The Canadian Summer 2016 by CCCJ The Canadian

The Canadian A QUARTERLY MAGAZINE OF THE CANADIAN CHAMBER OF COMMERCE IN JAPAN | SUMMER 2016 | VOLUME 16 | ISSUE 03

THE TRANS-PACIFIC PARTNERSHIP IS BY FAR THE LARGEST DEAL IN PLAY*

Mackenzie Clugston | Impeccable Credentials * AMBASSADOR MACKENZIE CLUGSTON ON THE MOST CHALLENGING ASSIGNMENT FOR CANADAâ&#x20AC;&#x2122;S MISSION TO JAPAN

The Canadian

CONTENTS

SUMMER 2016 VOLUME 16 ISSUE 03

Canadian Chamber of Commerce in Japan La Chambre de commerce du Canada au Japon

The Canadian Chamber of Commerce in Japan is a private sector, not-for-profit business organization that has, since 1975, promoted the development of commerce between Canada and Japan.

Chairman Ron Haigh Toyota Motor Corporation ronhaigh@icloud.com Vice-Chairman Eric DeGroot Icynene Asia Pacific Ltd. ed.groot@icynene-ap.com Operations Associate Renaud Deronzier renaud.deronzier@cccj.or.jp 7F Parkside Sepia 3-13-10 Nishi-Azabu Minato-ku, Tokyo Japan 106-0031

Canadian Prime Minister JustinTrudeau and Japanese Prime Minister Shinzo Abe address the media about their bilateral meting in Tokyo. May 24, 2016.

Tel: +81 (0)3 5775-9500 Fax: +81 (0)3 5775-9507 www.cccj.or.jp LinkedIn: http://bit.ly/cccjapon Facebook: www.facebook.com/cccjapon Twitter: @cccjapon YouTube: cccjapon

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GPlusMedia GPlus Media K.K. 4F Higashi-Azabu IS Bldg., 1-8-1 Higashi-Azabu Minato-ku, Tokyo, Japan 106-0044 Editor-in-Chief: Jeff W. Richards [ jeff@gplusmedia.com] Art Director: Niklas Wendt Designer: David Jaskiewicz Contributors: Joseph Caron, Adam German, Alfie Goodrich, Ron Haigh, Robert Sakai-Irvine, Neil van Wouw For advertising inquiries: ads@gplusmedia.com Tel: +81 (0)3 5403-7781, Fax: +81 (0)3 5403-2775 www.gplusmedia.com

Get The Canadian in digital Get it for free at bit.ly/thecanadian

Chairman’s Perspective 06 Mission Canada * Special Photo Report 012 Chamber Insights 014 Cover Story 018 Member Profile 020 Special Report 022 Asia Pacific View 05

Housing Trends 024 / Timeline 026 Calendar 028 / New Members 031 / Business Directory 032 Chamber Voices 034 / Retrography 035

On the cover: Ambassador of Canada to Japan, the Honourable Mackenzie Clugston, as photographed by Alfie Goodrich in the great hall of Marler House, the ambassador’s official residence in Tokyo. The Canadian is the official publication of the Canadian Chamber of Commerce in Japan (CCCJ), published quarterly in Tokyo. The views and opinions expressed herein are solely the opinions and views of their authors and do not necessarily reflect those of the CCCJ or GPlusMedia. © 2016 GPlusMedia Co. Ltd. All rights reserved.

The Canadian / 03

Chairman’s Perspective

RON HAIGH

CCCJ CHAIRMAN

NEW FACES & LONGTIME FRIENDS This May, I was privileged to sit in on a meeting between Prime Minister Trudeau and several senior Japanese executives. Toward the end of the meeting, the prime minister was asked if he had any advice for someone like himself who has had to fill the shoes of a very successful father in the same business. The question, of course, refers to Pierre Trudeau, the renowned fifteenth prime minister of Canada who served from 1968-1979 and 1980-1984. The question also underlines the different roles that certain children must fulfill from giving support and encouragement to a successful parent to actually leading by oneself. The younger Trudeau gave a wise answer. He said that when you take over your father’s business you will face a very severe evaluation and receive praise only when you do something like your father did before you. However, he added that to be a great leader it’s important to bring new values and methods that are suitable for the time. Prime Minister Trudeau is doing exactly that with a trip to Japan and other Asian countries so soon into his term as well as his policy emphasis on innovation, the environment plus a large amount of infrastructure and social investment to enhance the global competitiveness of Canadian industry. Almost at the same time that Japan was getting its first look at a welcome new face on the global stage, it was having to say goodbye to a longtime friend when Ambassador Mackenzie Clugston retired from the foreign service. As this issue of The Canadian points out, he served five postings in Japan over three decades. He always did so with great dignity and grace, a deep knowledge of Japanese culture, an uncanny ability to read people and a great sense of humor. For many years he has advised and supported the cccj—and our organization will deeply miss his guidance. The good news is he will be residing in Japan for a few years more and we hope that he can continue to participate in chamber activities as his schedule permits. Finally, speaking of new faces, the board of governors has been busy rebooting the cccj office with new executives and also preparing for the annual general meeting that will take place later this summer. If all goes according to plan, we will soon benefit from the energy and insight of a new team that will allow the cccj to grow and improve our operations significantly. Please have a safe and enjoyable summer!

The Canadian / 05

Prime Minister Justin Trudeau and Prime Minister Shinzo Abe inspect the guard during a welcome ceremony at the Kanteiin Tokyo. May 24, 2016.

Mission Canada

PHOTO REPORT

Prime Minister Trudeau Touches Down in Japan

ON HIS FIRST OFFICIAL VISIT, THE PM ATTENDS THE G7 SUMMIT IN MIE AND PROMOTES IN TOKYO The CANADA Canadian / 07

Mission Canada

PHOTO REPORT

Improving trade relations with Japan is a top priority of our government

”

— Prime Minister Justin Trudeau

From May 23 to May 27 this year, the Right Honourable Justin Trudeau made his first official visit to Japan. During his time here, the prime minister attended the 42nd G7 summit hosted by Prime Minister Shinzo Abe in Ise-Shima and also made official rounds in Tokyo, which included an audience with the emperor and empress of Japan as well as another meeting with Prime Minister Abe. Prime Minister Trudeau is escorted across the Ujibashi bridge by a Jingu priest. May 26, 2016

Prime Minister Justin Trudeau and Mrs. Sophie Grégoire Trudeau disembark RCAF01 in Tokyo. May 23, 2016.

