JBIC Today

December 2019

Special Feature

Creating Harmony between
Environment and Economic Society▶ JBIC's role responding to the times and needs▶ JBIC’s projects are expanding into Indonesia, India and Thailand▶ Launch of JBIC’s global environment facility of “QI-ESG”▶ Introducing the environmental technology of Japanese companies todeveloping countries
The Focus / Our Global Challenges

英文組合せシステム

New Product that Captured the Needs in Thailand.
Uplifting Domestic Businesses through Reverse Imports

Latest Report From Young Staffs

Project Frontline▶ Supporting production of rare mineral resource in collaboration between public and private sectors▶ Loan to the government of Uzbekistan▶ Strengthen the relationships with national oil companies in Malaysia and Saudi Arabia

FeatureFeatureSpecial Feature Creating Harmony between Environment and Economic Society

JBIC's role responding to the times and needs
Climate change is raised and discussed as an urgent challenge that threatens the global
economic society. Under such circumstances, JBIC has evolved its operations to the global environment in response to the changing times.
What roles can JBIC and Japanese companies play in achieving continuous sustainableeconomic growth?
The achievement of sustainable economic
growth is a common concern of the world.
As part of a global effort to tackle such a
concern, implementation of various actions
towards climate change including reductionof greenhouse gas (GHG) emissions has beenenhanced all over the world. In reaction to theinternational engagements including the Japanese government to climate change, JBIC contributes to taking global environmental actions
by providing policy-based financing. “2010was a big turning point for JBIC's actions to
the global environment,” Tsutomu Sato said,

who serves as Deputy Director General for the
New Energy and Power Finance Department
II and Director for Global Environment Division of the Infrastructure and Environment Finance Group. Then, in the 15th Conference of
the Parties to the United Nations Framework
Convention on Climate Change (COP15),
which was held in Copenhagen, in December
2009, developed countries agreed to mobilizefinance to developing countries with US$100
billion per year by 2020.

Proactively supporting global
environmental preservation

Tsutomu Sato

Deputy Director General,
New Energy and Power Finance Department II,-AndDirector for Global Environment Division
Infrastructure and Environment Finance Group2

December 2019 │ JBIC Today“In the Kyoto Protocol adopted at COP3
in 1997, only developed countries committed
to meet national targets of reducing GHG
emissions. However, as a matter of fact, developing countries are another GHG emittersas same as developed countries so that the
global climate actions should not be successful
without involving those developing countries.
To change this situation, both developed anddeveloping countries had intense discussions
for a new framework agreement at COP15 in2009. Those countries could not reach a new
agreement at COP15, but in the negotiation
process, they once again realized that mobiliz-

ing a large amount of finance were necessary
for developing countries in order to introduce
low-carbon technology. In the light of this situation, it was agreed that developed countries
will mobilize US$100 billion per year by 2020
to those developing countries to support theirclimate actions. After this agreement, developed countries continues to fulfill their commitment to mobilizing finance to developing
countries, building a mutual trusting relationship with them. I believe that this effort paved
the pathway for adopting the Paris Agreement
at COP21 in 2015.”
Taking over the Kyoto Protocol, morethan 180 countries participated in the Paris
Agreement which will commence in 2020.
All the participating countries̶not only
developed but also developing countries̶
will make climate actions under a new legallybinding agreement.
“In April 2010, JBIC incorporated a new
mission of 'preservation of the global environment' in its establishment law. Responding tointernational climate change policies including
the COP discussions, this mission aims topromote actions for protecting the global environment such as preventing global warming.
In order to perform this mission, JBIC started
a new financing operation called Global action
for Reconciling Economic growth and ENvi-ronmental preservation (GREEN).”
Up to that time, JBIC had seen activities in fields that directly benefit the Japanese
economy as its main missions, such as securing
natural resources and maintaining and improving the international competitiveness ofJapanese industries.
“I think that incorporation of 'preservation of the global environmentʼ as one of four
missions of JBIC was an important message
to state JBICʼs intention of contributing toachieving sustainable economic growth inalignment with global climate change.”
The purpose of the GREEN operation
is to provide loans and equity participations
to projects that are expected to reduce GHG
emissions, such as renewable energy, highly
efficient power generation projects and deployment of energy-saving equipment. Under
the GREEN operation, JBIC created its own
methodologies called Guidelines for Measurement, Reporting and Verification of GHG
Emission Reductions in JBIC's GREEN(JMRV Guidelines), in consultation with environmental specialists including professors
and experts specializing in climate mitigation
projects.”

