October 2022

Special Feature

Japan-Australia Collaboration Aims fora New Stage of Economic Cooperation
JBIC established a new representative office in Australia’s economic center
Supporting Japanese companies’ overseas business ventures
Private sector’s technology and wisdom are the keys to resolving mounting global-scale challenges
Cooperation between Japan and Australia Promotes Decarbonization and the Resilience of Supply Chains

Our Global Challenges - Holus Co., Ltd.
Production of frozen vegetables and processed foods in Vietnam
Supporting the world’s food supply with a “Made by Japan” model

Project Frontline Our People and Their Work
Contributing to semiconductor supply chain resilience through M&A support
Opening up the future of hydrogen through investment in overseas fundJapan-Australia Collaboration
Aims for a New Stage of
Economic Cooperation

2,500

Net trade
2,000

Changes in inventories

Billion AUD

1,500

Fixed capital formation-private

1,000

Fixed capital formation-public
Household consumption

500

CANBERRA

Victoria

Spatial Reference: GDA 1994 Australia Albers

Tasmania

Suitability

SYDNEYHigh

HOBART

Source:AUSTRALIA’s NATIONAL HYDROGEN STRATEGY, COAG Energy Council

Low

2021

ADELAIDE

500
km

Protected/
Unsuitable areas

New South Wales

PERTH

0

Capital cities

2020

BRISBANESouth Australia

2019

Renewable wind, solar
and hydropower
resource potential,
without infrastructure
constraints

Queensland
Western Australia

2018

Prospective hydrogenproduction regionof Australia

Northern
Territory2017

DARWIN2016

2

Regions with large potential for hydrogen production

2015

Australia is a key partner for Japan in the realization of a “free andopen Indo-Pacific.” Although some 20 times larger than Japan in landarea, its population, at 25.75 million, is only about 20% that of Japan.
However, due partly to its migrant intake, Australia’s population is
growing by 300,000 to 400,000 every year, leading to growth inhousehold consumption expenditure and housing investment. The
population is expected to continue growing, with some forecasts
showing that the population will reach approximately 37-49 million by
2066 (Australian Bureau of Statistics, 2018). The Australian government
has announced that it will invest AUD120 billion over ten years to build
new infrastructure.
“Population growth in Sydney is particularly remarkable, with that city
expected to grow by 60% from 5 million today to 8 million in 40 years’
time. With construction of the new Western Sydney International Airport
underway, the Australian government intends to develop a new urbanzone that incorporates advanced technologies, with the new airport at
the center. Although there are no concrete plans as of yet, there are
expectations that Japanese companies with cutting-edge technologies
will be involved,” TAKAHASHI explained.
It is also inevitable that, as the population grows, demand forelectricity will also increase. Installed generation capacity in Australia in
2019 was 71GW, and this will be increased to 132GW in 2030 (Source:
Australia's emissions projections 2021). These projections include theexpansion of renewable energy use such as solar and wind power, as
well as the closure of coal-fired power stations that have reached theend of their service life.
“One of the major policy drawcards of the new Albanese

Given Australia’s vast land area, resources and energy
circumstances vary from state to state. For example, Queensland and
New South Wales have abundant coal deposits, while Western Australia
and the Northern Territory are rich in natural gas. However, in responseto the recent decarbonization trend, coal and gas operators are looking
for ways to survive, such as decarbonizing through converting theseresources into blue hydrogen. In hydrogen-related developments,
Australia’s National Hydrogen Strategy, announced by the AustralianFederal Government in 2019, is well known. Interestingly, however, theindividual states have also developed their own unique strategies basedon the characteristics of their respective regions.
TAKAHASHI explained, “South Australia and Tasmania have notpreviously had major resource export industries, but they are now aiming
to become major production and export bases for hydrogen, making useof abundant renewable energy potential. Each state is competing withothers to attract investment by establishing a stable and conducive
business environment, including opening up new demand for hydrogen
within their own states.”
There is no blue hydrogen without CCS, the capture and storage of
CO2 generated during the hydrogen production process. With its long

2014

Population growth of over 300,000 every year
Increasing energy needs with renewables
expected to play a bigger role

Active promotion of hydrogen as a new energy
carrier, in combination with CCS

2013

economic growth and❶ Steady
infrastructure development❷ National Hydrogen Strategy❸ CCS potential❹ Leading mineral resources producer❺ Collaboration with neighboring regions

2012

300

7,000

270
240

5,000
4,000
3,000
2,000

210

Calendaryear
2020
Total generation

180
150

Calendar
year
2020

120
90
60

1,000

30

Renewables generation

0

0
2011

2011

8,000

Terawatt hours

Five key trends

Megawatts (MW)Australia’s Economic Outlook:

Errors and omissions

Source: Australian Bureau of Statistics
The economy remains strong due to the expansion of household consumption expenditure and fixed capitalformation, supported by population growth. Although GDP growth in 2020 fell into negative territory due to the impact
of COVID-19, it recovered in 2021 due to steady household consumption expenditure and increases in exports.

6,000

administration, which was sworn in May 2022, was to lift Australia’s 2030
emissions reduction target from 26-28% below 2005 levels to 43%. As ameans of achieving this goal, it has significantly increased the 2030
target for the percentage of renewables in power generation from 69% to82%. These figures have been set as ambitious, yet realistic targets. The
Australian government will likely employ a variety of measures, including
strengthening the power grid, to eliminate bottlenecks in power supply,”
TAKAHASHI described.

