Uu88

Joana SANTOS VAZ

FINANCING OPPORTUNITIES FOR
EU SMEs INTERNATIONALISATIONIN JAPAN
June 2020
Tokyo

1

MINERVA Report
Financing Opportunities for EU SMEs internationalization in JapanDISCLAIMER AND COPYRIGHTDISCLAIMER AND COPYRIGHTThe information contained in this report reflects the views of the author and not necessarily the views of the EU-Japan Centre
for Industrial Cooperation, nor the views of the European Commission and Japanese authorities. It does not claim to becomprehensive and is not intended to provide legal, investment, tax or other advice. While utmost care was taken to check,translate and compile all information used in this study, the author and the EU-Japan Centre for Industrial Cooperation may
not be held responsible for any errors that might appear. This report is made available on the terms and understanding that
the EU-Japan Centre for Industrial Cooperation and the European Commission are not responsible for the results of any
actions taken on the basis of information in this report, nor for any error in or omission from this report. This report is publishedby the EU-Japan Centre for Industrial Cooperation. Reproduction of all the contents of the report is authorized for noncommercial purposes, provided that (i) the name of the author(s) is indicated and the EU-Japan Centre for Industrial
Cooperation is acknowledged as the source, (ii) the text is not altered in any way and (iii) the attention of recipients is drawn
to this warning. All other use and copying of any of the contents of this report is prohibited unless the prior, written andexpress consent of the EU-Japan Centre for Industrial Cooperation is obtained.

iMINERVA Report
Financing Opportunities for EU SMEs internationalization in JapanABOUT THE EU-JAPAN CENTRE

ABOUT THE AUTHORThis report has been conducted as part of the
MINERVA
Market&PolicyIntelligence
Programme of the EU-Japan Centre for Industrial
Cooperation.

Joana Vaz is a PhD candidate at the Universityof Lisbon (ISCSP), with a master’s degree ininternational Relations from the University ofBeira Interior, specializing in EU affairs. She
has been involved in the management of EUfunded projects and lectured a broad range ofsubjects in a public university, namely
Diplomacy & Foreign Policy, Diplomacy &Diplomatic Practice, International Governanceand International Organisations. Collecting
experience in financial services, EU affairs andeconomic diplomacy, prior to the MINERVA
Program Joana Vaz worked at BNP Paribas
Securities Services and at the European Trade
Promotion
Organisations
Association(ETPOA), through a program managed by
AICEP- Portugal Global, under the Portuguese
Ministry of Foreign Affairs.

The EU-Japan Centre (http://www.eu-japan.eu/)
is a joint venture between the European
Commission and the Japanese Government. It
aims at promoting all forms of industrial, tradeand investment cooperation between the EU
and Japan and at improving EU and Japanesecompanies’ competitiveness and cooperation byfacilitating exchanges of experience and knowhow between EU and Japanese businesses.

The author can be reached via Linkedin, or bye-mail at joanasantosvaz@gmail.com

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MINERVA Report
Financing Opportunities for EU SMEs internationalization in JapanACKNOWLEDGMENTS
I would like to express my honest gratitude to the EU-Japan Centre for Industrial Cooperation,
namely to Mr. Philippe de Taxis du Poët, EU-side General Manager, and Mr. Fabrizio Mura forthe opportunity given and for their guidance throughout this research. Enrolling the MINERVA
Policy & Market Intelligence program and venturing into this challenging topic has been
definitely demanding but also extremely enriching. For this part, I owe a thanks to the European
Trade Promotion Organisations Association, namely to Tonia Van de Vyver, Christos Skouras
and Vasso Kyrkou, as well as to Laurent Armaos, who have been true mentors for me. I would
also like to thank Morgane Benoist, Luca Escoffier and all the colleagues at the EU-Japan
Centre for helping me getting settled in Japan and for their availability. I am grateful I havereceived such a warm welcome and generosity from everyone. From unexpected dangos andpostcards, to tech apértifs and team dinners, your daily acts of kindness will be rememberedwith “saudade”. I also owe a special thanks to AICEP, especially to Miguel Malheiro, for all the
support given and for the taste of home during my stay in Japan. Finally, to my MINERVA
fellows, Rèka Loczi and Masami Marbot, the great teamwork and the shared experiences not
only made my best memories of Japan but were also the beginning of a beautiful friendship.
Last but not least, I would like to highlight that finishing this report would not be possible without
the insights of extremely helpful and knowledgeable people from several entities across Europe
and Japan. I received an impressive availability from the European Commission, the EIF, theEIB, MOFA, JBIC, JFC, JETRO, National and Regional Promotional Banks, Trade Promotion
Organisations, Business Support Associations, EEN, ECCP, EBOWWN, networks of investors
and guarantee institutions, businesses, VCs and individuals that accepted to provide me withadvice in exchange of nothing. This work is the result of synergies between people in different
organisations, fields and geographies that I’ve tried my best to put together. Without them, thisreport would be a mere sequence of empty pages.

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MINERVA Report
Financing Opportunities for EU SMEs internationalization in JapanCONTENTSABOUT THE AUTHORIIABOUT THE EU-JAPAN CENTREII

ACKNOWLEDGMENTS

III

ABREVIATIONS AND ACRONYMS

VI

LIST OF FIGURESIXLIST OF TABLESXEXECUTIVE SUMMARY

1

INTRODUCTION

3

CHAPTER 1 FINANCING OPPORTUNITIES IN THE EU

9

1. NEW APPROACHES TO SMES FINANCING SUPPORT IN THE EU

10

2. MANAGEMENT AND IMPLEMENTATION OF FINANCIAL INSTRUMENTS

13

2.1.
2.2.
2.3.

14
15
16

3.

EUROPEAN INVESTMENT FUND (EIF)
EUROPEAN INVESTMENT BANK (EIB)
FINANCIAL INTERMEDIARIES AND THE ROLE OF PROMOTIONAL BANKSASSESSMENT OF EU FUNDS AND PROGRAMMES

21

3.1. STRUCTURAL FUNDS (COHESION POLICY)
3.2. SECTORAL PROGRAMS UNDER THE INVESTMENT PLAN FOR EUROPE
3.3. INVESTEU

21
23
29

KEY FINDINGS32

CHAPTER 2 FINANCING OPPORTUNITIES IN JAPAN36

1.

BILATERAL COOPERATION: EU-JAPAN IN CONNECTIVITY

37

2.

FINANCING SUPPORT BY JAPANESE INSTITUTIONS

44

2.1.
2.2.

