TOKYO (Nikkei)--A government panel is poised to propose a series of deregulatory steps to transform Japan into a competitive nation that can thrive in a free trade zone, but the efforts are expected to run into opposition from entrenched interests.
The Government Revitalization Unit views some of the proposals as a way to lay the groundwork for Japan's possible entry into the Trans-Pacific Partnership free trade zone, or TPP. But the nation's protectionist farm sector is unlikely to go along with the plans.
The proposals include encouraging the private sector's participation in the farming industry.
For instance, companies may be allowed to work with local governments and agricultural cooperatives to help put land in the hands of producers working to expand their operations. The panel expects private-sector involvement in farming to help strengthen the industry.
But with regional elections coming up this spring, lawmakers are unlikely to push initiatives unpopular among farmers. In another step aimed at preparing for entry into the TPP, the panel called for expanding a program for accepting top talent from overseas.
Among the proposals that are unlikely to materialize are a plan to privatize airports to give them more operational independence. But airports under the central government's control currently receive several tens of billions of yen in funding from the general-account budget. If these airports lose such funding and are forced to stand on their own, many could see their losses swell.
Source:The Nikkei Jan. 26,2011
TOKYO (Nikkei)--In a sign of Japan's growing reliance on the wider regional economy, trade with the rest of Asia in 2010 surpassed 50% of the total for the first time, according to data released Thursday by the Finance Ministry.
Overall Japanese imports and exports grew 21.2% from the previous year to 128.04 trillion yen, recovering from a 33.9% drop in 2009 caused by the financial crisis. Trade with other Asian markets surged 24.8% to 65.3 trillion yen. The regional trade accounted for 51% of the total, an increase of 1.5 percentage points and the highest since tracking of comparable data began in 1979.
Asia's share of the nation's overall trade has grown about 10 percentage points in the past decade.
Meanwhile, the percentage for the U.S. has dropped by roughly half over the same time span to 12.7%.
China was Japan's biggest trading partner again, accounting for 20.7% of the total. In response to growing demand for LCD televisions, Japanese manufacturers such as Sony Corp. and Toshiba Corp. ramped up TV imports from their own factories and electronics manufacturing services in China.
But China is no longer just a production base. It is increasingly important as a consumer market, and passenger cars were one of the key products exported from Japan to China.
Japan has also strengthened economic ties with other Asian nations. Trade with members of the Association of Southeast Asian Nations grew 26.6% from the previous year, compared with a 24.5% increase for the so-called newly industrialized economies, which includes South Korea and Taiwan, and a 22.3% gain for China.
ASEAN has free trade agreements in place with such nations as China and India, so Japanese firms are exporting their products from ASEAN nations to those outside the group. For example, Nissan Motor Co. produces its March subcompact in Thailand for the global market, including Japan.
"Japanese firms may continue to shift management resources that were concentrated in China to other Asian nations," said an economist, citing rising labor costs and political risks in China.
Source:The Nikkei Jan. 28,2011
TOKYO (Dow Jones)--Japanese exports rose for the 13th straight month in December, rising 13.0% from a year earlier to Y6.113 trillion, due in part to higher exports of automobiles and machinery, the Ministry of Finance said Thursday.
The result exceeded the median forecast for a 9.9% rise in a poll of economists by Dow Jones Newswires. Exports rose 9.1% in November to Y5.441 trillion. Japan's trade surplus rose 34.1% to Y727.7 billion, the data showed, exceeding expectations for a Y469.6 billion surplus.
Exports to China were up 20.1%, while shipments to all Asian countries rose 14.8%, the ministry said. Exports to the U.S. rose 16.5%. Overall imports rose 10.6% to Y5.385 trillion. In November, imports were up 14.2% from a year earlier to Y5.278 trillion.
For 2010 Japanese exports rose 24.4% to Y67.406 trillion, while imports rose 17.7% to Y60.636 trillion. That gave Japan a trade surplus of Y6.770 trillion for the year, up about two and half times from 2009.
