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00ACCJ.April.Cover_v5.indd 4-6 3/25/16 5:55 PM CONTENTS
VOL. 53, ISSUE 4
4 FEATURED CONTRIBUTORS 22 TRAVEL Cool & Creative 5 EDITOR'S DESK Japan entices fans from afar Making Moves John Amari Brandi Goode 24 PARTNER CONTENT 7 SOCIAL MEDIA Tokyo’s Ambition Generation Trending on the Web Foreign Affairs
LEAD STORY 8 28 ENTREPRENEUR Japan’s Economy: A Life Well Lived “Mostly Free” Brandi Goode Riley Walters 31 J-MEDIA 13 GREEN BUSINESS Diet Dailies Charting Its Course More Multilingual Signs Five years after 3/11, Tohoku in the Works searches for its future direction Doubts Raised over Richard Smart My Number and Point Cards translation of news 16 PARTNER CONTENT from Keizaikai Japanese Manufacturers Dip into Global Water Business 37 ACCJ MEMBER NEWS Nikkei Asian Review
18 TRAVEL Okinawa: the New Hawaii? DISCLAIMER
THIS PAGE PHOTO: Julian Ryall Custom Media and the ACCJ will not accept liability Shisa lion dogs on for any damages caused by the contents of The Journal, Okinawan roofs including, but not limited to, any omissions, errors, facts or false statements. Opinions or advice expressed in – Page 18 the The Journal are not necessarily those of the ACCJ or Custom Media. FEATURED CONTRIBUTORS 4 www.custom-media.com
THE other great places!) Tokyo (though there are many so Kumamoto, one inTokyo Twitter handle: Role model: Favorite placeinJapan: Years inJapan: Languages: Hometown: Nobel Laureate Friedrich A.Hayek RILEY WALTERS “Japan’s Economy:
‘Mostly Free’‘Mostly ” JOURNAL page 8 page Alexandria, Virginia English and Japanese
I enjoy teachings the of n
@WalteRiley APRIL Two; one in
2016 Shibuya, certified bytheJapan PrintingInkMakersAssociation. Forest Stewardship Councilwith vegetableoilink isprintedonpaper certifiedbytheUS The Journal Sam Bird Client ServicesDirector Ximena Criales Michael Pfeffer Graphic Designers John Amari Deputy Editor Paul Leonard Studio Manager Brandi Goode Editor-in-Chief Robert Heldt President [email protected] Simon Farrell Publisher
Currently listeningto: Social mediahandle: Years ofexperience: for stories. and create narratives best the give most the comments meaningful Average people inabsurd situations Most memorableinterviewee: Languages: Hometown: www.vox.com/the-weeds saythey (Ioften don't). You don't to need agree with what people across spectrum. political the Matthew should Ygleisias heard be by analysis of Sarah Kliff, EzraKlein, and wonkish,be but opinions the and at important this time. It might anyone with an interest inUSpolitics is essential listeningpodcast for writing inJapan since 2002 RICHARD SMART “Charting Its Course” page 13 page English and Japanese Sheffield,Britain Kiyoko Morita Media Coordinator Yoshiki Tatezaki Project Coordinator Kotaro Toda Director Business Development Joshua Ellis Kimo Blackmore Account Managers Mosby DeWitt Anthony Head Advertising SalesDirectors Megumi Okazaki Marketing Manager Joy Fajardo Client ServicesManager Living and
@tokyorich The The Weeds
© 2016CustomMediaK.K. Tel: 03-4540-7730 Tokyo 106-0041 2-3-3 Azabudai,Minato-ku, Daiwa AzabudaiBldg.6F solutions. Producers ofBusinessinJapanTV. strategy/visual communications,corporatebespoke of Commerce inJapan.Specialistsbilingualbrand fortheAmericanChamber Publishers ofTheJournal Custom Media [email protected] Editorial: [email protected] To advertiseorsubscribe: Sadly, adying art Role model: Years ofexperience: Favorite placeinJapan: required to achieve that foot-slogging the all and due diligence Earhart—and his insistence on doing 1937 disappearance of Amelia mysteries inaviation history—the quest to solve one of greatest the Recovery, for 30-year his unswerving, Group for Historical Aircraft Ric Gillespie of The International Most memorableinterviewee: Languages: Hometown: Thoughts onprintjournalism: Secret skill: Currently reading: Favorite author: to spend more than eachmonth Iearn smattering of Japanese State of Paranoia, by Paul French. 27 in journalism JULIAN RYALL the New Hawaii?” “Okinawa: page 18 page London English, French, and a An uncanny ability My father Antony Beevor Antony North Korea: 25 inJapan; Yokohama
EDITOR'S DESK ) is a also n as the authority ACCJ Journal ACCJ
, as I am relocating with relocating I am , as (formerly the magazine with a 53-year history.
A flagship publication of the American American the of publication flagship A Chamber of Commerce in Japan (ACCJ), JournalThe business The Journal The ACCJ partner organization the partner organization ACCJ will soon be I, too, note, On a separate will be assuming Jones Christopher JOURNEY OF OPPORTUNITYJOURNEY OF Journal of The April edition The tourism. and highlights travel in Commerce of Chamber American to (see working 18) is page Okinawa With in the region. US businesses foster in the increase year-on-year a 68 percent in 2015—and visitors foreign of number designation government’s the national tourism for a hub as Okinawa of southernmost promotion—Japan’s a major poised become is to prefecture businesses. leisure for revenue of source issue my last is This traveling. some doing of It’s the Philippines. Manila, to family my know to getting pleasure been absolute an helping and members ACCJ so many publication. flagship ACCJ’s the redefine beginning editor-in-chief, the post of that confident I’m issue. the May with and experience,his professionalism, willpersonality the further strengthen Journal The of reputation in Japan. globalon business Ease of access to capital is key to key is capital Ease to access of this column Entrepreneur our In Women’s the Japan of a founder As Entrepreneurialism is a topic dear to dear a topic is Entrepreneurialism Chamber the American the heart of (ACCJ). in Japan of Commerce while Yet, culture. a startup cultivating raised in Japan funds capital venture we 2015—as 2014 to from doubled Generation” Ambition in “Tokyo’s read the second- has (see page 24)—Japan entrepreneurial early of level lowest just comes It in theactivity world. South a remote behind Suriname, American nation. Fish Toko meet Atsuko you’ll month, of turn interesting an (see 28). In page began career international Fish’s events, in a assistant executive was when she the ACCJ readers: most to familiar place from instilledmother her, in Fish’s office. English learning of the value age, early an abroad. going and (JWLI), Fish Initiative Leadership enact to women Japanese empowers spark and socialpositive change formerly Nakaoka, Yuko innovation. is a 2015 office, Kansai the ACCJ of a as works who now JWLI fellow theSelectUSA specialist at commercial General Osaka-Kobe. U.S. Consulate STARTUP CULTURE CULTURE STARTUP MOVES MAKING
Brandi Goode custom-media.com @ brandi , an Freedom Economic of Index While Jones and the report are are the report and Jones While Our April issue spotlights fiscal spotlights issue Our April generally optimistic about Japan’s Japan’s about optimistic generally fiscal the need to for they point future, well as monetary policyand reform, promote to changes private-sector as consumption. household and growth Both also of the value extolled entrepreneurs. and innovation and financial matters, beginning with beginning with matters, financial and the lead story (see 8) evaluating page in 178 nations of out ranking Japan’s the than more for published report annual a talk by attended We also 20 years. the Japan/Korea head of Randall Jones, Economic for the Organisation at desk Development and Co-operation (see page 46). With Japan’s fiscalWith Japan’s year having come a closeto in March, money is on the mind.
NOW TRENDING ON THE WEB MEDIA SOCIAL
IN THE NEWS FROM JAPAN TOP HASHTAGS LINKEDIN Tweets from Tweets in Japanese This month: Popular tags Discussions from media outlets from people and media from the top 30 list global leaders
@japantimes @Diplomat_APAC Surf’s up—and business is up—in Hawaii as Japan Robotics Diplomacy can’t get enough of the and the US–Japan 50th state Alliance http://jtim.es/ZsIsc http://bit.ly/21rGg5a
@AirwaysNews @JapanNewsForum How Will the Haneda- How China Could Kill US Market Change With Japan’s Abenomics Daytime Slots? Gains - Forbes http://bit.ly/1UimtVy http://ow.ly/3cf19W
NHKニュース 野球賭博問題 高木投手は「１年間の失格処分が相当」。 Rank @nhk_news http://www3.nhk.or.jp/news/html/20160322/k10010451861000.html 4 #gameinsight Baseball Gambling Scandal - An investigation committee submitted a report saying a Yomiuri Giants pitcher, Kyosuke Takagi, should be disqualified for one year. * 5 #Oscars
≪総理の動き≫本日（3月22日）安倍総理は官邸で第9回「まち・ひと・しごと創生会議」を開催しま 首相官邸 15 #Periscope した。会議では政府関係機関移転基本方針について決定されました。 http://twme.jp/jpn/00Mg @kantei Prime Minister Shinzo Abe held the ninth “Conference for Creating Cities, People, 27 #job and Jobs” at his office today, March 22. The basic policy for relocating government organizations and associations was decided. * 29 #GOPDebate * Translation of original content in Japanese
Yoshito Hori, Tai Tran Founder and president of GLOBIS Marketing PM, Forbes 30 Under 30 TWEET IT LIKE TRUMP: THERE’S NO SUCH THING AS BAD PUBLICITY TWITTER CELEBRATES ITS 10TH BIRTHDAY: How can a man so universally hated continue to win state after RECOUNT OF TOP state in the primaries and be looking increasingly certain to become MEMORABLE TWEETS the Republican Party’s presidential candidate? I’ve got a one-word answer to that: ATTENTION. Twitter is celebrating its People love Trump. People hate Trump. But no one ignores Trump. 10th birthday. Its most compelling value proposition? Real time content. From the Arab Spring to Ellen DeGeneres’ Oscars selfie, here are the top memorable tweets that best highlight Twitter’s real time history.
THE JOURNAL n APRIL 2016 7 JAPAN’S ECONOMY: "MOSTLY " FREE By Riley Walters
For more than 40 years, Japan has been secure in its Economic Co-operation and Development, the International Monetary Fund, and the Asian Development Bank (ADB). position—alongside the United States and China—as one of the world’s three largest economies in terms HOW DOES JAPAN RANK? In the 2016 index, of 178 world economies, Japan ranks 22nd, of real GDP. This is even despite the past 20 years of with an aggregate score of 73.1 out of 100. This places Japan’s anemic growth. economy in the category of mostly free. There are five rankings possible in the index: free, mostly According to a 2016 report, Japan’s level of economic free, moderately free, mostly unfree, and repressed. This year freedom, as ranked by the Index of Economic Freedom—and only five economies—four of them directly competing with measured according to 10 components—had been on the rise Japan in the Asia–Pacific region—were ranked free: Hong Kong, following the report’s inception in 1995. However, since the Singapore, New Zealand, Switzerland, and Australia. These 2008 Lehman shock, the ranking of Japan’s economic freedom nations have achieved top rankings in the survey nearly every has remained lackluster, and the country is falling behind year, with Canada and Ireland occasionally also figuring in the competing nations. ranks of free economies, instead of the mostly free category where they rank in 2016. WHAT IS ECONOMIC FREEDOM? Japan ranks sixth among all Asian nations, just behind Taiwan, Economic freedom rankings are based on the average score of 10 which scored 74.7 out of 100. components that reflect fixed aspects of a country’s economy. Over Japan’s numeric score places it above 90 percent of the countries the long term, factors that foster or hinder economic freedom can surveyed in the Index of Economic Freedom. But, when individual affect substantially a nation’s GDP growth. components are examined closely, specifically government The 10 components evaluated in the annual index are: property spending and fiscal freedom—which typically reflects consumer rights; freedom from corruption; fiscal and corporate tax rates—Japan scores freedom; government spending; freedom Japan’s numeric score far below the world average. The in terms of business, labor, and monetary 2016 world averages for government policy; as well as trade, investment, and places it above 90 percent spending and fiscal freedom are 65.7 financial freedom. of the countries surveyed and 60, respectively; Japan scored 46.2 Countries where it is relatively easy to open and 48.8 in said categories. and close a business, for example, or where In addition, Japan’s level of monetary labor mobility is high, would be favorably scored according to the freedom, a component reflecting inflation rates and price stability, components of business and labor freedom. Meanwhile, excessive has continued to fall over the past 10 years. The country’s score taxing and rampant government spending would lead to a reduced in this category is likely to drop below the current world average score in the fiscal freedom and government-spending components. of 75.7 sometime in the near future. Japan currently scores The information that goes into the Index of Economic Freedom is 81.2. Greater central bank intervention, rather than market collected from a variety of sources, including the Organisation for dependence, tends to have a negative effect on monetary freedom.