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Mission Canada

Prime Minister Trudeau and Sophie GrĂŠgoire Trudeau have an audience with their Majesties the Emperor Akihito and Empress Michiko of Japan.

Prime Minister Trudeau and Sophie GrĂŠgoire Trudeau visit the Meiji Shrine in Tokyo. May 24, 2016.

The Canadian / 09

Mission Canada

Prime Minister Trudeau is welcomed to Ise Jingu by Prime Minister Shinzo Abe. May 26, 2016.

010 / The Canadian

Mission Canada

Prime Minister Trudeau is greeted by ASIMO at Honda headquarters prior to his meeting with Takahiro Hachigo, the president of Honda Motor Co.

Prime Minister Trudeau meets with Toyota Motor Corporation President Akio Toyoda.

The Canadian / 011

Chamber Insights

OPEN ARMS

BY RON HAIGH â&#x20AC;¢ ILLUSTRATION DAVID JASKIEWICZ

HYOGO PREFECTURE ENTICES FOREIGN COMPANIES AN OPPORTUNITY FOR CANADIANS TO LEARN AND INVEST

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Chamber Insights Ron Haigh is the chairman of the Canadian Chamber of Commerce in Japan and Toyota Motor Corporation project manager for the Americas group.

to decide on and use consistent branding that epitimizes and distinguishes Hyogo-Kobe from other investment locations.

INTERNATIONAL ECONOMIC AREA

Hyogo has many freatures that make it an attractive spot for fdi: • It’s a transportation and logistics hub (less than three hours from Tokyo by bullet train). • It has one domestic and two international airports (within an hour of Kobe city). • It contains the longest and most developed highway system in the country. • It has a globally prominent container seaport.

HYOGO HARIMA SCIENCE GARDEN CITY MINAMI ASHIYAHAMA ZONE SANNOMIYA ZONE

HIMEJI STATION ZONE ABOSHI ZONE

HIROHATA ZONE

KOBE

HAT KOBE ZONE

Image credit: David Jaskiewicz PORT ISLAND PHASE I & II ZONE

Much of the world economy seems to float in a sea of stagnation, subject at best to only irregular spurts of growth. In response, the Japanese government launched the Japan Revitalization Strategy in an effort to encourage its economic development. A key part of this program is a concerted effort to increase foreign direct investment (fdi) from beyond the country’s borders. Hyogo Prefecture is a good example of an investment location taking the initiative to enhance fdi. It uses promotional activities by the governor and offers incentives to foreign and foreign-affiliated companies to help minimize the risks involved—and maximize profits. In March, representatives from overseas companies, the cccj and other foreign chambers of commerce in Japan met with Governor Toshizo Ido at the Hyogo Global Business Summit to exchange opinions and discuss how to make the region more attractive to businesses. The prefecture has been hosting this event annually since 1998 as one of many initiatives to increase fdi. Other enterprises include the successful lobbying for an extension of foreign residential status in Japan from three to five years and the granting of

ROKKO ISLAND ZONE

special location privileges for foreign companies in the region. This year, one of the biggest topics

The region offers metropolitan convenience without the hyper-urban trappings of Tokyo or Osaka

”

was how to better market the HyogoKobe region and advertise more effectively. A key suggestion by many of the participants was for the coordinators

The Hyogo and Kobe region also provides many resources for business, including world-class research complexes like Riken’s Spring-8 supercomputer and the Center for Developmental Biology. It also supports foreign companies active in any of the region’s 10 international economic areas with a 1/3 exemption on the corporate enterprise tax as well as subsidies for ofﬁce rent, new employees and establishment costs. To effectively compete against other world-class investment destinations, summit participants stressed the importance of focusing on a distinct message. As the region enjoys a well-developed social infrastructure, many health industry-related companies and metropolitan convenience without the hyper-urban trappings of Tokyo or Osaka—trafﬁc jams and overcrowded trains are rarely an issue—“Best Living Environment for Work-Life Balance” was suggested as a potential focus for communication with foreign investors. Hyogo is an excellent environment for Canadian companies looking to branch out into Japanese and Asian markets. With its unique message, strategic multi-year outreach plan and expanded collaboration with foreign stakeholders; the region’s fdi incentives are a boon to Canadian companies to invest in Japan—and perhaps a great model for attracting the same to Canada.

The Canadian / 013

Cover Story

MACKENZIE CLUGSTON

BY JEFF W. RICHARDS â&#x20AC;˘ PHOTOS ALFIE GOODRICH

Pushing Forward AS HE MOVES ON TO NEW CHALLENGES, THE CANADIAN AMBASSADOR DISCUSSES DIPLOMACY AND TRADE RELATIONS The Ambassador of Canada to Japan Mackenzie Clugston will be leaving the foreign service after serving five key posts at the Canadian missions in Tokyo and Osaka in a diplomatic career that began when he joined the Department of Foreign Affairs and International Trade in 1982. The ambassador, who was born in Kobe and is fluent in Japanese, plans to reside in Kansai area for the foreseeable future.