Expanding finance in response
to client needs: deploymentof advanced environmental
technology to the world“Mobilizing finance to developing countries, which was agreed at COP15, was officially adopted at COP16 in Cancun in December
2010. After the adoption of the Cancun agreement, Multilateral Development Banks such as
the World Bank started to ratchet up financing operations in the area of climate change.
Just on the same time, JBIC commenced
its GREEN operation, which was of greatsignificance in spearheading global actions
on climate change. After that, ahead of the
adoption of the Paris Agreement in 2015, theJapanese government stated “Actions to Cool
Earth 2.0(ACE2.0)” to provide public andprivate climate finance to developing countries
amounting to JPY1,300 billion by 2020 which
was increased by 1.3 times against the previous
commitment. In line with the ACE2.0, JBIC
promoted the GREEN operation than before.
I think that Japanese companies have highly
advanced low-carbon technology and operational knowledge such as geothermal power
generation and energy-efficiency projects.
JBIC proactively supports those Japanese com-panies in exporting energy-efficient equipment
and participating operation and maintenancein environmental projects overseas throughnot only GREEN operation but also otherfinancial tools. In addition to project financing
to IPP projects, JBIC provides loans and equity participation to M&A deals by Japanesecompanies, while investing in equity funds forrenewable energy, energy efficiency and environmental conservation.”
Financing for global environmental projects contributes to achieving a global targetof reducing GHG emissions as well as creates
new business opportunities in a new market
of environmental field amid the international
trend of transition to a low-carbon society. In
recent years, more diversified advanced technologies are utilized in various projects.
In 2018, JBIC launched its new Global
Facility to Promote Quality Infrastructure Investment for Environmental Preservation andSustainable Growth (QI-ESG)with extending
the coverage of the GREEN operation to environmental projects other than GHG emission
reduction, such as air pollution prevention,water supply, water pollution prevention andwaste energy. In this QI-ESG, JBIC finances
a wide array of infrastructure projects aiming
for global environment preservation and so
far, JBIC financed an offshore wind power
generation project in the United Kingdom
and a smart energy business (maintenance andupgrading of transmission and distribution
networks) in Central America.

Harmonizing between economic
growth and environmental
preservation
JBIC's activities in the environmental
field are not limited to supporting projects
aiming for global environmental preservation. Since the mid-1980s, Organization for
Economic Cooperation and Development(OECD) and United Nations Environment
Programme (UNEP), have shown a growinginterest in economic development as well as
environmental and social considerations. They
added an environmental assessment to evaluate the impact on both natural and social environments as a precondition for implementing
a project. Under such circumstances, since thelate 1980ʼs, the Export-Import Bank of Japan(JEXIM), the predecessor of JBIC, had enhanced its system to assess if a project operator
properly considered environmental and social
impacts on the target project. In 1992, JEXIM

established the Global Environment Officeinside Project and Corporate Analysis Department. In 1999, upon international trends inthe environmental assessment, JEXIM createdguidelines for environmental and social consideration, which became later the prototype
for JBICʼs current guidelines known as “JBIC
Guidelines for Confirmation of Environmental and Social Considerations”. In accordance
to these guidelines, JBIC has strived to ensurethat project operations generate no significant
adverse effects to the lives of local residents
and the natural environment such as ecosystem.
“After establishing our environmental
guidelines, we revise it as needed by considering international trends on environmental
assessment. When revising our guidelines,
we emphasize the outcomes of the discussions about environmental safeguard policy
in OECD, while collecting a broad range of
opinions and views through consultations
with our stakeholders from various fields including business community, civil society andacademia. All projects financed by JBIC are
subject to its environmental guidelines. Afterscreening projects into different categories
according to level of impact on environmentand society, we evaluate environmental andsocial aspects of each project based on thecriteria in the guidelines . As for a project thatis considered to have a significant impact onenvironment and society, we visit the projectsite along with specialists in the environmental
and social field to gather information directlyfrom relevant agencies of the government in
the projectʼs host country or talk to local residents living near the project site.”
JBIC examines each project based on thereal information obtained from the projectsite. Sato continued to say, “JBIC has emphasized an approach to carefully evaluate a project by following local laws and regulations, aswell as the actual conditions of the project site,while communicating with various stakeholders of the project.”“Even if JBICʼs project has a great significance to the development of the country,
we must avoid the situation where the project
has negative impacts on environment andsociety. It is a very difficult theme to balance
between economic activities and environmental protection, but we will continue to play arole in connecting economic growth with environmental preservation through our careful
coordination of opinions with stakeholders in
the project site.”
December 2019 │ JBIC Today3FeatureFeatureContracts for Difference, a U.K. renewableenergy subsidy scheme, MOWEL will sellelectricity to power retailers for 15 years after
the start of its commercial operations.
In November 2018, JBIC signed a loan
agreement in project financing totaling up to
approximately GBP743 million (JBIC portion) with MOWEL. This project financing
is provided under JBICʼs “Global Facility toPromote Quality Infrastructure Investment forEnvironmental Preservation and Sustainable

