Mr. Hiroshi Yokokawa

I cannot deny the adverse effect that Japan's poor economic performance has , whether on trade or investment , said Hiroshi Yokokawa , executive vice-president with the Japan External Trade Organization.

It's very tough right now and the prospects are also severe , Mr. Yokokawa said during a stopover in Toronto with a group of Japanese information technology executives.

Japanese businesses are desperate to find ways to survive this difficult period , which may last a very long time..

The week-long mission is designed to drum up interest among Canadian IT companies in the vast Japanese market , which despite a prolonged slump , still holds considerable potential.The Japanese IT sector is about three times the size of the automotive industry and had been growing rapidly even through the severe economic downturn of the 1990s until it , too , hit a wall this year.

The result has been plunging profits and massive job cuts.
...
Many companies are still in the tunnel , Mr. Yokokawa said through an interpreter.But they know they will see the light . . . sooner or later.They want to be ready to run when they see it..

One sign of how the dire economic situation has affected Japanese thinking is the attitude toward foreign takeovers.

I think it is natural for the targeted companies to feel resistance to such a move , Mr. Yokokawa said.But when we look at what Japanese society can absorb or tolerate , Japan has changed rapidly in the past five or six years..

Noting the potential positive economic impact of such fusion , he added : We Japanese , in general , have come to view such investment as a good thing..

Mr. Yokokawa acknowledged that because of the global downturn , Japan's own economic miseries and the Sept. 11 terrorist attacks , We were a bit apprehensive about this mission , to be honest with you.However , we are very , very happy that the enthusiasm of the Japanese businessmen overrode our worry and anxiety..

Earlier, Hiroshi Yokokawa, executive vice president of Japan External Trade Organization (JETRO), said 41 percent of Japan's overseas investment was in North America, followed by Europe (23 percent), Asia (17 percent) and the Middle East (0.8 percent).He said the total Japanese investment in Saudi Arabia and the rest of the Middle East stood at $19 million in 2000 - just 0.04 percent of direct Japanese overseas investment.

The reason for the poor showing of the Middle East in terms of attracting Japanese investment was the restrictive economic environment in the region.Now that the Saudi economy was being liberalized, JETRO hoped that the flow of information on Saudi Arabia through its Riyadh office would help increase investment in the Kingdom by Japanese firms.

Yokokawa said another factor that should engage the Kingdom's decision-makers was that Japanese companies base their investment decision on the performance of other Japanese companies already operating in the Kingdom.

"I would sincerely ask Saudi Arabia to continue providing support to these companies for running their business smoothly," he added.

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Hiroshi Yokokawa is Executive Vice President of the Japan External Trade Organization.He can be contacted through webmaster@jetro.go.jp.

Hiroshi Yokokawa is the Executive Vice President of the Japan External Trade Organization (JETRO).This article is adapted from a presentation on ‘Mechanisms for TPO cooperation' made by Mr. Yokokawa at the third World Conference of Trade Promotion Organizations (Marrakech, 25-27 October 2000).Mr. Yokokawa can be contacted at yokokawahiroshi@jetro.go.jp

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Hiroshi Yokokawa, Executive Vice President, Japan External Trade Organization (JETRO) E-mail: webmaster@jetro.go.jp

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