NIPPON EXPORT AND INVESTMENT INSURANCE (NEXI)JAPAN INTERNATIONAL COOPERATION AGENCY (JICA)

44
45

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Financing Opportunities for EU SMEs internationalization in Japan

2.3. JAPAN BANK FOR INTERNATIONAL COOPERATION (JBIC)
2.4. JAPAN EXTERNAL TRADE ORGANISATION (JETRO)
2.5. JAPAN OVERSEAS INFRASTRUCTURE INVESTMENT CORPORATION FOR TRANSPORT AND URBAN
DEVELOPMENT (JOIN)
2.6. INCJ, LTD. AND JAPAN INVESTMENT CORPORATION (JIC)
2.7. JAPAN FINANCE CORPORATION (JFC)
2.8. JAPAN DEVELOPMENT BANK (DBJ)

46
48

3.

54

3.1.
3.2.
3.3.

OTHER OPPORTUNITIESTHE UNIQUENESS OF JAPANESE GENERAL TRADING HOUSESVENTURE CAPITAL AND EARLY STAGE INVESTMENT IN JAPANEU-JAPAN R&D COLLABORATION

50
51
52
53

54
56
62

KEY FINDINGS

65

CONCLUSIONS AND RECOMMENDATIONS69

REFERENCES

78

ANNEX I – MAPPING OF NATIONAL AND REGIONAL PROMOTIONAL BANKS AND
INSTITUTIONS

85

ANNEX II – MAPPING OF OTHER RELEVANT FINANCIAL INSTITUTIONS IN THE EU MS

88

ANNEX III – LIST OF RELEVANT SUPPORT ASSOCIATIONS, NETWORKS AND TOOLS90

ANNEX IV – LIST OF EU INITIATIVES/ FINANCING SCHEMES

92

ANNEX V – LIST OF NATIONAL INITIATIVES WITHIN THE EU MS

95

ANNEX VI – INSTITUTIONAL STAKEHOLDERS IN JAPAN100

ANNEX VII – LIST OF NON-INSTITUTIONAL STAKEHOLDERS IN JAPN

101

ANNEX VII – INSTITUTIONAL STAKEHOLDERS IN JAPAN104

ANNEX VIII – INCJ’S OVERSEAS MANAGEMENT RESOURCES SCHEME

116

ANNEX IX – IMPLEMENTATION OF THE EU-JAPAN INTERINSTITUTIONAL WORKING GROUP
117
ANNEX X – SUITABILITY OF FINANCING INSTRUMENTS

129v

MINERVA Report
Financing Opportunities for EU SMEs internationalization in JapanABREVIATIONS AND ACRONYMS
AECMEuropean Association of Guarantee Institutions

APAC

Asia-Pacific Region

ASEAN

Association of Southeast Asian Nations

ADB

Asian Development BankBDNBlue Dot Network

BRI

Belt and Road Initiative

CF

Cohesion Funds

COSME

Competitiveness of Enterprises and Small Medium Enterprises

CVC

Corporate Venture Capital

DBJ

Japan Development BankDITUK Department of International Trade

DG DEVCO

Directorate-General for International Cooperation and Development

DG ECFIN

Directorate-General for Economic and Financial Affairs

DG FISMA

Directorate-General for Financial Stability

DG GROW

Directorate-General for Internal Market, Industry, Entrepreneurship and
SMEs

EASME

Executive Agency for Small Medium Enterprises (SMEs)

EBOWWN

European Business Organisations Worldwide Network

EBC

European Business Council in JapanEC

European Commission

ECCP

European Collaboration Clusters Platform

EEN

Enterprise Europe Network

EFG

Equity Facility for Growth (COSME)EFSIEuropean Fund for Strategic Investments

EIAH

European Investment Advisory Hub

EICEuropean Innovation Council

ESIF

European Structural and Investment Funds

ERDF

European Regional Development FundETPOAEuropean Trade Promotion Organisations’ Association

EIB

European Investment Bank

EIF

European Investment Fundvi

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Financing Opportunities for EU SMEs internationalization in Japan

ELTI

European Association of Long-Term Investors

EPA

Economic Partnership Agreement

ESIF

European Structural Investment Funds

EU

European UnionETPOAEuropean Trade Promotion Organisations Association

FDI

Foreign Direct Investment

FIs

Financial Instruments

FTA

Free Trade Agreement

INCJ

Innovation Network Corporation of Japan

IoT

Internet of Things

JBIC

Japan Bank for International Cooperation

JETRO

Japan External Trade Organisation

JFC

Japan Finance Corporation

JIC

Japan Investment Corporation

JICA

Japan International Cooperation Agency

JOIN

Japan Overseas Infrastructure Investment Corporation for Transport and
Urban Development

LGF

Loan Guarantee Facility (COSME)METIJapanese Ministry of Economy, Trade and Industry

MFF

Multiannual Financial Framework

MOFA

Ministry of Foreign Affairs of Japan

MOU

Memorandum of Understanding

NEDO

New Energy and Industrial Technology Development Organization

NEFI

Network of European Financial Institutions for Small and Medium Sized
Enterprises

NEXI

Nippon Export Investment Insurance

NPBIs

National Promotional Banks and Institutions

ODA

Official Development AssistanceOECD

Organisation for Economic Co-operation and Development

PFI

Private Finance Initiative

PPP

Public-Private Partnership

P2P

Peer-to-Peer Lending

RPBIs

Regional Promotional Banks and Institutionsvii

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Financing Opportunities for EU SMEs internationalization in Japan

R&D

Research and Innovation

SDGs

United Nations Sustainable Development Goals

SMEs

Small Medium Enterprises

TPOs

Trade Promotion Organisations

UNCTAD

United Nations Conference on Trade and Development

VC

Venture Capitalviii

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Financing Opportunities for EU SMEs internationalization in Japan

LIST OF FIGURES
Figure 1. Number of jobs linked to trade with non-EU countries. Source: EC in Business Europe,
2019.

3

Figure 2. Percentage of SMEs ranking access to finance as highly important by country. Source:
ECB in EIF, 2019

4

Figure 3. Methodology and expected outcomes. Source: Own elaboration

5

Figure 4. Relative use and importance of external financing sources for EU SMEs. Source:
European Central Bank in EIF, 2019.

11

Figure 5. Percentage of small loans by country. Source: European Central Bank in EIF, 2019.

12

Figure 6. Indirect application of guarantees by financial intermediaries. Source: AECM, 201919

Figure 7. Direct application of guarantees by financial intermediaries. Source: AECM, 2019, bypersonal communication

19

Figure 8. The roles of promotional banks in the delivery of EU-backed financial instruments.