2010

2009

2008

2007

2006

2005

2004

2003

2002

Amid mounting challenges around energy supply, the securing of mineral resources, and tackling climate change, there
is growing attention being focused on Australia and the Pacific region. What kind of potential do these regions offer?
We asked TAKAHASHI Naoki, Chief Representative of JBIC’s Representative Office in Sydney, for his insights.

2001

Changes in nominal GDP(seasonally adjusted)

2000

1999

1998

1997

1996

1995

1994

1993

1992

1991

-500

Government consumption
1990

0

2012

2013

2014

2015

2016

2017

2018

2019

2020

1979-80

1984-85 1989-90 1994-95 1999-00 2004-05 2009-10 2014-15 2019-20

Rapid expansion of solar power generation capacity

Changes in total generation and renewable generation

Source: Australian Energy Update 2021
There is high potential for solar power generation in all regions of Australia. The recent expansionof the market is clear from the trends in solar power generation capacity, and market growth has
been particularly remarkable since 2018.

Source: Australian Energy Update 2021
Australia’s energy mix varies from state to state, with hydro-electricity accounting for nearly 80% of
power in some states, while other states are focused on wind and solar power generation. The shareof renewables in total electricity generation is on the rise overall.

history of gas-field development, Australia has many spaces that would
be suitable for CCS, making it an area with high potential even in global
terms. Making CCS profitable has so far been a challenge, but theAustralian Government has launched a new Carbon Credit scheme inwhich tradable Carbon Credits are granted to operators according to thevolumes of CO2 they have stored underground with CCS. Once therelevant laws and regulations have been developed, there is also
potential for the establishment of a new business in which CO2
generated in Japan could be transported to and stored in Australia.
“To be exported, hydrogen needs to be converted to liquefiedhydrogen, ammonia, or methyl cyclohexane (MCH). Japan has
considerable technological strengths in this area as well. The Hydrogen
Energy Supply Chain (HESC) project, whose partners include a major
Australian energy firm and multiple Japanese companies, has attracted
a great deal of attention by becoming the world’s first large-scaledemonstration project to successfully transport liquid hydrogeninternationally. MCH can be transported and stored at normal
temperature and pressure, which means that existing oil-related
infrastructure can be used for its transport and storage. In this way,advanced technologies cultivated from many years of research anddevelopment by Japanese companies are attracting the attention ofAustralian companies.”

Critical mineral industry essential forbatteries
Government providing full support for industry
development
Demand for batteries is growing against the backdrop of
decarbonization, but the regional maldistribution and oligopolization of
supply of critical minerals, such as lithium and nickel, which are essential
for battery production, present challenges.
“With its abundant reserves of critical minerals, Australia has alreadyestablished a certain position in the market, but it has not yet establishedthe processing and refining facilities for supplying refined minerals to an
adequate degree. To this end, as well as developing upstream mining forlithium, nickel, and copper, the Australian government intends to nurture
midstream and downstream industries, such as ore refining and battery
manufacture, for the further expansion of those industries.”

Australia’s exports of lithium, nickel and copper were valued at
AUD12 billion in 2020, with the Australian government aiming to expand
this figure to AUD84 billion by 2050. Alongside the development ofindustries in other critical minerals such as rare earths, this is expected
to create 52,000 new jobs. The new administration’s flagship AUD15
billion National Reconstruction Fund also focuses on adding higher
value to the resources sector.
“Compared with base metals such as iron ore, the markets forindividual critical metals are relatively small, and future demand may
fluctuate significantly depending on trends in technologicaldevelopment. This makes it difficult for companies to make investment
decisions, but Chinese and Korean companies have already started
investing in Australia in this area. As this sector has strong support fromthe Australian government and is one that JBIC has also positioned as apriority area, we really hope that Japanese companies will also consider
investing.”
Japan and Australia have long enjoyed an excellent relationship andhave worked together in many different areas. In addition to theformation of the Australia-Japan-United States Trilateral InfrastructurePartnership in November 2018, there has also been active discussion
among the three countries and India (the Quad) in recent years. It could
be said that Japanese companies are being given a further boost to
encourage the development of business in Australia and the Pacificregion.

The use and application of hydrogen energy requires technologies for
production, transportation, storage, and utilization. Progress is being
made on the development of a large liquefied hydrogen carrier in Japan.
(Photo courtesy of Kawasaki Heavy Industries)

3

JBIC established a new representative
office in Australia’s economic center
Supporting Japanese companies’
overseas business ventures

Private sector’s technology and wisdom
are the keys to resolving mounting
global-scale challenges