Special Feature Creating Harmony between Environment and Economic Society

JBIC’s projects are expanding into Indonesia, India andThailandGrowth (QI-ESG).” Japanese companiesʼ participation in this offshore wind power projectket, will help more Japanese companies enter

maintaining and enhancing the international

vestment for Environmental Preservation andinto a new market for wind power generation.

competitiveness of Japanese companies but

Sustainable Growth (QI-ESG).”also to reducing greenhouse gas (GHG) emis-

India
JBIC is supporting Japanese companies in participating in environmental projects overseas by utilizing its various financial instruments.
This section reports on JBIC’s representative projects in both developed and developing countries.
Indonesia
Rantau Dedap Geothermal Power Project

Providing a loan to a geothermal
power project operated by
Japanese companies
In Indonesia, electricity demand is surg-

Waste Treatment and Biogas Production BusinessContributing to reductionof GHG emissions andestablishment of a recyclingbased society

Utilizing Japanese technology
to purify automobile exhaust
gassesThe Government of India aims to devel-build, own and operate a geothermal power

portion) with SERD for this project. This is

op 100 GW solar power capacity by 2022 toplant with a gross capacity of 98.4 MW in thethe third geothermal IPP (Independent Powersecure stable power supply and diversify elec-

South Sumatra Province, Indonesia. The elec-

Producer) project in Indonesia where JBIC

tricity power sources. On September 1, 2014,

Hitachi Zosen Group is a leading compa-

mobile demand in Asian countries, particularly

tricity generated from this plant will be soldprovides project financing, following theJapanese Prime Minister Abe and Indian Prime

ny which boasts a world-class track record inin China and the ASEAN region. In response

to PT PLN (Persero), a state-owned power

Sarulla geothermal power plant project andMinister Modi announced the “Japan-India

a number of EPC (Engineering, Procurement,

to this growth, emission regulations have been

Muara Laboh geothermal power plant project.

Investment Promotion Partnership,” in which

and Construction) orders for waste treatment

tightened. Under such circumstances, an in-Japan will provide JPY3.5 trillion of public

and power generation plants. In this project,crease in demand is expected for the ceramics

and private financing to India over the next

HZI Jönköping Biogas AB, a Swedish subsid-that purify harmful automobile emissions such

five years.

iary of Hitachi Zosen Group will construct a

as hydrocarbon (HC), carbon monoxide (CO),and nitrogen oxide (NOx).

utility in Indonesia, for 30 years. Fuji Electricincrease its power generation capacity by 35

one of the EPC (Engineering, Procurement

GW. In 2014, the government established a

and Construction) contractors. This is typicalnew legislation for geothermal power genera-of an All-Japan effort to operate and manage ation to utilize its rich geothermal resources.

project overseas with advanced Japanese technology over a long period of time.
In March 2018, JBIC signed a loan

United Kingdom
Moray East Offshore Wind Power Project

Supporting Japanesecompanies participating in an
offshore wind power project

In recent years, economic growth andpopulation increases have driven rising auto-

Under this project, SBG Cleantech

waste treatment plant using methane fermen-

ProjectCo Private Limited (SBG Cleantech) ,tation technology (annual waste treatment

NGK CERAMICS (THAILAND) CO.,invested in by SoftBank Group Corp.(SBG),

capacity of 40,000 tons; annual biogas pro-LTD. (ACTH), a Thai subsidiary of NGK IN-

will build, own and operate a solar power gen-duction capacity of 35,000 MWh) in the city

SULATORS, LTD., aims to expand its busi-

eration plant with a total generation capacityof Jönköping, Sweden, and sell biogas for 20

ness in Asia by increasing its manufacturing

U.K., development of large-scale offshore windof 350MW at the solar park to be built inyears. The biogas sold by HZI Jönköping Bio-capabilities for automobile exhaust purifying

farms is accelerating, and the competition for

Kurnool district, the state of Andhra Pradeshgas AB will be used as fuel for public transport

ceramics for large commercial vehicles. The

obtaining concessions is intensifying among ain the south of India. SBG Cleantech will sellin the city of Jönköping. This plant is expected

new manufacturing facilities are to be built in

the generated electricity to NTPC Limited,to contribute to creating a recycling-based so-

Samut Prakarn Province, Thailand.

Indiaʼs state-owned power generation compa-

ciety for green mobility.

number of companies.
In this project, Moray Offshore Windfarm (East) Limited (MOWEL), invested in

December 2019 │ JBIC Today

Manufacturing of Environmentally-conscious
Materials

to approximately USD188 million (JBIC

In European countries, including the4

SwedenElectric Power Co., Ltd. and others, willCo., Ltd. also participates in this project as

Geothermal power plant project in Indonesia.

