Investment Time In Japan

“I HOPE THE TURKISH PEOPLE FALL IN LOVE WITH JAPAN FOR REALISTIC REASONS.”

HIROSHI OKA

Hiroshi Oka was appointed as Japanese Ambassador to Turkey in April 2016, and has since then strived to develop relations between the two countries in every possible field. Oka says that Turkish people are open hearted towards Japan.“This love has developed without an indepth knowledge of Japan, but I hope Turkish people will become more familiar with Japanese culture for deeper reasons.” Speaking about the volume of trade between the two countries, Oka said it would be increasing in 2017, highlighting the many incentives for foreign investors. The Ambassador provided sincere answers to our questions on trade and politics, and spoke about the cultural relations between the two countries, while he and his wife Reiko Oka provided us with magnificent photographs.
What are your impressions and views about Turkey? 

My first encounter with Turkey and the Orient was in the Imperial Archives, where I developed a fascination with the ancient artifacts that were made in Orient region during fifth and sixth centuries A.D. This became the genesis of my interest, and that interest would grow even larger once I started to learn about the history of the region and the contributions made by the Islamic Culture and the Ottoman Turks to science, medicine, architecture and the arts. After joining the Foreign Ministry, I developed also a professional interest in this region, and in recent years we have been working on a number of issues in which Turkey is involved, either directly or indirectly, including the refugee problem, the civil war in Syria and stability in the Middle East. I can say that I am here as a further extension of the early days of my personal interest, and also of my professional career. 

By M. Ferhat YÜKSEL

Hiroshi Oka was appointed as Japanese Ambassador to Turkey in April 2016, and has since then strived to develop relations between the two countries in every possible field. Oka says that Turkish people are open-hearted towards Japan.“This love has developed without an indepth knowledge of Japan, but I hope Turkish people will become more familiar with Japanese culture for deeper reasons.” Speaking about the volume of trade between the two countries, Oka said it would be increasing in 2017, highlighting the many incentives for foreign investors. The Ambassador provided sincere answers to our questions on trade and politics, and spoke about the cultural relations between the two countries, while he and his wife Reiko Oka provided us with magnificent photographs.

SPEAKS FLUENT ARABIC 
Hiroshi Oka has held the posts of Chief Counselor and Minister Plenipotentiary in both the United Kingdom and Saudi Arabia, and served as Counselor in New York. Prior to his appointment to Turkey as Ambassador of Japan, he was the General Director of Intelligence and Analysis Services in the Japanese Ministry of Foreign Affairs. Oka graduated from the Tokyo University Law School in 1982, after which he joined the Ministry of Foreign Affairs. Oka has served in many different countries of the world and speaks fluent Arabic.
I FEEL LIKE AT HOME 
In which areas do you think Japan and Turkey have their strongest bonds? 

There are many aspects and layers to the strong bonds of confidence that exist between our two peoples. At the highest level, there is a strong personal bond and mutual trust between Prime Minister Abe and President Erdoğan, while at a grassroots level, every Turkish person I have spoken to shows strong interest and affection towards Japan, which makes me feel very much at home and like a welcome guest. Both nations began their modernization efforts in the middle of the 19th century, and so we faced the same challenges of how to preserve our culture and traditions while modernizing and strengthening our countries.

How would you assess the progress Turkey has made in its integration with the EU? How important is this for Japan? 

The regulatory reforms and legal frameworks that have been applied by Turkey as part of its EU integration efforts have been assessed in a positive light by Japanese investors and business people, which can be seen in the sudden increase in investments from Japan that occurred in around 2010. This is a sign of the appreciation and optimism that businesses and investors are seeing in Turkey.

Hiroshi – Reiko Oka
WE HAD EACH OTHER
Both countries are prone to earthquakes and have suffered greatly from such disasters in the past. Whenever disasters of this kind hit, ‘we had each other’. In 2011, following the Great East Japan Earthquake, it was a Turkish rescue team that was first to arrive and the last to leave for the search and rescue operation. This shows the level of confidence and respect that we have at every level in our societies. We are deeply grateful for the generosity of the Turkish people.
JAPAN RECOGNIZES THE INTEREST OF TURKEY TOWARDS THE EAST 
Turkey has been changing direction, both politically and financially, towards the East in recent years. How does Japan evaluate this change? 

Located between the East and the West, it is natural for Turkey to strengthen its ties with the West, while at the same time being very important to cultivate and strengthen ties and relations with the East too. Turkey can work as a bridge, a hub or as a center at this convergence of West and East. In this regard, Japan welcomes Turkey’s increasing interest and strengthened ties with the East.

How do Japan and the Japanese people view the coup d’état of July 15, 2016? 

