices

Agents, distributors, specialist market development companies,

In-country business development and sales for Scottish companies ready to engage their target customers and partners in Japan

Low-risk and accelerated approach that doesnt require investment in a local legal entity, infrastructure or staff until revenues justify it

Addresses the need to have people located in the market before you can start selling

A bilingual team which operates in Japanese but delivers transparency A bilingual team which operates in Japanese but delivers transparency through communication and contact reports in native English

Focus on revenue generation with a track record of results Over 20 years in Japan with experience and contacts across multiple

sectors

A cost-effective way to enter the Japanese market while keeping your longer term options and strategies open

www.intralinkgroup.com

Doing Business in the Japan - Same as doing business in any region:

Understand your own value Understand your clients business

& needs Get creative to match your

product with their needsproduct with their needs Hitting a home run takes a couple

of innings No need to worry about all the

cultural nuances, there are just a small number of points you should follow SDI is here to help

Ofuro and Black Coffee

Time to Consider Japan

Thank You

Craig NeilGlobalScot

Doing Business in Japan 2013

GlobalScotScottish Development International

Craig NeillSSE plc., Director, International Market Development

Japan Experiences

SSE plc., Director, International Market Development

28 November 2013, Glasgow

Introduction:

Lived and worked in Asia region 2008 2012 GlobalScot since 2008 Opened Representative Offices in Beijing & Tokyo

Resided in Azabu-juban, Tokyo Travelled extensively in Asia on SSEs Renewables brief

International Market Development Supply Chain & Inward Investment Supply Chain & Inward Investment

This presentation covers: Ease of Doing Business Living and Working in Japan Day to Day Business Good Outcomes

Ease of Doing Business World Bank 2014 Ranking: 27th out of 189

GoodResolving Insolvency, 1Getting Credit, 24Protecting Investors, 16Enforcing Contracts, 36

Less GoodStarting a Business, 120

http://www.doingbusiness.org/rankings/

Country Rank

Singapore 1

US 4

UK 10

China 96

Chad 189Starting a Business, 120 Paying Taxes, 140

JETRO Business Registration and Taxation advice

Akasaka, Tokyo

SDI, UKTI provide formal network opportunities and introductions Yokohama St Andrews/ Caledonian Society Brits do Lunch, Tokyo

Chad 189

Living and Working Is it expensive?

Service Unparalled, attention to detail

Accommodation Smaller than UK

Working Day Longer commutes and working day Limited availability of mobile phone and wifi Time difference work rounds

Travel system excellent Travel system excellent JR East and West Shinkansen

Apps for everything, Street Signs in English Food

Good quality and great choice Lunch, the 1000 set meal

Family life Healthcare

Private insurance recommended

Business Day to Day The Importance of the Business Card Meishi

Establishes social and business hierarchy Office

Rents high, look for flexibility Communication

Japanese display a traditional reticence Practice your listening skills Be patient with silences and dont interject Dont expect business on 1st meeting

Presenting Yourself Be early!

Meeting Composition Numbers and Gender

Relationships Personal Longer term Balanced, multifaceted Trading Houses

Decision Making Pace seems slower and often complex

Exchange of Gifts Representative of thoughtfulness, rather than value

Good Outcomes Scotland and UK have a good standing in Japan Established key contacts with major trading

houses Innovation & Disruption on key offshore wind

categories Tested global supply chain scenarios

Project Financing Project Financing Low Carbon Technology MoU with MHI

UK based teams in SSE Glasgow and Edinburgh SeaAngel Offshore WTG, Kanazawa

Hunterston Demo, May 2014

Artemis Digital Displacement Technoloy (DDT) 2 MW ESS Orkney

Craig NeillDirector, International Market Development

Inveralmond House

Arigato gozaimashita

Inveralmond House200 Dunkeld RoadPerthPH1 3AQ

craig.neill@sse.com

JETRO Activities for Promoting Direct Investment in Japan

November 2013

Yutaka HaradaJETRO London Invest Japan Senior Advisor

What is JETRO?JETRO: Japan External Trade Organization Government-related organization to promote mutual trade and

investment between Japan and the rest of the world Established in 1958

73 offices worldwide, 39 domestic offices 73 offices worldwide, 39 domestic offices