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What do you feel was the most challenging (and satisfying) assignment as the Canadian Ambassador to Japan? Ambassador Clugston: I would have to say it was the work that went into advancing trade negotiations between Canada and Japan. When I arrived in late 2012, the Canada-Japan economic partnership agreement (epa) negotiations were underway. Roughly six months later, we began engaging on the Trans-Pacific Partnership (tpp) at

a time when both countries decided it was in their interest to join. The tpp is by far the largest deal in play, but the entry negotiations were very tough between our two countriesâ&#x20AC;&#x201D;particularly regarding the auto sector. While we were all waiting for the tpp to be completed and ratified, the Australians successfully completed their epa with Japan. Consequently, the Australians have enjoyed an advantage that has allowed them to make inroads in many sectors

Cover Story

MACKENZIE CLUGSTON of importance to Canada. Despite the current deadlock on the tpp in the u.s., or perhaps because of it, there are ample reasons to push forward with a CanadaJapan epa. I don’t believe that Japan yet sees the strategic merit of concluding an epa with Canada in the absence of the tpp. But, there can be little doubt an EPA with Canada that encompasses energy as well as food security issues could be an enormous boost to the bilateral economic relationship while serving as an important incentive to the u.s. to compete the tpp. An epa with Australia may not turn many heads in Congress, but a Japanese epa with Canada— which touches on areas of mutual interest to the u.s.—would be an enormous wake-up call for them. What was your most memorable meeting with a foreign dignitary in your role as ambassador? MC: In the lead up to various discussions between prime ministers Shinzo Abe and Stephen Harper during Harper’s visit to Japan, I had the opportunity to interact with Chief Cabinet Secretary Yoshihide Suga. It’s rare to meet someone quite as cool and shrewd as Suga, who appears capable of managing different issues and players almost as if it was a complex game of chess. The chief cabinet secretary is, in my view, a very impressive individual and one of the keys to the success of the Japanese government in the past four years. What was it like to meet the Emperor of Japan and what are your impressions of the Imperial Family and their continuing legacy? Do they have any connections to Canada and Canadians? MC: To meet the emperor is to come face to face with more than 1,600 years of history. In the presence of Their Imperial Highnesses, you feel a wonderful sense of spiritual calm. He has an unusual ability to focus on the person with whom he is speaking, and to leave the distinct impression that he really cares. There’s an innate goodness and sympathy that shines through the emperor and empresses personalities. While above politics, nonetheless

he’s prepared to express his views on profound issues that affect Japan, such as the current debate surrounding Japan’s constitution. I believe that side of him is very much appreciated by most Japanese. There are many connections to Canada for the Imperial Family. For example, Prince Takamado, a first cousin of Emperor Akihito, studied at Queen’s University from 1978-81. Also, Princess Ayako, daughter of Prince Takamado, studied at Camosun College and later at the University of British Columbia. Further, Princess Takamado is patron of The Canada-Japan Society. In fact, the connections with Canada

My key focus has been on strengthening bilateral trade ties by working on areas of common interest, such as housing, food products and education

”

go back quite far. In 1953, Crown Prince Akihito on route to attend Queen Elizabeth’s coronation, spent his first night overseas sleeping in Victoria as travel by boat was the preferred way to travel at that time. Canada is fortunate to have such links with the Imperial Family. What do you hope to be the defining legacy of your term as Canada’s ambassador to Japan? MC: Over my five different assignments [see sidebar], a key focus has been on strengthening bilateral trade ties by working on areas of common interest, such as housing,

food products and education. An excellent example are the advances that the embassy, in concert with the private sector, has achieved since the 1970s to open up the Japanese housing market to Canadian wood. In Japanese government circles, there was a misconception that wood wasn’t a safe building material. This perception had been shaped— fairly enough—by the large urban conflagrations that Japanese cities suffered on a regular basis over the centuries. Through a long process of discussion, demonstration and sheer effort, Canada was successful in nudging forward the evolution of Japanese building codes to recognize that wood products are comparatively inexpensive, provide superior structural resistance to earthquakes and have excellent fire-retardant qualities. Canada literally built a housing industry in Japan and greatly changed the traditional Japanese wooden house for the better. I’m proud to have been a part of that particular effort. During your time as the Canadian Ambassador to Japan, what are some of the misconceptions about Canada that you’ve heard from Japanese people or misconceptions about Japan that you’ve heard from Canadian people? MC: One of the key problems is that Canada has no regular reporters in Japan and Japan no reporters stationed in Canada. As a result, we’re seeing each other through others’ eyes. This is a problem. There’s a persistent cliché in Japan that Canada is a cold country of great natural beauty. While that may be true to some degree, it simply doesn’t capture the reality that Canada is a modern, technologically advanced country (with one of the highest standards of living in the world), capable of making things like the Canadaarm2 for the International Space Station or Bombardier aircraft. Canada’s rich ethnic and cultural diversity, a source of strength to the country, is also something that some Japanese people have a hard time understanding. This may be because they have been

The Canadian / 015

Cover Story

MACKENZIE CLUGSTON

schooled to think that ethnic and cultural homogeneity are key underpinnings to a harmonious society. As for Canadian misconceptions about Japan, the 2011 earthquake created an enormous amount of sympathy for Japan in Canada and respect for the quiet dignity, perseverance and mutual cooperation with which the Japanese coped with this disaster. This was a breakthrough in terms of perceptions of Japan. However, the stereotypes of Kyoto, geisha, advanced technology and anime still dominate the perception of Canadians with respect to Japan. This is rapidly changing, however, with the growth in Canadian tourism to Japan, up 26 per cent to over 230,000 visitors in 2015. One of the other keys to breaking down misconceptions or stereotypes will be reforming the curricula of our education systems so that we learn some important fundamentals about each other.

Ambassador Clugston’s Tour of Duty in Japan

How many meishi, or business cards, do you think you have given out during your time as ambassador? MC: Easily 5,000 over the last three years. I’ve retained more than 1,800 after sorting through a great deal more. It’s a challenge to remember everyone you meet, but I review the cards I receive and try to match the name to photographs of the individuals. I also try to use unusual kanji in people’s names by which to remember them.