Source:The Nikkei Jan. 26,2011
TOKYO (Nikkei)--The government's waste-cutting panel has compiled a list of about 250 deregulatory steps it sees as crucial to revitalizing industry, including relaxing rules governing online sales of some over-the-counter drugs.
Prime Minister Naoto Kan sees regulatory reform as a catalyst for new growth as Japan pursues free trade agreements. The Government Revitalization Unit looked into rules and regulations seen by other nations as effective trade barriers. The panel will complete its proposals before the end of this month.
Ministers, senior vice ministers and parliamentary secretaries will then use the proposals to work out concrete details, with final plans to be approved by the cabinet by March's end. The panel argues that Internet sales of OTC drugs can be deregulated without compromising consumer safety as long as sales records are thoroughly managed and restrictions on purchased quantities are in place to prevent abuse. It seeks to have the new rules in place by May.
And to facilitate negotiations on economic partnership agreements, the panel suggests the government streamline approval procedures for food additives already being distributed overseas.
It is also proposing an easing of building codes for auto repair facilities and relaxing requirements for wholesale liquor licenses. The European Union has called for regulatory reform in these areas as a condition for entering into economic partnership pact negotiations with Japan.
The Land and Transport Ministry should consider allowing airports to set their own usage fees based on such factors as hours of operation and passenger traffic, the waste-cutting panel says. It also believes that landing and departure slots at airports should be increased alongside improvements to air traffic control technology.
Source:The Nikkei Jan. 26,2011
TOKYO (Nikkei)--To make Japanese ports more competitive, the Land, Infrastructure and Transport Ministry has decided to set up a port management company system to facilitate the privatization of port facilities.
The move will open up the management and operations of the nation's 23 key ports, including Tokyo, Yokohama, Kobe and Shimonoseki, to the private sector. They are currently run by municipalities.
Due to high fees, Japanese ports are losing customers to Asian rivals, notably South Korea's Busan and Taiwan's Kaoshiung. By privatizing their operations, the government hopes to drive down fees and bolster port usage.
Under the new system, one management company per port will be selected by the Land and Infrastructure Minister and local governments, with a single company eligible to run multiple ports.
Shares in the companies can be held by businesses and local governments, but the maximum stake per shareholder will be set at 20%.
Container wharf operations have already been privatized in some ports, and these operations will likely be brought under the new system. To encourage participation and investment by firms in the manufacturing and distribution sectors, the government plans to allow port management companies to undertake related businesses such as warehouse operations in nearby areas.
Port management companies will also be able to tap no-interest loans from the government for improving their facilities, such as loading cranes. Piers and other public assets will be leased to the companies under long-term agreements of up to 30 years. Operators will be allowed to set fees freely.
The ministry plans to submit bills for the new system in the current ordinary Diet session.
Source:The Nikkei Jan. 26,2011
TOKYO (Nikkei)--Major manufacturers are expected to reduce domestic greenhouse gas emissions in fiscal 2020 by 18% from fiscal 1990 levels, according to a recent survey by The Nikkei. The Nikkei conducted its annual survey on environmental management between September and November and received responses from 842 firms, including nonmanufacturers.
The weighted average of emissions in fiscal 2020 as estimated by 205 manufacturers is set to fall 18% from fiscal 1990, which is a significant improvement from the previous survey's estimated average of 13.9%. In the latest poll, estimated emissions in the machinery industry were pegged to fall 70.5% from fiscal 1990. Emissions in the electronics sector, meanwhile, are expected to decline 38.9%.
Major cuts are expected because international competition is particularly fierce in these industries, and this will likely prompt domestic companies to aggressively pursue energy-saving efforts in a bid to remain price-competitive.
In fiscal 2009, greenhouse gas emissions by Japanese manufacturers fell 16.1% from fiscal 1990 levels, largely due to the economic downturn in the wake of the global financial crisis. Roughly 60% of the manufacturers in the latest survey estimated that their domestic production volume in fiscal 2020 would be higher than it was in fiscal 1990. The main challenge now is to further slash missions while ramping up production. With this in mind, many manufacturers are now accelerating efforts to reduce oil use by exploring alternative sources such as renewable energy.
