Ushering in a new era for growth

The land of the rising sun is opening up its social and economic corridors to the world. The opportunity for the UAE is significant.

Japan is stoically working towards economic resurgence. Initially, the country focused on propping up investment and consumption domestically, but it is now widening its approach and attracting foreign investors to its shore.

For this, Japan is increasingly opening up its economical and social fronts. JETRO Dubai, a government-related organisation, is an important stakeholder in this bid, and has been making all the right moves to channelise investments from the region to the land of the rising sun.

"JETRO Dubai was established in 1981; 10 years after establishing diplomatic ties between Japan and the UAE," says Masami Ando, Managing Director, JETRO Dubai and MENA.
In the last three and a half decades, JETRO has operated as a gateway for Japanese companies that wish to establish a base in the UAE or other countries in MENA region. Consequently, many Japanese firms have expanded into the arid lands of the Middle East and benefited from the dynamic consumer base.

Gateway for investments
JETRO is also increasingly networking with the UAE business councils and important cohorts to highlight the benefits of investing in Japan. Its core focus now is to promote foreign direct investment (FDI) into Japan and help small- to medium-size Japanese firms maximise their global export potential.
"The priorities are to increase direct investment by overseas companies into Japan (Invest Japan); promote exports of Japanese food products; support small- and medium-size enterprises (SMEs) expand overseas; promote 'Cool Japan' to support global expansion of Japanese content business such as animation or games; contribute to 'Visit Japan' initiatives to enhance visit of foreign tourists; and contribute to the formation of trade policies related to economic partnerships," informs Ando.
JETRO Dubai doesn't just offer ancillary support but also actively works to protect and promote the interests of Japanese companies in the UAE. It has recently added an IP department within the organisation to strengthen intellectual property protection activities and launched the Middle East Intellectual Property Group of Japan (ME-IPG) in Dubai.

Japanese firms in the UAE
Currently, more than 300 Japanese companies are operating in diversified fields in the UAE. Most of these companies are trading offices of manufacturing companies, which are located in the free zones. Besides, Japanese firms also have presence in the financial sector, and are increasingly gaining ground in the hospitality sector with a number of new Japanese restaurants and food outlets. Japanese companies are engaged in the oil and gas industry too in Abu Dhabi.
Needless to say, JETRO has played a crucial role in establishment and smooth running of such businesses here. "We provide vital information on the investment climates of overseas countries as well as host seminars for potential Japanese investors in cooperation with governments or free zone authorities in MENA region. JETRO also provides business opportunities for Japanese companies with excellent technologies and products by arranging business matching or organising Japan pavilion in major exhibitions," adds Ando.  

Increasing presence
The land of the rising sun has been increasing its presence in the UAE and the region, courtesy JETRO Dubai, which is active all year round and  helps companies identify opportunities in the region and take part in various exhibitions. This year, for instance, JETRO Dubai set up Japan-centric pavilions at ATM 2016 (Arabian Travel Market), Arab Health 2016, and Gulfood 2016.
In ATM 2016, Japan pavilion welcomed many visitors, including Emiratis (25 per cent) and Indians (18 per cent). The event raised awareness among the visitors about the upcoming Tokyo Olympics 2020 and piqued tourist interest. Almost 68 per cent of the visitors said they were looking forward to attending the games.
At Arab Health 2016, JETRO Dubai facilitated over 2,100 business meetings. The result of which includes business deals worth $4.6 million and $97,000 worth of contracted deals.
Similarly, at Gulfood Japanese companies concluded deals worth $11.2 million by participating in the Japanese pavilion. This amount was almost double the value of deals concluded at the previous years' Gulfood exhibitions. The number of Japanese companies or organisations participating at Gulfood 2016 under the Japan pavilion increased to 27 compared with 24 in 2015.