Meeting increasing electricity
demand in India throughsupport for solar power

Thailandagreement in project financing totaling up

ing on the back of stable economic growth.

tau Dedap (SERD), an Indonesian company

Solar Power Projectsions in India.

invested in by Marubeni Corporation, Tohoku

The Indonesian government promotes plan to

In this project, PT Supreme Energy Ran-

Waste treatment and power generation plant in Sweden.

in Europe, which is the most advanced mar-ny, for 25 years.

In November 2018, JBIC signed a loan

Hitachi Zosen Group regards this projectagreement totaling up to approximately

by Mitsubishi Corporation, Kansai Electric

In September 2017, JBIC signed a loan

as an important strategic milestone for further

USD66 million (JBIC portion) with ACTH toPower Co., Inc. and Mitsubishi UFJ Lease &agreement in project financing with SBG

expansion in its overseas business. In Marchsupport the expansion of their manufacturing

Finance Company Limited and others, will

Cleantech for this project. This is the first2019, JBIC signed a loan agreement totaling

capabilities. This loan is also provided underbuild, own, and operate an offshore wind farmoverseas solar power project for SBG. In India,

up to approximately 120 million Swedish kro-

JBICʼs “Global Facility to Promote Quality

with the worldʼs largest generation capacity ofelectricity demand is surging on the back of its

na (JBIC portion) with HZI Jönköping Biogas

Infrastructure Investment for Environmental

950 MW. The wind farm will be built 22 km

rapid economic growth in recent years. JBICʼs

AB. This loan is provided under JBICʼs “Global

Preservation and Sustainable Growth (QI-

off the coast of Moray in Scotland. Under thefinancial support will contribute not only to

Facility to Promote Quality Infrastructure In-

ESG).”
December 2019 │ JBIC Today

5FeatureFeaturefying the reductions in GHG emissions fromeach project. All projects financed under the
GREEN operation were required to measure,report and verify the reduced amount of GHG
emissions. Under the QI-ESG facility, thisquantitative measurement process is simplified
in order to further promote environmental
projects.
JBIC made 10 commitments totaling
USD2.9 billion under the QI-ESG facility
during 9 months from July 2018 to the endof March 2019. The fields of the projects are
wide-ranging, from renewable energy throughto gas-fired power generation. Furthermore,
the QI-ESG facility offered a loan to a waste
treatment project, which is the sector where
JBIC had never financed before under the
GREEN operation.
“JBIC signed a loan agreement totaling
up to 120 million Swedish krona for a waste
treatment project. In this project, a Swedish
subsidiary of Hitachi Zosen Corporation
Group will construct a waste treatment plantusing methane fermentation technology andsell biogas for 20 years (see page 5). There aremany companies contacting us for more in-formation about financing for environmental
projects.” (Morimoto)Amid the global trend of ESG investment, establishing infrastructure using renewable energy sources that contributes to theprotection of global environment is becoming
increasingly important both in developed anddeveloping countries.
“That is why we intend to provide extended support to Japanese companies which
pursue new business opportunities in the environmental field, by utilizing our new facilityof QI-ESG.” (Morimoto)Special Feature Creating Harmony between Environment and Economic Society

Launch of JBIC’s global environment facility of “QI-ESG”
In July 2018, JBIC established its new facility of “QI-ESG” in order to support deployments of infrastructure that is expected to help protect the global environment. The accumulated amount of commitments under this facility is about USD2.9 billion as of the endof March 2019.
What is the role of JBIC’s new facility of “QI-ESG”?
In July 2018, JBIC launched a new
financing facility called “Global Facility toPromote Quality Infrastructure Investment forEnvironmental Preservation and Sustainable
Growth (QI-ESG).” The Japanese government
has promoted quality infrastructure investment since 2015 in collaboration with various
governments and international organizations
according to the initiative of “Partnership for
Quality Infrastructure.” QI-ESG was established against the backdrop of this initiative

Soichiro Morimoto

Deputy Director
Operation Policy and Strategy Coordination
Division of Corporate Planning Department,
Corporate Planning Group, JBIC (Then)

6

December 2019 │ JBIC Today

as well as the global trend of environmental,social and governance (ESG) investment.
Eligible projects under this facility include not only projects aimed at reducing
greenhouse gases (GHG) emissions, but also
those that are expected to help preserve theglobal environment.