20

Figure 9. The three pillars of Horizon Europe. Source: European Commission, 201926

Figure 10. Financial instruments and schemes integrated into the umbrella program InvestEU.
Source: European Commission

29

Figure 11. Delivery of Overseas Investment Loans (OIL) by JBIC. Source: JBIC, 2020

47

Figure 12. How JOIN operates in the overseas infrastructure market. Source: JOIN, 2020

50

Figure 13. The International Networks of JOIN. Source: JOIN, 2020

51

Figure 14. The growth of R&D expenditures by sector from 2017 to 2018. Source: Statistics
BurJapan, 201963

Figure 15. R&D expenditures by business enterprises by industrial sector from 2017 to 2018.
Source: Statistics Bureau of Japan, 201964

Figure 16. Implementation of an EU SME Finance Helpdesk

78

Figure 17. Implementation of the EU-Japan Interinstitutional Working Group120

Figure 18. Suitability of financing instruments for different firm profiles and stages. Source:
OECD, 2018

129

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Financing Opportunities for EU SMEs internationalization in Japan

LIST OF TABLES
Table 1. Priorities for investment in each one of the ESI Funds.

22

Table 2. Differences between the four EIC Pilot funding instruments.

28

Table 3. Forthcoming initiatives under InvestEU presented at the Commission’s Communication
EU SME Strategy. Source: Own elaboration from European Commission, 2020.

30

Table 4. Forthcoming initiatives under InvestEU presented at the Commission’s Communication
EU SME Strategy. Source: Own elaboration from European Commission, 2020.

30

Table 5. Suitability of the four selected EU programmes for internationalisation beyond the EU

32

Table 6. JFC supported businesses per size and type. Source: JFC, 2020 (personalcommunication)

53

Table 7. Priority sectors in third markets referred by Japanese institutions. Source: Own
elaboration from JBIC, JOIN and JETRO

68

Table 8. List of National Promotional Banks and Institutions (NPBIs)

85

Table 9. Non-exhaustive list of Regional Promotional Banks and Institutions (RPBIs)

86

Table 10. List of relevant financial institutions per member state.

88

Table 11. List of relevant support associations, networks and tools at the EU level

90

Table 12. List of initiatives at the EU level.

92

Table 13. Non-exhaustive list of initiatives at the EU Member States level

95

Table 14. INCJ investments through its overseas management resources scheme. Source: Own
elaboration from INCJ

88

Table 15. Relevant institutional stakeholders in the Japanese market. Source: European
Commission

100

Table 16. Relevant non-institutional stakeholders in the Japanese market (non-exhaustive list).

101

Table 17. Participatory research - Target-groups description

105

Table 18. Conducted interviews (with no specific order)

107

Table 19. Attended seminars

117

Table 20. INCJ’s overseas management resources scheme. Source: Own elaboration from INCJ

118

Table 21. Institutional stakeholder mapping for the EU-Japan Interinstitutional Working Group

121x

MINERVA Report
Financing Opportunities for EU SMEs internationalization in JapanEXECUTIVE SUMMARY
Difficulties in accessing external financing and attracting investment can prevent EU SMEs from
benefiting from the opportunities triggered by the EU-Japan Economic Partnership Agreement (EPA)
and the signature of the EU-Japan Partnership on Sustainable Connectivity and Quality
Infrastructure. If on the one hand, finance remains one of the biggest obstacles to SMEs
internationalisation beyond the EU; on the other hand, EU SMEs are highly unaware of available
financing support schemes. Striving to fill this gap, the current report draws on desk review andparticipatory interviews to nearly 60 stakeholders in view of providing an overview on the availabilityof financing opportunities for EU SMEs internationalisation in Japan.
As for financing opportunities within the EU, as a rule of thumb, the EIB Group doesn’t provide direct
debt and equity to businesses. Their business model is based on the provision of financial
instruments to national and local financial intermediaries who then look for final beneficiaries for the
EU-backed products. Thus, most opportunities will be available at home, via national and regional
promotional banks, commercial banks and equity funds in each EU MS. This report thus provides alist of national and regional promotional banks and institutions, as well as other public entities
providing financial support to SMEs and relevant associations, networks, initiatives and tools acrossthe origin market (EU), as well as the destination market (Japan).
As for financing opportunities within Japan, financing to EU SMEs occurs only upon existence ofstrategic interest over determined priority sectors and/or if there is a Japanese company involved.
This study observes that such investments often take the form of joint acquisitions between a
Japanese institution and a Japanese acquirer. Thus, partnering up with a Japanese company seems
to be key, with Japanese general trading houses standing out as valuable partners. An interestingobservation by thus report is the particular interest from Japanese institutions in transferring knowhow from the EU in offshore wind and learning from the EU’s latest investments in renewable energy,
not disregarding the importance of others such as high-tech, new-drugs and hydrogen technology.
Delving into available private capital in Japan, some other trends with relevance for EU SMEs
highlighted in this report are the expressivity of corporate venture capital, the relevance of R&D
expenditures by the private sector and the reversal of the VC investment composition towards earlystage investments. As for the latter, this study also observes a growing interest in European startups.
In an attempt to access the interests of Japanese VCs, some triggers of this growing interest, as
well as the main challenges from the perspective of the Japanese investor are identified.
On a final remark, although some financing opportunities are indeed available, the multiplicity of
stakeholders involved in the management, provision and promotion of financial instruments makes
it hard for EU SMEs to find and process the existing information. Thus, in view of overcoming thisfragmentation of information, recommendations discussed include: the potential implementation of
an EU SME Finance Helpdesk at the EU-Japan Centre; the engagement of active partnerships inview of increasing information-sharing with the EU and Japanese institutions; the outreach of the
EU-Japan Centre’s services to EU SMEs through multipliers, notably governmental and nongovernmental business support organisations present in Japan.
Whereas the main audience of this research are EU SMEs and, ultimately, the EU-Japan Centre,
the information here contained can also be of relevance to EU policymakers, as well as to European
business organisations in their goal of improving the capacity of their services for SMEs
internationalisation beyond the EU.