10 COMPONENTS OF ECONOMIC FREEDOM
property freedom from fiscal government business labor monetary rights corruption freedom spending freedom freedom policy freedom
8 THE JOURNAL n APRIL 2016 LEAD STORY
Meanwhile, compared with other JAPAN’S ECONOMIC FREEDOM countries, Japan has flourished in such Total Score Ranking (left scale) (right scale) areas as improved freedom in business, labor, and trade. It is still relatively easy 73.5 5 to set up a business in Japan, with only eight procedural hurdles to overcome, 73 10 according to the World Bank Group’s Doing Business 2016 report. Then there 72.5 15 18 17 is the fact that Japan has the typical labor 19 19 components of a free developed country: 72 20 20 20 22 22 good labor force participation (59 percent), 24 71.5 25 25 relative ease of hiring, and severance pay. As an island nation, Japan has increasingly 71 30 focused on bolstering trade relations. 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 Japan’s average tariff rate is 1.2 percent, versus 1.5 percent for the United States. Source: The Heritage Foundation’s 2016 Index of Economic Freedom.
COMPETING ECONOMIES Over the past few years, in a bid to maintain its ranking among Of Prime Minister Shinzo Abe’s three arrows of structural the index’s top 20, Japan has been neck and neck with a number reform, one and two were always seen as quick and easy solutions of European countries, including Iceland, Austria, and Sweden. to getting Japan out of its economic stagnation. The difficulty In the Asia–Pacific area, some of Japan’s largest trading lies in the implementation of the third arrow, including the partners, including South Korea and Malaysia, are catching up in enactment of promised structural reforms. the rankings (27th and 29th, respectively) as they look to increase In many aspects, Abenomics’s third arrow began fiscal and financial freedom. Economic freedom will grow as a Goliath transformation of the nation’s business other countries in the region deregulate domestic markets, a environment. Japan’s implementation of a Stewardship more stable environment is created by placing greater emphasis Code in 2014 essentially redefined corporate governance on the rule of law, and where government is less intrusive in nationwide. Abe’s goal to include more women in markets than in Japan. the workforce and his administration’s accession into Countries such as the Philippines and Vietnam have freed international trade initiatives such as the Trans-Pacific up their economies dramatically in recent years, by increasing Partnership have reflected positively on the nation’s trade freedom and regulatory efficiencies. And the potential reputation abroad. economic gains are already being seized, as is seen from increased In addition, Abe’s stated aims to lower the corporate tax foreign direct investment (FDI) in those countries, and broader rate to below 30 percent by 2020 and further deregulate investments in the nations by multinational organizations such industrial sectors such as agriculture bode well for FDI. as the ADB. In 2014, the Philippines and Vietnam had net FDI Abenomics 2.0 has made broader promises to tackle the inflows of $9 trillion and $6 trillion, respectively. issues brought on by an aging society. Investment will continue to expand in the region, as China’s Still, many of these policy changes are slow to take effect. Asian Infrastructure Investment Bank, which opened for Innovation takes time, and society as a whole is weighed business in January 2016, looks to begin investing in projects in down by the higher social and regulatory costs associated developing countries such as Indonesia. with doing business in Japan, rather than in some emerging free economies. Because of the relatively short THE BURDEN OF MONETARY POLICY implementation time required for changes in monetary Much like its economy, Japan’s economic freedom is stagnating. policy and government spending, the government returns Even before Abenomics, the Bank of Japan (BOJ) continued to these measures to spark growth. In doing so, however, it its near-zero (.05 percent) interest rate policy for almost stacks the deck against future generations, who will have to two decades. Only now, additional quantitative easing has deal with the increasing burden of a graying society. been integrated into monetary policy, with the BOJ buying Japanese households aren’t directly profiting when the government bonds to increase the monetary base by anywhere BOJ purchases government bonds, as monetary policy from ¥5 trillion to ¥7 trillion a month. has a trickle-down effect. Businesses in Japan today are retaining greater profits, while real Japan’s average tariff rate is wages remain stagnant. Part of 1.2 percent, versus 1.5 percent this is also reflected in the low job mobility rate, despite an increase for the United States. in the number of jobs. Add to this the nation’s near-zero interest rate policy, a fixation on a 2 percent inflation target, and the occasional consumption tax hike, and it is no wonder households are suffering under the first and second arrows’ trade investment financial regulatory burden. freedom freedom freedom
THE JOURNAL n APRIL 2016 9 C
M
Y
CM
MY
CY
CMY
K LEAD STORY
BUY MORE THINGS, PLEASE since 1997. Japan has the potential to be innovative and the ability Policymakers continue to blame the economy’s lackluster growth to keep from crashing hard. The question is whether the policies on Japan’s low consumption. They use this argument to defend the now in place can prepare Japan for the future, or whether Japan’s 2 percent inflation target and planned increase in consumption economy will continue to drag along, as neighboring countries tax. The rationale is the need to jump-start the economy by forcing become more economically free and ripe for investment. people to spend now rather than later. Many Japanese investors are already looking offshore for gains. For households, though, consumption has remained strong over The value produced by Japanese across the world, relative to the past 20 years. It’s hard to imagine this increasing any further, simply the value produced domestically, has been increasing each given the current state of Japan’s economy and stagnant wages. year for the past 30 years. Household investment has also steadily decreased in recent In the 1990s, the gap between gross national income and GDP years. Japanese households just aren’t saving as much as they once increased to about 1 percent annually, while in the 2000s the did, which puts downward pressure on potential future household difference edged to about 2 percent. It’s now closer to 3 percent. consumption, irrespective of another consumption tax increase. In 2013, Japanese made almost ¥17,900 trillion more abroad than Meanwhile, government consumption remains strong. they did at home. Considering its current monetary policies, Japan should brace The trend is also reflected in foreign investment figures. itself for more short-term recessions. It has had at least four Seeking to reap greater value for its money abroad, over the recessions over the past 10 years, although it had no post-war past few years Japan has invested roughly three times more in recession until 1990. With bond purchases increasing and interest the United States than the United States has invested in Japan. rates diving ever further into negative In 2014, US investment in territory, recessions may become more There is still room for improvement, Japan came to $108 billion, frequent. while Japanese investment That said, Japan should experience with increased deregulation on a in the United States totaled economic gains from the structural national scale and a decrease in $373 billion. In fact, investment reforms accompanying the into Japan has just barely implementation of Abenomics’s third government-related inefficiencies. returned to pre-Lehman arrow, although in the near term, any shock levels. such gains should not be expected to offset the malaise brought on The good news is, however, that Japan’s economy isn’t at risk of by monetary policies. corruption or having property rights taken away from its citizens, One would be remiss to omit reference to Japan’s growing debt unlike other countries in the region. Social and regulatory when discussing its fiscal and monetary policies. Certainly Japan hurdles will continue to negatively affect job mobility, however. is less susceptible to global interest rate movements than are other It will take time for such traditions of the working environment C nations, since most of its sovereign debt is held domestically. But as seniority-based promotions and long working hours to reach
M no, this doesn’t mean it should continue paying little or no attention levels on par with global norms.
Y to its public debt. After all, the figure is at least double the nation’s Abenomics’s third arrow has set in motion commendable total GDP. reforms that could make Japan better suited for international CM Bond purchases of debt look nice when interest rates are low, investment. Japan is already a leader in pioneering and MY and the lower the interest rates fall, the better the prospects appear. implementing tech-based programs, such as greater automation
CY But this continues to play into the catch-22 situation that Japan through robotics and the Internet of Things. But there is still
CMY has created, by selling promises today at tomorrow’s price. The room for improvement, with increased deregulation on a national interest rate policies established to date essentially have trapped scale and a decrease in government-related inefficiencies. K bondholders. Any rise in interest rates will create a massive loss of The questions that must be answered now are: Should the wealth for those holding sovereign debt. monetary and fiscal policies that have persisted over the past 20 years continue? Will the government and BOJ continue to risk WHERE THERE’S HOPE, THERE’S A WAY tomorrow’s economy for possible gains today? And will Japan be Japan’s economy is a paradox. The nation holds enormous wealth able to keep its economic freedom on par with that of competing with a high per-capita GDP, but real GDP has hardly increased regional and first-world economies? n
Private residential investment Private non-residential investment JAPAN’S ECONOMY (Trillions of yen) Government consumption Household consumption (right scale)
150 320
300 100
280
50 260
0 240 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
Source: Cabinet Office Annual Real GDP (calendar year)
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Five years ago, Japan and the world experienced a disaster unlike any that One marquee project is the construction of a seawall, about 13 meters high, along had been seen before. Many were reminded of the multinational earthquake about 400 kilometers of coastline to protect on December 26, 2004, as the tsunami swept the coast of east Japan. However, against future tsunamis. Supporters see it as a protection for future generations, but this time was different, as half a century of modernity was swept away many locals believe it is a waste of money in minutes. that would be better spent elsewhere. “Many oppose it, but the bureaucrats Factories and houses were dismantled northern Japanese region worst affected by are just coming and presenting their plans, as easily as tents, the world’s most reliable the disaster? What lessons did the disaster presenting and presenting, and people cars were effortlessly crushed, and Japan teach, and how could they be applied to get tired,” says Dr. Christian Dimmer, an again faced the wrath of the atom as the the economy? assistant professor at the Urban Design Lab, Fukushima Dai-ichi Nuclear Power Plant The University of Tokyo. “At some point, experienced meltdowns. BERLIN WALL there are just three people at the meetings, As the chaos calmed, the confirmed Quickly, the conversation turned to and the bureaucrats assume that means death toll reached more than 15,000, with making sure cities were sustainable and the community has reached a consensus to thousands more missing. On visiting more disaster resilient. Tokyo set up the move ahead.” Tohoku, the power of the wave and of Reconstruction Agency and moved the The concrete is being poured and Japanese technology were apparent: up to nation toward renewable energy, paying work on the barrier goes on, at a cost the point the wave had reached, everything for electricity generated by solar and other of nearly $7 billion. Beyond all else, it was gone, or nearly so. Beyond the water natural sources. is difficult to see how the construction line, houses were standing, cars were on the Under the agency, the idea of forming can be viewed as anything other than a roads, and rebuilding lives was possible. a new Tohoku was devised, based on monstrosity aesthetically. Questions about the future of the nation three pillars: creating a strong regional It is a Berlin Wall for people who have a quickly came to the fore. Should Japan community, building up infrastructure, deep connection, through the good times continue to use nuclear power? How and bringing in expertise from across and the bad, with an ocean that has for could there be a recovery in Tohoku, the the country. generations defined their lives. It is also CHARTING ITS COURSE Five years after 3/11, Tohoku searches for its future direction
By Richard Smart
THE JOURNAL n APRIL 2016 13
GREEN BUSINESS an expression of the distance between the idealism of the New Tohoku policies, formulated by the mandarins of Tokyo, and the reality of life in the areas affected by the tsunami.