Japanese products and services
Japan and the UAE have maintained very cordial bilateral trade relationship for the past several years, and trade is keeping its growth momentum in the medium to long run. The UAE is one of the largest export markets for Japan's automobile and other machinery industry as well as electronics, communication equipment, textiles and foodstuff. On the other hand, nearly 25 per cent of Japan's fuel oil requirements are met by the UAE, making the country  one of Japan's top partners in energy security. Japan's reliance on oil, gas and other petrochemicals from this region will continue for the foreseeable future, and thereby keeping the prospects of continued trade and investments between the two countries.
The UAE is also a major traditional supplier of aluminium to Japan. A large portion of the semi-finished aluminium produced in the UAE is exported to Japan.
In terms of business possibilities in the region, JETRO is currently promoting the export of medical equipment, and Japanese food products through special campaigns such as Japanese pavilions in Arab Health and Gulfood, the two major exhibitions in these sectors. JETRO is also promoting tourist industry, environment and energy sectors, and innovations and entrepreneurship through its participation in exhibitions, such as ATM, WETEX and GITEX.  
"Recently we have requests from the UAE retail sector to introduce Japanese food and beverage companies and Japanese clothing brands. JETRO also supports Japanese companies in that sector to enter the UAE or GCC market," adds Ando.

Collaborations in research
Japan has played a great role in various innovations, especially improving processes of manufacturing adopted by Japanese SMEs as well as major companies. Japanese universities also have strong presence in research and development (R&D), which has aided in the development of Japan as a hub of R&D in the fields of robotics, EV and HEV cars, healthcare, and IoT.
"Japan has evolved as a technology hub and is renowned for its R&D capabilities and facilities. Consequently, many foreign companies are setting up R&D facilities in the country to develop their global products. As the demand for Japanese technologies grows among foreign companies, Japanese companies are taking more favourable stance toward licensing and partnerships with foreign firms. JETRO helps foreign companies with their investments in Japan, and has been receiving an unprecedented volume of requests for information on Japan's latest R&D capabilities. Large overseas companies have asked JETRO to help find Japanese partners for joint development projects and Japanese universities, research institutions and business ventures for various technological tie-ups. Innovative products developed through such collaborations are distributed to many countries including the UAE."
In Dubai, JETRO debuted at the GITEX Technology Week in 2016 with a Japanese pavilion that included  startups. The companies exhibited innovative technologies that can help develop sustainable smart cities. This project was a good channel for the flow of Japan's technology and new innovations for the benefit of Dubai and the region as a whole.

FTA with the GCC
Japan is showing a strong presence in this era of mega FTAs (free trade agreements). "Although utilisation of FTAs has increased, utilisation by SMEs remained at half the rate of large-scale companies. In addition to the Trans Pacific Partnership (TPP) negotiations, negotiations for other mega FTAs have begun in rapid succession, including the EPA/FTA between Japan and the EU and the Regional Comprehensive Economic Partnership (RCEP). Japan participated in negotiations for the EU-Japan accord, RCEP and TPP," says Ando. These three mega FTAs account for 80 per cent of the world economy and greater than 60 per cent of world's population.
"The UAE and Japan agreed on a tax treaty in 2013, and the treaty has been in effect since 2014. Though the Japan-GCC FTA talks began in 2006, it has not been finalised yet. The talks have been slowed down but hoping it would be accelerated for the agreement with GCC," informs the managing director.

Foodex 2017
Foodex Japan is one of major exhibitions in Asia, and the largest food and beverages exhibitions in Japan. It is holding its 42nd international exhibition from March 7 to 10, 2017.  In 2016, nearly 77,000 people visited the exhibition, where 3,197 exhibitors (1,262 domestic exhibitors and 1,915 overseas exhibitors) from 78 nations or regions took part. Out of the 77,000 visitors, 67,000 were from Japan and 10,000 were from overseas countries.
For UAE vendors, Foodex Japan opens up wonderful opportunities to export their products to Japan, and offers an excellent platform to meet Asian companies in the industry.
-suneeti@khaleejtimes.com

• UAE