Japanese Business andAfrican Development
June 10, 2014
Norihiko Ishiguro
Vice-Minister for International Affairs
Ministry of Economy, Trade and Industry
1Africa’s growth and challenges
 Africa has experienced rapid economic growth. However, it faces further
challenges for sustainable development.
GDP growth (%)
8.0

Sub-SaharanAfricaWorld
世界全体

サブサハラアフリカ

6.0
4.0

5.8% average
growth in 2000’s

2.0

2.3% average
growth in 1990’s

0.0
1990

1993

1996

1999

2002

2005

2008

2011

2014

-2.0

Challenges faced by Africa(Source) IMF World Economic Outlook

 Youth employment： Globalization and urbanization calls for skilled workers
adapted to the modern economy. Human resource development is key.
 Social issues： Not all Africans have benefited from economic growth.
There is a need to further improve the livelihood of the rural poor and women.
 Monoculture economy： Colonial legacy means many African economies rely on
single raw products. Need for industrialization through value-addition.
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Japanese companies and Africa
 Japanese businesses value the building of long-term relationship throughmutual trust rather than short-term profit, serving as good partners for
African development.
Japanese FDI into Africa

Contribution by Japanese companies

1. Human resource development Valuing workers’ own inititatives.
→ “Kaizen”(US$ billion）

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2. Contribution on social issues

4 Improving the life of the poor andencouraging women’s social participation.

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3. Value addition (beneficiation)0
1997 2002 2007 2012(12-fold growth in 15 years)(Source) JETRO Creating new industries by adding value toAfrican raw materials.
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1. Human resource development
 Human resources development by Japanese companies encourages bottom-up, on-thejob training of workers : the “Kaizen” philosophy.
 Treating workers as “members of the family” should fit in with African traditions.
“Kaizen”

Account by former Prime Minister of Ethiopia, Hon. Meles“ KAIZEN is a management philosophy, and it is asystem that allows companies to improve theirproductivity and product quality.

 First, organize the workplace.
 Then, workers share and implement ideas
for continuous productivity improvements.

…And it’s based on the creativity of all employees,
involves all employees, in the improvement ofquality and productivity for the companies. That isthe philosophy, we like, we agree with, we believe,
can make a lot of difference in Ethiopia.

Before

The fact that KAIZEN has been introduced in many countries and in some Africancountries seems to suggest that, irrespective of cultural differences between
Ethiopia and Japan, we can benefit from introducing the system to Ethiopia.

Practice of TOYOTA (South Africa)

 “Kaizen” training extended also to local suppliers.
On the Job Training
After(Source) JICA(Source) JICA

Lecture(Source) Toyota South Africa Motors4

2. Contribution on social issues
 Japanese companies directly tackle social issues through business activities.
Japan Poly-gluAjinomoto
 Marketing of affordable dietary supplements
for infants.

 Marketing of affordable, powder-based water
purifiers to provide rural residents with accessto safe drinking water.
 Employment of local women as sales staff.
→ Encouraging women’s social participation.

(Source) Ajinomoto

 Operation of a seasoning packaging factory.
 Marketed through cooking demonstrations
by local women.
→ Encouraging women’s participation to society
through easier cooking and job creation.

(Source) METI(Source) Poly-glu5

3. Value addition (beneficiation)
 Japanese companies can utilize their advantages in manufacturing and marketing
capabilities to add value to African raw materials for export to the global market.
Adding value to natural resources

Proposals by Japanese companies Natural gas development （Mozambique）- LNG processing plant- Methanol production

ValueAddition- Gas-to-liquidtechnology(Source) JAPAN-GTL Consortium(Source) Mitsui & Co.

Adding value to local products Local manufacturing of leather products
and food products

ValueAddition

 Export to outside markets including Japan(Source) Andu Amet, JETRO

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Efforts by the Japanese government (1) The Japanese government has been strongly encouraging Japanese companies to invest
in Africa through high-level visits and the TICAD process.
TICAD V (June 1-3, 2013)

Prime Minister Abe Prime Minister Abe held bilateral meetings with all 39 headsof state / government who participated in TICAD V.

1. Djibouti
 August 27, 2013

2. Cote d’Ivoire, Mozambique, Ethiopia
 January 10-14, 2014
 Business delegation of 34 companies andorganizations(Source) MOFA Minister Motegi (METI) delivered a speech on how Japan
can become a “trusted business partner” for Africa.
(Source) MOFA

Minister Motegi (METI) The “African Fair” showcased Africanand Japanese products and provided
business matching assistance.

Tanzania, Kenya
 August 9-13, 2013
 Business delegationof 20 companies
and organizations(Source) METI

(Source) JETRO, METI

Efforts by the Japanese government (2) The Japanese government supports the entry to of Japanese companies in Africa at eachstage with various tools (e.g., investment seminars, bushiness matching, finance).
Interest Investment seminars on Africa (JETRO, others)
 Support for creating business plans (JETRO, JICA)
 Support for Japanese companies’ participation inAfrican trade fairs; business matching (JETRO) Training and dispatch of experts to local
institutions and business partners (HIDA, JICA)
 Risk finance (JBIC, JICA, JOGMEC, NEXI)

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Requests for African countries

 Maintenance of political stability and security
 Good governance and transparency
 Stability and predictability in the implementationof regulations and tax regimes
 Ease in obtaining visas and work permits

Thank you.

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