TAKAHASHI Naoki, Chief Representative of
JBIC’s Representative Office in Sydney, explains:“Japanese companies have a long history ofJapaninvesting in Australia in sectors such as minerals,
including major industrial minerals such as iron ore
and coal, energy resources, primarily LNG, and infood, particularly beef. Even while companies from
Northernother parts of the world were reducing their
Mariana Islands
investment balances due to the pandemic,
Marshall Islands
Japanese companies actually increased theirdirect investment balances in Australia. For these
Palau
Micronesia
reasons, Australia views Japanese companies as
Kiribati
highly reliable and secure partners. Japanese
Nauru
Papua New Guinea
companies, meanwhile, hold Australia’s stable
TuvaluSolomon Islands
investment environment underpinned by a robust
Samoa
regulatory framework in high regard. Establishing
Niue
Vanuatua new representative office in Sydney has made it
Fiji
Cook Islands
Tonga
easier for us to work together with DFAT and EFA.
Australia
New Caledonia
Going forward, we hope to actively promote theformation of collaborative projects between Japan,
the United States, and Australia.”
Infrastructure projects, particularly local
infrastructure projects in Australia, require not only
New Zealandclose communication but also an understanding ofAustralian business practices, such as the need forRepresentative Office in Sydney
quick decision-making, in order to be executed
Address: Suite 4102, Level 41, Gateway Tower, 1 Macquarie Place, Sydney, NSW, 2000, Australia
successfully. For this reason, it is vital to form
Countries and regions covered: Australia, Kiribati, Cook Islands, Samoa, Solomon Islands, Tuvalu,
relationships with Australian companies that haveTonga, Nauru, Niue, New Zealand, Vanuatu, Papua New Guinea, Palau, Fiji, Marshall Islands,
an established track record in the sector. The main
Micronesia, Northern Mariana Islands, New Caledonia
roles of JBIC’s Representative Office in Sydney
includebuilding
relationships
with
local
stakeholders and researching the potential ofindividual businesses. To achieve the mosteffective outcomes, the office will collaborate with organizations andinstitutions that are familiar with local circumstances to deliver beneficial
information to Japanese companies.
TAKAHASHI remarks, “In addition to areas such as iron ore andnatural gas that have long been and will continue to play an importantrole, we will also focus on areas that— despite their considerable
business potential— we have not engaged in very much to date, such as
In March 2022, JBIC established a representative office in Australia’shydrogen, renewable energies, critical minerals, and social
largest city of Sydney, New South Wales. Through this new office, JBIC
infrastructure, in our efforts to support Japanese companies in new
will strengthen its financial support for Japanese companies’ businesschallenges.”
activities in Australia, New Zealand, and Pacific island nations. A major
factor behind the new office’s establishment was JBIC’s signing of theAustralia-Japan-United States Trilateral Infrastructure Partnership (TIP)with the United States International Development Finance Corporation(USDFC), Australia’s Department of Foreign Affairs and Trade (DFAT),
and Export Finance Australia (EFA).
In recent years, demand for infrastructure development has been
growing in the Pacific and the rest of the Indo-Pacific region, andAustralia seeks to promote private-sector investment in the region for thesake of sustainable economic development. However, due to the limited
number of Australian companies which are actively investing in overseas
infrastructure development projects, Australia has called for participationfrom Japan and the United States. JBIC is in a position of providing
financial support for Japanese companies’ overseas business
Members of Representative Office in Sydney
expansion, and the United States is also proactive in its support ofFrom left: TAKAHASHI Naoki (Chief Representative), Montana Clapton(researcher), WADA Sachie (administrative staff), TAKAHASHI Kento
infrastructure investment. For these reasons, consensus was quickly(Representative)
reached between these three nations, resulting in the finalization of the
The team’s main missions are to build relationships with local
stakeholders and conduct research.
TIP in November 2018.

How to address the global agenda?
Possibilities created by multilateral
cooperation

Communication is critical in the infrastructure
sectorNew office provides support that only local
representation can offer

4

The world’s economy has grown significantly with the progress ofglobalization. In order to continue this trend, it will be necessary to findsolutions to global-scale challenges, otherwise known as the global
agenda.
One easily understood example is action to counter climatechange. The climate knows no national borders, and climate issues
cannot be resolved by a single country or region alone. In addition toconventional collaborative economic support and assistance todeveloping countries, the technologies, expert knowledge, and wisdomof private-sector companies will be essential in aiming toward long-termtargets such as achieving net zero greenhouse gas emissions by 2050.
Moreover, it is only when actions are sustainable as businesses thatthey will truly become solutions.
In the promotion of private-sector investment, policy-based
financial institutions such as JBIC have a major role to play. Just as thechallenges faced by different countries differ, different companies havedifferent approaches to investment and face different challenges. With afull understanding of the technologies or investment sentiment of thecompanies as well as the recognition of the policy agenda each country
prioritizes, Policy-based financial institutions are in a better position towork quickly to connect the private sector with solutions to address theglobal agenda. These kinds of moves to promote investment havebecome a global trend.
The Australia-Japan-United States Trilateral InfrastructurePartnership (TIP) has been established to address the common
challenges in the field of the infrastructure development, particularly in
the Indo Pacific region. In addition, cooperation among policy-based
financial institutions in the Quad, which comprise Japan, Australia, India,
and the United States, has also been strengthened to allow them toaddress solutions to issues under the concept of a “free and open
Indo-Pacific.”
In May 2022, ahead of the Quad Leaders’ Meeting held in Tokyo,
JBIC hosted a roundtable involving Export Finance Australia (EFA), theAustralian Infrastructure Financing Facility for the Pacific (AIFFP),
Export-Import Bank of India (India Exim Bank), and U.S. International
Development Finance Corporation (USDFC) to discuss enhanced
collaboration to better connect the Indo-Pacific region.
Japan, the United States, and Australia share a common

Signing of the Memorandum of Understanding on the Australia-Japan-UnitedStates Trilateral Infrastructure Partnership (November 2018)

SEKINE Hiroki

Special Advisor for Operation Policy and Strategy, Corporate Planning Groupgeographical feature in that they all face the Pacific Ocean. More
importantly, these three nations complement each other in various ways.
Regarding climate change, for example, Japan has strengths in energy
conservation and has developed proprietary technologies in the areas ofsecondary batteries and hydrogen. Australia, meanwhile, has great
potential in terms of clean hydrogen export capacity and has abundantreserves of critical minerals that are indispensable for electric vehicle
secondary batteries. Similar to Japan, the United States also has
strengths in technological areas, such as semi-conductor chips andother advanced technologies in particular. By combining theserespective characteristics of Japan, the United States, and Australia,
they can be expected to offer solutions that could not be achieved by one
country alone. This would include the combination of various solutions
for difficult issues such as climate change action and building an entire
value chain as a package from upstream to downstream processes.
India is the fourth member of the Quad alongside these threenations. India’s participation as a partner will expand the regions andareas for which solutions can be provided. India has strengths in fields
such as medicine and manufacturing, and its market is expected to growas its population increases. On the other hand, it also faces mounting
challenges that are typical of developing countries. How to reduce
dependence on fossil fuels to get close to net zero? How to improve thefood situation by making agriculture more efficient? India is a microcosm
of global issues, and it also has a huge market. For this reason, I believethat resolving India’s challenges will be a first step toward resolving the
global agenda.
5What Australia Expects of Japanese Companies and JBIC