Main activities:

1. Promoting foreign direct investment into Japan

2. Supporting the overseas business of Japanese firms

3. Facilitating economic growth in developing countries through trade promotion

1

Inward Investment Promotion

Japans Inward FDI/GDP is 183rd out of 187 Countries!Promoting Japan as Asia HQ, R&D Base and FDI in High Priority Area

(environment, life science, tourism, finance etc)

Inward FDI/GDP (%) in Major Countries (2011)49.8%

0%

10%

20%

30%

40%

50%

3.7%

23.2%20.0%

34.7%

11.8% 10.1%

Japan US UK Germany France Korea China

Source: UNCTAD World Investment Report 2011 2

Advantages in Doing Business in Japan

51.0%

49.7%

47.3%

35.6%

0% 20% 40% 60%

High Income Level, Large Customer Volume

Well-developed Infrastructure

Responsive Market to Added Value and Trends

Agglomeration of Global Enterprises35.6%

33.9%

23.9%

18.6%

12.3%

11.6%

11.6%

10.5%

(N=2,855)

Well-developed Living Environment

Capable Human Resources

Gateway to Asia Market, Regional HQ

High Quality R&D

Well-protected IPR

Easy Access to HQ

Good Financial EnvironmentSource: 2011 Foreign Affiliated Firms Survey (METI) 3

Impediments in Doing Business in Japan

70.5%

46.4%

39.7%

38.6%

0%0%0%0% 20%20%20%20% 40%40%40%40% 60%60%60%60% 80%80%80%80%

High Business Cost

Closed and Unique Market

Difficulty in Getting Human Resources

High Requirement from Customers

32.8%

29.0%

19.1%

15.0%

14.2%

12.8%

10.0%

Complicated Administrative Procedure

Stringent Regulatory/Licensing System

Insufficient Incentive

Concern about Radioactive Pollution

Concern about Natural Disaster

Living Condition for Foreigners

Concern about Unstable Power SupplySource: 2011 Foreign Affiliated Firms Survey (METI) 4

Industrial nation with twin engines

Ending deflation, expanding jobs, stimulating the economy

Trade oriented country Industrial investment oriented country

Industrial country driven by the twin engines

Important issues on intl business strategy Accelerating regulatory reform

Three-pronged strategy

Flexiblefiscal

policy

Bold monetary

policy

Growth strategy

Japans growth strategy

Price stability target at 2% annually

Fund supply by Bank of Japan (monetary easing)

Investment promotion for renewable energy & energy conservation

Financing support for SMEs

Focus on investment in health care, agriculture, education, etc.

New Deal for Disaster Prevention & Mitigation

Accelerationof recon-struction

Three-pronged strategy for revitalization of economy 1. Bold monetary policy2. Flexible fiscal policy3. Growth strategy that encourages private-sector investment

Shift from redistribution in diminishing equilibrium to creation of wealth through growth to be an industrial

country driven by twin engines (trade and industrial investment).

JETRO contributes to these policies bysupporting intl business of Japanese companies, promoting FDI in Japan, contributing to trade policy through research activities and more.

Promoting economic partnerships (FTAs, EPAs) Ambitious agricultural policy Securing resources and promoting export

of infrastructure Promoting Cool Japan

policypolicy

5

Employment Effect/ Large Scale Employment Effect/ Large Scale InvestmentInvestment

Key Industrial SectorsEnvironment (New Energy, Next Gen. Vehicles etc.-Next Generation VehiclesEV, HV development etc.

New EnergySolar/Wind/Wave power etc. Manufacturing, supply, and joint development of related

materials + components (Solar Cells, Lithium Ion Battery Materials etc.