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MINERVA Report
Financing Opportunities for EU SMEs internationalization in Japan
Introduction

INTRODUCTION
Context and relevance
The internationalisation of EU Small
Medium Enterprises (SMEs) beyond theinternal market is crucial for EU
competitiveness1 and plays an importantrole in increasing job growth (please see
Figure 1). 2 However, entering new
overseas
marketsisparticularly
challenging for them. Besides the nonfinancial
challenges
relatedtointernationalisation, such as regulatory
issues, cultural nuances and language
barriers, entering new markets is often
costly.
If on the one hand, start-ups and SMEs
often lack own capital to finance what isneeded to enter distant markets, such as
Figure 1. Number of jobs linked to trade with non-EU
the adaptation of products, increased
countries. Source: EC in Business Europe, 2019.
working capital to finance exports andmarket research3; on the other hand, they
face greater obstacles than bigger companies in accessing external financing 4. Such difficulties occur
for many reasons, including higher transaction, lack of proven financial track record, lack of financing
skills, lack of collateral and difficulties in accessing the commercial part of the banks. As a result, limitedaccess to finance remains one of the biggest obstacles to SMEs international growth. A survey
conducted last year by the European Investment Bank reports that one in four EU SMEs facedifficulties in accessing finance, with Greece, Italy and Portugal having the highest percentage of
SMEs ranking access to finance as a highly important issue (Figure 2). Following this and other

European Commission, 2011. Small Business, Big World – a new partnership to help SMEs seize global opportunities. Brussels,
9.11. COM(2011) 702 final. Source: https://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=COM:2011:0702:FIN:EN:PDF
2 European Commission, 2018 via Business Europe, 2019. Prosperity, People, Planet – Three Pillars for the European Union Agenda
in 2019-2024, Brussels, November. Source: http://euyourbusiness.eu/content/uploads/2019/11/2019-11-13-Prosperity-PeoplePlanet_interactive.pdf
3 European Commission, 2014, p. 10. An Investment Plan for Europe. Brussels, 26 November. COM(2014) 903 final. Available in:https://ec.europa.eu/transparency/regdoc/rep/1/2014/EN/1-2014-903-EN-F1-1.Pdf
4 World Bank. 2017. “Addressing the SME Finance Problem”. Facundo Abraham and Sergio Schmukler. Research and Policy
Briefs. World Bank Malaysia Hub. Source: http://documents.worldbank.org/curated/en/809191507620842321/pdf/Addressing-theSME-finance-problem.pdf
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MINERVA Report
Financing Opportunities for EU SMEs internationalization in Japan
Introduction

evidences, improving access to finance has
been defined as one of the three mail pillar
priorities to enhance SMEs growth in the recently
launched 2020 SME Strategy by theCommission.
Although the European Commission and the EIB
promote a wide range of support programs andrisk sharing mechanisms to facilitate SMEs
access to finance, the multiplicity of stakeholders
involved in the management and delivery offinancial instruments, as well as thefragmentation of information on financing
support schemes across several sources,
makes it unclear for EU SMEs how to accessthem. Thus, finding suitable support schemesthat can cover internationalisation-related costs
in markets outside of the EU becomes very
challenging.
A comprehensive study by the European
Figure 2. Percentage of SMEs ranking access to
Commission in 2011, based on a survey
finance as highly important by country. Source: ECB in
EIF, 2019conducted to EU SMEs with business activities
outside of the EU, draws some relevant
conclusions in this regard. As for Japan, three highlights can be made: the Japanese market isperceived as a growth market with increased importance for EU businesses (1), lack of financing is
one of the main barriers to EU SMEs internationalisation beyond the EU (2), the percentage ofsurveyed businesses that used public support measures develop their activities in Japan is as low
as 1% (3). With regard to the latter, easing access to finance is the service with lowest offer amonga total of 26 public support services, such as advice on IPR or information on rules and regulations.
On the one hand, this study confirms the importance of access to finance for EU SMEs willingto internationalise beyond the EU, notably in Japan; on the other hand, it suggests a service
gap in terms of supporting EU SMEs finding the right financing sources to enter the Japanesemarket. This being said, the implementation of services focused on providing support to easing
access to financing is deemed to be a crucial support mechanism to facilitate EU SMEs entry inJapan. We thus hope this study can provide useful insights and recommendations in this regard.

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MINERVA Report
Financing Opportunities for EU SMEs internationalization in Japan
Introduction

Purpose, scope and methodology
Context analysis

Participatory
research

Identification of:- opportunity domains- barriers- stakeholders

Collection of:- support initiatives- suggestions from national(including Japan) and EU
experts

Dissemination &engagement

Opportunity
mapping &capacitation- Dissemination ofopportunities- Strengthening
partnerships withstakeholders- Analysis of key findings- Identification ofactionable insights

MINERVA Report
EU SMEs

EU JAPAN CENTRE

EU SME Guide

Policy recommendations

Facilitate access to finance
Implementation of the EU SME Finance Helpdesk

Figure 3. Relation between the aims, objectives and methodology. Source: Own elaboration

PurposeFrom a financing point of view, there are two questions that come to the mind of an SME willing tointernationalise to Japan: what are the financing opportunities available and how can these beaccessed? However, neither questions have immediate answers. The identification of relevant
stakeholders and available public and private financing support opportunities requires anunderstanding about how and through whom financial instruments are de facto implemented.
Gaining expertise in financial matters, as well as understanding the processes of implementationof public support measures both at the EU and national level either has significant costs or requires
a prohibitive amount of time that SMEs usually don’t have.

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MINERVA Report
Financing Opportunities for EU SMEs internationalization in Japan
Introduction

The main purpose of this report is to provide an overview on the availability of funding andfinancing opportunities for EU SMEs internationalisation in Japan, in view of supporting the
EU-Japan Centre for Industrial Cooperation in its own goal of improving the capacity of its services
to EU SMEs. In order to accomplish this objective, the current report strives to:
1. Provide a comprehensive analysis on the availability of financing instruments thatcomprises an explanation on the implementation of financial instruments, as well as theidentification of opportunity domains, barriers and relevant stakeholders.
2. Map relevant stakeholders and funding/financing support initiatives that would
otherwise be scattered across several sources.
3. Identify actionable insights for the EU-Japan Centre based on the key findings of theresearch and on suggestions from EU and Japan experts
4. Strengthen collaboration with relevant stakeholders through the dissemination of theresults of the report.
The main beneficiaries of this report are, therefore, the EU-Japan Centre for Industrial
Cooperation and EU SMEs.

Scope of the study
This study focuses exclusively on the opportunities that are suitable for Small Medium Enterprises(SMEs) and startups headquartered in the European Union, on the one hand, and can cover theinternationalisation-related costs of their operations in the Japanese market, on the other.
Thus, the components of the conceptual framework used in this study are defined below:
Funding is defined as a sum of non-repayable capital given by governments, local authorities,
organisations, universities, companies or charities in order to provide financial support for theaccomplishment of determined non-financial interests/ needs in a particular thematic/ policy area.
Some EU initiatives, as well as support agencies might offer funding to support SMEs international
growth, such as funding to attend international trade events for example.
Financing is defined as the process of supplying or acquiring repayable capital for business activities
that would otherwise be out of reach. Financial instruments can take many forms, yet all of them will
be debt-based, equity-based or a combination of the two. Debt is often paid back with interest, while
equity involves ownership and therefore the return depends on the success of the company. In any
case, the capital provided by both debt-based and equity-based instruments is expected to be paidback with a return. In the case of debt, it will be interest and in the case of equity it will be profit.
Financing support for internationalisation includes, among others, loans, credit guarantees, pre andpost-shipment financing, insurance solutions and risk management, financing for short-term exports,
as well as equity financing.