Instead of adapting past success stories todeveloping countries, we need to identify
business opportunities in areas withchallenges
Over the years, JBIC has provided financial support for Japanesecompanies’ overseas business expansion in Australia and Pacific island
countries. In January 2021, we signed a buyer's credit (export finance)
agreement with Belau Submarine Cable Corporation (BSCC), a
state-owned public submarine cable corporation of the Republic of
Palau. This became the first project under the TIP. As tourism is a majorindustry for Palau, the establishment of reliable telecommunication
infrastructure is essential. This loan has been co-financed with
Sumitomo Mitsui Banking Corporation and is intended to provide thefunds necessary for BSCC to purchase submarine cable-related
equipment from a Japanese company. At the same time, the UnitedStates and Australia are also providing financial support related to thisinfrastructure development. The TIP enables the three countries to bring
their own offerings to the table and to support infrastructure development
according to what is needed.
Also, in March 2021, JBIC signed a shareholders’ agreement forjoint investment with the Chugoku Electric Power Company in Energy
Fiji Limited (EFL), which is a vertically integrated electric utility thatgenerates, transmits, and distributes electricity throughout Fiji. This is amedium- to long-term initiative that has the future in mind, and by
assisting the provision of expert knowledge from Japan, JBIC intends tohelp Fiji to realize carbon net zero. JBIC does not believe that its roleends with the joint investment of funds with the Japanese company.
Rather, JBIC is aware that its key role is to be actively involved in Fiji’stransition to renewable energy going forward. Through cooperation with
Australia and the United States, we plan to promote this vision steadily
by bringing the tools and expert knowledge of each country together.
I mentioned climate change action as an example of suchcooperation, but the world is facing many different challenges. I believethat if Japanese companies were to seek out business opportunities
even first of a kind project in countries and regions facing suchchallenges, instead of trying to extend their successful businesses inJapan to other countries, it will present them with many newopportunities. What is important is that they see solutions to challenges
as opportunities. Single companies selling their own technologies will
merely lead to price competition, so it is important that multiple
companies and organizations join forces to propose solutions. The TIP
and the Quad are unprecedented tools for such collaboration. To
support Japanese companies in such endeavors, in addition toconventional financial tools, JBIC will strive to provide functions that willconnect them to the strengths of companies in the individual countries.

Cooperation between Japan andAustralia Promotes Decarbonizationand the Resilience of Supply Chains
Representatives of the Australia-Japan-United States Trilateral Infrastructure Partnership
meet with the Communist Party of Vietnam’s Central Economic Commission to discuss
directions for problem-solving in Vietnam under the TIP. (October 2020, January 2022)

Signing of the buyer's credit (export finance) agreement with Belau Submarine Cable
Corporation of the Republic of Palau (January 2021)

In joint investment with the Chugoku Electric Power Company, shares inEnergy Fiji Limited were acquired from the Fijian government.
(Shareholders’ agreement signed in March 2021)

Related press releases
JBIC signs MOU with Overseas Private Investment Corporationof the U.S., Department of Foreign Affairs and Trade, andExport Finance and Insurance Corporation of Australia

Buyer’s Credit for State-Owned Submarine Cable Corporationof Palauhttps://www.jbic.go.jp/en/information/press/press-2018/1112-011585.html

https://www.jbic.go.jp/en/information/press/press-2020/0114-014143.html

Equity Participation in Energy Fiji Limited

Trilateral Infrastructure Partnership Meets with Communist
Party of Vietnam Central Economic Commission andRelevant Ministry

https://www.jbic.go.jp/en/information/press/press-2020/0326-014423.html

https://www.jbic.go.jp/en/information/topics/topics-2021/0202-015853.html

Untied Loan to Export-Import Bank of India

https://www.jbic.go.jp/en/information/press/press-2022/0523-016310.html
6Strong Support for Small andMedium-sized Enterprises in Addition
to Strategically Important Projects― What is the role of Export Finance Australia (EFA)?
Export Finance Australia (EFA) is Australia’s export credit agency. We
have been supporting Australian exports for 65 years. In this time, we haveundergone some changes as the export credit landscape has changed,
including exiting the short-term credit insurance and establishing dedicatedsmall and medium-sized enterprise (SME) business teams and products.
However, our most significant transformation has occurred over the last 5
years. During this time, we provided our largest amount of support to date forSME businesses. We have been entrusted by the Australian Government withstrategically important mandates in critical minerals, infrastructuredevelopment in the Pacific and broader Indo-Pacific region and in defence.
We now also have an equity capability.
― It seems that the governments of Japan and Australia have been
deepening the extent of economic cooperation undertaken between thetwo nations when it comes to carbon neutrality and energy.
At the Quad Leaders’ Meeting held in May of 2022, Australian Prime Minister
Anthony Albanese announced that by 2030, Australia would be reducing its
greenhouse gas emissions by 43%. This demonstrates that our countries
have immense potential to cooperate in moving towards carbon neutrality.
Achieving carbon neutrality will require major adjustments. We will need tocollaborate and share resources and expertise. Australian and Japanesebusinesses have been working together for decades. For example, EFA has
supported an Australian business, Atlus Renewables, to export wood pellets
to Japan to help the power sector meet its emissions targets. Japanesecooperation, through important investments is helping to develop Australia’shydrogen sector which will be important to a low carbon future.
― Are there any other areas garnering your attention?
Australian exporters have traditionally had great strengths in areas suchas agriculture and high value manufacturing, for example aerospacecomponents. We are also seeing Australian businesses in fast-growing
sectors such as cyber security, space, and medical technology. Australia has
immense resources to power emerging technologies that are important
globally. Sectors such as renewable energy and critical minerals are growing
extremely fast in Australia.