Other (Smartgrid, Material Recycling technology etc.)

Retail + Service-Apparel , Restaurant, Distribution (Store Expansion,

Distribution Center etc) -Services utilizing new business models (Advertising,

fitness, etc.) - Establishment of distribution points for Japan-made

foodstuffs, products, or contents (Online shopping mall, master franchiser etc.)

Other Industries:Smart Meter Data Center BPO

Asian HeadquartersR&D SiteEmployment Effect/ Large Scale Investment

Pharmaceutical Development (Contract Research Organizations, Contract Manufacturing Organizations,

software etc.)Medical Devices+ Systems(AED, Cancer Diagnosis + Treatment etc.)Tools and services for Geriatric Care

(Acquisitions of private nursing homes,Telemedicine etc.)Beauty Related (Anti-aging products + services etc.)

-LCC + other airlines Japan service (including regional airports)

-Airport Related Services (Fixed Base Operator etc.)

-Establishment of local regular ferry routes -Friendly acquisitions of hotels +resorts

-Businesses targeted to Asian tourists(Travel agency, Payment Systems etc.

ICT

Other Industries:Manufacturing Centers, Call centers,

Customer Service etc. w/ potential for job creation)

Healthcare Tourism

Smart MeterGreen-IT

Data Center BPO Mobile

Communications Online Shopping

HC IT (Electronic Medical Records) HC Business Process Outsourcing (BPO) ,

Online ReservationsFlight SimulatorAugmented Reality Applications

Procurement BaseReconstruction 6

JETROs Free FDI Promotion Activities Dissemination of information Seminars, website, pamphlets

Local consulting servicesMeet with the Senior Adviser at JETRO London or at your offices for an initial consultation.

Invitation Programmes Support to attend exhibitions in Japan to meet Japanese

companies

offices for an initial consultation.

Six Invest Japan Business Support Centers (IBSC) in Japan Consulting services (sector specialists, advice on setting up)

Temporary office space, meeting rooms, seminar room

7

JETRO Invest Japan Website JETRO Publications

http://www.jetro.go.jp/en/investMarket reportsHow to set up a business in Japan Success stories in JapanRegional incentive information

8

Paris, France (27 February, 2013)Venue: Paris-Ile-de-France Regional Chamber of Commerce and Industry, Paris, France

Organizer: JETRO, the Paris-Ile-de-France Regional Chamber of Commerce and Industry (CCIR),French-Japanese Economic Committee (CEFJ)

Co-organizer: Reconstruction Agency, Cabinet Office, Ministry of Economy, Trade and Industry (METI), Prefectural Governments of Iwate, Miyagi and Fukushima

Invest Japan Forum: French-Japanese Cooperation toward the Restoration from the Great East Japan

Trade and Industry (METI), Prefectural Governments of Iwate, Miyagi and FukushimaSupported by: Embassy of Japan in France, French Chamber of Commerce and Industry in Japan

Number of Attendees: 237, from Japanese and French firms and organizations

JETRO hosted an investment forum aimed to promote quake-recovery measures of the Japanese Government and its incentive programs to encourage global companies to invest in Japan. With the goal to revitalize the Japanese economy by promoting foreign direct investment, the forum was attended by 237 people including representatives of French companies. Those in attendance profoundly exchanged views on potential forms of cooperation between Japanese and French firms and other topics.

*JETRO also hosted Japan Business Forum: New Initiatives for Sustainable Growth in New York (17 July), Opportunities from Japans Revitalization in Singapore (11 December) in 2012.