AMBITIONS Cities across the east coast, aware of the costs of nuclear energy and the ferocious power of the ocean, have begun to consider ways to become more sustainable. Power saving devices, smart grids, and renewable energy projects have all been substantially discussed and reviewed at municipal and Oranda-jima House’s natural environment was made possible by donations from Canada Wood and others. regional levels. Minami-soma, on the cusp of the radiation evacuation zone, particularly “This [influx of workers] has had various Dutch companies provided the money, suffered after the disaster. At one point impacts on the city, including an increase van der Linden designed the facility after the Great East Japan Earthquake and in traffic jams and accidents on the road, as at no charge, and other companies Tsunami, the city’s population shrank from well as a rise in crime,” Sakurai said. “Even donated materials. 71,000 to less that 10,000, although in if these workers are only here temporarily, “We had difficulties in terms of the the years since, it has again risen to about they have caused citizens concern, and that budget. Some things were expensive 57,000. All are working to entice people to must be addressed.” because materials were being used to return and contribute to building a more Sakurai’s office is now working with the rebuild piers and higher seawalls. But we sustainable community. police to address the issues, but his city had very generous sponsors. We could “In March of 2015 I issued a declaration faces a bigger problem down the line: If or build almost exactly what we wanted. that Minami-soma would be an anti- when the workers leave, what happens to Canada Wood donated maybe ¥10 million nuclear-power city, perhaps the first in the town? Efforts to promote industry may in wood to us.” Japan,” Katsunobu Sakurai, mayor of not be enough to solve the problems. Oranda-jima House is full 75 percent of Minami-soma, said at a news conference. Tohoku is not alone in seeing the time. Located in an area the tsunami “All of the city’s energy will be derived its population shrink. Japan’s most did not reach, it gives residents peace of from renewable energy by 2030. We are recent census data shows that almost all mind. “It’s a big contribution to the city,” now working toward this by increasing prefectures face a similar decline. And most says van der Linden. All the people that installations of renewable energy such are working to find ways to attract people. worked on the construction of the building as solar.” were from Yamada, bringing a sense of Toshiba Corp. is among the companies MAKING DO purpose to the locals and helping get the working with the city to improve its energy Not all areas took the same, optimistic economy back on its feet. grid. It has supplied the municipality approach to recovery as Minami-soma. For As for the house’s energy needs, solar with a large-scale battery energy storage some, sustainability has been about simply power was not affordable. “We didn’t have system that is capable of holding up to getting back to business and improving the budget for it. It just didn’t work out. We 40 megawatt-hours of electricity, an amount community ties where possible. started construction in 2013, by which time that could power between 1,600 and 3,600 The Iwate Prefecture fishing town of there was a bit of donation fatigue.” homes, depending on the season. This Yamada, not much bigger than a village, has In the end, the facility was fully insulated has added much-needed stability to a grid a population of about 16,000. It received and double glazed, and air conditioning that could see large fluctuations in supply, help from the Netherlands Chamber was cut in favor of open windows in the depending on factors including the weather. of Commerce in Japan (NCCJ) in the cooler climate. “In the winter, the sun heats Beyond energy, the town is also looking aftermath of the disaster. up the building and in the summer, there’s to develop new industries such as robotics Martin van der Linden, the head of an overhang to keep the heat down.” and smart agriculture. The aim is to bring Van Der Architects in Tokyo and activities The compromise frustrated van der in people from other parts of Japan to chairman for the NCCJ, suggested soon Linden, but he believes that without work in Minami-soma’s industrial and after the events of March 11 that something the appropriate guidelines for creating agricultural sectors. Many working-age should be done to help. Another chamber sustainable buildings, Japan will not be residents who left after the disaster have no member pointed him to Yamada, which able to achieve its vision of self-sufficient, plans to return. has had a relationship with the Netherlands resilient cities. The population of workers in town since 1643. Yamada, he believes, has a fighting temporarily has reached 8,000. Many have “We went too early, the whole city was chance of making a comeback and gone there from across the country to destroyed and people were still in shock,” says overcoming the demographic issues that engage in reconstruction and help to clean van der Linden. “In the end, a year later, we afflict much of Tohoku. “It is one of the up the areas affected by radiation. This asked ‘really, what do you want?’ and they towns with a relatively large population has caused problems in the eyes of many said ‘an after-school facility.’ ” The group then of children, so it is a city with a relatively local residents. got to work on Oranda-jima House. bright future.” n
THE JOURNAL n APRIL 2016 15 Three large pump parts are bolted together at Ebara’s plant in Futtsu, Chiba Prefecture.
Japanese Manufacturers Dip into GLOBAL WATER BUSINESS
Water—it’s crucial for life, as well as for a smoothly functioning Including design time, the manufacturing process takes about economy. Because water resources are a vital and basic part of a year, with the most difficult part infrastructure, large projects are teeming with activity, and commercial reportedly being mounting the rotating shafts linked to the impeller. opportunities in the water business are bubbling up around the world. Being off by only a few millimeters can cause friction and generate heat, Infrastructure companies are stepping up the battle for resulting in the shaft scorching the pump itself, which in turn business related to water. Japanese companies are not on necessitates replacement of parts. Yet manually adjusting the the scale of water majors like France’s Suez S.A. or Veolia impeller’s balance requires considerable expertise. Environnement S.A., but they have a presence in the market for the necessary equipment and technology. INDUSTRIAL LIFEBLOOD The main plant of Ebara Corp.—the largest domestic At Jazan, an industrial park is being prepared where the Saudi manufacturer of commercial pumps—is located in Futtsu, government hopes to cultivate industry, and coal gasification Chiba Prefecture, across Tokyo Bay from the capital. Lined up facilities and an oil refinery will be constructed. outside the maker’s building are parts and Ebara’s pumps will be used in large- materials for pumps that weigh around scale facilities that draw in seawater and five tons, and measure about two meters in Ebara's Futtsu plant process it into commercial-grade fresh diameter and three meters in length. supplies many projects water. The company will supply a total Each of the finished products sucks in the Middle East. of 28 pumps with an estimated value in enough water in 30 seconds to fill a of around ¥4.5 billion. High-pressure 25-meter pool. The first of the pumps pumps will be the heart of the site, and was completed in June 2015 and the last of the 12 on order the water they will help circulate will be the lifeblood flowing is slated to be finished before the end of 2016. Their ultimate through the entire industrial park. destination is Jazan, western Saudi Arabia. The water of the Red Sea features high temperatures and salt “We might make pumps this large once a year,” says a content, which demand strict durability parameters. Ebara in worker in the production management department. 2002 became the first in the world to develop a stainless steel
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THE n Nikkei Asian Review is published ©2016 Nikkei Inc. Nikkei by Nikkei Inc. All rights reserved. In 2015, Chinese authorities opened bidding for about about for bidding opened Chinese 2015, authorities In Ebara is not alone in pursuing projects at the national the national at projects in pursuing alone not is Ebara Tokyo and Corp. which Mitsubishi for in Qatar a plant At also is Corporation JGC builder facilities and Plant and will sell water invested has it in which company The are businesses power and Eastern desalination “Middle business water the worldwide that project forecasts Some 50 cutting-edge coal-fired power plants known as “ultra- as known plants coal-fired power 50 cutting-edge the pumps of 30 percent than More models.” supercritical high- require They Ebara. to awarded were plants such for of height a to water pumping of technology capable pressure product division inthe sales official An global 4,000 meters. of the share top the “has Ebara that confidence expressed pumps.” large for Chinese market is, stage main The do the same. companies Engineering level. been has a series there East, the Middle where of naturally, desalination and generation power large-scale build to projects and electricity. water produce simultaneously that plants intended which is in 2015, and orders won Co. Electric Power of Zosen in charge is in 2017, Hitachi operation into go to completed company The systems. desalination seawater a compiling steadily is fall, and last in Qatar system another in the East. Middle record track in water Its investments in this field. presence its increasing has It even billion. exceed ¥30 now fields power-related and the of one at facilities power and desalination in invested and Aramco run by petrochemical plants, largest world’s Arabia. Saudi Chemical in western Sumitomo 20 years. roughly for company a state-owned to power will the project but $1 per ton, about at will be cheap, Water free are land and because the seawater be highly profitable of charge. marketing global company’s inthe official an says assets,” safe increase to is the aim years, three to two Within division. 90 workers, have and ¥50–¥60 billion, to investments present. at than more 50 percent business into this cuts If per year. 4 percent nearly at will grow can profits long-lasting even more level, the national at be anticipated.
A woman collects drinking water from a hand pump in Dhaka, Bangladesh. a hand pump in Dhaka, A woman collects drinking water from
AP © Among the orders it has received is one in one is received has it the orders Among pumps that said Maeda Toichi President Ebara and safety “water that said often is it Japan, In projects many supplies plant Futtsu Ebara's pump that is both lightweight and corrosion- and both is lightweight that pump it. for orders numerous won has and resistant, linking a pipeline a water for 24 pumps 2013, for in western in Yanbu, plant desalination seawater The Medina. of city the holy with Arabia, Saudi 10 and 600 kilometers, some send water pumps 500 meters. of a height to water blow them can of pumping of capable company, his thoselike of be only “can hour, an water of meters 5,000 cubic or six companies worldwide.” five by made the by shared isn’t sentiment that but free,” are water from suffer regions Many world. entire and quality, water deteriorating or shortages the national at resolution require problems such the become, problems such worse The level. in terms arise, opportunities business more water improving and seawater desalinating of circulation. and treatment by visited frequently is in the East. Middle It An official in Ebara’s Europe, US, and Middleand East US, sales Europe, in Ebara’s official An in China. Wanjiazhai on sights also is its setting Ebara 270 kilometers, some stretches pipeline The alsosupplied company Japanese The Customers demand products that won’t break down after after down break won’t that products demand Customers win their can a supplier If use. continual of even 40 years to chosen be will continue company that confidence, for orders. a “30 percent enjoys the company that emphasized division the Sales to market.” large-pump the East’s Middle of share in fiscal 2016, ¥23.4 billion a at targeted EastMiddle are fiscal 2013. from jump 56 percent to times ancient in built town, a fortified is Province Shanxi Corp., Toshiba with along 1999, Ebara, In invaders. out keep transports that a pipeline for 15 pumps for order an received the provincial to in this area River the Yellow from water Taiyuan. of capital meters. of 630 difference elevation an with that sand so much contains Because the water required is high durability yellow, appears it a critical was Pulling this off the pumps. of a presence develop to Ebara for point starting in China. the Eastern 2013 for 2011 to from 10 pumps China, in eastern pipeline, Project Route from water divert to planned which was the country part of in the central Yangzhou the landed companies Beijing. European to competition and the Central Route, for orders Route. Western upcoming the for fierce is DEMANDING DURABILITY officials from Saudi Arabia’s state-owned petroleum company company petroleum state-owned Arabia’s Saudi from officials Saline Water company desalination Saudi and Aramco Saudi in the Ebara room Each one time, Corporation. Conversion for room prayer Islamic an into converted quickly is office the visitors. Okinawathe New Hawa ?: By Julian Ryall
It has breathtaking beaches and skies so blue you want to reach out and touch them. The islands have a distinctive history and a vibrant present. They have diving and shopping, cuisine and culture, entertainment, and a natural environment it is hard to find anywhere else. Little wonder, therefore, that travelers from around the globe are flocking to Okinawa Prefecture.
Beach near Kafuu Resort Fuchaku on the main island’s west coast
Equally, the biggest names in the international tourism as Bali or Hawaii, based on sheer numbers,” says Carl sector recognize that Okinawa has great potential for Bastian, managing director of Ryukyu World Office, an their businesses. international tourism consultancy. Bastian is serving his Japan, as a whole, has seen a surge in international fifth term as chairman of the Tourism and Hospitality arrivals in the past couple of years. Inbound tourists totaled Committee of the American Chamber of Commerce in 10.46 million in 2013, climbed to 13.41 million the following Okinawa (ACCO). year, and soared to 19.737 million in 2015. The national The anticipated number of arrivals in 2015 was government’s target of 20 million visitors in 2020, the year 6.9 million, but the actual total was 7.76 million. Growth of the Tokyo Olympic and Paralympic Games, will likely be has been a steady 10 percent over the past three years. surpassed well in advance of that date. Those impressive figures have resulted in the raising of the And, while Japanese still account for 81 percent of 2021 target to 10 million visitors, of whom 2 million are holidaymakers arriving in Okinawa, just over 1.5 million expected to come from abroad. foreign travelers visited the prefecture in 2015, a remarkable “As long as peace prevails in the Asia–Pacific region, 68 percent leap from the previous we should easily clear that as well,” year’s figure. The main obstacle Bastian believes. “At this rate of growth, Okinawa Yet a number of hurdles must will definitely become as big [to boosting tourism] is a be overcome to achieve that shortage of accommodation. figure. The main obstacle, as elsewhere in Japan, is a shortage of accommodation. Nakijin Castle and its ruins are part of a UNESCO World Heritage Site. “The average beach resort enjoys an annual average occupancy rate of 80 percent, while city hotels are sitting at around 70 percent—meaning that a lot of the time they are either full or overbooked,” says Bastian. “There are simply not enough beds to meet demand in the high seasons.” Aware of the potential, two of the world’s largest hotel brands, both headquartered in the United States—Hilton and Hyatt—have recently opened expansive new properties in Okinawa. Several more hospitality-related developments are close to completion or are in the planning stages.