Swati Dave, Managing Director and CEO of EFA (at time of writing),and HAYASHI Nobumitsu, Governor of JBIC, at a meeting in Sydney.

EFA’s website
https://www.exportfinance.gov.au/

Swati DaveManaging Director and CEO,
Export Finance Australia (at time of writing)**Export Finance Australia’s new Managing Director and CEO, Mr John Hopkins, commenced on 1 August 2022.

Appreciation for LNG Investments
Made by Japanese Companies
Anticipation of Support for Critical
Minerals and Hydrogen― What are you expecting of Japanese companies?
Australia we have a strong appreciation of the care with which Japanesecompanies make their partnership and investment decisions. Japanesecompanies were vital to providing long term investments to drive the growthof our LNG sector decades ago, an industry which has proved important toAustralia’s economic success. We see wonderful opportunities for Japan tobring this same approach to assist in growing sectors such as criticalminerals and hydrogen. Regionally, we also want to work more withJapanese companies. Japan has deep links throughout our region, and a
track record of helping countries to develop. I see immense potential for EFA
to work with Japan to pursue joint financing opportunities in areas such as
renewable energy and encourage Australian companies to lend theirexpertise abroad.
― What are the roles and responsibilitiesof government agencies when it comes toglobal issues such as climate change?
To address issues such as decarbonizationand supply chain resilience, EFA and JBIC need
to use our track records of helping new sectors
to develop and anticipating future needs.In
addition to direct support, we also play a role infacilitating cooperation. I believe that EFA and
JBIC can play significant roles by striving toencourage business cooperation and alignment
for the purpose of achieving the targets of thegovernments of Japan and Australia.

7Our Global Challenges

Production of frozen vegetables
and processed foods in Vietnam
Supporting the world’s food supply witha “Made by Japan” model
Holus Co., Ltd.
Based in Vietnam, Holus produces, imports, and sells frozen vegetables and processed foods withcarefully selected ingredients.
The company aims to become a supporter of the world’s food supply with a “Made by Japan”
model that uses Japanese technology and expertise.

Insistence on safe, reliable produce
Realizing “Japan-quality agriculture” through farm business coaching
Holus plays a role in Japan’s food supply through the
production, import, and sale of frozen vegetables andprocessed foods. Company President ABE Hideaki’s aim is toestablish sustainable agriculture through business. “Althoughfood is an important foundation that supports our daily lives,
many farmers and producers are not being adequately
compensated for their role in its supply. We are progressing ourbusiness with a strong ambition to improve the status offarmers and producers,” said Mr. ABE.
Holus handles many different vegetables, including
eggplant, okra, paprika, sweet potato, and zucchini. It sells

ABE Hideaki
President and CEO
8foods that have been pre-processed, such as fried, grilled, andsteamed, to Japanese business operators, including foodprocessing companies, foodservice chains, and supermarkets.
Production of these processed foods takes place in Vietnam.
Holus procures agricultural produce from more than 2,000
partner farms and processes them at its factory in Vietnam.
After working at a Japanese company that handled foodproducts, Mr. ABE relocated to Vietnam about 20 years ago. In
the hope of producing food that he would feel confident feeding
to children, Mr. ABE established a company jointly with a local
company, and that joint venture engages in shrimp farming,
frozen vegetables, and processed foods. Since becoming a
listed company in Vietnam in 2008, it has grown to become oneof Vietnam’s largest companies dealing in agricultural products.
However, wanting to put more effort into social contribution andimproving the status of producers, Mr. ABE established Holusin 2013 to pursue his personal philosophy.
Holus focuses on vegetable production in the belief that
ingredients are the decisive factor in how good food products
taste. Operating company-owned farms in both Japan and
Vietnam, Holus establishes farming methods and techniques
for growing vegetables that are safe and reliable. Japanese
farmers who endorse Mr. ABE’s ambitions have moved toVietnam to instruct local partner farmers on farming techniques
and knowhow. The aim is the realization of “Japan-quality
agriculture” in Vietnam.
A typical example of these efforts is the grafting of
eggplant plants. In general, Japanese farmers use splicegrafting to graft eggplant plants to prevent soil-borne diseases
and produce delicious eggplants. Holus has introduced thismethod to its partner farms in Vietnam.
It has also implemented farming methods that use as few
chemicals as possible. Farms in Vietnam have very acidic soil,
making it difficult for the soil to retain fertilizers. To improve thesoil, Holus experimented with manure from livestock such as
cows and pigs and with biofertilizers made by using naturalbacteria to ferment coconuts, shrimp scraps, etc. They also
planted marigolds and spread chili peppers around the crops
as natural insect repellents. These and other ingenious
methods helped to reduce the use of agro-chemicals to about athird of previous levels.
Japanese-style farming methods and techniques have
improved the quality of the produce grown by Holus’s partner
farms and helped them to achieve stable yields. Mr. ABE

pointed out, “In Vietnam, factory workers earn about
JPY30,000 to 35,000 a month. Holus’s partner farmers areachieving income of about twice that amount. Only about 20%of the children of farmers attended school 20 years ago, butthat rate is now 100% for the children of our partner farmers.”
The improvement of the status of farmers and producers that is
Holus’s goal is steadily producing results.
Japan-quality produce is processed at a local partner
factory, where Japanese staff are permanently stationed, under
meticulously controlled time and temperature conditions. “At
the beginning, due to difference in customs, some local staff
were bewildered by the hygiene measures and other policies that
we enforced, but through extensive worker education, they now
share our awareness of the importance of such measures,” said
Mr. ABE proudly.