9

Supporting and Consulting ServicesProvide information about industrial structures, the industrial system,

product sales, market shares etc. Access to administrative experts covering fields such as legal issues,

tax, payroll, accounting, social insurance, visa and labourDedicated support for areas such as initial cost estimation for setting up,

JETRO Invest Japan Business Support Centre (IBSC) Services

Dedicated support for areas such as initial cost estimation for setting up, recruitment and real estateIntroduction to incentives from national and local governments

Office Facilities Private and secure temporary office facilities Use of facilities i.e. exhibit hall and conference rooms

Fully stocked business library

These services are free of charge !!10

50 working days (free of charge)+ 25 extra days (daily charge 5,000 - 7,000JPY)

Office hours: 9:00AM to 9:00PM, Monday to Friday Ready-to-use: direct telephone/fax number, broadband access

23 office rooms, 6 meeting rooms and 1 seminar room

Temporary office space (e.g. Tokyo)

Yokohama

TokyoOsaka

Kobe Fukuoka

Nagoya

11

Invitation for Exhibition ProgramIT PRO EXPO 2013 (9th -11th October, 2013)

Sector: ICTVenue: Tokyo Big SiteExhibitors: 12 companies

Main Exhibitors: Cloud Computing, Security, Server and Storage, Business Applications, OS / DB / middlewares, and Network.

*Concurrent event: Security 2013, Cloud Days Tokyo 2013 Fall / BigData 2013 Fall / Smartphone & Tablet 2013 Fall / e- Document JAPAN 2013

*Previous years result : Total visitors 64,245 / Total exhibitors 354 companies*Previous years result : Total visitors 64,245 / Total exhibitors 354 companies

4th INT'L SMART GRID EXPO26th 28th February, 2014)Sector energy-saving / renewable energyVenue Tokyo Big SiteExhibitors 12 companies

Main Exhibitors: Smart Grid, including utility/infrastructure companies, house/building companies, construction companies and various energy management solution providers.

*Concurrent event: BATTERY JAPAN 2014 - 5th Int'l Rechargeable Battery Expo / PV EXPO 2014 - 7th Int'l PhotovoltaicPower Generation Expo / PV SYSTEM EXPO 2014 - 5th Int'l Photovoltaic Power Generation System Expo

/ FC EXPO 2014 - 10th Int'l Hydrogen & Fuel Cell Expo / ENETECH JAPAN 2014 - 5th ProcessingTechnology Expo / 4th ECO HOUSE & ECO BUILDING EXPO

/ WIND EXPO 2014 - 2nd Int'l Wind Energy Expo & Conference*Previous years result : Total visitors 76,340 / Total exhibitors 1585 companies

INTL Smart Grid Expo 2012 JETRO

Zone

12

1. Browse through business proposals from around the world

TTPP allows anyone, free of charge, to search andbrowse through business proposals in variousareas registered by users in Japan and other

TTPP (Trade Tie-up Promotion Program) connects you and other companies all around the world.

TTPP: JETROs global business matching database

www.jetro.go.jp/ttpp

2. Transmit your business proposal information to the world

areas registered by users in Japan and othercountries according to business type such asexport and import of products/parts, business tie-ups and technology transfer.

The business proposals will be posted in bothEnglish and Japanese after they are registered soyou can transmit the information to the world andbroaden your business opportunities.Registered information can be updated and deletedonline, enabling you to transmit your information in atimely manner.

13

Program name Outline Implementtion status Authority in charge

The Act for Promotion of Japan as an Asian Business Center

The Japanese Government will take support measures for certified global companies, including tax breaks and patent fee reduction, in order to motivate them to locate their R&D facilities or regional headquarters in Japan.

Effective from Nov. 2012

Trade and Investment Facilitation Division, Trade and Economic Cooperation Bureau, METI

Subsidy Program for Projects Promoting Asian Site Location in

Japan

Subsidy program for establishment by global companies of R&D facilities or regional headquarters in Japan. Covers survey design costs, facility costs, equipment costs, and facility rental fee.

Application Period for 2013: April 1 June 3

Trade and Investment Facilitation Division, Trade and Economic Cooperation Bureau, METI

Incentives by the Japanese Government

Japan

Comprehensive Special Zones

Incentives, including special regulatory measures and tax reduction, are available for companies with business plans

in 7 designated zones: Hokkaido, Ibaraki, Tokyo, Kanagawa, Aichi/Gifu, Kyoto/Osaka/Hyogo, Fukuoka.

