Tsuneo Tanaka

Tsuneo Tanaka, managing director of JETRO Malaysia
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,,The biggest advantages for Japanese companies operating here are that most Malaysians speak English, and there is political stability and a geographic advantage,'' says Tsuneo Tanaka, managing director of the Japan External Trade Organization.

In sounding out the potential, Tsuneo Tanaka, the managing director of the Japan External Trade Organisation (Jetro), said that local parts makers however, have to upgrade quality and improve delivery.

He said a team of Japanese experts, who visited Malaysia recently to evaluate auto parts makers, find local firms still have quite a distance to go to effectively compete in the international market.

But the good news was that several parts makers have what it takes to penetrate global markets, with at least two now in "serious discussions" to supply parts to Japanese firms following matchmaking sessions, he said.

"Some Malaysian companies were requested to submit quotations, some even have settled prices but negotiations have not been finalised," he told Bernama here Friday.

The companies were mainly involved in manufacturing auto accessories and components.

"If they build on current capacities, then there is a good chance for them to compete internationally," Tanaka said.

With Japan's technical assistance, Japanese car firms operating in Malaysia could also source better quality parts locally instead of importing them from other countries or Japan.

He said local firms should also endeavour to penetrate the single market under the Asean Free Trade Area where they could also supply to Japanese firms operating elsewhere in Southeast Asia, such as Thailand.

All this has been made possible with the signing of the wide-ranging Economic Partnership Agreement (EPA) between Malaysia and Japan.
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Tanaka said EPA also culminated in Japan helping to set up an auto skills centre at the Advanced Training Centre (Adtec) in Shah Alam, aimed at fostering world class technologists.

It also offers training courses to raise the competency of auto industry workers from the novice to top-class levels, as it was found that the existing system for the auto industry in Malaysia was inadequate.

Tanaka also said the Japanese experts found that only 10 percent of the estimated 300 parts makers are internationally viable.

The rest were not so competitive in terms of pricing and quality, which means they have to upgrade as well as improve quality and delivery in order to survive in the international market, he said. - Bernama

In sounding out the potential, Tsuneo Tanaka, the managing director of the Japan External Trade Organisation (Jetro), said that local parts makers however, have to upgrade quality and improve delivery.

He said a team of Japanese experts, who visited Malaysia recently to evaluate auto parts makers, find local firms still have quite a distance to go to effectively compete in the international market.

But the good news was that several parts makers have what it takes to penetrate global markets, with at least two now in "serious discussions" to supply parts to Japanese firms following matchmaking sessions, he said.

"Some Malaysian companies were requested to submit quotations, some even have settled prices but negotiations have not been finalised," he told Bernama here Friday.

The companies were mainly involved in manufacturing auto accessories such as rear view mirrors, side mirrors and wire harnesses.

"If they build on current capacities, then there is a good chance for them to compete internationally," Tanaka said.

With Japan's technical assistance, Japanese car firms operating in Malaysia could also source better quality parts locally instead of importing them from other countries or Japan.

He said local firms should also endeavour to penetrate the single market under the Asean Free Trade Area where they could also supply to Japanese firms operating elsewhere in Southeast Asia, such as Thailand.

All this has been made possible with the signing of the wide-ranging Economic Partnership Agreement (EPA) between Malaysia and Japan.
...
Tanaka said EPA also culminated in Japan helping to set up an auto skills centre at the Advanced Training Centre (Adtec) in Shah Alam, aimed at fostering world class technologists.

It also offers training courses to raise the competency of auto industry workers from the novice to top-class levels, as it was found that the existing system for the auto industry in Malaysia was inadequate.

Tanaka also said the Japanese experts found that only 10 percent of the estimated 300 parts makers are internationally viable.

The rest were not so competitive in terms of pricing and quality, which means they have to upgrade as well as improve quality and delivery in order to survive in the international market, he said.

In sounding out the potential, Tsuneo Tanaka, the managing director of the Japan External Trade Organisation (Jetro), said that local parts makers, however, have to upgrade quality and improve delivery.

He said a team of Japanese experts, who visited Malaysia recently to evaluate auto parts makers, find local firms still have quite a distance to go to effectively compete in the international market.

But the good news was that several parts makers have what it takes to penetrate global markets, with at least two now in "serious discussions" to supply parts to Japanese firms following matchmaking sessions, he said.

"Some Malaysian companies were requested to submit quotations, some even have settled prices but negotiations have not been finalised," he told Bernama in Kuala Lumpur yesterday.

The companies were mainly involved in manufacturing auto accessories and components.

"If they build on current capacities, then there is a good chance for them to compete internationally," Tanaka said.

With Japan's technical assistance, Japanese car firms operating in Malaysia could also source better quality parts locally instead of importing them from other countries or Japan.

He said local firms should also endeavour to penetrate the single market under the Asean Free Trade Area where they could also supply to Japanse firms operating elsewhere in Southeast Asia, such as Thailand.

All this has been made possible with the signing of the wide-ranging Economic Partnership Agreement (EPA) between Malaysia and Japan.
...
Tanaka said EPA also culminated in Japan helping to set up an auto skills centre at the Advanced Training Centre in Shah Alam, aimed at fostering world class technologists.

It also offers training courses to raise the competency of auto industry workers from the novice to top-class levels, as it was found that the existing system for the auto industry in Malaysia was inadequate.

Tanaka also said the Japanese experts found that only 10 percent of the estimated 300 parts makers are internationally viable. - Bernama

Tsuneo Tanaka, managing director of the Japan External Trade Organisation's Kuala Lumpur office, said some 1,300 Japanese companies have already invested in Malaysia since the 1980s.