Completion ceremony of AGRIEX factory

Innovative processing techniques to use produce
without wastage
Final products made at company-owned factory
The partner factory has honed its processing techniques touse up all of the ingredients without waste. In many cases, strict
specifications, such as size, shape, and color, apply to
products destined for the Japanese market. The aim is toeliminate waste by improving technical capabilities andimplementing flexible approaches.
Mr. ABE explains, “For example, the specified standard forsweet potatoes used for baked potato is ‘160-200g in size, skin
not too red, and a root depth of no more than 1 mm.’ Only about
30% of the produce supplied to the factory meet thesestandards. We strive to use up all of the farm produce supplied
through various measures, such as cutting any potatoes thatare too large, peeling the skin of those that are the wrong color,and frying them in oil.” These efforts have helped to improve
farm productivity.
Demand in the foodservice industry has dropped
dramatically since 2020 due to the pandemic. In addition, strict
lockdowns in Vietnam restricted the operations of the partner
factories. Holus was also affected in various ways, but, as Mr.
ABE describes, “We transported unused farm produce andother products to towns that were in lockdown and donatedthem to the local people, as I believed that this was precisely
the time when we needed to think of others.” Throughout the
pandemic, Mr. ABE maintained the intentions toward social
contribution and the producer-oriented approach that he has
held since Holus was first founded.
Mr. ABE established AGRIEX CO., LTD in Vietnam in
2021 and opened a company-owned factory near the
production region in 2022. “This is our flagship factory that will
demonstrate our resolve to continue to make good products in
Vietnam even in the face of the adversity brought by the
pandemic,” Mr. ABE explained. Various initiatives have beentaken in this new factory, such as emphasizing freshness morethan ever, shortening the time from harvest to processing, andfurther improving processing technologies with the introductionof cutting-edge facilities. In addition to frozen vegetables madewith carefully selected ingredients, AGRIEX has embarked on
the production of finished products, such as pre-fried tempura,and sweet potato that can be eaten immediately after thawing.
When Mr. ABE decided to build the new factory, he wasinitially concerned about whether they would be able to recruit
enough workers, given the labor shortage in Vietnam.
Ultimately, however, because the name of AGRIEX was wellknown due to its volunteer activities, he received a flood of
applicants. “We plan to provide healthy, delicious lunches at
the factory’s canteen under the guidance of a registered

Established a local subsidiary, AGRIEX, in Vietnam in 2020

Sweet potato snack and grilled
eggplant produced by AGRIEX

dietitian from Japan. In the future, I hope to make this a place
where employees can come to enjoy lunch with their families
even on their days off,” says Mr. ABE. He aims to make it afactory with deep roots in the local community and that is loved
by local residents.
JBIC, the Bank of Fukuoka, and the Shoko Chukin Bank
extended a syndicated loan of JPY180 million in total for theconstruction of AGRIEX’s factory. “We’ve been promoting
business based in Vietnam. Bank of Fukuoka, our bank ofaccount, introduced us to JBIC, saying that JBIC would support
us in our overseas business development. I am very grateful for
JBIC’s support in backing our significant decision to build ourown factory. I hope that JBIC will continue to provide us withspeedy and timely support in the future.”
From this new factory, Holus will strive to expand its
business with the intention of supporting part of the food supply
in Japan, Asia, and even the world. Holus currently sells its
products to Japan and Vietnam, as well as some products to
Taiwan. It has also received inquiries from Singapore,
Malaysia, and Thailand and intends to pursue exports to thosecountries. Holus supports the supply of food to the world with a“Made by Japan” model.

Holus Co., Ltd.
Head Office
URL
Established
CapitalSales Volume
President and CEO
Employees
Business description

3-4-16 Ebisu Minami, Shibuya-ku, Tokyo
https://holus.co.jp/
April 2013
JPY11 million
JPY1,600 million
ABE Hideaki
15
Production and sales of processed food, planning,
manufacturing, import, and sales of food products,
agribusiness in Japan and overseas

9Project Frontline
Our People and Their WorkJBIC is engaged in an array of different projects in various parts of the world.
JBIC’s leaders talked about their work on the front lines, their commitment
to projects, and what they find most appealing as professionals in theirrespective fields.