Expanding support to watersupply, water pollution
prevention and waste treatment
disposal
What are the features of this new facility?
Soichiro Morimoto, then Deputy Directorof the Operation Policy and Strategy Coordination Division of the Corporate Planning
Department, who was engaged in launching
this facility, explains, “We established a framework that allows us to provide a wide range of
support to environmentally-friendly projects.”
Under the GREEN operation launchedin 2010 to perform its new mission of the
global environmental preservation, JBIC has
financed projects that are expected to help
reduce GHG emissions. The range of projects
that are eligible for the QI-ESG facility has
expanded to projects that contribute to protecting environment, such as air pollution prevention projects, water supply, water pollution

prevention and waste treatment, in addition to
those for reducing GHG emissions.” (Morimoto)
For example, in the mobility field, only
inner-city railway projects were eligible forfinancing under the GREEN operation. However, the range of projects that are considered
for financing under the QI-ESG facility was
expanded to inter-cities railways such as highspeed railways contributing to urbanizationand enhancement of transportation capabilities.
“Additionally, more diversified financial
tools are available through the QI-ESG facility.
Under the GREEN operation, financing wasprovided only in the form of the Untied Loan
and the Equity Investment, but the Overseas
Investment Loan (hereinafter referred as ʻOILʼ)were added to the QI-ESG facility in addition
to those financial instruments. Previously,
JBIC made decisions on commitments to OIL
based on the degree of involvement of Japanese companies in targeted projects. However,the new facility has enabled JBIC to provide
OIL from the viewpoint of enhancing support
for projects that help preserve global environment.” (Morimoto)Besides, JBIC reviewed its own guidelines
called J-MRV Guidelines, which define theprocedures for measuring, reporting and veri-

JBIC Interview

Kazuhiko Hombu, Visiting Professor, the Graduate School of Public Policy,
the University of Tokyo as well as Managing Executive Officer of Taisei Corporation

Introducing the environmental technology ofJapanese companies to developing countries
What is necessary for achieving the goal of the Paris Agreement?
—The global roles played by Japanese companies in advanced environmental technology—― The Paris Agreement has set the target of keeping the
average global temperature rise to below 2 degrees Celsius
compared to the level before the Industrial Revolution. However, aren’t there many challenges in balancing this with theeconomic development of developing countries?
Mr. Hombu: The 2 degrees Celsius target of the Paris Agree-

ment is fairly ambitious. According to the forecast of theInternational Energy Agency (IEA), even if every country
pursues their targets of reducing greenhouse gas (GHG)
emissions that they submitted to the United Nations, thegoal of 2 degrees is far from being achieved.
This situation tells us that we need to “do all we cando.” It is important to take every possible measure to reduce carbon emissions and keep the temperature increases
to below 2 degrees. These measures include the use of not
only solar and wind resources but also other energy sourcesin the renewable sector, the introduction of a carbon dioxide capture and storage (CCS) technology and the continued use of nuclear energy.
― In what fields will Japanese companies capitalize on theirstrengths?
Mr. Hombu: When it comes to power generation, Japanesecompanies have a competitive edge in the geothermal, water and waste-to-energy power sector. Particularly, manufacturing of high corrosion resistant turbines for geothermal
power generation is one of the areas where Japanese companies still have a significant competitive edge. Waste-to-energy power generation is a relatively new field in developing
countries, but its demand is expected to rise in large cities

in the ASEAN countries.
In developing countries, in the process of introducing
renewable energy amid expanding electricity demand, theneeds for natural gas power generation will increase further
because power output from natural gas power plants caneasily be controlled and GHG emissions can be curbed.
On the other hand, countries that have difficulty obtaining
natural gases may require high-efficiency coal-fired power
generation. In that case, it is important to introduce power
plants with as high efficiency as possible. In light of this,developed countries need to provide funds to those developing countries for introducing environmental technologythat suits the actual situation of each country.

― What roles do you expect JBIC to play?
Mr. Hombu: To achieve the Paris Agreement, I expect JBIC

to utilize its expanded global financing facility of QI-ESG
aimed at encouraging Japanese companies with strengths
in various fields to participate in environmental projects
abroad. Environmental projects are long term and those indeveloping countries entail a country risk. It is JBICʼs role
to assume these risks and complement the private sector.
Besides, there are some new environmental technologies
that the private sector alone cannot support because it isdifficult to evaluate the business feasibility due to a lackof track records of those technologies. I believe that JBIC
is also expected to contribute to supporting the overseas
deployment of environmental technologies to establish
proven track records of those technologies and accelerating
the spread of the technologies.

December 2019 │ JBIC Today

7

The Focus

Our Global Challenges
A New Product that Captured the Needs in Thailand.
Uplifting Domestic Businesses through Reverse Imports―DECSYS CORPORATIONDECSYS CORPORATION, a manufacturer of appearance inspection systems using advanced image
processing technology, quickly expands into Thailand in anticipation of the local demand forautomated inspection process.

Expectinggrowth in
the auto& medical
sectors!

Until now, appearance inspection of partsand materials that require high safety and reliability has been performed manually. This typeof work requires advanced knowledge and experience, but staff performing inspection duties
are aging. DECSYS CORPORATION founda business opportunity in this situation and developed a system to inspect stereoscopic objects
using image processing technology.
Through the establishment of its local
subsidiary in Thailand in 2017, the company
quickly entered the local appearance inspection
market, getting off to a good start in their overseas expansion.