"All major companies have already invested in Malaysia.Looking back at the last five or six years, the (local) market is saturated.It is difficult to have new Japanese FDI increasing as rapidly as before," Tanaka said in an interview in Kuala Lumpur.

However, he said Japanese companies have continued to expand their existing business operations in Malaysia and there has been significant re-investment in their expansion programmes.

"Last year, there was a healthy increase in Japanese FDI to Malaysia compared with the year before, increasing by 20 to 30 per cent," he added.

Unless there are new business opportunities, it could be tough to attract Japanese investors to Malaysia, which was their favourite investment destination even before the launch of the Look East Policy in 1981.

While Malaysia has become an expensive production base due to rising labour and land costs, Vietnam is now turning into an attractive port of call for Japanese businessmen.

"Japanese companies are quite interested in the potential of Vietnam and this is quite understandable because up to now they do not have much presence in Vietnam," Tanaka explained.

Vietnam, he said, was developing quite rapidly and this meant that there was potential in increasing business opportunities there.

"As far as the investment environment is concerned, especially in terms of labour costs, currently Malaysia has become a middle developed country.

Naturally its labour costs are less competitive compared to Vietnam and other Asean countries," he said.

Tanaka said labour-intensive companies will naturally opt for cheaper production markets like Vietnam. - Bernama

Tsuneo Tanaka, managing director of the Jetro Kuala Lumpur office, said responses came from 796 Japanese firms with international operations in the manufacturing, trade and wholesale/retail sectors.

They were polled toward the end of last year and comparisons

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were made on their responses in 2004.

Tanaka said sentiment among Japanese firms for starting or expanding operations in China improved despite the dip in bilateral relations between China and Japan in April 2005.

Jetro Kuala Lumpur managing director Tsuneo Tanaka said there are ongoing efforts to match-make Malaysian and Japanese companies involved in biotechnology.

Jetro officials recently met Prime Minister Datuk Seri Abdullah Ahmad Badawi and have expressed support for Malaysia in participating in biotech exhibitions and forums in Japan as well as in supplying information on the industry.

"We have to increase the awareness of companies in Japan on the potential of the biotechnology sector in Malaysia," Tanaka said in an interview with Business Times.

Tsuneo Tanaka, managing director of the Japan External Trade Organisation's Kuala Lumpur office, said some 1,300 Japanese companies had already invested in Malaysia since the 1980s.

"All major companies have already invested in Malaysia.Looking back at the last five or six years, the (local) market has saturated.It is difficult to have new Japanese FDIs increasing as rapidly as before," Tanaka told Bernama in an interview here.

However, he said Japanese companies have continued to expand their existing business operations in Malaysia and there had been significant re-investment in their expansion programmes.

"Last year, there was a healthy increase in Japanese FDIs to Malaysia compared to the year before, increasing by 20 to 30 percent," he added.

Unless there are new business opportunities, it could be tough to attract Japanese investors to Malaysia, which was seen as their favourite investment destination even before the launch of the Look East Policy in 1981.

While Malaysia has become an expensive production base due to rising labour and land costs, Vietnam is now turning into an attractive port of call for Japanese businessmen.

"Japanese companies are quite interested in the potential of Vietnam and this is quite understandable because up to now they do not have much presence in Vietnam," Tanaka explained.

Vietnam, he said, was developing quite rapidly and this meant that there was potential in increasing business opportunities there.

"As far as the investment environment is concerned, especially in terms of labour costs, currently Malaysia has become a middle developed country.Naturally its labour costs are less competitive compared to Vietnam and other Asean countries," he said.

Tanaka said labour-intensive companies would naturally opt for cheaper production markets like Vietnam.

Tsuneo Tanaka, managing director of the Jetro Kuala Lumpur office, said although Malaysian autoparts makers had been in existence for more than 20 years, they must gear up to compete with established producers.

"Malaysian automobiles as well as component parts will face stiff international competition.To respond effectively, Malaysian industries must strengthen their international competitiveness.

"Unless they upgrade their competitiveness, it will be quite difficult to cope with the current trend of liberalisation in the auto market," Tanaka told Bernama in an interview.

Of the 300 parts manufacturers in Malaysia, only a handful had the capacity to compete in foreign markets, he said.

Given this grim picture, Tanaka said there was an urgent need to restructure the sector to make it more competitive.
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Citing Japan as an example, Tanaka said Japanese autoparts producers were once heavily protected by the government when they started out, but were later forced to raise their product quality to counter stiff foreign competition.

"Without training capabilities, it is difficult to learn state-of-the-art technology in the automobile industry," Tsuneo Tanaka, managing director of the Japan External Trade Organisation's (JETRO) Kuala Lumpur office, told Bernama in an interview here.

"The overall knowledge and skill level of technologists working in the Malaysian automobile industry have yet to reach the competitive level in the world market.

"The Malaysian government itself recognised this and had requested the Japanese government to assist in this field," he said.

The primary objective of the Skills Training Centre is to foster world-class technologists while offering introductory to advanced training courses to raise the competency of auto industry workers from the novice to top-class levels at the same time.

To be located at Shah Alam, the training centre, mainly for leaders in the local automotive industry, will also act as a model institute for existing public vocational training schools in Malaysia.

Tanaka said a preliminary study team from Japan which was despatched to Malaysia earlier found that the existing training system was inadequate.
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"In the following two years, training courses will be progressively launched and the centre will spread the state-of-the-art training know-how to more automotive industry workers later, Tanaka said.