From 25-28 April 2012, the Economic Ministers from ASEAN countries and the Secretary-General of ASEAN will attend a road show in Sendai and Tokyo, Japan, to discuss opportunities for Japanese businesses looking for new opportunities in Southeast Asia.
During the road show, the Ministers will hold dialogues with politicians, bureaucrats and business leaders, participate in symposia, tour Japanese companies and factories, and visit the sites affected by the Great East Japan Earthquake.
Issues to be discussed include the overview and status of trade and investment in the region, and there will be a presentation on the prospects of ASEAN regional integration by the ASEAN Secretariat, ADBI and Denso International Asia, a Japanese company operating in Thailand.
The ASEAN Road Show aims at building strategic economic partnerships between Japan and ASEAN countries in public and private sectors and enhancing and promoting trade and investment in East Asia region. It is organized by the Economic Research Institute for ASEAN and East Asia (ERIA), with support from the Japan External Trade Organization (JETRO) and Tokyo’s ASEAN-Japan Centre.
For further details, please see: ERIA
More companies listed on the Bursa Malaysia (Malaysian stock market) are potential acquisition targets for Japanese companies as investment continues to flow in, thanks to a strong yen and a geographic diversification drive gathers pace in Japan.
The momentum was already underway before Japan’s 11 March 2011 disasters highlighted the need for more offshore activity. Between January 2009 and July 2011 Japan was involved in 513 M&A deals worth US$14.2 billion in emerging Asia, reports The Edge Malaysia. This figure includes Chinese and Indian deals as well as those in Malaysia and Indonesia.
Focusing on Malaysia alone, however, Japanese FDI rose 537% year on year in 2010 (compared to 109% in other Southeast Asia), accounting for 12% of all foreign direct investment inflow. Japan was involved in 34% of Malaysian M&A activity.
But this activity might not be what you’d expect from Japanese deals, and is certainly different to those of the previous two decades. UOB Kay Hian Malaysia Research said it’s not the electronics and electrical sector attracting Japanese interest this time. Instead, the Japanese are looking at logistics, financial, healthcare and consumer industries, as well as heavier industries where Malaysia offers a better deal on energy and logistics costs. The research house said Japanese companies were also prepared to pay more for greater control of their acquisitions, like Asahi Group’s purchase of Malaysian bottler Permanis, and Mitsui & Co’s 30% stake in Integrated Healthcare Holdings. Companies that already trade with Japanese firms are seen as more attractive.
source & article: The Edge Malaysia
Asia’s most booming airline is teaming up with one of its strugglers to hopefully produce profit: AirAsia Japan, a subsidiary owned by All Nippon Airways (ANA) will become the first low-cost carrier to fly out of Narita International Airport near Tokyo by August 2012.
The announcement was something of a surprise, since AirAsia X began flying out of Tokyo’s second international airport, Haneda, just this year and ANA also announced its own budget airline venture, Peach Aviation, in May. AirAsia X will continue to operate from Haneda for the foreseeable future, while Peach will be based at Kansai International Airport near Osaka and serve mainly the domestic market.
Even so, the move is an interesting one given the dramatic drop in tourist inflows to Japan after the March 11 disasters and a reluctance among Japanese to spend on luxuries like travel in the face of national hardship. Japan’s other major traditional carrier, Japan Airlines (JAL) has repeatedly flirted with bankruptcy over the past few years and home-grown domestic carriers have struggled to offer the kind of discounts seen in other countries, given Japan’s high landing fees and manpower costs.
AirAsia’s CEO Tony Fernandes remained confident his airline could do better, saying enhanced links in travel and tourism would boost economic ties between East and Southeast Asia and produce growth. ANA will hold a 67% share in AirAsia Japan, with plans to fly domestic routes and longer-haul services to South Korea and Taiwan.
source & article: news.com.au
Malaysian auto parts manufacturers have spent years building a reputation for product build quality and supply reliability, exporting their products to several automakers around the world. Appealing to Japanese automakers, however, is another story entirely. A contract with a major manufacturer there offers lucrative rewards and increased stature, but Japanese thoroughness and taste for flawless quality present extra challenges to suppliers.
Some Malaysian companies were making inroads into the Japanese market even before the 11 March disasters in Tohoku damaged supply chains. The two countries signed a five year Economic Partnership agreement in 2006, with an auto industry component providing a skills training center in Malaysia and a number of trade shows.
Since March, many Japanese companies have expressed a desire to diversify their risks by teaming up with manufacturers in other Asian companies and Malaysia has found itself in a prime position. Trade agencies JETRO and MATRADE are aiding firms to find each other and achieve profitable outcomes on both sides. (more…)
It’s not just big Japanese businesses presenting opportunities for Malaysian manufacturers. With several Japanese small and medium sized enterprises (SMEs) looking to diversify risk, Malaysia is stepping up to offer an alternative location to these smaller businesses for manufacturing and data management facilities.
Again, Malaysia is interested primarily in Japanese automotive, electrical and electronics companies.
After Tohoku’s string of destructive tragedies in March, Japan’s own government has called for local firms to protect themselves by moving some functions overseas. Malaysia’s Deputy Minister of International Trade and Industry, Mukhriz Mahathir, said that his country offered a secure location outside earthquake danger zones and business-friendly policies.
source & article: MIDA
Malaysian and other Southeast Asian manufacturers are making themselves known in Japan, and more Japanese companies than ever are looking for overseas collaborations. International trade fairs are a fantastic opportunity to showcase a company’s offerings but adapting to each other’s business culture can make the experience more profitable, says Japan’s largest overseas trade organization.