1993-97: Counsellor and Trade Commissioner, Embassy of Canada to Japan

What do you think it would have been like being the Canadian ambassador to Japan in Herbert Marler’s time [see “Retrography,” p.35]? MC: To have been in Japan in the 1930s would have been fascinating. The early Showa period was a time in which the country was making the transition from a struggling democracy to a military dictatorship, and the pressures within the political and military classes must have been enormous. I feel that now is also an interesting and important time for Japan. It has emerged out of the super growth period and is now facing big decisions about what kind of society it will become in the face of serious challenges such as an ageing and declining population, globalization and the environment. What would you say is the most unusual official event you have been asked to attend in Japan in your capacity as Canadian ambassador? MC: There haven’t really been that many unusual or surprising events. I consider carefully what I participate in, understanding that in Japan maintaining reserve and decorum are important for any senior position. One of my first priorities is to uphold the dignity of the office of the ambassador. That is why I would be very hesitant to take part in certain TV shows, for example. What do you see as Japan’s primary challenge going forward? MC: Post-war Japan has evolved into an egalitarian

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1985-87: Second Secretary, Public Affairs, Embassy of Canada to Japan 1987-89: First Secretary, Commercial Division, Embassy of Canada to Japan

2000-2003: Consul General, Consulate of Canada to Osaka 2003-2004: Minister (Commercial), Embassy of Canada to Japan 2004-2006: Deputy Head of Mission, Embassy of Canada to Japan 2012-2016: Ambassador, Embassy of Canada to Japan

society that is both wealthy and possessed of advanced social benefits. However, we’re seeing the stresses imposed on this model by rising national debt, the emergence of greater income inequality and a rapidly ageing population. Most Japanese recognize that this is not sustainable, but the choices going forward will be hard. Japan is also a bureaucratically bound country, and certain sectors—such as banking—are over-regulated. Many observers have been hoping that Prime Minister Abe’s “third arrow” reforms would be well underway by now, opening up the economy to change, but such is not the case. How did you evaluate Prime Minister’s Trudeau’s first official trip to Japan? MC: I was very pleased with the recent trip of the prime minister. He sent a strong message to Japan that this is a country of primary importance to Canada. He’s been able to create a strong relationship with Prime Minister Abe and I suspect that relationship will become the foundation for greater collaboration between Canada and Japan in the coming years. On a personal level, it’s clear that he’s fascinated by the country, its cuisine and its culture. The new Canadian ambassador will be arriving at a good time—and doubtless able to take this relationship to a new level.

CANADIAN CHAMBER OF COMMERCE IN JAPAN CHAMBRE DE COMMERCE DU CANADA AU JAPON

BECOME A MEMBER OF THE CCCJ

Benefits of Membership New and useful business contacts Exposure and promotion Local knowledge expertise Opportunities to participate Weekly Canadian newsletter What You Will Receive When You Join the CCCJ Entry to all events at member rates and exclusive invites to VIP functions Access to joint events sponsored by fellow chambers Special business and government briefings Listing in the annual Membership Directory Subscription to the The Canadian, CCCJâ&#x20AC;&#x2122;s magazine & digital app Periodic bulletins on key issues facing business in Japan Contact Us Email: admin@cccj.or.jp Tel: +81 (0)3 5775-9500 7F Parkside Sepia, 3-13-10 Nishi-Azabu Minato-ku, Tokyo 106-0031 Japan

www.cccj.or.jp

People Are People BUSINESS STRATEGY FOR MANULIFE IN JAPAN STARTS AND ENDS WITH UNDERSTANDING CULTURAL DIFFERENCES 018 / The Canadian

Member Profile

DONNA COTTER

BY JEFF W. RICHARDS An extensive career in financial services with Manulife has taken Donna Cotter across Canada to Hong Kong—and now Tokyo. We asked her a few questions about her new position in Japan and getting involved with the cccj. Where in Canada do you hail from? Donna Cotter: I grew up in North Bay, Ontario, a small city about four hours north of Toronto. After graduating high school, I went to university in Waterloo and Ottawa. How long have you been working in Japan and what brought you here? DC: I arrived in Japan in April 2015. I had been working in Hong Kong for more than five years when the opportunity to transfer here came up. Japan is a highly coveted posting, but there aren’t many opportunities for expats to come here compared with other countries, so I felt very fortunate and jumped at the chance. You’re currently with Manulife. What’s your role with the company and how long have you been with them? DC: Currently, I’m the vice president in charge of strategy and business development. I’m responsible for developing and overseeing the execution of our business strategy in Japan. I’ve been with Manulife for almost 14 years, and have worked across Canada, Hong Kong and Japan. What do you find most challenging about your current position? DC: I’m a firm believer that business strategy has to start with the customer. Coming in, I had to try and understand how Japanese consumers think and behave— especially as it relates to financial services. It’s been fascinating, however. And it reinforced for me that businesses cannot just assume that a strategy or model that worked in one market will work in another. What do you find most rewarding about it? DC: First, what I do can have a significant impact on our company results. Japan is a very important market for Manulife, so when we succeed here, it has a global impact on customers, staff and shareholders. Second, I love learning about different cultures and trying to understand what makes a culture and its people the

way they are. Through my job, I have the opportunity to delve deep into certain issues—such as retirement and the aging population—that I find really fascinating. People are the same yet different everywhere. And third, done right, strategy considers all aspects of a business to find what propositions have the greatest chance of success in the future. It’s about balancing vision, competitive differentiation and customer value with economic value, operational practicality, market forces and risk management. Manulife has been a long-time sponsor of the cccj. How would you like to see the chamber evolve? DC: Canadian chambers of commerce around the world have a reputation for being very active members of the communities in which they operate and are often disproportionately large compared to the size of Canada. The cccj has an opportunity to be this in Japan as well. In Hong Kong and Indonesia, for example, the Canadian chambers of commerce are amongst the largest in their communities, have members from all over the world and host some of the largest events of the year. How could the chamber support your work or your company’s objectives? DC: The chamber should continue to provide a platform for its members to explore and discuss timely and relevant issues with other Canadian and Japanese companies and peers. As it expands its membership, the cccj will become increasingly valuable to companies like Manulife since it’s better able to explore a range of topics with a membership that has diverse views. What chamber activities have you been involved with? DC: I’ve supported the chamber with participation in trade mission events and events exploring diversity issues in the workplace. What do you like to do when you’re not working? DC: My 9-year-old twin daughters keep my husband and I busy on weekends. When not keeping up with them, we like to explore Tokyo and beyond. In the winter, skiing in Japan is fantastic!