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MINERVA Report
Financing Opportunities for EU SMEs internationalization in Japan
Introduction

Internationalisation is defined as the range of operations carried on by a company to developinternationally. The current report does not define internationalisation as a merely export-led
phenomenon, it also includes the use of foreign subcontractors and subcontracting for a Japanese
partner, foreign direct investment, technological cooperation with a Japanese partner and otherforms of partnership and alliances, such as joint ventures and MOUs. As for internationalisationrelated operations, it includes a non-exclusive list of activities conducted in view of further growing
the business into a new market, such as working capital to finance exports or increase production
capacity, product development and/or adaptation of products to new markets, market research, costs
associated with special distance (e.g. transportation) and installing facilities.

Methodology
The current research takes a multilevel approach, considering sources of financing andstakeholders in several levels of governance (intergovernmental, governmental, nongovernmental) across two geographies: the origin market (European Union) and the destination
market (Japan). The two levels of analysis will result in the two chapters of the report.
The first chapter begins with an analysis of the implementation of financial instruments at the EU
level and proceeds with the results of the mapping exercise on relevant stakeholders and available
financing opportunities. The EU institutions offer several funding and financing opportunities for small
businesses, however the multiplicity of support programs, instruments and stakeholders involved
makes the financing landscape very complex. As many opportunities are available through financial
intermediaries, this chapter aims to answer: Who are the implementing entities? Which instruments
will suit internationalization in Asia/Japan? How can these instruments be accessed by SMEs?
The second chapter explores financing opportunities for EU SMEs available in Japan. The
assessment includes opportunities offered by Japanese institutions by means of EU-Japan
collaboration and by private resources. In the first place, it will focus on financial instruments promoted
by Japanese institutions, including potential opportunities triggered by means of bilateral cooperation
with the EU, with reference to the EU-Japan Economic Partnership Agreement (EPA), the Connectivity
Agreement and the Memorandums of Understanding (MoUs) between the European Investment Bank
(EIB), the Nippon Export and Investment Insurance (NEXI), the Japan Bank for International
Cooperation (JBIC) and the Japan International Cooperation Agency (JICA). Proceeding from here, itwill drill down into the private level, in an effort to map other financing opportunities offered by private
entities, such as business angels and venture capitalists. That said, this chapter aims to respond: To
what public financial instruments are EU SMEs eligible to apply? What is the eligibility criteria andpriority sectors? Is there any available capital offered by private stakeholders in Japan

This study lays down on existing literature on the topic, official EU documents and in-depth
interviews conducted to EU and national experts. It begins with a context analysis based on desk

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MINERVA Report
Financing Opportunities for EU SMEs internationalization in Japan
Introduction

review which aims at identifying opportunity domains/ sectors, potential barriers and relevant
stakeholders, and proceeds with a participatory research, based on in-depth interviews tonational experts, potential financial providers and EU businesses. The participatory research aims
at collecting relevant insights from the practical experience and technical knowledge ofstakeholders and practitioners, on the one hand, and bring comprehensive information on theavailable financing support programs, on the other.

Conduction of interviews
Questions: The in-depth interviews will comprise generic questions about the functioning of the institutional
bodies and the implementation of financial instruments, but also specific questions related to potential
opportunities. The last part will be dedicated to open suggestions/ recommendations focused on theimplementation of the EU SME Finance Helpdesk.
Target-group: The target-group of the interviews is composed by several stakeholders, includingintergovernmental bodies, such as financial institutions (multilateral banks), governmental institutions,business associations and EU-Japan business partnerships. These stakeholders will be divided into fourmain groups. The comprehensive list of stakeholders for each one of the four groups can be found in Annex VIII

Limitations
The conduction of interviews will face significant timing and confidentiality-related limitations. On the
one hand, the Multi-Annual Financial Framework (MFF) is still being negotiated and even thoughnegotiations about the new umbrella program InvestEU have been initiated is not yet clear whether
old instruments will cease to exist or be integrated in the form of new instruments. On the other hand,
the lack of operational outcomes of the MoUs, as well as the diplomatic sensitivity and confidentialityof some information might pose barriers to obtaining relevant information with regards to the current
status of discussions.
Additionally, the broad range of stakeholders involved in the management and provision of financial
instruments, as well as the fragmentation of information on financing support initiatives andinstruments across multiple sources in several policy areas/ sectors constitute relevant challenges tothis research. Whilst utmost care will be taken in accessing the largest number of financing sources
within a six months’ timeframe, the fact that this report was not tailored to any specific financing needs
or industrial sectors might result into unintentional omissions on relevant financing opportunities inparticular sector/ policy specific areas.
Notwithstanding, rather than being exhaustive and/or conclusive, this report aims at providing apreliminary assessment of available financing opportunities that can be a useful starting point for EU
SMEs looking for financial support for their internationalisation operations in the Japanese market. As
sources of financing are very dynamic, the information here contained should be constantly updated
in view of including new sources and stakeholders.

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Chapter 1 – Financing opportunities in the EU

CHAPTER 1 Financing opportunities in the EU
A new approach to EU
financing support
Trends and shortcomings in the EU
approach to SMEs financing.

Opportunities &stakeholders mapping
Mapping of relevant stakeholders andinitiatives that can potentially support
EU SMEs internationalisation in
Japan – ANNEXES I-V.

Implementation offinancing instruments
The role of institutions and financial
intermediaries in the delivery offinancial products

Overview of EU funds
and programmes
Addressing the suitability of EU
initiatives to internationalization
beyond the EU, namely in Japan.