The Japan External Trade Organization, or JETRO, has been around since 1958. Its original mission was to promote Japanese exports in overseas markets, but given radical economic shifts in Japan and elsewhere since then, its mission has broadened to include general facilitation of business understanding between Japanese companies and their overseas partners. This happens mainly through trade fairs, seminars, data-gathering, trade missions and publications. It has offices in 73 cities in every world region, of which 24 are in Asia and nine are in ASEAN countries.
JETRO offers a surprising amount of support to foreign enterprises looking to build a position in the Japanese market. For trade fairs it offers prime exhibition space and decoration, pre-arranges meetings and study tours before the fair begins, actively promotes exhibitions through the media and direct mail, and provides several interpreters.
I spoke recently to Ms. Mio Kawada, JETRO’s Director of International Trade Fairs in Japan, who in May oversaw the fifth Malaysian Auto Industry Exhibition (MAIE) in Yokohama. The expo featured 11 Malaysian manufacturers seeking export and import opportunities, OEM arrangements, technical alliances and other joint ventures with their Japanese counterparts. A glance at the Malaysian auto industry’s experience in Japan offers useful and universal pointers to other industries as well. (more…)
More good news of new Japanese investments for Malaysia as Prime Minister Najib Razak completed a short but high-level tour last week. Japanese firms have reportedly confirmed a commitment to RM3.8 billion (US$1.26 billion) in new investments between now and 2012, with another RM5.22 billion ($1.72 billion) to follow from 2013-15.
Key targets for investment are industries specializing in electrical and electronic goods, biomass, metallics and substrates used in the manufacture of hard drives. The total includes Tokuyama Corporation’s RM3.7 billion ($1.22 billion) investment in a polysilicon project in Bintulu, Sarawak state. Polysilicon is a vital ingredient in making electronics and solar photovoltaic (PV) cells.
During the tour, Najib met with Japanese Foreign Minister Takeaki Matsumoto, held discussions with representatives of the Japan-Malaysia Economic Association (Jameca) and delivered the keynote address at the 17th Nikkei International Conference.
Matsumoto apparently asked Najib to consider Japanese firms for major Malaysian infrastructure projects arising from the Economic Transformation Programme (ETP), such as the proposed Mass Rapid Transport system. He also expressed support for the new Malaysia-Japan International Institute of Technology, due to begin in September, and promised a special loan from his government to guarantee its success.
For its part, Malaysia has lifted a travel advisory it issued for its citizens going to Japan after the Fukushima nuclear incidents, and offered its expertise as an intermediary between Japanese firms seeking foreign investments of their own in lucrative Middle East markets.
source & article: Business Times
We’re seeing more interest from Japanese companies in Southeast Asian assets. Yesterday Japan’s second largest bank (by market cap) Sumitomo Mitsui Financial Group Inc made a bid for a 25% share of Malaysia’s fourth largest (by assets) RHB Capital Bhd.
Business Times reports that the Carlyle Group, a US private equity firm, has also put in an offer. The 25% currently belongs to Abu Dhabi Commercial Bank PJSC, which is looking to sell. The news took RHB Capital’s share price up 2.4% to a 14-year high, valuing the 25% stake at RM5 billion (US$1.66 billion).
While Japan’s recent disasters and subsequent economic downturn have sparked a new interest in overseas investments, Japan’s large corporations were already keen to move into Southeast Asia before the events, facing competition from their Chinese and South Korean counterparts. Takeda Pharmaceutical Co. and Toshiba Corp also announced yesterday a combined $16 billion in overseas takeovers. Mitsui Sumitomo Insurance Corp bought 50% of Indonesia’s PT Sinar Mas Multiarta this month for $820 million, while Mitsui & Co trading company grabbed a 30% share of Malaysia’s Integrated Healthcare Holdings for RM3.3 billion ($1.09 billion).
source & article: Business Times
AirAsia has launched a year-long promotion called “To Japan With Love”, aimed at increasing traffic to and from Japan and raising money to donate to disaster relief and recovery.
Fundraising efforts over the coming year include donation boxes placed on all AirAsia, AirAsiaX, AirAsia Indonesia and AirAsia Thailand flights, short and long-haul. They’ll also be selling wristbands with the promotion’s slogan and will donate all money collected to the Japan Platform, a group of 32 NGOs working to help and rebuild Japan’s stricken Tohoku region.
The promotion coincides with special fares designed to increase tourism to Japan, a vital step in rebuilding the economy. AirAsia is offering one-way economy flights from Kuala Lumpur to Tokyo Haneda (its primary route) for RM199 (US$66.60) and special deals for Japanese tourists wishing to head the other way.
AirAsia’s CEO Azran Osman-Rani will also join adventurer and mountain climber Khoo Swee Chiow on a climb to the summit of Mt. Fuji as part of an eight-mountain tour. The company had also previously donated cargo space on its flights to Japan to ferry humanitarian aid.
It’s been hinted before that Southeast Asian economies might benefit from Japanese investors and manufacturers looking to diversify their interests after March’s disasters. Apparently many are traveling to the Philippines on fact-finding missions, attracted by the country’s prices, proximity to Japan and a skilled, English-speaking workforce.
Many Japanese companies already have a presence in the Philippines and it’s long been a popular destination for Japanese tourists. Local tourism bodies plus trade and investment boards should capitalize on the opportunity to attract Japanese investment that would otherwise go to countries like Vietnam or Thailand, said a government official.
This includes hundreds of small and medium sized enterprises in the northeastern Tohoku region that were completely wiped out by March’s tsunami, as well as others whose operations were damaged but were seeking to hedge against any similar future disasters. Sergio Ortez-Luis Jr, head of the Philippines Chamber of Commerce & Industry (PCCI), said if the Philippines could promote itself as a safe and attractive tourist destination for Japanese, then investment would follow.
source & article: Philippines Daily Inquirer