In a new bill designed to address global warming, the Japanese government has included a medium-term goal to cut emissions in 2020 by 25% from 1990 levels. The Environment Ministry is now considering a plan to achieve an 18% cut in emissions in the industrial sector, mainly among manufacturers.
However, even if the industrial sector makes significant progress, it still appears uncertain whether Japan will be able to achieve its 2020 target.
Source:The Nikkei Jan. 30,2011
TOKYO (Kyodo)--The farm ministry urged prefectural officials at an emergency meeting Saturday to make more efforts to bring the spread of bird flu under control, while some 96,600 chickens were culled in Miyazaki Prefecture and highly lethal viruses were confirmed in Aichi and Kagoshima prefectures.
At the gathering of senior farm officials of prefectural governments from across Japan, Agriculture, Forestry and Fisheries Minister Michihiko Kano warned, ''It will deal a blow to local economies if the spread continues.''
''Please implement thorough guidance to ensure that every farm complies with sanitary control rules'' under the law on control of infectious diseases in domestic animals, he said. In Miyazaki Prefecture, all the roughly 90,000 broiler chickens had been killed at a poultry farm in the town of Kawaminami by Saturday afternoon, after about 6,600 other chickens at another farm in Nobeoka were culled during the morning, as the season's fourth and fifth bird flu outbreaks in the southwestern Japan prefecture were confirmed there earlier in the day.
The Aichi prefectural government, meanwhile, said it has confirmed that the highly pathogenic H5 virus found Thursday among chickens at a farm in Toyohashi was highly virulent.
The Kagoshima prefectural government said the avian flu virus detected in chickens at a farm in Izumi was the H5N1 strain that is closely related to viruses found in wild cranes wintering in the city and chickens in Miyazaki and Aichi prefectures.
Following the season's first avian flu outbreak at a Japanese poultry farm last November in Shimane Prefecture, infections have been confirmed this month at three other farms plus a meat-processing center in Miyazaki Prefecture and a farm in Kagoshima Prefecture before Aichi's case, amid the spread of the H5N1 virus among wild birds.
Source:The Nikkei Jan. 29,2011
Tip: Lean on design, efficient production HP Japan's factory workers affix stickers with the words "Made in Tokyo" written on them to the computers they make.
Japan Steel Works Ltd. is one of many Japanese manufacturers trying to make the most of their technological advantages to stay ahead of their emerging-market competitors.
But a myopic focus on technology could be dangerous, according to Toshiyuki Kita, a Japanese industrial designer known for shaping Sharp Corp.'s Aquos line of liquid-crystal display TVs.
His message: Put some thought into design. This spring, Kita's second office in China will open in Foshan, an industrial city in Guangdong Province. The provincial government eagerly pursued Kita to set up shop in the city, offering a three-story building rent-free. The local authorities apparently hope Kita will train young Chinese designers.
Eight years ago, Beijing made developing a design industry one of the key goals of its economic growth strategy. Now Kita can see where it is all going. "While Japanese consumer electronics still exceed their rivals in quality, South Korea is already ahead of Japan in design strategy," Kita said.
"China will overtake Japan in design capability in five years."
Kita said he is worried about how unaware top Japanese executives are regarding the importance of design. "They are so focused on technology that they regard design as a matter of only color and appearance," he said.
Learning in Tokyo
There are other roads that lead to competitive advantage. Some argue that Japanese manufacturers must add something extra to their products and operations in a way their foreign rivals cannot easily copy. Hewlett-Packard Japan Ltd. has taken this path, having developed a method to domestically build computers that is competitive with low-cost Chinese production.
Eight years ago, the U.S. parent tried to shift production to China. But Naoyuki Shimizu, chief of the company's factory in Tokyo, succeeded in making Hewlett-Packard Co.'s management think twice, arguing the total cost of manufacturing and delivering computers to Japanese consumers could be 15% lower in Japan than in China despite Japanese workers' much higher wages.