Special regulatory measures differ from one designated region to the other.

Regional Revitalization Bureau, Cabinet Secretariat

Special Zones for Reconstruction

Incentives, including special regulatory measures and tax reduction, are available for companies with business plans in the recovering areas stipulated in the Act on Special Provisions of Article 3 of the Public Finance Act.

In effect Reconstruction Agency

Points-based Preferential Immigration Treatment for Highly Skilled Foreign Professionals

Under the points-based system, foreign professionals who earn 70 points or more will be recognized as "highly skilled foreign professionals" and will be given preferential immigration treatment.(* Personnel of selected companies for the Subsidy

Program for Projects Promoting Asian Site Location in Japan are given 10 points.)

Effective from May 2012

Foreign Residents Information Center, Immigration Bureau, Ministry of Justice

Source: JETRO website (http://www.jetro.go.jp/en/invest/incentive_programs/) 14

Tax breaks(Prefectural level)

Tax breaks (Municipal level)

Aomori

Iwate

Approved plans for reconstruction promotion (as of April 22, 2013)Regulations and procedures

Reduced requirements to be eligible for public housings Special measures in agricultural land conversion for

development of facilities for food/forestry/fishery processing and sales

Tax breaks Special depreciation/tax credit Tax credit equivalent to 10% of the combined amount of salaries

and other payments for employers from severely damaged

Special measuresSpecial measures

Incentives in the Special Zones for Reconstruction

(Municipal level)

Deregulation (Prefectural level)

Deregulation (Municipal level)

Compensation for interest rate on loans (Prefectural level)

Compensation for interest rate on loans (Municipal level)

Iwate

Miyagi

Fukushima

Ibaragi

Special measures can be added through consultations between central and local governments

and other payments for employers from severely damaged areas

Exemption from corporate tax for 5 fiscal years for new enterprises, etc.

Financial and fiscal assistance Grants for reconstruction Interest rate compensation for reconstruction projects

Land use restructuring Special arrangements for land use restructuring beyond existing

land use frameworks Relaxed requirements for the floor area ratio of buildings aimed

at easy evacuation from tsunamis

15

39.8%

40.0%

45.0%

N America13 9

North America Europe Asia

Having supported more than 10,000 foreign companies. More than 1,000 foreign companies have invested in JapanUS (318), China (107), Germany (98), Korea (65), UK (63)

JETROs Inward FDI Promotion (2003-2012)

28.7%33.3%

24.5%

6.5%12.8%

16.1%

41.5%

0.0%

5.0%

10.0%

15.0%

20.0%

25.0%

30.0%

35.0%

40.0% N America

Europe

Asia

China

342

334

318

48

16

IKEA(Sweden)

Successful Cases by JETROs FDI Promotion

Hennes & Mauritz AB (H&M)(Sweden)

Inditex Group(ZARA)(Spain)

Forever21(USA) Abercrombie & Fitch(USA)

PRICE COSTCO/COSTCO WHOLESALE JAPAN

(USA)

McLaren Automotive(UK)

Scottish and Southern Energy plc(UK)

David Austin Roses (UK) Colortrac(UK)

Intelligent Energy (UK)

Aggreko (UK) Evolution Power Tool(UK)

Alpha CRC (UK)

Oxford Immunotec(UK)

LEO Pharma(Denmark)

Electro Medical Systems S.A(Switzerland)

Maquet(USA)

BGI(China)

17

Thank you for listening.If you have any further questions,please contact:

JETRO LondonInvestment TeamE-mail: Ldn_invest@jetro.go.jpTel: 020-7421-8300 Fax: 020-7421-0009 Address: MidCity Place, 71 High Holborn, London WC1V 6AL U.K.