Contributing to semiconductor supply chain resiliencethrough M&A support

Director, Division 1,
Corporate Finance Department

KATO Genki
I was involved in a syndicated loan project tosupport an overseas M&A by Renesas
Electronics Corporation. The loan provided partof the funds necessary for Renesas to acquire a
British company, Dialog Semiconductor Plc, aprovider of analog semiconductors withexpertise in connectivity technologies such as
Bluetooth.
As many readers would know, Renesas
i s a leading Japanese manufacturer ofsemiconductor. Despite temporary hardships,
in part due to 2011’s Great East Japan
Earthquake, Renesas has worked hard tostrengthen its competitiveness through active
overseas M&As and other means. The
company’s strengths lie in the manufactureand sales of products such as microcontrollers,
analoguesemiconductors,
and
power
semiconductors and in the provision of a wide
range of solutions. Dialog specializes in“analogue semiconductors,” which control
analogue signals such as light, temperature,sound, and vibration and convert them todigital signals. They are widely used in
automobiles and industrial equipment and are
indispensable for practical applications of IoT.
Small lot production of a large variety of
products is a feature of these kinds of products.
Because they require meticulous fine-tuning oftechnologies and know-how to suit thecustomer’s required performance, companies
with many years of experience in analogue
semiconductors have a competitive advantage
in this field.
For Renesas, this acquisition forms part ofan M&A strategy that it has been pursuing since2017 to strengthen its analogue semiconductorbusiness. It will enable Renesas to enhance its
product portfolio by adding more engineers andother staff and to elevate its ability to offer
products and solutions for the fast-growing IoT,
industrial, and automotive markets.
The semiconductor is a core technology that
supports not just single products, but Japan's
overall industrial power. For this reason, it
could be described as the “staple food” ofJapan’s manufacturing industries. Not only will
this financing project provide financial support
to the Japanese company’s overseas expansion,

but it will also contribute toward thestrengthening of the manufacturing base ofdomestic semiconductor manufacturers, a goal
declared by the Government of Japan in its“Strategy for Semiconductors and the Digital
Industry.” Building the resilience of supply
chains of key commodities, including
semiconductors, is a major theme of Japan-U.S.
cooperation. The “Strategy for Semiconductors
and the Digital Industry” also states that
so-called “legacy semiconductors,” such as
analogue semiconductors, have a role to fulfill
in supporting the global supply chain. From
this viewpoint, we believe that strengthening
the manufacturing foundations of Renesas,
which produces large volumes of legacy
semiconductors, will also contribute toward
strengthening Japan-U.S. cooperation.
JBIC, as a policy-based financial institutionof Japan, needed to accurately identify this kindof political significance of the project and to
confirm the risks of extending a long-term loan,
which involved a large sum of money, before
making a decision on the loan. We held many
discussions with a wide range of stakeholders
from both the public and private sectors,
including Renesas’s executives, otherco-financing banks, and Japanese government
officials, and we also built up consensus within
JBIC. Ultimately succeeding in bringing the
project together into a satisfactory form throughthese efforts has been an invaluable experience
for me. Going forward, through the provision of
long-term loans required for strategic M&As
like this project, I hope to continue to support
the business expansion and new businessdevelopment of Japanese companies andcontribute toward supply chain resilience forkey products such as semiconductors.

Loan for Acquisition of British Company Dialog
Semiconductor Plc by Renesas Electronics Corporation
In December 2021, JBIC signed a loan agreement for up to JPY144 billion (JBIC's portion) withRenesas Electronics Corporation. This loan is intended to finance part of the funds necessary
for Renesas to acquire British company Dialog Semiconductor Plc. By acquiring Dialog,
Renesas aims to provide stronger and more comprehensive solutions for the fast-growing IoT,
industrial, and automotive markets. This loan supports overseas business deployment by theJapanese company by providing the necessary long-term funds for overseas M&A. In doingso, it will back up the company’s overseas expansion of its existing businesses as well as new
business deployment, and contribute toward maintaining and improving the international
competitiveness of Japanese industry.

I was in charge of JBIC’s equity participationin the Clean H2 Infra Fund S.L.P., which invests
in clean hydrogen-related projects around theworld.
Today, the use of “hydrogen” is drawing
attention in the context of the broader global
trend of decarbonization. Fuel cells forautomobiles and other machinery is one of thecommon use of hydrogen. This is because, whenelectricity and combustion heat that are
generated from hydrogen combined withoxygen, only water is vented, and there areno carbon dioxide emissions. Also, hydrogenh a s t he p o t en t i a l t o c o n t r i b u t e t o wa r ddecarbonization in a wide range of industries.
For example, hydrogen is being used on a trial
basis as an alternative fuel to power the enginesof ships and aircrafts. Also, the use of hydrogenin the iron ore reduction process, whichcurrently generates CO2 emissions, will realize
decarbonization of the iron manufacturing
process. In these ways, it is believed that the useof clean hydrogen will make it possible to achieve
decarbonization in a wide variety of industries
previously considered difficult to reduce CO2
emissions.
On the other hand, there are many hurdles tobe overcome at technology and cost to realize
the social implementation of hydrogen. For
example, upstream green hydrogen production
technologies do not come into wide use in
upstream processes and establishing thedownstream infrastructure is needed forhydrogen supply. A massive investment of JPY50
trillion worldwide will be required by 2030 toovercome these challenges and establish thehydrogen business. However, the public spends
that governments of individual countries areplanning to inject would not enough to cover thatneed. Under these circumstances, the Clean H2Infra Fund was established, mainly by Westerncompanies, with the aim of investing in selected
and promising hydrogen-related businesses
globally, covering upstream to downstream in

