JETRO-2017年日本投资报告（英文）-2017.12-60页-7mb

JETRO Invest Japan Report 2017 Summary

Core Content

The JETRO Invest Japan Report 2017 provides an overview of the growth and trends in Japan's inward foreign direct investment (FDI) and highlights the government's efforts to improve the business environment for foreign companies. It also outlines JETRO's role in supporting these investments and fostering innovation and regional revitalization.

Main Points

1. Inward FDI Growth and Trends

• Inward FDI stock reached a record high of 27.8 trillion yen at the end of 2016, marking the third consecutive year of growth.
• The ratio of inward FDI to Japan's nominal GDP exceeded 5% for the first time, indicating a significant increase in the proportion of FDI.
• FDI inflow in 2016 reached 3.8 trillion yen, a record high and about six times that of the previous year.
• Asia is rapidly increasing its share of FDI in Japan, with inward FDI stock from Asia reaching 971% of 2000 levels.
• Europe remains the largest investor, with FDI stock of 13.6 trillion yen (48.7% of total).
• Key sectors attracting investment include finance and insurance, electric machinery, transportation equipment, and pharmaceuticals.
• Major M&A deals in 2016 included the acquisition of Sharp by Hon Hai Precision Industry, and the management rights of Kansai International Airport and Osaka International Airport by a French-led consortium.

2. Business Environment Improvements

• The Japanese government has implemented various reforms to improve the business environment, including:
  • "Regulatory sandbox" system to foster innovation through trial and error.
  • 20% reduction in administrative procedure costs by 2020.
  • "Bedrock regulations" reform, which aims to simplify and streamline regulations.
  • Lowering of corporation tax rate, which has been reduced by 7% since 2003.
• These reforms, part of Abenomics, have contributed to the improvement of the investment climate and increased confidence among foreign-affiliated companies in Japan.

3. Key Trends in FDI

• Qualitative changes in FDI: More focus on R&D centers, expansion from Asia, and investment in tourism due to the rise in foreign tourists.
• Fourth Industrial Revolution technologies: Use of IoT and AI to address Japan's challenges in healthcare, agriculture, manufacturing, and other sectors.
• Cross-border e-commerce (EC): Growing investments in procurement bases and logistics, helping Japanese companies expand overseas markets.
• Human resource challenges: Foreign companies struggle to secure skilled professionals, especially engineers with foreign language abilities.
• JETRO's support: JETRO has supported over 16,000 projects and 1,600 companies since 2003, and introduced a personal advisors system to assist 1,000 companies.

4. Regional Revitalization

• JETRO and local governments are promoting FDI to revitalize local economies by creating jobs and introducing new technologies.
• Examples include:
  • Fukushima Prefecture: Aiming to develop a medical equipment cluster.
  • Greater Nagoya Initiative (GNI): An industry-government-academia collaboration to attract foreign investment.
  • Shirahama Town, Wakayama Prefecture: Succeeded in attracting investment using the concept of "teleworking on the beach."
  • Tokushima Prefecture: Attracting satellite offices due to its high-speed broadband infrastructure.

5. Foreign Affiliates' Perception

• Foreign-affiliated companies are generally positive about the economic prospects and business environment in Japan.
• 70% of foreign-affiliated companies plan to expand their business and employment in the next five years.
• The main attractions for foreign companies are the Japanese market and the stability of the nation and society.
• Obstacles include difficulty in securing human resources and the need for better administrative support.

Key Information

• Japan's FDI stock at the end of 2016: 27.8 trillion yen.
• Asia's FDI growth: 971% increase from 2000 levels.
• FDI inflow in 2016: 3.8 trillion yen, a record high.
• Top countries by FDI stock: US (25.2%), Netherlands (13.6%), France (12.0%).
• Top industries: Finance and insurance (35.0%), electric machinery (14.1%), transportation equipment (13.6%).
• FDI reduction targets:
  • Corporate tax rate: Reduced by 7% since 2003.
  • Administrative costs: Targeted to be reduced by 20% by 2020.
• JETRO's support: Over 1,600 companies supported through FDI projects, and a new personal advisors system for 1,000 companies.

Conclusion

The report highlights the positive trajectory of Japan's inward FDI and the government's commitment to creating a more business-friendly environment. JETRO plays a central role in supporting foreign investment and addressing challenges such as human resource shortages and regulatory complexity. The Fourth Industrial Revolution and cross-border e-commerce are emerging as key drivers for future investment, with foreign companies increasingly interested in Japan's potential for innovation and market expansion.