Tell us one thing people would be surprised to know about you... DC: Growing up, I was a competitive figure skater. This kept me busy before and after school for most of my school years. What’s your favorite Japanese saying? DC: I’m still struggling with my Japanese, but I like the phrase shouganai (“it can’t be helped”) because I think it gives very interesting insight into a uniquely Japanese attitude. This is something that we see very little of in the West, where people typically want to feel like they have control over all aspects of their lives.

I love learning about different cultures and trying to understand what makes a culture and its people the way they are

”

The Canadian / 019

Event Report

GROWING TOGETHER

BY R. SAKAI-IRVINE

Premier Christy Clark addresses the B.C.-Japan business luncheon, May 30, 2016 at the Palace Hotel, Tokyo.

CHRISTY CLARK THE PREMIER LOOKS TO AN INNOVATIVE FUTURE FOR THE JAPAN-B.C. RELATIONSHIP A cccj-backed luncheon on May 30 headlined by British Columbia Premier Christy Clark was all about trans-Pacific relationships—from the personal variety to the macro-economic. cccj Chairman Ron Haigh kicked off the theme in his opening remarks, hailing the packed event of over 200 guests as a “great opportunity for conversation with important stakeholders in the Japan-b.c. relationship.” Premier Clark then took to the podium to emphasize to the audience of Japanese and Canadian business leaders and officials at the luncheon sponsored by the Vancouver Fraser Port Authority how deep and important British Columbia’s relationship is with Asia overall, and Japan in particular. British Columbia, which sends nearly 50 per cent of its

020 / The Canadian

exports to Asia, has “been purposeful in making friends and creating new relationships across the Pacific, because we understand that this is where the future of the world economy sits,” she said. She went on to credit her province’s economic health—a growth rate double the Canadian average, the lowest unemployment rate in the country, a stable aaa credit rating and four annual budget surpluses— to this Asia-focused trade relationship, plus fiscal discipline. Premier Clark then looked back on the postwar Japan-British Columbia relationship built on the “bedrock” of the province’s natural resources, saying that “for over 30 years, Japanese companies have played a crucial role in building British Columbia’s exploration for mining projects;

Event Report R. Sakai-Irvine is a journalist and university lecturer in Tokyo.

We are at a moment where British Columbia has opportunities before it to work together with Japan as never before

”

projects that build communities and that keep people working.” However, she noted the need to grab new opportunities when they appear, and with the province’s economy in robust condition, “we are at a moment where British Columbia has opportunities before it to work together with Japan as never before.” During a 2013 Asian trade mission that made its final stop in Tokyo, Premier Clark focused heavily on liquefied natural gas (lng) development opportunities, and lng remained an important pillar of her address this time. She acknowledged that current market conditions have slowed that development, but “we cannot be distracted by what’s happening today. If Japan teaches the world anything, it is that visionary, long-term thinking is what pays the bills for our future.” She added that in that future, “demand for clean energy is only going to increase in Japan, and also for your neighbours in Asia.” The premier highlighted that natural gas is the cleanest of all the non-renewable energy sources, but also mentioned that the British Columbia forestry sector is a leader in developing renewable biofuels. “b.c. has what Japan needs in order to grow, and in order to grow sustainably,” she said.

However, Clark was also keen to point out that there is more to b.c. than trees and mineral wealth, that it is quickly becoming a high-tech centre with plenty of charm points for the Japanese investor: access to the nafta zone, a culture of innovation and the lowest combined corporate taxes in North America as well as among the lowest personal taxes. She reserved some of her last comments for relationships writ large, saying, “I hope very much that our two countries will continue to grow [their] relationship by making sure that we confirm the Trans-Pacific Partnership, which is so vitally important for Canada to grow, as well as the Canada-Japan economic partner[ship] agreement.” Premier Clark left the audience with hopeful and ambitious words for the future of the long and fruitful ties between her province and Japan. “Japan and British Columbia have to work together to make sure that we change the future,” she declared. “Our greatest resource is people in both of our countries… And the future is transformed by people, because we build relationships.”

This page: Premier Christy Clark greets guests at the B.C.-Japan business luncheon, May 30, 2016 at the Palace Hotel, Tokyo.

The Canadian / 021

Asia Pacific View

INDEX CARD

BY JOSEPH CARON • ILLUSTRATION DAVID JASKIEWICZ

The Making of Things CANADIAN COMPANIES CAN FIND OPPORTUNITY IN JAPAN’S TRADITION OF ‘MONOZUKURI’

Canadians who have the good fortune of living in today’s Japan, and those who have decades of experience there, understand that its unique blend of cultural and social continuity—mixed with its economic discontinuities— has largely reshaped the country over the last two decades. In just over one generation, Japan has gone from being viewed as the power house of Asia to a perpetual “also ran” behind China in terms of economic stature. For Canadians unfamiliar with Japan, this has left a confusion of images, many inaccurate. It’s in Canada’s interest to correct

022 / The Canadian

misconceptions by providing a more fulsome picture of today’s Japan, and the opportunities it continues to present. Such messaging is the job of our chambers of commerce in Canada and Japan, as well as that of Canadians committed to international business. There are three narratives to consider about modern Japan. Two will be familiar, but the third is where Canadian business opportunities lie. JAPAN RISING

The first narrative begins in 1960 and continues for over a decade of 9.7 per cent annual growth.