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THE that it intends to bring more of its luxury its of more bring to intends it that Hilton already has one of its Double Tree brand properties properties brand Tree Double its of one has already Hilton open to is Inc. Resorts Worldwide, and Starwood Hotels up to snap swiftly also moving are developers Japanese Manza Beach Resort is also InterContinental ANA The & Resorts, its based Osaka, in planning is KPG Hotel In terms of tourist attractions, discussions are apparently apparently are discussions attractions, tourist of terms In (see 22) is page Japan Studios Universal Similarly, the map on a scale Okinawa such will on put projects Any BED—AND VIEW—FOR THE NIGHT developments. in part, the flurrynewof hotel Hence, Castle, Shuri Naha the Hilton while hotel, a second in Naha, confirmed has company 1. The July open to target on is Journal to The the prefecture’s of some to including Okinawa, to brands outlying islands. Resort in Sunmarina Okinawa Sheraton the 200-room be scheduled to added in early 45 rooms mid-2016, with seen the potential, have investors institutional 2017. Even and market” in muscles the its “flexing Stanley Morgan with contracts management three than fewer no expected have to said. sources future, in the near a opening Hotels Terrace Okinawa-based with opportunities, break to Resorts due Hoshino and this month new property year. next island main on the hotel their first on ground while Mori Trust a luxury on hotel, also is working Ken Corp. and island the main on taking shape properties two has group. island in the Miyako Island, Irabu on another services and facilities its reputation secure to its upgrading island the main spectacular on the most of locations one as a a graceful occupies curveatop hotel The Okinawa. of is and coast, the west on beside bay a serene land of pit regenerate to the local with closely community working reefs. coral nearby to way under is Work in Okinawa. high-end property next Naha Airport, due to be completed in 2019, and a second 2019, and in be Airport,to completed due Naha terminal. ship the nearby berth dock cruise at to liners for Disney operates that company between theJapanese ongoing the creation for government, the prefectural and domestically Corps Air the Marine of the site on a new park theme of relocated. are tenants present soon its as as Futenma, Station There in the prefecture. opportunities exploring reportedly is complex casino a large-scale that also suggestions are consideration. under the turn will and help says, Bastian emphatically, even more destination.” international major “a into islands prefecture’s Okinawa has many tropical fruits and its own style of cuisine. Okinawa has many tropical “The development of inbound tourism, mainly from Asia, from mainly tourism, of inbound “The development access convenient is there as attractive is the location “First, is significantly travelers of inbound “The delivery capacity hubs major the government’s of one is “Okinawa and infrastructure development anticipate we a result, “As visitors, more designed attract to are that Other projects Ancient paths around Shuri Castle in Naha Ancient paths around NEW ASIA HOT SPOT ofopened Resortsummer in the Chatan Okinawa Hilton The location taking a prime by new ground broken has 2015, and Village—a American the Mihama port and between Chatan’s bowling cinema, boutiques, bars, restaurants, with complex even a Ferris wheel. and venues, music live alley, domestic of the number and impressively, accelerating is E. Soper, Timothy says slowing,” of signs no shows tourists Micronesia and Korea, Japan, for operations of vice president Worldwide. Hilton for that out pointing Soper, says Asia,” around cities major from two- just and Taipei, from hop Airport a 90-minute is Naha Seoul. and both Shanghai from hours and-a-half flights direct of in the number increase an to due expanding more carriers, and low-cost entry cities, by Asian major from port cruise calls ships. by also has while the prefecture promotion, tourism for Promotion Tourism the developed Okinawa independently its for begun a full-scale and process vitalization Roadmap, industry. tourism the as such transportation, public the islands’ of expansion develop.” to continue to monorail, at a new runway of the construction are out, Bastian points Mihama American Village in Chatan HOMAT HOMES
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Shisa lion dogs a common are adornment outside Okinawa homes APRIL
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“These are the people who have been to Japan before and and before Japan to been have who people “These are the somewhere go to want Osaka, but and Kyoto, Tokyo, visited different. new and is new and when the Naha, runway to direct flying now are airport.” of the capacity will the flight it triple completed is she says ACCO, of newly elected president and property lead to “such been the opportunity given have to “delighted” destination.” in a great property a stunning Journal The told she visits,” tourist beautiful beaches people, Okinawan hospitable wonderfully great Sites, Heritage [UNESCO] nine World landscape, and activities, and water exciting weather, local excellent cuisine, experiences.” dining and shopping those foundations. on build to businesses American prospective and current for key of number a have “We she said. Okinawa,” in flourish commerce of further in 2016 to the development priorities able are we that ensure to and trade Okinawa with and members, ACCO our for opportunities maximize to to continuing and partnerships strengthening including local and business our with relationships strong on build institutions, educational local governments, communities, fellow organizations. and and businesses our for support provide all.” us for opportunities create helps
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By John Amari
Images courtesy of Universal Studios Japan
USJ launched the world’s first XR ride this year, combining a virtual reality headset and roller coaster ride.
For the second year running, to reach out to the whole world enjoyed the rides and attractions before Universal Studios Japan (USJ) about this event.” they opened to the public. has teamed up with some of the In recreating some of the The first item on the agenda was an country’s top names and brands from popular worlds of Japanese invitation onto the set of “Biohazard: entertainment culture, the The Escape 2,” based on an entertainment the world of manga, anime, games, campaign “aspires to convey franchise known as Resident Evil in the music, and fashion, to recreate one-of-a- the charms of Japan not only United States. Inspired by an action- kind attractions—in fully immersive within the country, but also to adventure film and horror-fiction video the entire world.” The US-based game of the same name, the attraction 3D and 4D experiences—at its franchise draws a considerable pits the wits of participants against those entertainment park in Osaka. number of visitors from Asia to of attack zombies, who are played by its park in Japan. According to a actors in full costume with bloodied faces survey by CLSA, it was the third-most- and a zombie-like gait. visited theme park in Asia in 2013 and In a several-storied building complete 2014 (behind Tokyo Disneyland and with ghoulish sound effects and Tokyo DisneySea). The 2015 and 2016 industrial wasteland-esque detail, teams Its latest manifestation, “Universal campaigns were launched Cool Japan 2016,” showcases five new as part of the government’s attractions: two 4D cinema experiences, Cool Japan strategy to help The 2015 and 2016 campaigns two “participatory encounters,” and promote Japanese pop were launched . . . to help promote the world’s first XR ride. XR attractions culture abroad. Japanese pop culture abroad. combine a virtual reality (VR) headset This year, on opening day, and roller-coaster ride to create what USJ Kyary Pamyu Pamyu said calls “super-real” experiences. she not only felt completely immersed in of players use clues to solve puzzles— In a press release before the campaign the park’s experiences, but the up-close- all via interactive bilingual hand-held opening, Japanese music and fashion and-personal nature of each attraction mobile devices—to find their way to icon Kyary Pamyu Pamyu—whose music allowed her to enjoy some of her favorite safety. However, visitors who are not inspired the XR attraction—said: “I’m genres, such as anime and manga, in Japanese speakers may find this activity really looking forward to witnessing the a completely new way. Some of the challenging, as much of it is conducted in worlds of five big entertainment brands attractions were “hair-raisingly fun,” the local language. that represent Japan come alive with she added. According to USJ, the attraction lets the scale and quality of [USJ]. As the The Journal was among a handful of you “experience the mounting horror [campaign’s] special ambassador, I want international and domestic press that and suspense of zombie attacks and
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Kyary Pamyu Pamyu is the campaign ambassador. Zombies attack at ”Biohazard: The Escape 2”
bio-organic weapons sprays of water that are synchronized According to USJ, Kyary Pamyu as the clock ticks, with the on-screen action. Pamyu XR Ride is the world’s first XR [while you] discover a Guests, moreover, get to enjoy the attraction, allowing visitors to “dive into new sense of success action from the point of view of an a bewitching, 360-degree world of pop.” and camaraderie at Evangelion, a bio-robot being, as it goes The ride was designed to stimulate the end, [after having into battle against monstrous creatures all six senses, taking riders beyond successfully navigated all called Angels. The attraction aims to even 4D experiences, as they zoom the challenges].” take the theater-going experience to a unpredictably through the singer’s Along the same new dimension. psychedelic bubble-gum world with line of shock-and-awe Fans of manga are also catered for in fantastic speed. entertainment, “Monster this year’s USJ offerings. An all-new 4D The novelty of the XR experience, Hunter: The Real” brings cinematic experience has been created coupled with the growing popularity of USJ launched the world’s first XR ride this year, combining a virtual reality headset and roller coaster ride. participants face-to-face based on the comic series Attack on Kyary Pamyu Pamyu, made this ride the with giant, animated, Titan. Dubbed “Attack on Titan: The topic of conversation among gathered fire-breathing creatures. It is based on the Real 2,” the attraction allows participants press and a location of perpetual long Monster Hunter series of role-play video to experience the heat of battle against lines on opening day. games. The attraction showcases new human-eating creatures called Titans. According to USJ, Universal Cool creatures from Monster Hunter X with “Become a member of the Survey Japan brings together internationally steaming nostrils that are liable to leave Corps [a military unit that fights Titans] praised Japanese entertainment unsuspecting visitors covered in a light and fly around with Mikasa [and] Armin icons and “applies . . . creativity, film of “phlegm” (watery liquid emitted using three-dimensional maneuvering technology, and talent for high-quality from 4D elements). to fight back against an attacking reproductions [offering] attractions that Lovers of anime, meanwhile, are Female of Titan,” a USJ press release have never been seen before.” treated to a rare cinematic experience implores visitors. The campaigns from this year and of the popular animated TV series Neon But the marquee attraction of Universal last have reportedly earned high Genesis Evangelion, developed in Japan. Cool Japan 2016 may well be the XR ride praise from visitors coming from both Called “Evangelion The Real 4D: 2.0,” through Kyary Pamyu Pamyu’s kawaii domestic locations and abroad, and the attraction provides a fully immersive (cute) world, which is epitomized by her were considerable draws for guests 4D cinema experience. This includes 3D up-tempo pop music video “PonPonPon.” planning holidays in Japan. Universal goggles and seats that move in tune with At the time of writing, the song had over Cool Japan 2016 attractions will be the action, as well as gusts of wind and 92 million views on YouTube. open until June 15. n
”Attack on Titan: The Real 2” offers a 4D cinematic experience.
THE JOURNAL n APRIL 2016 23 Tokyo’s Ambition
Entrepreneurs and Japan’s new business culture
A deep uncertainty about the future has bottlenecked Japan’s THE ONLY WAY IS UP Japan’s economy still ranks among the most corporate sector. Despite high profits, companies such as Fuji innovative in the world, topping some Heavy Industries, Ltd. are refraining from raising wages; other measures such as patent activity. But innovation on the part of large firms big firms are hesitating to invest because of a shrinking domestic is different from entrepreneurship, and in the market and the lingering memory of the 2008 financial crisis. latter category, Japan has a long way to go. None of Japan’s startups number among the world’s 145 “unicorns,” or those valued at more On a government level, as Japanese officials are than $1 billion (China and the United States are home to 22 discovering, loose monetary policy and prolific fiscal and 92, respectively). What is more, according to the Global spending (see page 8)—the central components of Tokyo’s Entrepreneurship Monitor (GEM), Japan has the second- plan for economic revival—can take growth only so far. lowest level of early entrepreneurial activity in the world, This is where Prime Minister Shinzo Abe’s growth beating out only Suriname, the South American country with strategy comes in. Abe is encouraging investment in a population of 560,000. venture companies and new technologies, supporting Nor is enthusiasm for entrepreneurialism in Japan strong training and education in entrepreneurship at Japanese relative to the country’s economic position. In 2014, the most universities, reforming corporate governance, and recent year for which data are available, only 7 percent of those connecting Japanese entrepreneurs with their peers in surveyed by GEM said they perceived startup opportunities Silicon Valley through seminars and mentorship programs. in Japan, compared with 33 percent in China and 51 percent In a sense, Tokyo is following the money: from 2014 in the United States. That caution has been the norm since to 2015, venture capital funding raised in Japan doubled, 1999, when GEM first started collecting data. Fear of business from about $1 billion to $2 billion, and more young failure is also relatively high in Japan; in 2014, 55 percent of Japanese are approaching the startup world as a prestigious respondents to a GEM survey said that it was a concern. alternative to the country’s Masahiro Ito, CEO of the corporate sector. “The big change in the past 15 years user-interface firm Yappa, “The market has changed identified several reasons for in the past two years, and is that it is now socially acceptable Japan’s lack of unicorns. First, the number of entrepreneurs to work at a startup in Japan.” Ito said, unlike in the United is increasing,” says Naoko States, in Japan most funding Samata, CEO of the electronic contracts require entrepreneurs payment company Coiney. “Series A funding used to be to personally guarantee loans above $250,000, putting their 1 million dollars or so, but now it’s five to ten million financial reputations on the line in the course of building dollars. Start-ups are raising amounts like in the United new businesses. States or India. That was impossible three years ago.” Second, corporate lenders tend to dispatch “typical Samata founded Coiney in 2012; in 2015, it was one salarymen” instead of startup experts to assess potential of the recipients of a Nippon Venture Award, a program investments. That is a significant difference from Silicon Valley, launched that year by the Ministry of Economy, Trade, and where many funders are startup specialists and are more eager Industry to recognize successful new businesses. to serve as mentors to budding entrepreneurs. Another reason Yet for all the interest, the amount of venture capital for Japan’s lack of unicorns is metrical: corporate investors invested in new Japanese businesses (around $1 billion assess the value of young businesses based on operating profits, in 2015) is still a tiny fraction of the nearly $59 billion excluding their potential future earnings, which produces invested in US startups the same year. And the recent lower valuations across the sector. growth is in part the result of a low starting point brought Despite these difficulties, Japanese business culture is slowly on by the 2008 recession; Japan’s level of venture capital becoming more welcoming to startups. In 2008, 26 percent funding was nearly twice as high in 2006 as it is today. of Japanese respondents surveyed by GEM considered
24 THE JOURNAL n APRIL 2016 PARTNER CONTENT PARTNER Generation
By Devin Stewart
government, Kagami said, his office runs three venture capital funds worth $350 million that produce some 600 inventions a year, bridging the gap between scientists and the commercial applications of their ideas. Last year, Abe presented a Nippon Venture Award to euglena Co., a company that makes fuel from microalgae and was incubated at Kagami’s office. “The reality now,” Kagami tells me, “is that the smartest students go for Google or McKinsey and startups. It has been a radical change.”