the hydrogen value chain, by mobilizing private
capital from around the world.
In our Medium-term Business Plan, JBIC has
set an action plan for contributing to therealization of a decarbonized society byfinancing projects for promoting production,transportation, and utilization of hydrogen, andwe had been seeking opportunities of further
involvement in this field. Around that time, we
became aware of that the Clean H2 Infra Fundwas being established, and we begandeliberating an equity participation in the fund. In
its “Green Growth Strategy Through Achieving
Carbon Neutrality in 2050,” the Government ofJapan is calling for international cooperation topromote the social implementation of hydrogen.
JBIC’s equity participation in this fund willcontribute toward the promotion of this trend.
Also, it is an investment in the sustainable fund*for clean hydrogen projects. For this reason, thisinvestment has a positive impact from theperspective of the protection of the global
environment. Having said that, the hydrogenbusiness is an advanced field with many
challenges, as mentioned above, and its trackrecord of successful projects is still quite limited.
Consequently, we needed to examine its
potential closely from a variety of angles. To thisend, we conducted research and analysis of thehydrogen market based on the hydrogen policies
of many countries and International Energy
Agency (IEA) forecasts. We also held numerous
discussions with HY24 SAS, the French fundmanager of the Clean H2 Infra Fund, about thefund’s investment strategies to verify the fund’s
potential. We had a limited timeframe of aboutfour (4) months to complete our deliberations
with the aim of the early realization of social
implementation of hydrogen decarbonizedsociety. It was therefore no easy task to build
consensus with our stakeholders, but finally ourteam completed this equity participation.
The Clean H2 Infra Fund is a unique fund inwhich many enterprises related to the hydrogen

Deputy Director, Division 4,
Equity Investment Department (at time of interview)

TSUCHIYA Tohori
field, including industrial gas and fuel cells, haveinvested with earnest intention to establish ahydrogen market. Although negotiating online
with HY24 SAS in France was a challenge, weshared a strong passion to unlock strategic andlarge-scale projects under development toaccelerate the scaling up of hydrogen markets
for the realization of decarbonized society, sothey finally welcomed us as their only Japanese
anchor investor. Building a trusting relationshipin such a short period of time with ourcounterparts in France and sharing the same
passion with them was a valuable experience andleft a deep impression on me. I will definitely
make use of this experience in my nextchallenges in new finance fields.
* The investment policy of the fund is to invest inhydrogen-related projects that conform to “climatechange mitigation,” which is one of the environmental
objectives of the EU taxonomy regulation. In accordancewith the European Union’s Sustainable Finance
Disclosure Regulation (SFDR), the fund will makesustainable investment as its objective and will measure
how far its objective is attained based on quantitative
benchmarks.

Equity Participation in Clean H2 Infra Fund managed
by Hy24 Globally Investing in Clean
Hydrogen-Related Projects under GREEN Operations

Semiconductors handled by Renesas(Photo courtesy of Renesas Electronics
Corporation)

https://www.jbic.go.jp/en/information/press/press-2021/1223-015680.html

10Opening up the future of hydrogenthrough investment in overseas fund

In March, JBIC signed an agreement for equity participation in the Clean H2 Infra
Fund S.L.P. of France. This fund is targeting EUR1,500 million, toward which
JBIC plans to invest up to EUR100 million. The fund will invest inhydrogen-related projects around the world, such as green hydrogen production
and refueling station projects. JBIC’s participation in the fund is based on its
Global action for Reconciling Economic growth and ENvironmental preservation(GREEN). JBIC’s equity participation is expected to contribute toward reducing
carbon emissions through the investments by the fund.

Team members visiting a hydrogen refueling stationin Germany, one of the fund’s investees.

https://www.jbic.go.jp/en/information/press/press-2021/0307-015946.html

11

JBIC exchanges views with development financeinstitutions and agencies of Australia, India, Japan,
and the USA ahead of Quad Leaders’ Meeting
Discussing enhanced collaboration among the four nations to better
connect the Indo-Pacific region
In May 2022, JBIC hosted a roundtable of development
finance institutions and agencies from Australia, India,
Japan, and the USA. The heads of Export Finance
Australia (EFA), the Australian Infrastructure Financing
Facility for the Pacific (AIFFP), India Export-Import Bank
(India Exim Bank), JBIC, and U.S. International
Development Finance Corporation (USDFC) gathered inperson and virtually to discuss enhanced collaboration tobetter connect the Indo-Pacific region, ahead of the Quad
Leaders’ Meeting held in Tokyo.
The roundtable focused on four areas that the leaders ofthese organizations see as essential priority areas for the
Indo-Pacific region. They are (1) climate change, (2) secureand reliable telecommunication networks, (3) sustainablesupply of energy, food and medical security, and (4) global
supply chain resilience. The participants exchanged candid
views on current initiatives in each area and the possibilityof further collaboration among the development financeinstitutions and agencies of the four countries.
Specifically, they shared their recognition of theimportance of (1) green transition technology including

MAEDA Tadashi, Governor (then) of JBIC exchanging views at the roundtableclean hydrogen, (2) telecommunication network projects
including 5G rollout, and (3) (4) diverse sources of criticalgoods and related supply chain. They agreed to makeconcerted efforts to promote initiatives in these areas.
As a Japanese policy-based financial institution, JBIC
will continue to work closely with the development financeinstitutions and agencies of Australia, India, Japan, and the
USA to further strengthen our support for projects in avariety of areas, including (1) to (4) above.

The heads of the finance institutions and agencies of Australia, India, Japan, and the
USA gathered in person and virtually.

Visit the address below for the Joint Media Release by EFA, AIFFP, India Exim Bank, JBIC, and USDFC
https://www.jbic.go.jp/en/information/topics/topics-2022/pdf/0608-016347_1.pdf

JBIC Today October 2022
Published by】Press and External Affairs Division, Corporate Planning Department,
Corporate Planning Group, Japan Bank for International Cooperation
4-1, Ohtemachi 1-chome, Chiyoda-ku, Tokyo 100-8144, Japan
Cover illust : Adobe stock*No part of this magazine may be reproduced without the written permission of JBIC.

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