Japan’s technological and industrial accomplishments were spectacular and re-introduced post-war Japan to much of the world. For Canadians, this meant Japanese-produced Toyotas, Hondas and Nissans; Sony Walkmen and Trinitron televisions and Panasonic and Hitachi appliances. At the same time, Canadian tourists brought back an awareness of the rich features of Japanese culture. POST BUBBLE

The second narrative starts in the immediate aftermath of the asset

Asia Pacific View Joseph Caron is the former Ambassador of Canada to Japan, an honorary professor with the Institute of Asian Research at the University of British Columbia and a distinguished fellow with the Asia Pacific Foundation of Canada.

price bubble burst in 1990—an event prompted not only by the Bank of Japan’s decision to raise interest rates, but also because a lot of bad business and government policy chickens came home to roost. The Nikkei Stock Average plunged nearly 50 per cent in that year alone. Commercial real estate in the largest cities, which had risen on the index from 1983 to peak in 1990, plunged more than 500 points by 2002. Japan saw the worst deflation of any developed economy in contemporary history. NEW METRICS

We can’t deny these facts. Nor should we downplay Japanese social policy challenges. But these don’t tell the whole story. Canadians need to look beyond the first two narratives and understand the abiding strengths of Japan’s economy and contemporary realities—the third narrative. Japanese ict lost its luster when its competitors created major global brands, best exemplified by Apple and Samsung. It also saw the u.s. lead in areas that were only nascent in the 1970s, such as biotechnology, nanotech and cloud computing. One of the consequences of these tech developments has been that what makes our every day consumer products and tools work and produce the marvels that we now take for granted are not the outer shells but what’s inside them. We have the impression that the Japanese economy has largely exhausted its creativity and its technological innovativeness—but that’s not true. Take Apple. Few Canadians have heard of Japanese companies such as Murata, tdk, Kyocera or Nitto Denko, but these and other Japanese firms provide many elements of Apple’s iPhone 6. Four of the seven critical component suppliers from Asia are Japanese: Sony for its cameras, Japan Display for screens, tdk for inductor coils and Toshiba for storage. According to some sources, 139 Japanese companies supply components to the Apple family of products. That is more than twice the number of American ones.

And it’s not just Apple: • •

•

• •

Nidec has the world’s largest market share for hard disk drives. Mabuchi Motors manufactures 70 per cent of the motors used in automotive door mirrors and handles. Japan Steel Works in Hokkaido is the only company in the world that manufactures solid steel vessels for nuclear reactors. Shimano supplies over 60 per cent of the world’s bicycle gears and brakes. And ykk makes around half the world’s zip fasteners!

Japan is home to a plethora of world class, highly specialized manufacturers leading in key industrial subsectors

”

So in addition to leading globally in transportation, digital media, financial and auto companies, Japan is home to a plethora of world class, highly specialized manufacturers leading in key industrial subsectors, as those noted above. Some of these firms have international footprints, others supply what is still the vast Japanese domestic market: Japan is one of only 12 countries in the world with over 100 million people. This makes it, for example, the second largest insurance market in the world. Japan has a centuries old tradition of manufacturing, referred to a monozukuri, or “the making of things.” As anyone who as spent time in Japan and watched a sushi chef prepare dinner or a sales

clerk wrap a gift will know, there is a meticulousness, a devotion to precision and correct form. These characteristics of Japanese culture flow naturally into manufacturing and professional conduct. They underpin the products that you buy and on which mass producers such as Apple and Toyota depend. It’s not just a matter of culture: since 2000, Japanese have won 16 Nobel prizes, all in the sciences—half in physics and the rest in chemistry and medicine. That’s more Nobels than the total for France (10) or Germany (9). Only the u.k. and the u.s. surpass Japan on that front. Japan is the third largest investor in R&D after the u.s. and China, and it surpasses both as a share of GDP: 3.6 per cent over the us share of 2.7 and 2 per cent for China. Only South Korea, at 4.3 per cent, surpasses Japan. Canada’s share of R&D to gdp is a paltry one-third that of Japan. Another thing to keep an eye on: the propensity of Japanese business and consumers to spot cutting edge trends. During my 17 years living in Japan, I was always impressed by the thirst for the new among Japanese consumers— the desire to have the latest gadgets, fashions, products and services that businesses could dream up. If you want to spot trends, spot them among the Japanese. Just look at mobile media. Did you know that Japan is the biggest app market in the world? According to Forbes, Google and Apple sell more apps in Japan than in the u.s. or Korea. On the way to the 2020 Olympics, Japan is installing universally accessible, near field communication (nfc) facilities throughout Tokyo to automatically connect smart phones to service providers, including the subway system, train stations and so forth. All of this, and more, defines contemporary Japan. Many of us may keep an eye on the macro-economy, and that makes sense because Japan remains the world’s third largest economy and a keystone in the Asian dynamic. But we all live and do business in the micro-economy—the third narrative—and this is where Canadian businesses will continue to find opportunities in Japan.

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Housing Trends

BED, BATH & BEYOND

BY ADAM GERMAN

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Housing Trends Adam German is from Brantford, Ontario. He’s lived in Japan for 13 years working with the most widely used, international real estate platforms across all levels of property management. Got a question? german@housingjapan.com

GOOD AGENT, BAD AGENT A REALTOR’S PERSPECTIVE ON HOW TO RENT AN APARTMENT IN JAPAN There are a lot of “How To” articles out here outlining the process of renting an apartment in Japan. However, even if one follows all of the steps included, it’s still a daunting task—especially if you’ve just arrived in the country or are looking in a new, unfamiliar region after a transfer or new position. One of the most critical parts of the leasing process is the agent you choose—and how you keep them motivated to source the best properties for you or your company. Many moons ago when I was a leasing agent, the best clients were the ones that committed to staying with me once I’d demonstrated that I deserved their trust. Unfortunately, these types of clients were few and far between with most approaching the lease negotiation as if it were a million dollar sale in which the client assumed that the agent would work fullout for them, day and night, without even providing minimum contact and feedback to the agent. If you’re looking to rent—for yourself or your firm—always approach the leasing process with skepticism. If you’re new to a city, always use multiple agents. Over time, these “Good Agents” (trust me: you’ll know them once you work with them) will float to the top. It’s at this stage when I see most clients make the largest and most common mistake: they keep engaging all good agents throughout their search. The problem with this approach is that Good Agents didn’t just fall off the turnip truck yesterday. They’ve been around awhile, know the market and they know how best to deliver relevant properties to you. They’re plugged-in and they listen to what you want, and— most importantly—what you didn’t know you wanted yet.