CALIFORNIA DREAMING For many in Japan, US entrepreneurial culture is a model. Noriyuki Matsuda, founder of the software distributor Sourcenext, claims that the decision to run his Japan-based company from California was responsible for improving his company’s sales and stock price, in part because living near Silicon Valley has given him access to intelligence about new technologies that would not otherwise reach Japan. entrepreneurship a positive career choice; that figure steadily Masami Takahashi, president of Uber’s Japanese division, rose about one percentage point over each of the following six came to Tokyo from California, where he had a corporate years, to 31 percent in 2014. job at Sony Corp. “There are more people in Japan taking “The big change in the past 15 years is that it is now risks and starting businesses compared with 10 years ago,” socially acceptable to work at a start-up in Japan,” Soichiro Takahashi says. Yet he also indicates that Japanese startups “Swimmy” Minami, CEO of the executive job site BizReach, can at times be derivative and underambitious: there was a says. “More and more people in Japan are realizing that the pattern, Takahashi said, of founders creating Japanese versions best way to protect yourself from uncertainty is to avoid of US innovations or setting out to develop business models becoming useless.” that simply take advantage of minor loopholes in regulations. Japanese authorities are encouraging this trend. In January, “Disruption and innovation go together in the United for example, the Tokyo Metropolitan Government decided to States,” Takahashi said. “In Japan, innovation is good, while establish a center, with an operating budget of ¥700 million, to disruption [hakai] is negative, implying ‘to destroy.’ ” support early-stage entrepreneurs who are developing plans If entrepreneurship is to take root in Japan as it has in for new businesses. At the national level, the government is Silicon Valley, startups will need to make room for women. establishing a program to subsidize new businesses founded by To be sure, Silicon Valley has its own problems with diversity people over 60, who establish about one-third of Japan’s new and sexism. But most of Japan’s big corporations were built by companies, with up to ¥2 million if they hire older employees. and for men. Women might have a relative advantage in the And as part of a broader strategy to grow companies out of startup sector, where the division of labor by gender has not university labs, Tokyo has invested ¥100 billion in four major yet been institutionalized. public universities—Kyoto, Osaka, Tohoku, and Tokyo—to Keiko Maruyama, founder of Womanet Academy & kick-start university-affiliated ventures, raising the prospects Consulting, a training center for female entrepreneurs in for seed-stage funding. Yokohama, was working at Cisco Systems, Inc. in Tokyo Shigeo Kagami, the general manager of Tokyo University’s when the historic earthquake and tsunami hit Japan in Office of Innovation and Entrepreneurship, says that over 2011. Stranded overnight on the 27th floor of her building, the past decade he has seen a growing appreciation for Maruyama had an epiphany. start-ups among Japanese researchers, many of whom have She decided to quit and started Womanet a year later. “I have historically regarded the prospect of developing businesses seen more and more women wanting to start businesses from academic research as pedestrian. With the support of the because they want to do what they want,” Maruyama said.
THE JOURNAL n APRIL 2016 25 www.skillhouse.co.jp PARTNER CONTENT PARTNER
“Working at a big company is limiting, unsatisfying, and underserved schools. Like Endo, he had become disillusioned boring. These women want to contribute to society.” by the 2008 financial crisis. “We thought there was lifetime employment,” Matsuda AMBITION VS. DUTY says. Now people know that you can only rely on your own Naoki Endo, CEO of the Tokyo-based Internet consulting ability to solve problems or be a leader or entrepreneur.” company beBit, says startups in Japan, offer a way out of Last summer, Matsuda, Endo, and about 150 other a corporate culture overly focused on bottom lines—one entrepreneurs met for a conference in Tokyo organized evidenced by some of his own corporate clients, who by Hiroki Komazaki, who has become a leader in Japan’s occasionally used his company’s technology to bilk their start up scene by creating much-needed nurseries in unused customers through hidden fees. “Many managers in Japan apartment spaces. The name of the retreat, Matsuda told me, lack a philosophy because they was “Kokorozashi”—a Japanese just worked hard to get promoted,” word for which there is no precise Endo says. “My generation is not greedy English equivalent but that But Endo also shares his worries . . . and greed is a power.” translates roughly as “ambition” that the altruism he sees in his peers or “willfulness.” in the startup sector might hold It is no coincidence that the back their ability to bring about change. same word is used by the government to describe up-and- “My generation is not greedy,” he says, “and greed is a coming startups such as Coiney and by some Japanese power.” A friend of his, Endo said, had retired from running investors assessing the value of new businesses. The his own technology company at the age of 40 to climb connotations of kokorozashi, however, are more revealing. mountains. “That’s emblematic for me. He is a humanist. He Its roots, kokoro (heart) and sasu (to aim at), suggest a kind has a vision. But he isn’t greedy enough, and that may mean of ambition that is inseparable from civic duty. The dual he doesn’t have the energy to change the world.” meaning captures the central tension in the entrepreneurial I later meet with Yusuke Matsuda, another friend of Endo’s culture of today’s Japan: between the drive to change society and the CEO of Teach for Japan, an organization that aims on the one hand and the pressure to be a respected member to reduce poverty by bringing highly qualified teachers to of the community on the other. n
For the article in full, please follow The Journal online: journal.accj.or.jp Atsuko Toko Fish (front row, fourth from left) with husband Larry Fish, and associates A Life from the Fish Family Foundation and JWLI Well Lived By Brandi Goode
At 72 years old, Atsuko Toko Americans: they accept mistakes, that helped rebuild the country and as long as you learn from those after the war. People forget how Fish’s river of accomplishments errors, Americans embrace and hard that was,” she notes. runs deep and wide. Still, she praise you. This is a key difference In Japan, she has seen social compared with Japan. This is also innovation emerge slowly but says this is the best time of why innovation lags in Japan.” surely. This she finds incredibly her life. interesting, noting that “Japan FELLOW FEMALES never had a third sector before the Fish is a devoted advocate of March 11 disasters. Now, people Fish is a retired US–Japan cross- women’s issues. In 2006, she founded are not entirely dependent on cultural consultant, a board member the JWLI to help entrepreneurially the government; rather, they are of the U.S.–Japan Council, founder minded Japanese women go to the taking the initiative to help others,” of the Japanese Women’s Leadership United States and learn directly— Fish says. Initiative (JWLI) . . . and the list goes from successful nonprofit on. A first-generation American, organizations and social her life as a global citizen began in enterprises—how to become I am nobody in America, but a place familiar to many readers of leaders. As a trustee of the it is such an open, inclusive, The Journal: the American Chamber Fish Family Foundation, encouraging place. of Commerce in Japan (ACCJ). Fish has relatable experience Heeding her family’s advice in the so-called third sector to learn English and experience (nonprofits). When she launched the JWLI life outside Japan, Fish took a While she expresses program a decade ago, she struggled job as executive assistant at the disappointment that the Japanese to recruit fellows to attend the ACCJ office. government has reduced its 2020 weeks-long US initiative. Last year, “I knew nothing about the target for women in managerial however, more than 40 people American business world,” Fish roles to 7 percent from the previous applied for just four positions. relates. “But people were so generous, 30 percent, she admits to seeing “Japanese women are smart, even though I made mistakes every tremendous change in her native educated, and hardworking; but day. That’s the best thing about Japan. “I was part of the generation they are not expected to play
28 THE JOURNAL n APRIL 2016 ENTREPRENEUR
first business lesson in America,” United States. Most recently, in she says. September 2012, Japan’s Ministry Fish’s career progressed with her of Foreign Affairs awarded her the involvement in several public and Foreign Minister’s Commendation. private organizations, supporting In May 2013, the White House immigrants, the arts, global health named Fish a recipient of the Asian initiatives, and disaster victims, in American Pacific Islander women addition to her efforts to advance “Champion of Change” award, an accolade that is part of Last year, more than 40 people US President Barack Obama’s “Winning the applied for just four positions Future” initiative. [with JWLI]. “I wanted to work for Obama, so that award was so meaningful. women’s role in society. Besides I am nobody in America, but it is her board seat with the U.S.–Japan such an open, inclusive, encouraging Council, she has served over 10 place. I am so lucky to be here. years on the board of the Asian Task America gave me opportunity. This Force Against Domestic Violence is still the country where dreams JWLI 2015 fellows (ATASK), as well as The Japan come true,” she shares. Society of New York, Management Sciences for Health, and the CREATE YOUR LEGACY a [leadership] role in society. At Museum of Fine Arts in Boston, Nowadays, Fish is “retired,” but still school they need to teach women among others. works with the JWLI program as leadership skills, such as public When taking on a board-level well as the Fish Family Foundation. speaking,” she believes. role, she listens carefully to the Together with her husband, A mom of three, Fish points to organization’s needs and considers they established the foundation the critical role a mother plays how she can make a difference as a to support human service within a family. board member. organizations helping low-income “Children always look to their “I believe that at my age, working families, with a particular mother, to see what role she plays giving back is my responsibility,” emphasis on aiding immigrants. and how father treats her. Women she explains. In 2015, the group helped some must believe in themselves and Her first board role was with 4,000 Green Card holders become their ability to make a difference. ATASK, which she describes as US citizens. The foundation also In particular, Japan needs to a life-changing experience. She supports a Japan program at the teach women the value of learning chaired the group for 10 years, Boys and Girls Club of Boston, for English, going abroad, and seeing during which time she “learned which inner-city children take a year the world,” she says. and cried a lot.” She relates how of Japanese culture and language Fish was raised by a single mother in Japan, it is taboo to talk about lessons and are sent to Japan as a who set a strong example for her to domestic violence, whereas ATASK reward for hard work. follow. “She was a mother, father, encourages women to speak out on When asked her thoughts on business consultant, and my best such topics, to educate and support leaving a legacy, she humbly retorts buddy,” Fish shares. other potential victims. that the people of Tohoku—who Fish also experienced great joy she supported by creating a relief SPEAK UP and overwhelming emotion serving fund in the aftermath of the 2011 Her husband, Larry, has also on the board of organizations, such triple disaster—are much stronger provided valuable business insight as Management Sciences for Health, than she. over the course of her career. building public health systems in “You create your own legacy, After moving to the United States, developing countries. This was and it is not just top–down. Every Atsuko Fish took a job with the likewise an eye-opening experience, woman can create her own legacy by state government, and Larry sagely she says, as Japan residents are rarely believing she can make a difference. advised her to speak up and own her exposed to environments lacking in My message to the younger opinions. On her first day at work, reliable access to healthcare. generation is this: go out and see the she actually got pulled aside after As a result of her work, Fish world, let things touch your heart. an important meeting—because she has received numerous awards Learn how to give back to society hadn’t said anything! “This was my over the years, in Japan and the and the community.” n
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Diet Dailies Japan policy updates translated from Keizaikai magazine
as well as at such major MINISTRY OF INTERNAL AFFAIRS sightseeing areas as Tokyo AND COMMUNICATIONS Skytree, airports, and rail stations. The first places that will display DOUBTS RAISED OVER MY the new signage, within NUMBER AND POINT CARDS the current fiscal year, are likely to be the Akihabara electronics retail district A remark made in January by Internal and areas in the vicinity Affairs and Communications Minister of Tokyo International Sanae Takaichi has sparked debate regarding Airport Haneda. combining the new My Number cards with The total number of various types of point cards. foreign visitors to Japan Distribution of the My Number cards— during 2015 is predicted assigned to all adult residents of Japan and to have exceeded 19.7 initiated to discourage tax evasion—began million, making it probable in October 2015. At present, competition that the previously stated is intensifying among companies that issue target of 20 million soon such point cards as T Point, Ponta, and will be surpassed. The government has Rakuten Super Point. It is thought that some MINISTRY OF LAND, INFRASTRUCTURE, identified inbound travel as an important cardholders would welcome the convenience TRANSPORTATION AND component of economic growth. Thus, of merging all their points into a single card. TOURISM it has begun to expedite efforts to bolster According to the ministry’s website, tourism infrastructure by taking a number standardizing the different point cards of steps, including arranging consultations would enhance the usability of the My MORE MULTILINGUAL with panels of outside advisors. Number cards by making unused space on SIGNS IN THE WORKS According to the feedback received a card's IC chip available to private firms. from the panels, “signs and explanatory This would also enable closer collaboration displays are currently unsuitable for between the government and the In the runup to the 2020 Tokyo Olympic foreigners.” Up to now, efforts have private sector. and Paralympic Games, the Ministry mainly gone into the preservation of However, there are many potential of Infrastructure, Land, Transport and historical and cultural artifacts, rather drawbacks. Should a My Number card Tourism is planning to modify some than providing multilingual explanations also have monetary value, it would raise 17,000 street signs in the greater Tokyo at cultural sites. the likelihood that cards would be lost or metropolitan area, so that they can be As visitor numbers increase, authorities stolen, as well as the possibility that personal understood by foreign visitors. will also need to deal with issues such as data might be leaked. In addition to these In addition how to protect security concerns, the notion of merging to being written The government has identified the environment commercial services of private businesses in Japanese, at sites of on a government-issued card seems sure some signs at inbound travel as an important cultural interest. to invite strong opposition. Combining present are also component of economic growth. The government the points from various schemes on a written using the even may My Number card may also serve to reduce Roman alphabet. try diverting commercial competition for customers. These, however, are merely phonetic more foreign visitors to regions outside Widely differing opinions on the transcriptions of the Japanese of Tokyo, as a means of coping with issue have been raised even within the (e.g. Meiji-dori). The new system will expanding inbound tourism. That said, ministry, making it uncertain what form clarify the meanings, for example by increased international tourism is certain the final proposal will take. In the end, the using the wording Meiji-dori Ave. to bring further complications that will government may be forced to abandon such Another planned addition is the require more than additional multilingual ideas in its effort to promote the use of the use of pictograms at Olympic venues, signage to resolve. My Number card. n