Shimizu stressed that production in China would lengthen delivery time to more than 10 days, driving many Japanese customers away. Through a strenuous period of trial and error, HP Japan has devised a cost-efficient system to produce and deliver custom computers to buyers' doorsteps in five days. At least partially as a result, the company's share in the Japanese desktop computer market is up from around 10% to over 18%. Now the U.S. parent is learning from the business model developed in Tokyo, which defies conventional computer industry wisdom.
Source:The Nikkei Weekly Jan. 24,2011
TOKYO (Nikkei)--Japanese firms have a lot of growth potential in overseas markets--if they can make the best of their customer-centered approach at home and the skills they have honed in a country with the world's most demanding consumers.
Customer first
Zozotown, an online fashion Website operated by Start Today Co. that got its start six years ago, is forecast to handle 55.5 billion yen in merchandise for the year ending March. That is nearly the same as bricks-and-mortar department store Matsuya Co.'s main store in Ginza. Zozotown's Web site offers over 100,000 clothing items from among 1,370 domestic and foreign brands. Its wide selection is not the only reason for the store's growing popularity; customer service has also played a big role in drawing some 3 million customers to the site.
Zozotown adds about 1,500 new items to the site every day. At a 20,000-sq.-meter distribution center in Narashino, Chiba Prefecture, staff take pictures of models wearing new clothes from about 10 different angles, including close-ups of the collars, to give customers a better sense of the items.
Other services include letting customers select high-heel shoes according to the height of the heel.
Nearly everything the online store does, from selecting products in huge lots to packing and shipping, is handled by full-time employees. "All our employees, including me, buy items from our Web site to see whether our services are really customer-friendly," said Yusaku Maezawa, president of Start Today.
Although it raises fixed costs, the company does not outsource its operations because it believes doing things in house helps it continuously improve service. The approach seems to be paying off: Start Today expects its pretax profit to rise 40% this fiscal year despite a sluggish economy. It is now setting its sights on overseas markets.
Smaller, faster
Aeon Co., Japan's largest supermarket operator, is overhauling its strategy for opening stores. With growth at its large suburban stores slowing, the company is developing a network of smaller stores in urban areas. "In big cities, more and more consumers are looking for stores where they can buy necessities at low prices," said President Motoya Okada.
Aeon's My Basket supermarkets are about the same size as a convenience store and handle a variety of items, including fresh produce and prepared foods. It hopes to lure customers away from convenience stores in the Tokyo metropolitan area by offering prices similar to those of suburban supermarkets.
Finding out which items are hot sellers is critical to making My Basket shops profitable. Aeon has a point-of-sale inventory management system that transmits sales data directly from the checkout counter to its distribution center. Orders are then placed to manufacturers and wholesalers automatically, based on demand projections. By keeping a close eye on consumer trends, the firm can hold down operating costs. It plans to eventually open 1,000 My Basket supermarkets, up from 160 at present.
If you can make it here...
According to the Ministry of Internal Affairs and Communications, Japan's workforce totals roughly 58 million people, with tertiary industries including wholesaling and retailing employing nearly 80%, or over 40 million people. If Japanese firms can make the most of their strengths in customer service, finding profits overseas should not be that difficult, given that they have already passed the test of satisfying Japanese customers, long thought to be the world's pickiest.
Japan's mobile phone technology has come in for criticism for the "Galapagos syndrome": products that are overly focused on the domestic market end up isolated from those overseas. But the technology has continued to evolve nonetheless. The mobile phone makers and carriers continue working to enhance customer convenience -- introducing electric wallets and "one-seg" digital TV for example. "There are many overseas markets in which technologies and services we have created over the years will prove effective" overseas, said Kiyoyuki Tsujimura, vice president of NTT DoCoMo Inc.
DoCoMo is making inroads into mobile phone broadcasting in India by stressing its cutting-edge technologies, including one that allows high volumes of video to be transmitted efficiently. Another firm bringing skills developed at home to overseas markets is parcel delivery firm Yamato Holdings Co. (9064). It is introducing delivery of frozen and chilled foods in Shanghai and Singapore.
"Unique services have been created in Japan because demand for finely tailored services is high, and they will be a powerful tool in competing overseas," said Kaoru Seto, Yamato's president.