Automation of Manual Appearance
Inspection Led to Increased Sales
Established in 1998, DECSYS CORPORATION initially developed and sold devices
specialized in appearance inspection for semiconductors and liquid crystals. Thereafter, thecompany shifted its focus to the highly competitive market of medical supplies such as medical
containers, nozzles and syringes, which require
more advanced technology for quality inspection.
Currently, the appearance inspection devices for
medical materials and pharmaceutical products
account for 80% of total sales of the company,
while the remainder of sales comes from thosefor precision components such as semiconductors, liquid crystals, as well as sensors of electricvehicles. Mr. Seki, the companyʼs President &Representative Director, states the following:“Our equipment is intended to be used forinspecting objects requiring manual inspection.
Appearance inspection needs advanced knowl-

Tadao Seki
President & Representative Director
DECSYS CORPORATION

8

December 2019 │ JBIC Todayedge of detecting minor scratches and dents on
inspected objects, while it usually takes many
years to acquire such knowhow. Because of this,errors and omissions can happen during theinspection process, depending on the personʼsknowledge and experience. Moreover, inspection
staff are aging in many companies and labor
shortages are becoming a problem. Thatʼs why
automated inspection systems utilizing image
processing technology are needed.”
The company eventually established a structure to develop a set of appearance inspection
systems. The company is the only manufacturer
in Japan that makes appearance inspection devices combining image processing technology.
Usual appearance inspection process requires pre- and post- processes in which theinspected objects are aligned to be fed into theinspection station and taken out of it after the inspection and packaged in boxes for shipment. In
2017, the company developed a humanoid appearance inspection robot called “Gaikan Kenta
Kun” which automatically completes all of thesesteps, and surprised the whole industry. Having
two arms, the robot automatically identifies andpicks up objects for inspection and can even perform simple tasks such as assembly of parts andmaterials after the inspection. For this reason,
it can be integrated into the whole production
process, as well as used for specific process which
may require inspection by human hand.
In July 2017 when “Gaikan Kenta Kun”
was launched, the company established its local
subsidiary, DECSYS (THAILAND) CO., LTD.
(DTCL) in Bangkok, Thailand.

Focusing on Needs for Automated
Production in Thailand“It was important to expand overseas to sustain stable business management. We had alreadyWith a local subsidiary staff member in Thailand who is
promoting products at an exhibition.

exported our products to overseas subsidiaries/
affiliates of Japanese companies and were awareof increased needs of automation in their production bases. After researching about China andSoutheast Asia, we decided that itʼs best to enter
the Thai market,” says Mr. Seki.
However, in Thailand, appearance inspection by hand was still the most common method
for inspection and it was difficult that a fully-automated system was adopted. That has led thecompany to develop a semi-automated inspection device in Thailand that needs inspection
staff only when the inspected objects are placedin and out of an inspection station.
Mr. Yasuo Sugai, the president of DTCL,
who was involved in the launch of DTCL, says:“Our semi-automated devices can be operated easily by anyone because it simply requires
inspection staff to feed and take the inspected
object into and out of the device by hand. Weʼdfirst like our clients to introduce this device into
their production process and consider adopting afully-automated device in the future.”
DTCL had a strong start and even made aprofit from the first year thanks to demand forappearance inspection for parts used in smartphones. The semi-automated devices have also
been re-imported for sales in Japan.
DTCL is making stable profits and this is
primarily because DTCL were able to hold down
their initial investment according to their business strategy of: entrusting production of devices
to a Thai factory of Japanese companies which
are shareholders of DECSYS as well as its alliancepartner; and outsourcing sales and distribution of
the inspection devices to Japanese trading firms.
“Emphasizing the alliance strategy also inJapan, we cooperate with domestic partner companies for production of our products. Moreover
we have many partners for sales and development. The concept of our business strategy is not
simply focused on outsourcing of production andsales, but more on creating mutual business benefits for us and our business partners. We wanted
to implement this alliance strategy in Thailand as
well,” says Mr. Seki.
Positioned as a technical support base,
DTCL has highly-skillful engineers transferredfrom Japan and hired two local office staff members and three technicians.
“In fact, we are also training two Thai engineers at our Tendo office in Yamagata Prefecture,
where one is learning about image processing,and the other about device designing. We plan totrain them for two to three years and eventually
have them return to Thailand,” says Mr. Sugai.
As for the local office management, he further
explains, “we try to manage the local staff by examining the relationships between the members,
as Thai people tend to place value on verticalsocial relationships in terms of communicationstyles.”Part of the long-term funds required forthis Thai business was provided by JBIC in collaboration with Chiba Bank, which is their main
financing bank.
“In addition to a long-term loan in Thaibaht, JBIC has been helpful in providing us
overseas information. They also supported us infinding potential clients and business partners
through business matching events. We are sincerely grateful for their service,” says Mr. Sugai.
In Thailand, labor costs are rising while theproductive-age population is aging and decreasing. Due to this, the Thai government is also
promoting the automated production process.
With the rising hopes for the progress in automation in production process, DECSYS sees the
future as follows: “We expect our technology
to spread into the sectors of automobile andmedical materials. As inspection for parts andmaterials particularly exported to Japan is strict,automated inspection devices for such products
should be widely adopted in Thailand.”Expandingour presencein thedomestic
marketthrough our
foray into
Thailand!