18

Networking Breaksign up for one to one sessions

Doing Business in Japan 2013

sign up for one to one sessions at the registration desk

Carl GardinerProject Manager

Doing Business in Japan 2013

Project ManagerSmart Exporter

SCOTTISH DEVELOPMENT INTERNATIONAL

Greater International Trade

To raise the ambition of more Scottish

businesses to think, compete and trade

globally

THE ROLE OF INTERNATIONAL TRADE

Having more companies involved in international trade is important for economic growth and the ultimate well-being of the economy.

Not only do companies that export tend to grow faster, are more profitable and have higher productivity they can also stimulate faster

economic growth in Scotland Some specifics include:

Increasing productivity growth Increasing productivity growth

Generating employment

Profit flows to Scotland spent in Scotland

Positive spillovers to local communities

SDI GLOBAL REACH

BackgroundStarted in 1981Government agency

People230 employees in 23 countriesIndustry specialists

Budget25.3m

Partnership Delivery

UK Trade & InvestmentSDI offers UKTI services in

Scotland, participates in UK-wide approaches to inward

investment attraction, and influences policy through membership of key

committees

SCDIOperate missions under Market Visit scheme on behalf of SDI during 2010-11

Business Gateway

International Professional Advisors

Banks; Lawyers; Accountants; Property & Recruitment: Specialist

/Logisticswww.scdi.org.uk

www.uktradeinvest.gov.uk

GlobalscotPartner Engagement

The Enterprise Europe NetworkOffers support and advice to businesses

across Europe and helps them make the most of the opportunities in the European Union.

http://www.enterprise-europe-scotland.com/sct/

Scottish North American Business Council; Singapore EDB, China-Britain Business Council; Energy Industry Council; Dubai Chamber of Commerce etc

Overseas partners

Staff based at Local Authorities / Councils & Chambers of Commerce

www.bgateway.com

GlobalscotInternational business network of over 850 senior influential business leaders who are committed to generating opps for Scotland.

https://www.globalscot.com/public/about/index.aspx

International Trade Growth Model

Awareness & Ambition

Building Capability

| page 74

CI & ET

Market Expansion

Market Entry

Action Planning

SMART EXPORTER

:

Supports companies by helping them develop key skills in a range of business activities and equipping them with the

knowledge to operate internationally.

Delivered at 3 levels Introductory, Intermediate and Advanced

PREPARING TO EXPORT PROGRAMME

Delivered at 3 levels Introductory, Intermediate and Advancedvia workshops or online

Topics include Understanding International culture, market research, distribution channels to acquisitions and joint

ventures.

Which market is right for my companys Product/Service?

Im new to Exporting where do I start?

Market Awareness Events

Im ready to

Export Training Centre

Preparing to Export Programme

SMART EXPORTER PRODUCTS

International Business Manager

for Hire Im ready to Export but I dont understand what paperwork I need?

I need help in defining my Export Strategy

International Strategy Forum

International Strategy Workshop

Specialist Technical SupportWe need an Export Expert to help

implement our International Strategy

for Hire

EXPORT TRAINING CENTRE - NEW

New, free online tools from SDI which are NOW Available to help your business break into international markets.

- Complete a free export assessmentand discover the next steps that your business needs

- Refresh your thinking about exporting

http://www.sdi.co.uk/exporttraining

- Refresh your thinking about exporting and learn how to prepare to export

with the help of a step-by-step guide

- Access the Inbound Marketing University course of video tutorials for tips and advice on digital marketing and using social media

- Access trade guides for deeper insight into a range of topics

THANK YOU

Doing Business in Japan 2013

Sarah ChanterGeneral Manager

Doing Business in Japan 2013

General Managereteaket

Q&APanel session

Doing Business in Japan 2013

Panel session

Networking Lunchsign up for one to one sessions

Doing Business in Japan 2013

sign up for one to one sessions at the registration desk

One to Onemeetings

Doing Business in Japan 2013

meetings