Yamato plans to offer a new service overseas that informs customers by e-mail when their packages will arrive. That service is already available in Japan. Despite the yen's surge, many firms in service industries seem less concerned that their domestic business will be hollowed out. But to take advantage of opportunities to grow overseas, they will have to keep working to develop the customer service skills they have perfected in Japan.
Source:The Nikkei Weekly Jan. 17,2011
TOKYO (Nikkei)--Mail-order and online retailers, including Rakuten Inc. Yahoo Japan Corp. and Nissen Co., are rushing to adapt their services for smartphone users, who tend to have higher incomes and be more eager shoppers than others.
Domestic shipments of smartphones are projected to rise 190% on the year in fiscal 2010, which runs through March this year, and the uptrend is expected to continue.
Late last November, Zozotown, an online fashion site run by Start Today Co. (3092), launched an application for users of Apple Inc.'s iPhone. The service displays a list of items according to brand or the sex of the wearer, and shoppers can move to the operator's online shopping site if they find something they want to buy.
Over the past two months, the application has been downloaded more than 400,000 times. Nissen Co., a major catalog-order retailer, has also made an application available for smartphone users. The software enables shoppers to coordinate a collection of clothes on their handset and move to Nissen's online shopping site if they find something they like.
On Wednesday, the company added a new application that displays items using moving images.
"Sales (via smartphone) have totaled some several hundred million yen so far," said a Nissen official. The A Web page for iPhone users operated by Zozotown, an online fashion site. firm continues to see a double-digit increase. Shopping channel operator QVC Japan Inc. began broadcasting a live program for iPhone users Jan. 20. Meanwhile, Rakuten Inc. has optimized its Rakuten Ichiba virtual mall for smartphone users.
"Growth in transactions via smartphone is huge," said a Rakuten public relations official.
Transactions at Rakuten conducted using cell phones, including smartphones, account for over 25% of the total at a peak time. One major feature of sales via smartphone is "sales per customer are higher than those via regular cell phone," said a Rakuten representative.
The same holds true for Yahoo Japan Corp. In the October-December quarter last year, sales per customer via smartphone at the firm were 30% more than its overall sales via cell phone.
According to a Cyber Communications Inc. survey, the disposable income of people who use smartphones averaged 35,185 yen a month, 7,019 yen more than that of people who do not use smartphones.
Source:The Nikkei Marketing Journal Jan. 28,2011
Consumer spending appears to be improving as Internet shopping sites entice more people to open their wallets, but a full-fledged recovery still appears far off.
Online shopping boomed early this year. Sales at Yahoo Japan Corp. shopping sites were up 20% on the year for the first 10 days, while Rakuten Inc.'s virtual shopping mall benefited from a 30% jump. Online apparel and cosmetics sales have been especially hot as consumers warm to the convenience offered by Web shopping.
Meanwhile, department stores have also seen a pickup in sales since the start of the year, suggesting that the worst may be over for them. Same-store sales between Jan. 2 - the first shopping day of the year - and Jan. 10 were up 4.5% on the year at Takashimaya Co. and 3.3% at Daimaru Matsuzakaya Department Stores Co. Sales of discounted clothing and accessories have been particularly strong.
"This month's sales could end up being better than they were a year ago," said an official at
But there is still ample room for improvement. Through 2010, after all, nationwide department store sales have fallen for 14 years in a row.
And because the drop was so steep in the aftermath of the 2008 global financial crisis, the gains seen early this month are unlikely to lift overall sales out of their doldrums. Still, consumer spending, which accounts for 60% of Japan's gross domestic product, has improved for six-straight quarters on a real basis since the April-June period of 2009.
On a sour note, most economists expect spending to have declined in the October-December quarter due to the fading effects of government incentives and a cigarette tax hike but to return to moderate growth thereafter. Also, on a nominal basis, July-September spending still had not reached pre-financial-crisis levels.
Source:The Nikkei Weekly Jan. 17,2011
The Office of Commercial Affairs, Royal Thai Embassy in Tokyo, Japan
Source : http://www.depthai.go.th