Doing business in Japan

• Japan's Economy
• Attractive Japanese sectors: Automotive Parts, Retail, ICT, Biotechnology, Medical Care and the environment
• Economic Profiles of Japan's regions
• Doing Business in Tokyo
• foreign direct investment in Japan
• How to Set up Business in Japan
• Success stories of FDI

Available Languages :

Learning Unit Summary

Japan: The world's second-largest market.

Japanese consumers are early adopters and move fast to stay on the cutting edge of the latest technologies. Most companies in Japan listen carefully to consumer demands when developing new products, as many products in common use around the world have originated in Japan. Japan thus makes an ideal test market for new products and services.

Japan's main export goods are cars, electronic devices and computers. Most important single trade partner is the USA which imports more than one quarter of all Japanese exports. Other major export countries are Taiwan, Hong Kong, South Korea, China and Singapore. The most important import goods are raw materials such as oil, foodstuffs, and wood. Major suppliers are the USA, China, Indonesia, South Korea, and Australia.

Japanese companies of all sizes (from small ventures to major multinationals) produce unique and innovative products and services. Japan's strong technology-based industries offer a multitude of opportunities for foreign companies looking to partner with Japanese firms at all stages.

Partnerships with Japanese companies enable foreign-affiliated companies to leverage their respective talents, which is vital to remaining globally competitive. Furthermore, Japanese companies emphasize enhancing product development and manufacturing efficiency, making Japan the ideal arena for innovation.

Access to new Asian markets. East Asia continues to grow at an astonishing pace and economic integration in the region continues to increase. In 1980, East Asia's share of global GDP stood at 17%. In 2005, the figure stands at 29%, due to the robust economic growth of East Asia, where Japan continues to have a strong presence. East Asia is moving closer towards the establishment of an East Asian free business zone, as governments in the region work to conclude free trade and economic partnership agreements. This will help further trade in the region.

Japan's attractiveness as an investment destination is increasing, as the government works to improve the business environment. Surveys of foreign companies in Japan conducted by JETRO have shown that impediments to investing in Japan — high business costs, the exclusiveness and tradition-bound nature of commercial transactions, complexity of administrative procedures — have been significantly reduced compared to 10 years ago, and the environment for expansion of foreign companies into Japan is steadily improving.

Japan has the world's fastest and most cost-effective broadband environment and is rapidly moving towards becoming a true ubiquitous society. Each of Japan's regions has an economic scale similar to or even larger than some countries.

Tokyo is the center of politics, economy and culture in Japan. It has the largest number of consumers among the big cities in Japan, at 12 million. A variety of industries and headquarters of major companies are concentrated to develop active economic performances. There are over 720,000 business entities in Tokyo, more than 90 percent of which are medium and small sized enterprises. About 70 percent of approx. 8.37 million employees are working at medium and small companies whose advanced technology and high productivity greatly contribute to the development and dynamism of Tokyo. Moreover, some 70 percent of foreign companies active in Japan are concentrated in Tokyo, while the increasing number of joint research projects between companies and universities and other partners is leading to the cultivation of industry-university cooperation networks. In this way, increasingly diversified resources are coming to be pooled in Tokyo.