I was here in Ankara on July 15, and what impressed me most that day was the courage shown by the Turkish people in protecting their democracy, and their willingness to stand up against tanks and gunfire. This is something we Japanese respect very deeply, and we sympathize fully with the Turkish people. Immediately after the coup attempt, Prime Minister Abe sent a message to President Erdoğan in which he expressed his strong support for democracy in Turkey, and after the Referendum in April this year, the Presidential office in Turkey stated that Prime Minister Abe had been the first state leader to send his special envoy to convey a message to the President. This shows the strength of our ties and the confidence we have in our relationship with Turkey.

These challenging circumstances had little effect on our economic relations. Official data shows that Japan was the 13th largest contributor of Foreign Direct Investment (FDI) to Turkey in 2015, but had moved up to the 9th position in 2016 and was the largest among all Asian countries. This shows Japan’s continued commitment to doing business with Turkey and has made our bonds even stronger. That said, the number of tourists visiting Turkey from Japan declined in 2016, although figures for 2017 are showing signs of an increase. This continuous business commitment have made our bonds even stronger.

TURKEY IS A SHOWROOM FOR TOYOTA 
What is the current situation of our bilateral economic relations? 

They have never been better. Besides manufacturing, new areas have opened up for Japanese businesses in the food, medical and finance sectors. We now have Tokyo-Mitsubishi UFJ, a commercial Japanese bank, operating in Turkey, and this is crucial for Japanese businesses since having a Japanese bank in Turkey makes trading a lot easier. 

Figures for 2015 show a total trade volume that exceeds 3.6 billion USD, but Turkey and Japan still have ample room for growth. The total Japanese FDI to Turkey between 2002 and 2015 topped 1.52 billion USD. 

Important infrastructure projects in Turkey, such as Marmaray, the Haliç Bridge, the Hasan Uğurlu Dam, the Altınkaya Dam and the Second Bosphorus Bridge were all financed with loans provided by the Japanese International Cooperation Agency (JICA). 

Furthermore, last year, Toyota introduced to the world market a state-of-the-art hybrid SUV called the C-HR, which is being manufactured only in Turkey and Japan. Why do you think Toyota is manufacturing the C-HR in Turkey, despite having so many large factories around the world? For Toyota, Turkey is now a staging post, and it has strong confidence in Turkish craftsmanship and the quality of its workforce. This model is being sold and exported all over the world, and not just by Toyota, but by Toyota Turkey! 

Another important development has been the arrival in Istanbul of a number of Japanese media houses from the surrounding countries. Cairo has long been the base of Japanese journalists in the Middle East, but now Istanbul is becoming a logistically more convenient location. This new phenomenon shows that Turkey is not only attracting manufacturing businesses, but also the information sector.

What other sectors is Japan willing to explore in Turkey? 

Of course, energy! Turkey and Japan have already signed a deal for the Sinop Nuclear Power Plant and we are working together on this project. Japan has the most energy-efficient technologies in the world, having suffered two oil crises in the past that forced us to reduce our energy consumption and maximize energy efficiency. We are happy to share these technologies with Turkey. 

Healthcare is another promising sector that we are exploring, and we are currently involved in the Public-Private-Partnership hospital model (PPP), a government project aimed at improving, modernizing and expanding the hospital infrastructure all over Turkey. We are providing very high standards of medical equipment and diagnostic services in cooperation with our Turkish partners. 

Toyo Kohan, a leading Japanese steel manufacturer, is building a steel factory in Osmaniye with a total investment value that is second only to the Toyota factory, and the factory is completed and operational. This is important, since Turkey imports a huge amount of steel from overseas, and this factory will improve Turkey’s current account deficit by producing good quality steel domestically, bringing savings in Turkish foreign currency reserves.

SELLING SIMIT IS A GOOD IDEA 
What about Turkish companies or entrepreneurs who may be interested in the Japanese market? What can you tell about opportunities and incentives on offer, and about the Japanese market itself? 

We have six fields that we have earmarked as priority areas: environment/energy, medicine/life sciences, tourism, the service sector, ICT and manufacturing/infrastructure. Given the rapid growth of Turkish businesses in many fields, I believe there is a great deal of potential for Turkish investors. 

Last April, it was reported in the Turkish press that Vestel had announced that they had launched acquisition negotiations with Toshiba for Toshiba’s television business. This is clear evidence of the already strong position of Turkish companies in the Japanese market. 

The retail food sector may also be ripe for investment in Japan. For instance, selling simit might be a great idea, and in Japan, it is very fashionable to eat döner kebap, especially among young people. Simit in particular may enjoy the same popularity in Japan while promoting Turkish cuisine. 

While doing business in Japan, you can enjoy the safety in our country and the security of the business environment, while our strong ICT sector guarantees digital security. Most importantly, the fact that Japanese people are open-minded and open to new cultures makes doing business even easier.