Here’s a common scenario. Over the course of several weeks during the apartment search phase, a client is impressed with the services of three different agents. Suddenly—and for no apparent reason from the client’s perspective—all three good agents

Good agents, while earnestly working to get you what you would like, also have another allegiance— the company they work for

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become slower than usual at replying to emails. Phone calls aren’t being taken as immediately as they were before. This continues to taper off until all three have basically dumped the client, who has no idea why the situation has come to this and then

subscribes to the common thinking that all agents are “Bad Agents.” What really happened was this: the Good Agents figured out the client wasn’t forthright and was still working with other agents. Good agents, while earnestly working to get you what you would like, also have another allegiance—the company they work for. They need to hit their monthly targets. As any decent sales person knows, the path of least resistance is also where the least competition is. Agents are just like any other sales person, driven by targets and kpis. The good ones know the only to way to consistently hit those marks are to provide superior service and spend their time working in the most efficient way possible. From an agent’s standpoint, a client with a ¥200,000 per month budget who has clearly committed is worth more than the ¥1,000,000 per month client who has five other agents on standby. Choosing which account to spend time on will always veer toward those who are dedicated to working with one Good Agent regardless of who the client is. In the beginning, you should work with multiple agents—especially if you are new to the area. However, if one of them, like cream, rises to the top then you—the client—would do yourself a favour by committing to that agent and releasing the others. It saves time and everyone involved in your search will appreciate it, even the agents released. If your choice doesn’t pan out, you can easily reach back out to one of the others. If you’re considerate and understanding of their position, it makes their decision to dedicate themselves to your needs in a specialized market—especially here in Japan— an easy one.

The Canadian / 025

Timeline

LOOKING BACK

PAST EVENTS CHAMBER GOINGS ON AND BEYOND

2016 GOLF SCRAMBLE — May 27 It was fun day for all at 15th Annual CCCJ golf tournament which took place at Tsutsujigaoka Country Club where 40 golfers enjoyed a great day thanks to sponsors Air Canada, Toyota Motor Corporation, Rain Interactive, Hyatt Regency, New Otani and the Tokyo American Club. The tournament, a team scramble, was won by Goh Sugita, Mohan Patel, Neal Walters and David Anderson.

ASIA PACIFIC FOUNDATION LUNCHEON — April 5 The CCCJ was pleased to welcome Stewart Beck, Asia Pacific Foundation of Canada’s president and CEO, for a luncheon to discuss strategy for expanding Canada’s economic engagement with Asia. Beck presented recommendations for achieving those objectives and other key findings as prepared in their new strategy report.

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COOL JAPAN FUND SEMINAR — April 13 At this informative event held at at the Embassy of Canada to Japan’s Oscar Peterson Theater, CCCJ members had the chance to learn about some of the Cool Japan Fund’s most successful investments and future plans from CEO Noboyuki Ota. Also on hand was Tokyo Otaku Mode’s co-founder and CFO, Nao Kodaka, to describe how it became the fund’s very first project.

ASTRONAUT DAVID SAINTJACQUES — June 4

The CCCJ was pleased to host a special event with Canadian astronaut David SaintJacques, who delivered a captivating speech to members and their family that mixed funny anecdotes with more serious explanations about life in space and the importance of exploring it for all of us on Earth. Enjoyed by rapt adults and children alike.

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Jobs japan.careerengine.org/cccj

Calendar

DATEBOOK

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SUMMER-AUTUMN 2016

JULY

25 Years! A Celebration of our Chancery The Embassy of Canada in Japan is presenting a special exhibition in its Prince Takamado Gallery to mark the 25th anniversary of the present chancery. This exhibition will feature bluewprints, building plans, photographs of the old and new buildings, scale models and other relevant artifacts. This is an opportunity to reflect once more on the strong ties that link our two countries. The embassy welcomes you to extend your visit to the gallery with a self-guided tour of its art-inspired public spaces. Date: July 7 - Sep. 30, 2016 Time: Weekdays, 10 a.m. - 5:30 p.m. Cost: Free Location: Embassy of Canada Prince Takamodo Gallery www.canadainternational.gc.ca/

JULY

9 Soirée Blanche 2016 This summer The French Kitchen at the Grand Hyatt Tokyo will once again bring St. Tropez to Tokyo. Relive the glitz and glamor of 1970s French Riviera at these Soirée Blanche-themed parties. Come dressed all in white and enjoy free-flowing champagne, sizzling nibbles fresh off the grill, homemade ice cream and even a sorbet buffet. A special DJ will spin chilled tunes to complete the summer lounge vibe at the only event in Tokyo where the dress code may be tous en blanc, but the state of mind is pure azur! Reserve your spots now for these popular summer events.

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Date: July 9, 16, 23 & 30; Aug. 6, 13 & 27 | Time: 6-9 p.m. | Location: Grand Hyatt Tokyo, The French Kitchen | Cost: ¥11,000 www. restaurants.tokyo.grand.hyatt.com/french-kitchen-tokyo/news/Soiree-Blanche.html

Calendar

DATEBOOK

OCTOBER

JULY

CCCJ-McGill MBA Japan Gender Diversity Roundtable Series Join the CCCJ on July 14 at the Roppongi Hills Club for the fifth Gender Diversity Roundtable session hosted by Akiko Kosuda, member of the CCCJ’s Honorary Board of Advisors and Tokyo Girls Collection executive committee supervisor. This meeting will focus on engaging top executives in promoting gender diversity.. Date: July14, 2016 Time: 8-9 a.m. (Breakfast will be served during this event) Cost: Free Location: Roppongi Hills Club www.cccj.or.jp/en/events

AUGUST

Billy Talent Rock out to some Canadian content at one of Japan’s biggest music events, the Juno award-winning and platinum selling Billy Talent will bring their energetic presence to this year’s Summer Sonic music festival. The Mississauga natives will play the Tokyo leg on Saturday, August 20 and Osaka the following day. Also on the bill: fellow Canadians Badbadnotgood plus Radiohead, Fergie, Pentatonix, Mark Ronson and more. Date: Aug. 20 & 21, 2016 Location: Makuhari Messe (Tokyo), Maishima Arena (Osaka) Cost: ¥16,500 (1-day) / ¥30,000 (Platinum ticket) / ¥35,000 (2-day) www.summersonic.com/2016

OCTOBER

Autumn Alumni Mixer Join the CCCJ and alumni associations from various Canadian universities for a casual mixer hosted at BrewDog in Roppongi. Meet with other graduates from Canadian university alumni associations active in Japan. No RSVP, no cover charge. Cash bar in effect.