Chapter overview
There is a significant number of support measures to enhance SMEs competitiveness in the EU. This
support includes non-financial assistance, delivered in the form of services, but also financial assistance,
including both funding and financing schemes. The EU supports companies of any size 5 and sector
through several instruments, such as business loans, microfinance, guarantees and venture capital.
The current chapter intends to explore financing opportunities for EU SMEs internationalization in
Japan, available within the EU. It begins with a comprehensive exercise on the implementation of EUbacked instruments, which includes: shortcomings and new trends, the roles played by several
stakeholders at the EU level and an assessment of the current EU funds and programmes.
Information on financial products is often fragmented. Overlapping policies and programmes, and thediversity of stakeholders involved, such as the EU institutions, national promotional banks andinstitutions (NPBIs), regional promotional banks and institutions (RPBIs) and other financial
intermediaries makes it very complex for SMEs to look for adequate funding and/or financing. In fact,according to a study carried on by the European Commission in 2014, the awareness of EU SMEs about
these opportunities “ranges from 15% for micro-enterprises to 27% for medium-sized enterprises, andfrom only 10% for enterprises that are not internationally active to 22% of SMEs with international
This includes entrepreneurs, start-ups, micro-companies, small medium sized enterprises (SMEs), mid-caps and larger
businesses
59MINERVA Report
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Chapter 1 – Financing opportunities in the EU

activities.”6 Thereby, awareness of how financial instruments are managed at the EU level seems to be
the starting point for EU SMEs looking for financing within the EU in view of supporting their international
operations beyond the European Union.
Focusing specifically on opportunities for internationalisation in the Japanese market, the current study
tentatively aims at:
•

•

•

•

Identifying the most recent trends in the EU approach to EU SMEs financing support.
Subchapter 1 explores the latest Commission’s statements and official documents in view ofidentifying relevant trends and policy priorities with regard to SMEs financing.
Providing a clarification on the implementation of financing instruments at the EU level.
Subchapter 2 explains the role of institutions and financial intermediaries, notably the EIF, theEIB, as well as national and regional promotional banks in the delivery of EU-backed financial
instruments.
Providing an overview on the available EU funds and programmes. Subchapter 3
distinguishes selected EU funds and programmes in terms of scope and target priorities, while
addressing the suitability for internationalisation beyond the EU.
Map relevant stakeholders and initiatives that can potentially support EU SMEs
internationalisation in Japan: Annex I-IV.

The key findings, as well as relevant takeaways from the analysis at the EU level are provided at
the end of the chapter.

1. New approaches to SMEs financing support in the EU
From the analysis of several financing-related documents by the European Commission, two main
trends could be identified: firstly, the encouragement of a more extensive use of blended finance;and secondly, the need for diversifying finance sources.
Funding programmes have been the core of EU assistance to SMEs. However, with economical
sustainability at stake, and namely after the recent withdrawal of the UK from the European Union 7, theinvolvement of private capital in public investment became crucial, notably for development projects thatare not so profitable. As noted by Romana Vlahutin, the EEAS Special Coordinator for Connectivity, on
the occasion of Conference on the EU-Japan Connectivity Agreement held at Waseda University on the
14th January 2020, “the the problem of lack of finance does not lie in bankable, profitable projects as
those get financed anyway; the problem lies in needed projects that are not so profitable.” However,public money can’t cover it all, what raises the importance of the engagement of available investment
capital through blended finance.8

European Commission and EIM Business & Policy Research, 2010, p. 7. Internationalisation of European SMEs. Brussels. Ref.
Ares(2015)1816861
7 The UK was a major contributor to the European Investment Bank (EIB).
8 Vlahutin, Romana (2020). Sustainable connectivity and quality infrastructure – New level of EU-Japan Partnership, Lecture,
Waseda University, Tokyo, 14 January.
6

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Standing for the combination of grants and financial instruments (guarantees/ loans and equity), blended
finance enables the mobilization of private capital while reducing the risk for investors. The use ofblended finance has been broadly promoted by the European Commission and its representatives inview of maximizing the sustainability of EU funds and providing more long-term finance for Small
Medium Enterprises (SMEs). This shift from traditional grant funding towards a greater use of financial
instruments became evident in the period of 2014-2020, following the launching of the Investment Planfor Europe by the Juncker administration, and is likely to expand even more in the next MFF9.
As for the diversification of finance sources, a communication by the European Commission publishedthis year observes that the existing finance sources available in the EU do not suit the finance needs of
EU SMEs, particularly the needs of more innovative and fast-growing businesses. The backgroundstudies conclude the EU lacks diversified sources of finance, provided that only 10% of the EU SMEs
used capital market finance their operations and that venture capital investments in the EU are eighttimes smaller than in the US.10

Figure 4. Relative use and importance of external financing sources for EU SMEs. Source:
European Central Bank in EIF, 2019.

RUBIO, Eulalia, 2018. Making better use of public funding; The role of national promotional banks and institutions in the next EU
budget.
Jacques
DelorsInstitute.
Study
No.
115.
July.
Availablein:
http://www.astridonline.it/static/upload/the_/the_role_of_npbis_in_the_eu_budget.pdf
10 Afme Capital Markets Union Performance Indicators Report. 2019. via European Commission. 2020. An SME
Strategy for a sustainable and digital Europe. Brussels. 10.3.2020. COM (2020) 103 final. Source:
https://ec.europa.eu/info/sites/info/files/communication-sme-strategy-march-2020_en.pdf
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In an interview conducted in the course of this research to a fast-scaling high-tech SME in the Internetof Underwater Things (IoUT), the unsuitability of existing financing sources has also been highlighted
as one of the biggest constraints faced. According to the SME, one of the most important resources for
SMEs in general is the access to loans11.
Based on a survey conducted by the European Central Bank, the EIF also observes that whereas loans
are not the most used financial instrument, they are the financial instrument with highest relative
relevance for EU SMEs (Figure 5). The study also observes that small loans (less than EUR 0.25m) aresignificantly important for countries like Spain, Portugal, Italy and France. In the cases of Portugal andSpain, tsmall loans rank respectively 35% and 40% of the total amount of new loans granted.12

Figure 5. Percentage of small loans by country. Source: European Central Bank in EIF, 2019.

Even when there is already a business opportunity, they usually have to advance cash. Whereas equity
could be a possibility, the experience of the SME shows that access to equity is often time demanding,what might make them miss the opportunity. The process of obtaining equity becomes slow when VCs
lack a proper network of contacts and experience in the sector in which the company operates. 13

WSENSE. 2020. Personal communication.
European Investment Fund, 2019, p. 18. European Small Business Finance Outlook, EIF & Market Analysis,
Working Paper 2019/57. Source: https://www.eif.org/news_centre/publications/EIF_Working_Paper_2019_57.pdf
13 WSENSE. 2020. Personal communication.
11
12

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Many SMEs face challenges in accessing the commercial part within local banks, which is where
guaranteed loans can be accessed. As such, the awareness of the SME about EU-backed instruments
can help them reaching out to the right people within commercial banks.14
To address this issue, the EU plans to boost the creation of new tools to support SMEs engaging withinvestors based on blockchain technology. Integrated in the new Commission’s SME Strategy, thisblockchain-based initiative is expected to enable issuance and trading of SME bonds in the EU. The
Digital Finance Strategy, to be launched in the close future, should clarify in further detail how the useof crypto assets will be facilitated by the European Commission15. Following-up on further developments
is recommended.

2. Management and implementation of financial instruments
The management of the EU budget can be done via direct, shared or indirect management. With
exception for most of the programs under the European Structural Investment Funds (ESIF), whose
management is shared with the managing authorities of the EU Member States, the majority of thefinancial instruments are managed indirectly by the EIB Group.