Top: A humanoid appearance inspection robot called “Gaikan
Kenta Kun” that performs fully-automated inspection.
Bottom: A semi-automated inspection device developed tomeet the needs of Thailand.

Corporate DataDECSYS CORPORATION
Established 1998
Total capital JPY 100 million
Business Manufacturing and sales of inspection systems such as visual inspection based on advanced image
processing technology
Headquarters 2-1-34 Honcho, Funabashi-city, Chiba
Relation with JBIC
Has obtained funding from JBIC for the development and sales of image processing equipment and visualinspection equipment carried out by DECSYS (THAILAND) CO., LTD. in the form of a cross-border loan in thelocal currency.

December 2019 │ JBIC Today

9Project Frontline

Latest Report From Young Staffs

Supporting production of rare mineral resource in collaboration
between public and private sectors

O

A zirconium compound manufacturing plant to be built in Vietnam.

ne of the mineral resources strategically focused by the Japa-

T

he government of Uzbekistan promotes high-speed, high-capac-

high degree of certainty obtained through close communication

Joint Stock Company (VREC) in Vietnam to procure the raw ore (zir-with the Vietnamese government is indispensable for addressing

con sand) from local suppliers and produce ZOC. Since then, VREC

those issues. I recognized that JBIC’s strength lies in the network of

has continued to manufacture ZOC in its pilot plant with production

contacts that has been developed through number of projects we

capacity of 2,000 ton per year. DKKK has recently decided to expand

have accomplished in Vietnam and maintained by its representative

their production capacity and JBIC received a request for funding up

office in Hanoi over years. I also realized that JBIC needed to tackle

to JPY500 million equivalent from DKKK.

those challenges which VREC and DKKK facing by means of equity

We considered how we can support DKKK’s business in Vietnam

participation, not loans, because acquiring shares allows JBIC to be

used as a raw material for various industrial products including emis-

and what is the value that can only be offered by JBIC for this mid-directly involved in this project as one of the stakeholders. This is thesions purification catalysts for automobiles and other electronic ma-

sized but well established global company. Financing in the form ofvalue that can only be offered by JBIC. I am delighted that we were

terials. After repeated research and development of zirconium com-equity participation was one of the solutions we come up with.

able to meet our client’s needs and help to secure important natural

pounds, Daiichi Kigenso Kagaku Kogyo Co., Ltd. (DKKK) established

We’ve frequently visited DKKK’s head office in Osaka to explain

their own methods to refine and produce zirconium compounds.

the functions of JBIC. Through a number of discussions with them,With their technological capabilities, DKKK is acknowledged as one

we came to realize that they were facing some issues in startingof the largest producers in the global zirconium compounds market.

business Vietnam. In Vietnam, there are cases where it may takeIn order to manufacture zirconium compounds, it is required

years to go through necessary government procedures due toto procure zirconium oxychloride (ZOC), the raw material used forsudden changes in laws and regulations, as well as uncertainty inproduction of the compounds, from overseas. As Japan imports al-

guidelines of implementation of such laws and regulations. Envi-most all of its ZOC from China, DKKK needed to diversify their sup-ronmental considerations are also needed for disposing the waste

ply sources in order to secure long-term and stable supply of ZOC.

generated during the production process of ZOC. Information withsystem, Uzbekistan is one of the countries that have deep ties withJapan. This is the first loan that JBIC has provided to Uzbekistan

P

etrochemical industry is one of the leading industries in Malaysia and contributes to increase the added value of the oil andly owned subsidiaries, by Petroliam Nasional Berhad (PETRONAS),

gaining the trust of the related parties, the other agencies generally

by the government significantly changed. Business negotiations thatthe state-owned petroleum company of Malaysia, and Saudi Arabian

supported JBIC’s position even when we had to make a difficult de-were in progress, including those for loan agreements, were also

Oil Company (Saudi Aramco), the state-owned national oil company

cision or request.

reviewed again. These factors significantly impacted the progress ofof Saudi Arabia, launched a Refinery and Petrochemical Integrated

