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Speech made by Ambassador Orita on the occasion of the Nagoya Business Seminar in Birmingham

3 November 2003

Mt. Takahashi, Mr. Topman, Ladies & Gentlemen,

First of all, may I express my gratitude to all the organisers and sponsors for organizing this Nagoya Business Seminar? It is a great pleasure to be here with you at this splendid place in Birmingham, one of the leading business centres in the UK. And it is only fitting that I have the opportunity here in Birmingham to introduce the City of Nagoya, one of the most important business centres in Japan. Today, many distinguished speakers will speak to you what makes Nagoya attractive and suitable for business, and I hope you will be convinced of your opportunities in Nagoya by the end of the seminar. (Then talk about my personal experience with Nagoya & Aichi)

But before we move on to focus on Nagoya, I should first like to talk about a few points about the current state of Japan-UK business relations and the situation surrounding the Japanese economy.

Our economic and business links are as strong, wide-spread, deep and well-established as ever. We are in an era where both Japan and the UK, public and private sectors included, are doing their best to encourage mutually-beneficial investment and trade.

The UK remains the top European destination for Japanese direct investment. Altogether, more than 1,000 Japanese companies are now operating in the UK, and in the manufacturing sector their activities have led to the creation of over 80,000 jobs. I believe the British economy has benefited in other ways as well, such as through the increased productivity of the car industry as a result of the influence of the major Japanese car manufacturers with operations here, such as the Toyota group. Isn't it wonderful to know that quite recently a Toyota factory in the UK started to export to Japan Toyota cars manufactured in the UK? Japanese people are already driving in Japan Toyota cars made in the UK on the left side of roads which is right side of the road just like in the UK.

By the same token, Japan is very keen to see a rise in the number of British companies investing there. The Japanese government recognises that investment into Japan has a valuable role to play in line with the process of restructuring and reform under way in the economy. The Japanese economy now needs the influence and stimulus of foreign companies, just as the British economy has benefited from the increased productivity which was brought about by the influence of foreign companies, including Japanese. It is based on this line of thinking that Prime Minister Koizumi explained to Mr Blair in April and in July about the Japanese government's plan to double the amount of direct investment into Japan within 5 years. Investment in Japan would not only benefit us but, more importantly for you, would be beneficial to the investors. This, I say with confidence, based on the current state of the Japanese economy. British companies are already becoming active in Japan. Vodafone has been in Japan with a huge investment and is operating a part of highly advanced mobile-phone network there using Japanese technology. You can not only talk with your friends over mobiles, but also immediately send pictures to them.

The fundamental strengths of the Japanese economy remain intact, such as our abundant purchasing power, our skill at creating high value-added products and Japan's plentiful capital. Our GDP amounts to around $4.8 trillion, second only to that of the US. To put this figure into perspective, it amounts to around 60 percent of the GDP of the whole of Asia, about three times that of the UK and four times that of China.

Moreover, in order to help these fundamental strengths take hold, Japan has been undertaking structural reforms to tackle such problems as its governmental budget deficit, bad loans in the financial sector and the excessive supply capacity of industry, and has made decent progress. I am pleased to say that now we see positive signs of economic recovery in Japan; stock prices are keeping a rising trend and corporate profits have shown an improvement. During the first half of 2003 Japan recorded the highest economic growth rate among the major OECD countries for two consecutive quarters. In September, the IMF made a substantial upward revision in its estimate of Japanese economic growth for 2003-2004 in its World Economic Outlook Report. Last week, I was back to Tokyo and met with a number of top businessmen of Japan, top leaders of Keidanren (Federation of Economic Organizations of Japan). I was impressed by the general felling of business optimism among them. Of course, we should no be too optimistic but it is encouraging.

It is true that we still have challenges to overcome, such as deflation, the remaining bad loans, and the long-term demographic problems of our low birth rate and the ageing society. However, I strongly believe that this mixture of lower prices and costs, deregulation and favourable economic prospects makes Japan a 'buy' for the overseas investors. My message here is clear and simple: our mutual ties remain firm, we see clear signs of fundamental economic recovery in Japan despite its difficulties, and Japan now provides very good opportunities for the overseas investors. Why don't take advantage of them?

As yet another step to strengthen our mutual ties, I am pleased to note that the two countries are working together on a number of projects to address common tasks looking towards the future. When Prime Minister Tony Blair visited Japan in July, three Joint Statements were issued by the two Prime Ministers. One was on Science and Technology, another was on Environmental Challenges and the other one was on Information and Communication Technology. These statements are a demonstration not only of the collaboration of the UK and Japan in the relevant specific fields, but also of the fundamental strength of our friendship for the progress of mankind.

Here, I would like to draw your attention to a forum which will take place in Aichi prefecture, where the City of Nagoya exists: the 2005 Aichi Expo, because the Aichi Expo is also a token of our partnership for the global development of mankind. The theme of the Expo is 'the Earth's Wisdom'. This is not a world exposition of the old type, motivated by a sense of competition for national prestige. It is a forum for pooling the wisdom of the widest possible range of people from around the world to address tasks common to all of us. In this regard, I believe Aichi would be fit for the forum, considering its wealth of nature, the accumulation of industries and technology.

We are very pleased indeed that Prime Minister Blair announced, when he visited Japan in July, the decision of the UK government to participate in the Aichi Expo. Surely, the UK, which is one of the leading countries of advanced technology, will make a big contribution to the success of the Aichi Expo. Through this world exposition, together we would like to explore new ideas about how human beings can coexist with the earth and how we can reduce our dependency upon finite energy resources. And we like to send out to the world our strong messages of new ways of life in the new century. And I should like to encourage many of you to visit Japan on this special occasion and witness Japan-UK collaboration in action. This, of course, would also be a great opportunity for you to see with your own eyes what the city of Nagoya has to offer as an investment destination.

Let me also mention that the planned opening of the new Chubu International Airport will make it even easier for you to the Aichi Expo. Please do not hesitate to utilise this new airport, either as an investor or as a tourist. Japanese people will welcome you! Please make best use of business opportunities in Nagoya and in Aichi prefecture and also enjoy Japan filled with history, culture, tradition and ultra-modern entertainment!

I hope this seminar will be an important step towards strengthening the links between Birmingham and Japan, and particularly Nagoya. Again, I wish you all every success.

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