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accj-dir-JAN2016.indd 1 1/12/16 12:11 PM CONTENTS VOL. 53, ISSUE 4
1
39 FROM THE BOARD Vision for a 21st Century Global Financial System Andrew Conrad
40 ADVOCACY Healthier Women, Healthier Economy Andrew Joyce
43 KANSAI “One Kansai” Vision Balancing and promoting investment in Japan and Kansai 2 ACCJ-Kansai External Affairs Committee
45 EMBASSY Lessons Learned Spotlight Series shines light on tourism branding John Amari
46 ACCJ EVENT Japan in 2016 OECD expert suggests adversity could lead to opportunity John Amari
47 MEMBER NEWS 3 Roppongi Hills Makes Tax Exemption Easy CSR in Action
1 ACCJ President Christopher LaFleur speaks at the chamber’s first town hall meeting, held at the ACCJ office on February 18. 49 EVENTS The ACCJ in pictures 2 Pieter Franken, Safecast director and co-founder, presents radiation measuring equipment at “Changing Society through Crowdsourced Data: Safecast’s Impact on Fukushima Radiation Reporting,” held at the Tokyo American Club on March 11. 50 ACCJ LEADER More Important Than Ever 3 Chubu Walkathon leaders and volunteers served food to some of Nagoya’s homeless community, in conjunction with the Sasashima Christian Association, on March 3. Tom Clark
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ACCJ directory Ad.indd 1 6/1/2016 2:50:47 PM Vision for a FROM THE BOARD 21st Century Global By Andrew Conrad Vice president, ACCJ; and Financial System Chair, ACCJ Financial Services Forum
t is an honor to again serve on the Board of Governors stability or consumer protection, much less on economic after time away. This year, ACCJ President Christopher growth and job creation. I LaFleur has asked me to chair the Financial Services Against this backdrop, Nobuchika Mori, Japan's Financial Forum (FSF) and I look forward to working closely with its Services Agency commissioner, has been outspoken members to lead the chamber’s financial services initiatives. regarding global financial regulatory reform, pointing out that international standard-setting bodies have become FINANCIAL SERVICES: AN ENGINE “regulation factories.” OF ECONOMIC GROWTH Reforms to strengthen the global financial system As Japan confronts the unprecedented challenges of are needed and welcome to achieve the appropriate mounting public debt as well as a rapidly aging and balance to ensure consumer protection while promoting shrinking workforce, it will be essential to have efficient, economic growth. However, the key challenge is ensuring well-regulated financial and capital markets in Japan, the that the cumulative impact of these regulations does United States, and elsewhere to achieve sustained economic not harm financial stability or unnecessarily constrain growth and improve the well-being of Japanese citizens. economic growth. The ACCJ has long supported Japan’s government in its efforts to promote economic growth and make Japan G7: AN OPPORTUNITY FOR US–JAPAN LEADERSHIP the easiest place in the world to do business. Under Prime This year, Japan will host the G7 summit, providing an Minister Shinzo Abe’s leadership, Japan is implementing important opportunity for the government to showcase a clear economic policy vision to promote growth, with Japan’s growth-oriented vision and a chance for Washington recognition that financial services play a fundamental and Tokyo together to lead in forming a G7 consensus growth-facilitating role. that regulators must be responsive to economic concerns Following the 2008 financial crisis, rules for the global regarding global financial regulatory reform. economy are increasingly being written at the G20 and Accordingly, the FSF is preparing a white paper for release other international fora. Important progress has been in spring. It will provide the context and propose a new made. In 2014, G20 leaders declared the “job of agreeing to framework for the G7, enabling it to play a strategic, pro- measures to fix the fault lines that caused the crisis is now growth role in global financial regulatory policymaking. substantially complete.” However, the G20-led framework continues to generate We hope the white paper will be seen as a constructive new regulations at a rapid pace, without clear understanding contribution to the public policy debate in Japan and around of the cumulative effect this regulation will have on financial the world regarding this critically important challenge. n
THIS MONTH’S FEATURED VIDEO:
U.S. TAXES: INDIVIDUAL TAX CHANGES FOR 2015
In light of the US tax filing deadline this month, the ACCJ Taxation Committee would like to remind all members that there is a recording of last year's presentation on U.S. individual income tax requirements.
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THE JOURNAL n APRIL 2016 39 ADVOCACY
Healthier Women, Healthier Economy
By Andrew Joyce
he American Chamber of which limits informed choices about The American Commerce in Japan (ACCJ) and Chamber of when to start a family. Japanese Commerce T the European Business Council in in Japan women are also less likely to have February launched a joint white paper access to oral contraceptives and Healthier Women, urging the Japanese government to Healthier Economy assisted reproductive technologies, help improve the health of its female Building a Stronger Economy by such as in-vitro fertilization, which citizens. The paper seeks to draw Empowering Women Through Better Health makes balancing career advancement attention to a vital but generally and having children an even overlooked element in Prime Minister greater challenge. Shinzo Abe’s plan to increase female “For the one in six Japanese participation in the economy. couples that face infertility, the cost To date, the government’s reforms of treatment often limits access,” says to narrow the gender gap have focused Leo Lee, president on increasing the number of women in of Merck Serono. managerial positions and supporting “Despite improving working mothers. The ACCJ has Japan has more to do to national and local encouraged these efforts through its fully meet the healthcare subsidy programs, annual Women in Business Summit many women and other initiatives. The latest needs of its female citizens. are still unable to advocacy paper—sponsored by ACCJ pursue treatment." member companies GE, BD Japan, Bayer, MSD, Merck Serono, MetLife, and Cosmo PR—argues that healthcare- South Korea. Cervical cancer is second GLOBAL BEST PRACTICES related measures are also critical to the to breast cancer as the most prevalent Japan is also slower than other countries attainment of Japan’s gender equality cancer affecting women, yet only 42.1 to introduce best-practice technology goals and should go hand in hand with percent of Japanese women underwent and preventative treatments for structural and social reforms. screening in 2013, one of the lowest diseases affecting women. For example, “Prime Minister Abe last year rates among nations in the Organisation cervical cancer is preventable through announced a new set of policy ‘arrows’ for Economic Co-operation the use of both screening and HPV that combine efforts to shape a stronger and Development. vaccination—a combination that Japanese economy with assistance for raising Japan, unlike other countries, has authorities are still reviewing, despite children to stabilize the population no laws or regulatory guidelines for a statement from the World Health decline,” says William Bishop, director comprehensive health checks and Organization that HPV vaccines are safe. of corporate affairs at BD Japan gynecological care for women. As a “Japan should resume the active and chair of the ACCJ Healthcare result, Japanese women are less likely recommendation of the HPV Committee, which produced the white than those in the United States to have vaccination as soon as possible, so paper. “Clearly, the role of women an annual gynecological checkup, even that Japanese women can benefit from in the economy and women’s health though more than 70 percent of Japanese the same vaccination environment issues are central to the success of these women suffer from menstrual problems, as in many other countries,” says new policies.” which could be indicative of, or lead to, Tony Alvarez, representative director more serious health issues. and president of MSD K.K. LAGGING BEHIND “There is a great need for sustained The white paper also calls for the Japan has more to do to fully meet the education to build awareness of diseases implementation of liquid-based healthcare needs of its female citizens. and therapies, which is currently missing cytology screening to increase the Despite breast cancer claiming the in Japan,” says Kumi Sato, president and accuracy of cervical cancer testing, lives of tens of thousands of women each CEO of Cosmo PR, which specializes in as well as the use of more accurate year, the screening rate in Japan is only healthcare communication. screening and diagnostic methods 41 percent, compared with 80.8 percent Japanese women also fall behind their for breast cancer, such as digital in the United States and 67.6 percent in peers in terms of fertility knowledge, breast tomosynthesis and magnetic
40 THE JOURNAL n APRIL 2016 Breast Cancer Screening Rates among women 50-69 years old
68.4% GERMANY (2009) US 80.4% (2010) 36.4% JAPAN UK 72.6% (2010) (2011) SOUTH KOREA 74.1% (2012)
FRANCE 75.4% (2010)
The rate of breast cancer screening in Japan is among AUSTRALIA 55% the lowest in OECD countries (2011)
SOURCES: OECD Health Data 2013; Japanese Ministry of Health, Labour and Welfare
resonance imaging, as alternatives health and nursing care, it is critical out items, and by providing schedule to mammography. to ensure that women understand the flexibility for women undergoing “Evidence shows that Japanese women specific health risks they face and are fertility treatment. have a higher likelihood of a so-called empowered to achieve a more holistic “Policies and guidelines on dense breast tissue, which can require work–life–health balance,” says Sachin comprehensive support for women’s more advanced methods to detect and N. Shah, CEO of MetLife Japan and a health are vital to minimize the risk of diagnose cancerous growths,” says member of the ACCJ Board of Governors. otherwise treatable conditions and enable Kumi Ito, chief marketing officer of As with gender equality in the women to achieve their career and social GE Healthcare Japan. “It is important workplace, improving female health aspirations,” says Yasuko Aitoku, operating to continue to raise awareness about in Japan is not solely a job for the officer and head of market access at Bayer adequate breast screening and introduce government. The white paper provides Yakuhin. “Meeting these healthcare personalized care according to individual recommendations for businesses to challenges will address and accelerate the genetic risk factors.” improve the health of female employees, advancement of women in society.” n for example by offering training on life WIDER BENEFITS and family planning, including screening Andrew Joyce is senior manager of Improving the health of Japanese women for breast cancer and other conditions Government Relations at MetLife and a will have wider benefits for the country’s in health check-ups as standard opt- member of the ACCJ Healthcare Committee. economy and society as a whole. According to the Health and Global Policy Institute, a Tokyo-based think WOMEN’S HEALTH POLICY RECOMMENDATIONS tank, the cost to the Japanese economy of gynecological conditions in terms of Health literacy and education medical expenses and lost productivity � Educational intervention to improve health literacy and support women’s advancement is estimated to be at least ¥6.37 trillion Health for self per year. � Increase comprehensive screening and access to gynecological care Meanwhile, evidence from other � Reduce the spread of sexually transmitted infections countries suggests that the higher the � Promote cervical cancer prevention and screening osteoporosis screening rate, the lower the � Improve the accuracy of breast cancer screening eventual nursing care needs in the elderly � Prevent fractures due to osteoporosis population—an important consideration amid Japan’s aging population and Reproductive health rapidly increasing social security costs. � Improve access to oral contraceptives “As Japanese people increasingly bear � Improve access to fertility treatment more individual risk in areas such as
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By the ACCJ–Kansai External Affairs Committee
Guests at a luncheon sponsored by the ACCJ–Kansai External Affairs Committee and The Ritz-Carlton, Osaka, for Star Alliance CEO Mark Schwab (front row second from right)