A major success we achieved through this project financing is

the project. Under such circumstances, we pushed the negotiations

Development (RAPID) project in the state of Johor in Malaysia. RAP-

that we have not only supported Japanese companies to strengthen

on loan forward step by step through a direct dialogue with the

ID will be the largest complex of its type in Malaysia and will housetheir competitiveness in the global market but also strengthened

government of Uzbekistan that we had reached by utilizing JBIC’sa refinery with a daily refining capacity of 300,000 barrels and also

trusting relationships with Malaysia and Saudi Arabia as well as

network of contacts. Once the loan agreement was concluded, we

ethylene, propylene and other petrochemical plants (total annual

PETRONAS and Saudi Aramco through supporting a project in line

felt that all of our efforts were rewarded.

output of 3.3 million tons). This project is a national project for Ma-

with the economic and industrial policies of the governments ofboth countries.

tion technology and the growing popularity of smartphones. As partthrough administrative reform under the leadership of President

Saudi Arabia’s Vision 2030 and Saudi Aramco’s long-term strategy ofof this initiative, Uzbekistan’s state-owned communications compa-

Mirziyoyev. I feel that this loan is of great significance in encourag-increasing its global refining and petrochemicals footprint, including

ny, Uzbektelecom JSC, has decided to purchase from Toyota Tsusho

ing Japanese companies to expand overseas business and I achieve

in Asia.

Corporation a complete backbone telecommunication networka sense of accomplishment after all my efforts to complete the loansystem manufactured by NEC Corporation etc. The government ofagreement.

(export finance) agreement totaling up to USD 900 million (JBIC’s

Uzbekistan plans to upgrade the system to achieve a communication

profileportion) with Pengerang Refining Company Sdn. Bhd. (PRC) of

Yu Sasaki
Division 3, Oil and Gas Finance Department
Energy and Natural Resources Finance Group“It was hard to negotiate with a country that has a different
language and cultural background, but I realized how important it is to negotiate by trying to understand the other party’s
point of view.”

so that we could smoothly make financing arrangements in cooperation with the other export credit agencies. As a consequence, by

profileIn April 2019, JBIC signed a project finance-based buyer’s credit

Malaysia. The loan will be used to purchase a steam cracker facility
from Toyo Engineering Corporation.
While attending several face to face meetings held in Kuala
Lumpur, Singapore, London and Tokyo, we also visited the head of-Uzbekistan (NBU), in co-financing with Sumitomo Mitsui Banking

December 2019 │ JBIC Today

RAPID site in the state of Johor,
Malaysia.

cies, as well as various application and approval procedures taken

Malaysia Plan. The project is also of great strategic importance tofor more than 20 years to develop its communications network“I was able to re-acknowledge that there are certain insightsthat you begin to see and recognize after working closely withyour clients.”

Sdn. Bhd. (PRC) of Malaysia, which is indirectly invested in, via whol-

economic cooperation between Japan and Uzbekistan which went

Having received ODA loans from the Japanese government

Deputy Director
Division 1 & 2Equity Investment Department
Equity Finance Groupappointment of the new president, personnel of government agen-telecommunications system, in response to the progress of informa-

Corporation.

Shohei Koike

gas it produces. As part of this effort, Pengerang Refining Company

laysia and is expected to play a major role in implementing the 11th

the National Bank for Foreign Economic Activity of the Republic ofprofilesince President Mirziyoyev took office in December 2016. With the

Signing of the loan agreement has led to the deepening of

In March 2019, JBIC decided to finance a state-owned bank,resources for Japan.

Strengthen the relationships with national oil
companies in Malaysia and Saudi Arabia

ity telecommunications networks by upgrading the backbone

speed that is 20 times higher than current levels.

10

Therefore, DKKK established the Vietnam Rare Elements Chemicalnese government is zirconium. This is an important resource

Loan to the government of Uzbekistan
The cityscape of
Tashkent, the capital of
Uzbekistan. A tower inthe middle of the photois Tashkent Tower,
which is used as a radio
and TV tower.

JBIC is working on various projects around the world.
Young staffs report on the significance of the latest projects and the role of JBIC.

fices of PETRONAS, Saudi Aramco and Toyo Engineering Corporation
as well as the project site. Through these onsite meetings, we madeefforts to deepen our understanding of the project and technology

Daisuke Ito

Kyohei Iwaori (then）

Deputy Directors
Division 2, Corporate Finance Department
Industry Finance Group“To make a good precedent for the future, I stood strong at theforefront of negotiations to make it happen.”

December 2019 │ JBIC Today

11

JBIC Today December 2019【Published by】
Press and External Affairs Division, Corporate Planning Department,
Corporate Planning Group,Japan Bank for International Cooperation
4-1,Otemachi,1-chome Chiyoda-ku,Tokyo 100-8144,Japan
Tel.+81-3-5218-3100 URL: https://www.jbic.go.jp/en/
Cover photo : ©Product/VGL/Geoscience/Planetobserver Agency/Artbank
Some of the photos shown here are used under license from Shutterstock.
*No part of this magazine may be reproduced without the written permission of JBIC.