I would like to make two key points here. First, Japan has the second largest number of Nobel Prize winners since 2001, after the United States, which is indicative of Japan’s interest in research and development (R&D) and the development of new technologies. Second, Japan is again in second place after the United States in terms of patent applications, with 45,000 recorded in 2016. When you come to Japan as an investor, you can make use of this very sophisticated bank of science, technology, R&D, environment and ICT. So, we say to you “Hoş geldiniz”.

NATIONAL STRATEGIC SPECIAL ZONES 
What does Japan do to attract foreign direct investment? 

The Japanese government provides a number of benefits to importers and investors, including tax incentives, loan guarantees and low-cost loans. Furthermore, special regulatory measures and tax arrangements (corporate income tax), and financial/monetary support can be applied for in six particular regions that have been defined as “National Strategic Special Zones” as part of the country’s structural reforms. One of these zones, Okinawa, offers several financial incentives to encourage investments on the Okinawa Islands, which offer good access to the broader Asian market, and now local municipalities in Japan are also able to offer incentives. The visa requirement for short visits has been abolished, while those who want to stay for longer periods can take advantage of our fast-track application procedures with reduced requirements. The Japan External Trade Organization (JETRO) assists foreign companies and investors by providing information on the investment environments of regions across Japan and helps them arrange and carry out visits to these regions.

The sixth round of the Free Trade Agreement (FTA) negotiations started on January 23. How are things progressing? 

The negotiations have been very fruitful, and we are looking forward to concluding them as soon as possible for the benefit of both countries. This is not just about reducing customs duties or increasing market access; we call it an Economic Partnership Agreement (EPA) rather than FTA, since the term FTA is used for customs unions where only market access is adjusted. EPA is broader than FTA in scope, being about the facilitation of services, the protection of intellectual property rights and the promotion of business. Our discussions are touching on the investment environment, access to services and government procurements, and dealing with problems or disputes that may arise between the two countries, and we are establishing a committee to deal with such eventualities. 

43 PROJECTS IN TURKEY… 
Turkey is one of the countries named in the Japanese Grant Assistance for Grassroots Human Security Project (GGP). What have Turkey and Japan achieved so far, and what is the aim of the program? 

Japan is running this program in around 140 countries, where it is providing support to the economically disadvantaged and those in need of assistance. In Turkey, we have so far addressed 43 cases in different regions, mostly in small towns and villages. The assistance we have provided has included the renovation of schools to provide children with a better environment for education and providing women with vocational training giving them a profession or a skill that will enable them to contribute to the local economy. We have also provided equipment and vehicles to deal with emergency situations, such as traffic accidents, earthquakes or other disasters.

What is the current situation of the Space Program in which Turkey and Japan are cooperating? 
Japanese Experiment Module “Kibo”

JAXA (Japan Aerospace Exploration Agency) and Turkey’s Ministry of Transport, Maritime and Communications signed a Cooperation Arrangement back in September 2016 concerning the utilization of the Japanese Experiment Module “Kibo” (meaning “hope” in Japanese) on the International Space Station (ISS). This agreement opened the doors for the deployment of Turkish-built electronic components that have been undergoing testing on the Kibo Module on the ISS since April 13. We would like to strengthen our cooperation in this field, having already supported the establishment of the Turkish Space Agency and having assisted in the development of human resources in Turkey through workshops.

What are Turkey and Japan doing in the field of education? 

We are delighted that Turkey has the largest number of people learning the Japanese language in the region, which we attribute to the attraction of young people to Japan’s high technology, pop culture and animation. Every year, the Japanese Government (MEXT) scholarship for Turkish students sees 10 postgraduate scholarship students being sent from Turkey to Japan to study in various fields, from sciences to the arts and humanities. 

WE HOPE THE UNIVERSITY WILL OPEN IN 2018 
What is the status of the Science and Technology University project that Japan and Turkey are working together to establish? 

Turkey is known for its strong engineering sector, and so we are trying to promote cooperation in science and technology, focusing particularly on the Turkish Japanese University (TJU) project. An agreement between the two countries has already been approved by Turkish Parliament last year, and after the Turkish government approves the law, works will begin on the construction of facilities, the drawing up of a curriculum, the recruitment of staff, etc. A plot of land has been secured for the project in the Asian side of Istanbul, and we expect the University to be operational by autumn 2018.

VISA FREE TRAVEL
Reiko – Hiroshi Oka
Turkish people are very interested in Japan, but some of their love comes before their knowledge, and I would like to see Turkish people fall in love with Japan for realistic reasons. I hope to see more Turkish people visit, experience and learn about Japan. Turkish tourists don’t need visas for visits of up to 90 days, and staying in Japan is today more affordable than ever, allowing you to enjoy the Japanese cuisine, culture and country at a reasonable cost.