or Japan to further develop In cooperation with ACCJ member working on destination-marketing economically, there needs to be companies, the governments issues with local governments, F growth in regions outside the of the United States and Japan, the 11 hotels in our membership, Tokyo metropolis. The External together with related agencies, the theme parks, the transportation Affairs Committee of the Kansai Kansai–EAC is working to promote sector, and travel providers. Our chapter (Kansai–EAC) of the the One Kansai vision. To this aim is to further the use of IT to American Chamber of Commerce end, it encourages companies in improve the tourism market for in Japan (ACCJ) aims to help metropolitan Tokyo to decentralize, all involved. Kansai grow, based on the vision of by either moving or shifting certain In the field of education, our “One Kansai.” operations to Kansai, and at the same goal is to help develop future Japan’s foreign direct investment time works to attract new foreign leaders and foster global talent. (FDI) statistics show that 88.5 percent investment. We are also promoting We plan to do this by supporting of foreign-owned companies choose cross-border venture capital and education ventures in the United to operate in the Tokyo metropolis, exchanges, such as those in the fields States, creating more opportunities with only 6.9 percent going to Kansai, of R&D and technology. for cultural exchanges, and giving and 4.6 percent to other regions in Kansai cannot wait for the results students greater exposure to global Japan. This unbalanced investment of decisions made in Tokyo to thinking by having our ACCJ trend virtually precludes most areas of trickle down to other regions of members visit classrooms in Japan. Japan from benefitting from FDI, and Japan. The Kansai–EAC aims to help Under the One Kansai vision, presents companies that only operate stimulate business in the Kansai we want to help create synergies in the Tokyo metropolis with a greater region by working together with among Kansai business investment, concentration of risks. other stakeholders in regions outside tourism, and education, while at The One Kansai vision is laid out in Tokyo, based on our knowledge of the same time prioritizing diversity an ACCJ position paper, “Promoting how things work in Kansai. and inclusion in each field. We have Trade, Investment and Tourism in Currently, we are focusing on the identified these common themes as the Kansai Region Under a ‘One fields of tourism and education. For target areas for development across Kansai’ Concept.” With culturally tourism, we are concentrating on the region, and we believe they are rich histories, Kyoto, Nara, Osaka, both the macro wave of increased important to ensure the success of Kobe, Wakayama and other areas of inbound tourism, as well as on all ACCJ–Kansai members. Kansai each have distinct identities, outbound tourism, which also The ACCJ Kansai External Affairs and are justifiably proud of their contributes to gains in the travel, Committee is working hard to make differences. In the course of their hospitality, and leisure sectors. the One Kansai concept a reality. n everyday administrative functions, As our kick-off event this year, the prefectures and powerful city we hosted Star Alliance CEO administrations have yet to fully Mark Schwab at a luncheon Akio Arthur Matsumoto is chair of the unite in realizing that from a global sponsored by The Ritz-Carlton, ACCJ–Kansai External Affairs Committee perspective, their combined Kansai Osaka. We also co-sponsored a (EAC) and president of LS7 Corporation. identity offers many benefits that Brand USA event, at which Schwab Steve Iwamura is vice-chair of EAC, include collective resources and spoke, at the U.S. Consulate General an ACCJ–Kansai special advisor, and a marketing tools. Osaka-Kobe. We look forward to partner with Deloitte Touche Tohmatsu.
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Lessons Learned Spotlight Series shines light on tourism branding
By John Amari
n late February, some 100 public and private host direct consumer-focused campaigns. Trade- stakeholders from the tourism industry related initiatives are used in the other markets. I gathered at the U.S. Embassy in Tokyo and Schwab then discussed Brand USA’s creative the U.S. Consulate in Osaka-Kobe to share best marketing strategy, particularly honing in on practice branding and marketing strategies. US national parks. Under the banner “Solutions for 2020 and With video marketing having become an Beyond: A Spotlight Series on U.S.–Japan Cutting important element of the organization’s strategy, Edge Collaboration—Strategies and Tools in a short movie has already been launched this year Tourism Branding,” experts delivered keynote to celebrate the National Park Service’s centennial. addresses and participated in panel discussions. Four million people in 18 countries are expected to The events were part of the ongoing Spotlight Mark Schwab, CEO, Star Alliance see this campaign over an 18-month period. Series, focusing on sectors of the economy Turning to Japan, Schwab said that, in terms of offering compelling opportunities for bilateral in-bound tourism to the United States, the country business cooperation. The American Chamber of ranks fourth. The 2015 goal was to have 3.7 Commerce in Japan (ACCJ) partnered with the million visitors annually from Japan. Here, Brand embassy and other stakeholders to help host the USA’s marketing focuses on young urban adults, occasion by recruiting speakers and participants. particularly professional women, who tend to be Mark Schwab, CEO of Star Alliance and a open to new experiences and destinations. board member of Brand USA, delivered the first Brand USA’s multi-dimensional plan includes keynote address, titled “U.S. Tourism Branding participating in trade shows and industry events, Strategy: The Creation and Success of Brand utilizing a strong online presence, and engaging USA.” The presentation was just one of a series corporate partners such as hotels, airlines, as well Yuri Furusawa, Japan Tourism Agency of talks replete with expert advice and direct as digital and print media. accounts from industry and academia. In closing, Schwab said the United States’s Schwab began by outlining the events that led to the creation worldwide market share had improved from 12 percent to of Brand USA, a public–private partnership set up in 2010 13.3 percent since Brand USA was created. The key takeaway “to increase international visitation, spend, and market share” was the incremental increase, by 2 million visitors, over the past for the United States. The agency set a goal in 2014 to raise visitor two years, representing $6.5 billion in incremental spend, or numbers to 100 million (from the current 74 million) by 2022. 15,000 incremental jobs a year. He noted a “lost decade” between 2000 and 2010, when the Schwab’s presentation preceded a second keynote address by number of visitors from Japan to the United States dropped Vice Commissioner Yuri Furusawa of the Japan Tourism Agency. dramatically. The time coincided with a 37 percent global loss Next, regional tourism branding was discussed by representatives of market share for international visitors. from related agencies in Okinawa and New York. Finally, a panel To achieve its aims, Brand USA works closely with government including ACCJ member companies Adobe Systems Co., Ltd. and bodies and some 500 corporate partners. A key role of the Marriott International, Inc. offered industry insights and solutions.n organization is explaining to Washington the value of travel and the contribution tourism makes to the economy—about 8 million jobs From left: Yuri Ann Arthur, U.S. Embassy in Tokyo; Yoshiro Shimoji, University and $1.6 trillion annually, or 2.7 percent of national GDP. of the Ryukus; Makiko Matsuda Healy and Chris Heywood, NYC & Company Run as a business, Brand USA has a robust marketing strategy globally targeting nearly 40 markets—14 of which, including Japan,
The next Spotlight Series, scheduled for May 17, will focus on cybersecurity. It is being held as part of the Cybersecurity Trade Mission, with a keynote address by Admiral Dennis Blair, former director of US National Intelligence. ACCJ members are welcome to submit ideas for speakers. www.spotlight2020.info
THE JOURNAL n APRIL 2016 45 ACCJ EVENT
Japan in 2016 OECD expert suggests adversity could lead to opportunity
By John Amari
n late February, economist Randall Jones, of the Organisation for Economic Co-operation and I Development (OECD), addressed a luncheon held by the Japan Structural Reform Task Force of the American Chamber of Commerce in Japan. Jones, who is head of the Japan/Korea Desk at the OECD, touched on Japan’s economic prospects for 2016, the future of Abenomics (see page 8), and the importance of structural reform for Japan’s long-term economic viability. First came a whirlwind summary of the state of the global economy, in which Jones noted that global growth projections had been revised down 0.3 percentage points this year, in part due to a The major challenges facing Japan weak recovery in advanced economies. He then turned his attention to Japan. [are] how to promote faster growth Following exchange rate depreciation under and ensure fiscal sustainability. Abenomics, Japanese exports were quite strong between the first quarter of fiscal 2013 and the fourth quarter of fiscal 2015. This was promising, he said, particularly in light of the previous 20 years through had fallen to less than 1 percent in 2014, which was due to 2012, when Japanese exports had been losing global market aging, he said. Labor productivity had likewise fallen—from share. Industrial production had peaked in 2014, he added, 2 percent to 1 percent over the same period. and since had shown no increase. As for productivity, Jones recalled a well-known saying by What should drive economic growth this year, Jones the 2008 winner of the Nobel Prize in Economics and prolific continued, are record high profits and company cash writer Paul Krugman: “Productivity isn’t everything, but in the holdings—in addition to labor shortages. long run, it is almost everything.” “You would expect companies to invest more and increase While Japan is often thought of as being high-tech, pay for their employees, while trying to get more labor by productivity here, Jones said, was about 25 percent less than offering higher wages to attract people from outside the that of the top 17 OECD countries between 1991 and 2013. workforce,” he explained. An influx of new innovative firms and a comparable exit However, in part due to a lack of wage growth in Japan, of non-viable ones—in addition to a diffusion of cutting- private consumption during the first quarter of calendar edge tech from large corporations to small and medium year 2016 was at about the same level as it had been in 2012. enterprises—should drive productivity, he added. “Last year, we had wage growth of 1 percent in real terms, Jones touched on a number of other structural changes that and minus 1.2 percent in consumption,” Jones noted. ought to be implemented here, such as enhancing the role This meant households spent less than they earned, and of entrepreneurship, venture capital financing, and inward therefore should be in a position to spend more in 2016. The foreign direct investment. He also proposed reform of the consumption tax hike proposed for April 2017, moreover, services industry and effective implementation of Abenomics’s should cause demand for consumer durables—the intended third arrow, which would boost productivity. target—to increase before it comes into effect. Speaking to The Journal after the event, Jones said the Business investment is also expected to be strong this year, key takeaway was that, when examined in per capita terms, he added. and taking into account population change, Japan still Over the long term, Jones said the major challenges facing holds vast promise. Through enacting key reforms and Japan were how to promote faster growth and ensure fiscal better use of the country’s assets—which include a highly sustainability. At its peak in the early 1990s, Jones noted, educated workforce—Japan has great potential that is yet to Japan’s potential growth rate was around 3 percent. But that be realized. n
46 THE JOURNAL n APRIL 2016 MEMBER NEWS
Roppongi Hills Makes CSR in Action
Tax Exemption Easy he Fujisawa Beach Cleaning Project focuses on cleaning beaches in the Shonan area south of Tokyo, and on gathering T data on marine debris. Now in its seventh year, the project oppongi Hills—with the iconic Mori Tower at its heart— was started by long-term Japan residents Alana and Michel Bonzi. is making itself even more attractive to tourists due to This community activity brings foreigners and local Japanese R the addition of a one-stop tax-exemption counter and a together to do something good for the environment and to tourist information desk. get better acquainted. The family-friendly project creates Tax-exempt shopping is nothing new around the city, and opportunities for engagement and offers benefits on both an one-stop tax exemption counters can be found in department individual and corporate level. It provides an easy opportunity for stores. But offering such services in a multi-tenant facility like colleagues to volunteer together, as project partner firms usually Roppongi Hills, the mega-complex owned and operated by sponsor teams of employees and their families. Mori Building Co., has only recently become possible thanks Company participants tend to highly regard volunteer projects to changes in laws and regulations. that involve their families, as such opportunities promote work– According to Mori Building Co. Retail Manager Takeshi life balance while allowing a family to spend quality time together. Akiyama, this change presented the perfect opportunity The business benefits include team building, heightened for growth. Akiyama says the percentage of sales to foreign employee commitment, and enhanced corporate image, visitors at the complex is on the rise, yet it still accounts for while community and social benefits include improving the just a few percent of overall sales. So as soon as it was possible environment and helping local organizations. to coordinate tax-exempt shopping in a single location, Mori The project also ties into a global movement to improve and went all in. raise awareness about the state of the world’s marine ecosystem. “We believe that offering such tourist-friendly services Debris collected during the cleanups is recorded for a national ultimately leads to repeat visits and increased sales,” survey on the state of Japan’s beaches and an international Akiyama says. report on the state of the In addition to the new tax exemption counter, Roppongi world’s beaches. Hills’s tourist information office is staffed with full-time The Fujisawa project is twice bilingual concierges. The concierge service was already in conducted twice a year, with a year operation before laws made the tax-exemption counter possible. 350 volunteers uniting for However, the upgraded tourism desk was recently certified a day of service. The spring as a Category 2 facility by the Japanese National Tourism campaign, on April 24, is a Organization, meaning it has full-time bilingual staff who can special way to commemorate provide information on Tokyo and neighboring prefectures. Earth Day (April 22). The 350 “Information desk concierges are the face of our facility, fall campaign, on September volunteers so they undergo extensive customer service and professional 25, is part of the Ocean training,” Akiyama explains. Conservancy’s International In the months and years to come, Roppongi Hills plans to Coastal Cleanup Initiative. n raise the level of its hospitality even higher—and increase repeat visits—by incorporating a variety of related services that will 156 kg make it even easier for foreign visitors to explore Tokyo in their fujisawabeachclean.org of trash own language. n www.segoinitiative.org
THE JOURNAL n APRIL 2016 47 The ACCJ thanks its PRESIDENT Christopher J. LaFleur Corporate Sustaining McLarty Associates Member companies CHAIRMAN Jay Ponazecki Their extensive participation provides a cornerstone in the chamber’s efforts to promote a better business climate in Japan. TREASURER Nancy Ngou Ernst & Young Advisory Co., Ltd. Abbott Laboratories/ KPMG Abbott Japan Co., Ltd. VICE PRESIDENTS Kreab Aflac Andrew J. Conrad Aflac International, Inc. Lenovo Japan Leanne Cutts Mondele z Japan Ltd. AIG Companies in Japan Lockheed Martin Marie G. Kissel Abbott Amazon Japan K.K. Jonathan Kushner Kreab McDonald's Company (Japan), Ltd. Amway Japan G.K. Eric W. Sedlak Jones Day McKinsey & Company, Inc. Japan Christopher Zarodkiewicz (Chubu) Cezars International K.K. Baxalta Japan Limited Merrill Lynch Japan Dr. Stephen A. Zurcher (Kansai) Kansai Gaidai University Bayer Yakuhin, Ltd. Securities Co., Ltd. ACCJ GOVERNORS Becton Dickinson Japan MetLife Alison Sayre Birch JPMorgan Securities Japan Co., Ltd. Bloomberg L.P. Microsoft Japan Co., Ltd. Tim Brett Coca-Cola (Japan) Co., Ltd. Boeing Japan K.K. Mondelez Japan Ltd. Britt J. Creamer (Chubu) Lockheed Martin TAS International Corporation Broadsoft Japan Monex Group, Inc. Rebecca K. Green ERM Japan Ltd. Catalyst Morgan Lewis John D. Harris Cytori Therapeutics K.K.