MercedesBenz Cole Haan Cup The 2016 MercedesBenz–Cole Haan Cup will be played on Friday, October 7 at the Atsugi Kokusai Country Club in Kanagawa Prefecture. The organizing committee is hard at work—together with Mercedes-Benz Japan and Cole Haan Japan—to make this a memorable event for all participants. There will also be an afterparty held on Thursday, October 13 at MercedesBenz Connection in Roppongi, free for the players and their significant others. Date: Oct 7, 2016 Time: 8:30 a.m. Cost: ¥24,700 Location: Atsugi Kokusai C ountry Club www.dccgolf-japan.com/index. html

Date: Oct. 20 Time: 6:30 p.m. Cost: Free entry Location: BrewDog Roppongi brewdogbar.jp

NOVEMBER

2016 Maple Leaf Gala Feuille D’érable 2016 The CCCJ will once again host its popular annual Maple Leaf Gala. This is the flagship Canada-Japan community event in Tokyo and 2016 marks its 38th year. The CCCJ events committee is planning a festive evening of prizes, entertainment and excellent Canadian food and wine. Date: Mid-Nov. (TBA) Time: 6:30-11:45 p.m. Cost: TBA Location: TBA www.cccj.or.jp/en/events

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Directory Corporate Sustaining

Toyota Motor Corporation Established in 1937, Toyota now sells vehicles in over 170 countries and regions. With 53 manufacturing plants in 28 countries outside Japan, Toyota is a global company with deep local roots in all major markets. With 50 years in Canada, Toyota produces over half a million vehicles a year and employs more than 24,000 people there. Through ever-better cars and enriching the local community, the company seeks to satisfy stakeholders today and in the future.

AIU Insurance Company Japan Starting business as a general insurance company in Japan in 1946, AIU Insurance Company, Japan Branch is locally incorporated and started business as AIU Insurance Company Ltd. in April 2013. AIU accesses the worldwide network and overseas market experience of American International Group (AIG), as well as its long proven track record in Japan, to provide customers with reliable insurance products and services.

Corporate

JAL CAE Flight Training (JCFT) Co. Ltd. JCFT is a joint venture between CAE, a worldleading Canadian flight simulator manufacturer and training provider, and Japan Airlines. Our training center is located at Haneda Airport, where we provide airline operators the most comprehensive portfolio of pilot training and simulator maintenance services available in commercial aviation. Our team of experts provide customer focused solutions tailored to airline training requirements.

Scotia Securities Asia Limited Scotia Securities Asia Limited is an investment banking arm of Scotiabank and provides financial services such as fixed income, equities and M&A advisory.

New Members Directory D PwC Canada In Canada, PwC (PricewaterhouseCoopers) has more than 6,500 partners and staff in locations from St. Johnâ&#x20AC;&#x2122;s, Newfoundland to Victoria, British Columbia. With more than 100 years of excellence in Canada, we provide industry focused assurance, advisory and tax services for public, private and government clients. As part of a larger network of over 180,000 people in 158 countries, we work to provide clients with the best of our collective thinking, experience and solutions to build public trust and enhance value for our clients and their stakeholders.

Solar Power Network K.K. Solar Power Network (SPN) is a wholly employee-owned Canadian power company founded with the goal of bringing Ontario into the renewable future. By installing high-yield, low-angle solar panels on unused commercial, institutional and industrial rooftops; SPN generates green energy locallyâ&#x20AC;&#x201D;for local consumption. In addition to eliminating the losses associated with long-distance energy transportation, these installations provide peak power at times of peak consumption, thus reducing the provinceâ&#x20AC;&#x2122;s reliance on fossil fuewwls. SPN uses regional installation and operation teams for all sites, resulting in local jobs and commerce.

Corporate Non-Resident

Borden Ladner Gervais LLP (BLG) Borden Ladner Gervais is a pre-eminent full-service, Canadian law firm focusing on business law, commercial litigation and intellectual property solutions for our clients. BLG are experts in business and corporate commercial areas, electricity markets, publicprivate infrastructure projects as well as being a charities and not-for-profit solicitor.

ReDev Properties ReDev Properties is a Canadian commercial real estate asset manager that has purchased and managed over 30 commercial real estate properties in Canada since 2001. ReDev understands that the key to any successful commercial real estate project is location, so it carefully and diligently finds existing commercial real estate properties in markets that provide the necessary stability and future growth to ensure assets retain and increase in value.

Small Business & Professional

Nakagawa Japan Co. Ltd. Tower Knives Located in the heart of Osaka, Nakagawa Japan Co. Ltd. is a small trading company specialized in facilitating business relations between Japanese and international companies. Founded in 2012 with a focus on the export of Japanese-made knives, the company has since grown in volume and expanded its product ranges.

Nakai Immigration Services As a boutique immigration law firm with over 20 years of experience, we provide one-stop professional legal services to obtain visas for Japan. Our team includes gyoseishoshi (immigration) lawyers, a US attorney at law, a former supervisor at the Tokyo Regional Immigration Bureau and a labor and social security attorney. Our multilingual staff speak native English, Spanish, native German, Chinese and Korean apart from Japanese. Correspondence is available in all of these languages.

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