Directmanagement
Directly by the Commission’s
departments

Sharedmanagement
Between the Commission and the
managing authorities of the EU
Member states

Indirectmanagement
With budget implementation tasks
being entrusted to other bodies, suchas the EIB Group.

In financial instruments under indirect management, usually the European Commission assumes
the role of supervisor, monitoring the application of the budget, while the EIB Group is responsible
for the day-to-day implementation management through financial intermediaries. Financial
intermediaries, such as guarantee institutions, local commercial banks and equity funds, are thenresponsible to deliver the EU-backed instruments to the final beneficiaries (SMEs and midcaps).
As a rule of thumb, the European Commission and the EIB Group do not provide direct financial
support to individuals or enterprises. Thus, EU SMEs should not expect to apply directly to the
EIB/EIF products; they should rather consult with the financial intermediaries in their home country.

WSENSE. 2020. Personal communication.
Afme Capital Markets Union Performance Indicators Report. 2019. via European Commission. 2020. An SME
Strategy for a sustainable and digital Europe. Brussels. 10.3.2020. COM (2020) 103 final. Source:
https://ec.europa.eu/info/sites/info/files/communication-sme-strategy-march-2020_en.pdf
14
15

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As the largest multilateral lender among other existing International Financial Institutions (IFIs) andhaving the EU Member States as its main shareholders16 the EIB Group assumes a major role inthe delivery of EU-backed instruments to EU SMEs and midcaps. The Group is composed by theEuropean Investment Fund (EIF) and the European Investment Bank (EIB).

2.1.

European Investment Fund (EIF)The European Investment Fund (EIF) has been established to provide finance to small andmedium-sized enterprises (SMEs) and mid-caps that are not yet
bankable. It does so both through risk finance (loan/guarantees)and venture capital instruments. Owning 59.2% of the bank, the
EIB is the main shareholder of the EIF, followed by the European
Commission (29.7%) and private financial institutions around
Europe (11.1%) joint collaboration with entities from the EU
The EIF’s financial
member states (national and regional governments and private
instruments can only
strategic investors). The EIF has several guarantee and equity
be delivered within theinitiatives to support SMEs. Some of these initiatives are country
EU, candidate andand sector-specific, and others are centralised. Centralised
potential candidate
initiatives a conducted at the EU level, whereas country andcountries to the EU.
sector-specific initiatives refer to specific initiatives conducted in
Nonetheless, the bankhas been active in
In view of understanding how financial instruments are delivered
fundraising overseas,
looking for investors
by the EIF, the first aspect to take into account is that the EIF’s
willing to invest within
business model relies on financial intermediaries 17. The aim
the EU. Thus far,is to increase access to finance by supporting commercial
attempts to gather
banks, guarantee institutions and equity funds in lending/investment in Japan
investing into EU SMEs. Thus, the EIF never invests the full
were not successful
amount and does not provide financial instruments directly
to companies. According to a Senior Policy Advisor in the EIF,
EIF, 2020, by personal
the bank operates as a “catalyser, more like a machine to selectcommunication
financial intermediaries” 18 . In broad terms, the EIF selects
financial intermediaries (usually a call for proposals is launched), provides them financial
instruments and then financial intermediaries look for the final beneficiaries for these instruments.
As for the geographical scope of the EIF’s operations, it seems relevant to point out that the bank’s
mandate is limited to the European Union and, even though to a lesser extent, to the close
The EU Member States’ shares in the EIB’s capital is based on their economic weight in the EU. The UK, Germany,
France and Italy together hold more than 50% of the total shares. With the exit of the UK from the EU, the EIB lost
one of its biggest shareholders.
17 The list of the EIF financial intermediaries in each one of the EU Member States can be found in the following link:
https://www.eif.org/what_we_do/where/index.htm
18 EIF, 2020. Information provided by personal communication.
16

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MINERVA Report
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Chapter 1 – Financing opportunities in the EUneighborhood, within candidate and potential candidate countries to the EU. Notwithstanding,equity investors under EIF-backed instruments can also invest into businesses outside of the EU.
The bank has also been active in fundraising overseas, proactively looking for investors willing toinvest into the EU. As these investors are usually big insurance firms, the EIF has been quite activein Asia, namely in China. However, despite the attempts to gather investment from Japan into theEU, such efforts have not been successful thus far19.
However, what’s in for internationalisation beyond the EU? Even though the EIF instruments
can only be delivered into businesses registered within the geographical scope of the bank’s
mandate, it doesn’t mean that these instruments provide any distinction if the final products
or services are exported to third countries or not.20 In fact, financial intermediaries (e.g. fundmanagers) who can support SMEs internationalisation beyond the EU get a better evaluation in theselection process under some programmes. 21
With regard to programmes, the EIF manages the Single EU Debt Financial Instrument and theSingle Equity Financial Instrument on behalf of the Commission. The EU Debt Financial
Instrument is composed by the COSME’s Loan Guarantee Facility (LGF) and the Horizon2020
InnovFin SME Guarantee Facility. In turn, the Single Equity Financial Instrument is composed by
the COSME’s Equity Facility for Growth (EFG) and the Horizon2020 InnovFin Equity, which is moresuited for early-stage businesses. Under COSME, the EIF typically invests 25% of the totalcommitments (with a limit of EUR 30m) in fund managers who can commit to invest at least 50%of the total investment amounts into EU SMEs at the growth and expansion stage. 22 Under
Horizon2020, the most common investment is also 25% of the total investment amounts, however,in certain cases it go up to 50% of the fund’s total commitments (with a limit of EUR 50m) 23. The
four financial instruments will be integrated into the InvestEU Fund, under the umbrella program ofInvestEU that is currently being negotiated by the EU institutions.

2.2.

European Investment Bank (EIB)

Like the EIF and the European Investment Bank (EIB) also relies on financial intermediaries for thedelivery of its financial instruments. However, the scope and business models of both banks haveslight differences.
Firstly, the EIB has a broad mandate which allows for the signature of MOUs with other multilateralbanks and co-investment in projects, as well as for the provision of direct loans/equity to SMEs andmidcaps through programmes like InnovFin, for example. Nonetheless, direct financing to SMEs

19

EIF, 2020. Information provided by personal communication.