Caterpillar Morgan Stanley Japan Holdings A. Barry Hirschfeld, Jr. AIP Healthcare Japan GK Co., Ltd. Tad Johnson Pratt & Whitney Aftermarket Japan KK Chevron International Gas Inc. Patrik Jonsson (Kansai) Eli Lilly Japan K.K. Japan Branch Morrison & Foerster, Ito & Mitomi George L. Maffeo Boeing Japan K.K. Cisco Systems G.K. MSD K.K. Junichi Maruyama Citigroup Japan Holdings Corp. Citigroup Nanzan Gakuen Arthur M. Mitchell White & Case LLP (Nanzan School Corporation) Sachin N. Shah MetLife Insurance K.K. Coca-Cola (Japan) Co., Ltd. Yoshitaka Sugihara Google Inc. Northrop Grumman Colliers International Aerospace Systems William J. Swinton Temple University, Japan Campus
Cummins Japan Ltd. Nu Skin Japan Co., Ltd. PRESIDENTS EMERITI Deloitte Touche Tohmatsu LLC Oak Lawn Marketing, Inc. Debbie Howard (2004–2005) Delta Air Lines, Inc. Oracle Corporation Charles D. Lake II (2006–2007) Allan D. Smith (2008) Deutsche Bank Group Procter & Gamble Japan K.K. Thomas W. Whitson (2009–2010) Dow Chemical Japan Ltd. Prudential Financial, Inc. Michael J. Alfant (2011–2012) Jay Ponazecki (2014–2015) Eli Lilly Japan K.K. PwC Japan
en world Japan QUALCOMM JAPAN Inc. CHAIRMAN EMERITUS
EY Japan Randstad K.K. Kumi Sato Cosmo PR Federal Express Corporation Robert Walters Japan K.K.
Freshfields Bruckhaus Saatchi & Saatchi Fallon Tokyo ACCJ EXECUTIVE STAFF Deringer Tokyo Laura Younger Executive Director Squire Patton Boggs Gilead Sciences K.K. State Street Goldman Sachs Japan Co., Ltd. Teijin Limited Google Inc. Information as of March 18, 2016 Teva Pharmaceutical Industries Ltd. GR Japan K.K. Thomson Reuters Markets K.K. H&R Consultants K.K. The American Chamber of Commerce in Japan Toll Express Japan Co., Ltd. Masonic 39 MT Bldg. 10F, 2-4-5 Azabudai Heidrick & Struggles Japan Godo Kaisha Toys”R”Us, Japan Minato-ku, Tokyo, Japan 106-0041
Hilton Worldwide United Airlines, Inc. Tel: 03-3433-5381 n Fax: 03-3433-8454 www.accj.or.jp IBM Japan, Ltd. The Walt Disney Company (Japan) Ltd. IMS Japan The ACCJ is an independent membership organization not affiliated with any government White & Case LLP or other chamber of commerce. The ACCJ is a member of the Asia-Pacific Council of Johnson & Johnson American Chambers and values its relationships with Japanese, American and other Family of Companies Zimmer Biomet G.K. nations’ business organizations.
48 THE JOURNAL n APRIL 2016 1 Alan Thomas (left), director, client relations, IMS Japan K.K., receives a certificate of appreciation from ACCJ Healthcare Committee Chair William Bishop at “Japan Pharmaceutical Market Perspectives: Pain or Gain,” held at the Tokyo American Club on February 24.
2 ACCJ Vice President Jon Kushner speaks at “The Tokyo 2020 Olympic Dream - A Reality! A Joint Chamber Networking Event: Nomu-nication,” held at Oakwood Premier Tokyo Midtown Residents’ Lounge on March 11. EVENTS 3 Ken Kano, director-general, Tourism Bureau, Aichi Prefectural Government, speaks at the Chubu 2020 Vision event, held at the Hilton Nagoya on February 2. (PHOTO BY ANDY BOONE) 1 2 4 ACCJ leaders Timothy M. Connor (left), Imai Jen-La Plante (center), and Thomas R. Shockley at the ACCJ Town Hall, held at the ACCJ office on February 18.
5 Patrik Jonsson, president, Eli Lilly Japan K.K., presents at “The Journey of Creating a Great Place to Work - My Experience,” the ACCJ Kansai Leadership Series 2015-2016 closing session, held at Eli Lilly Japan’s offices on February 18.
6 Harry Hill (left), CEO, Oak Lawn Marketing, receives a certificate of appreciation from ACCJ-Chubu Independent Business Committee Chair Sean Gallagher after Hill’s presentation “Management Workshop - 5 Keys to Moving Your Company Forward,” held at the Coat of Arms restaurant on February 8. (PHOTO BY ANDY BOONE) 3 4 7 The winning team of an airplane trivia game receives a prize from ACCJ-Chubu Aerospace Industry Subcommittee leaders at “Meet-and-Greet and Name that Plane!” held at the Coat of Arms restaurant on February 12.
8 Dr. Shizuka Modica (left), professor of organisational behaviour and leadership, Kyoto College of Graduate Studies for Informatics, receives a certificate of appreciation from ACCJ Governor-Kansai Patrik Jonsson after speaking at the workshop “Leading Meaningfully for High Performance,” held at Eli Lilly Japan’s offices on February 26.
9 Akio Matsumoto (third from right), chair, ACCJ-Kansai External Affairs Committee, and president, LS7 5 6 Corporation, presents at the Hyogo Global Business Summit, held at Hyogo House on March 17.
UPCOMING EVENTS
Please visit www.accj.or.jp for a complete list of upcoming ACCJ events or check our weekly e-newsletter, The ACCJ Insider.
• APRIL 8 ACCJ & ASIJ: Engage Innovators and Entrepreneurs Forum
• APRIL 14 7 8 John Wood: Changing the World through Room to Read (Chubu event)
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6 9 THE JOURNAL n APRIL 2016 49 ACCJ LEADER
More Important Than Ever
n the wake of the 2008 global committee members in close contact financial crisis, governments, with personnel involved in events I financial institutions, and the taking place in the Asia–Pacific region companies that depend on ready and, indeed, around the world. This access to capital and liquidity have all is done with an eye to ensuring our been key stakeholders in the effort to views are part of ongoing dialogues in advance an appropriate approach to groups like the Asia–Pacific Economic financial regulation. Cooperation forum. In Japan, as in all major markets, By Tom Clark , former co-chair, Increasingly, there will be this approach must take into account ACCJ Banking, Finance and Capital opportunities for acting as a bridge both the need for sound, prudential Markets Committee; and executive among Japan’s Financial Services counsel, Govt. Affairs & Policy, supervision and regulation of Agency (which has been moving GE Capital International conduct—to avert the risky activities vigorously in implementing global that triggered the crisis—and the reform packages), need for capital and credit facilities. the Bank of Japan, The American Chamber of Our advocacy has focused both on domestic and the Ministry Commerce in Japan (ACCJ) legislation, as well as on the implementation of Finance. As Banking, Finance and Capital new waves of Markets Committee has, over the of various global initiatives. regulations for the past 15 years, taken a leading role financial sector are in providing a forum for sharing Over the past several years, the contemplated, the committee will ideas on financial policy, as well committee has spearheaded the play a lead role in ensuring that the as bringing these ideas to key following advocacy initiatives: voice of the financial sector is heard in stakeholders and decision makers. the deliberations. Our advocacy has focused both on � Ensuring the Personal Information This month marks the transition domestic legislation, including that Protection Law has taken into account of the committee’s leadership to related to the development of a sound the need for businesses to responsibly veteran market participants, co- asset-based lending market and a use consumer information to improve chairs Mitch Mason of Bank of reliable consumer finance market, services America Merrill Lynch and Junichi as well as on the implementation of � Calling for the elimination of Maruyama of Citigroup. They will be various global initiatives, such as burdensome limits on loans to small assisted by vice-chairs Jay Sapsford of derivatives regulation. businesses Morgan Stanley and Hiroshi Ueki of Now, with the increasing � Calling for a review of the Civil Code Goldman Sachs. globalization of financial markets, to implement a secure electronic Fellow outgoing co-chair this input is needed more than platform that would allow liens to be Ernie Olsen and I will take a well- ever. The major international properly recorded and researched deserved rest after many years leading policy organs, including the � Calling for the Money Lending the committee, but look forward to Financial Stability Board and the Business Law to be reformed to allow remaining members. International Organization of lending within an affiliate group of The financial services market has Securities Commissions, are defining companies without the burden of never been more important to our the items to be debated regarding licensing under that law. economy, and we continue to face a national legislation. These include myriad of challenges to balance access, capital requirements, risk buffers, In addition to these activities, the service levels, security, and availability derivatives clearing, and margining committee has provided a robust in the evolving marketplace. Current requirements. In this regard, our opportunity for networking, with its hot topics, such as data privacy and committee has been active in monthly meetings, frequent sponsoring cyber-terrorism, present challenges developing targeted ACCJ viewpoints of speaker events, and outreach. This across all facets of the market and will and public comment positions. outreach extends to keeping the necessitate a continuing dialogue. n
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