20 EC. 2020. Information provided by personal communication.

EIF, 2020. Information provided by personal communication.
EIF. “COSME Financial Instruments”. Source: https://www.eif.org/news_centre/publications/eif_flyer_cosme_en.pdf
23 EIF. “InnovFin Equity”. Source: https://www.eif.org/news_centre/publications/eif_innovfin_equity_en.pdf
21
22

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only occurs in very specific cases of big infrastructure projects, such as roads or bridges, forexample.
Secondly, the EIB has worldwide operations - although not yet in Japan. Whereas the EIF’s ismandated to operate in Europe, the EIB has worldwide operations and offices all over the world,
providing financial instruments through financial intermediaries in a broad sectoral range of
projects. The EIB’s basis for operating outside the European Union can be found in the Decision
on granting an EU guarantee to the European Investment Bank against operations supporting
investment projects outside the Union.24 This list is mostly composed by low income countries. Asa high-income country, Japan is not included, neither in the eligible regions and countries, nor in
the potentially eligible regions and countries. The list of eligible and potentially eligible regions canbe found in the Annexes II and III of the document 25. The outcomes of the MOUS signed withJapanese institutions, as well as the identified priority sectors for potential co-financing between
the EIB and JBIC, JICA and NEXI are further explored in this report, under section 1, Chapter 2.
Lastly, with regard to the sectors that can be financed by the EIB, this report draws EU SMEs
attention to the bank’s strategy towards climate action and environmental sustainability which goesin line with the goals of the Paris Agreement. Under its new Energy Lending Policy, the EIB will
not only increase its share of financing up to 50%, helping to unlock 1 trillion euros for investments
in related sectors, but it will also stop financing fuel energy projects by the end of 2021. 26

2.3.

Financial intermediaries and the role of Promotional Banks

The implementation of financial instruments (FIs) and budgetary guarantees is to be increasingly
entrusted to the National Promotional Banks and Institutions (NPBIs) and Regional Promotional
Banks and Institutions (RPBIs). These banks are, in very broad terms, national public financial
institutions in the EU Member States. Their role is to provide financing in sectors that are notserved by commercial banks.27
Namely as of 2016, following the Investment Plan for Europe, NPBIs and RPBIs were given a more
central role in the implementation of EU funds. It seems, however, that even though the importanceand recognition of their role is growing, there is still a lack of understanding about them. This sector
aims at providing a better understanding on how these banks operate across the EU. It thus focuses

European Parliament and European Council. 2014. Decision on granting an EU guarantee to the European Investment Bankagainst operations supporting investment projects outside the Union. Official Journal of the European Union, 466/2014/ EU.
Available in: https://eur-lex.europa.eu/legal-content/EN/ALL/?uri=celex%3A32014D0466
25 The document can be accessed in https://eur-lex.europa.eu/legal-content/EN/ALL/?uri=celex%3A32014D0466
26 EIB, 2019. Source: https://www.eib.org/en/press/all/2019-313-eu-bank-launches-ambitious-new-climate-strategyand-energy-lending-policy.
27 Directorate-General for Internal Polices (2016). Financial Instruments and the Role of National Promotional Banks,
Policy Department D: Budgetary Affairs. Available in: http://www.europarl.europa.eu/supporting-analyses
24

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on the current landscape of NPBIs and RPBIs in the EU, as well as on their role in the deliveryof EU-backed instruments to EU SMEs.

A. The landscape of NPBIs and RPBIs in the European Union
The landscape of promotional banks in the EU is rather heterogenous due to different national
political systems, regulations and mandates. For instance, some countries have more than one
public bank or institution at the national level and sometimes regional promotional banks play amore active role in in providing support to SMEs than the national promotional banks themselves 28.
The mandates, scope, business models and products offered by these institutions also
differs among Member States. For example, while the Croatian Bank for Development andReconstruction (HBOR) and BPIFrance offer export credit to SMEs, Belgium has a national agency
focused specifically on providing export credit to SMEs29, which is called Credendo. 30 Dependingon their scope of activity, some of these institutions are members European Association of LongTerm Investors (ELTI)31, others are members of the European Association of Guarantee Institutions(AECM) and others are members of both. The ones that are specialized in supporting SMEs mightalso be members of the Network of European Financial Institutions for Small and Medium Sized
Enterprises (NEFI) 32.
Eulalia Rubio, Senior Research Fellow at the Jacques Delors Institute, conducted one of the very
few studies on the experiences of NPBIs in implementing EU-backed instruments. Through asurvey conducted to NPBIs between 2017 and 2018, the study provides an overview of the maindifferences between NPBIs in terms of size, business models and mandate. With regard to thescope of their mandate, Rubio observes that these promotional banks often provide finance in a
broad range of sectors, such as infrastructure and innovation, however, a number of them is
specialized in providing financing support to SMEs and mid-caps in areas where commercial
banks are not able to do so. With regard to size, the author also observes that most of NPBIs are
medium-sized banks, but some of them are big and can even co-finance projects together with
the EIB. According to the author,
Some NPBIs are sizable, both by global standards and relative to the size ofnational GDP. Four of them have total assets superior to 100bn: the German

KfW. 2020. Information provided by personal communication.
HBOR. 2020. Information provided by personal communication.
30FIT.2019. Information provided by personal communication.
31 The following institutions are members of ELTI: Austria (OEKB), Belgium (SFPI-FPIM), Bulgaria (BDB), Croatia (HBOR), Czech
Republic (CMZRB), France (Bpi France), France (Caisse des Depôts), Germany (KfW), Greece (National Bank of Greece),
Hungary (MFB), Ireland (SBCI), Italy (CDP), Latvia (Altum), Netherlands (InvestNL), Lithuania (VIPA), Luxembourg (SNCI), Malta(MDB), Malta (Bank of Valletta), Poland (BGK), Portugal (IFD), Slovenia (SID Banka), Spain (ICO)
32 The following institutions are members of NEFI: Austria, Bulgaria (BDB), Croatia (HBOR), Czech Republic (CMZRB), Estonia(Fund KredEx), Finland (Finnvera), France (Bpi France), Germany (KfW), Hungary (MFB), Ireland (SBCI), Italy (CDP), Latvia(Altum), Luxembourg (SNCI), Malta (MDB), Poland (BGK), Portugal (IFD), Slovakia (SZRB), Slovenia (SID Bank), Spain (ICO),
Sweden (ALMI), United Kingdom (BBB).
28
29

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KfW (the biggest one by far), the Italian CDP, the French CDC and the Dutch
BNG Bank.33

A recent example of a co-financed project is the ASEAN’s Catalytic Green Finance Facility (ACGF),
created to attract more private investment the development of green infrastructure in ASEAN
member countries. Among other financial providers, such as the Agence Française deDéveloppement and the Government of South Korea, the ACGF counts with the financial
contribution of the KfW, the German national promotional bank 34.
In fact, the co-financing between the EIB and sizable EU development banks, such as the Agence
Française de Développement and the KfW is very common. Another example that can be given is
the recently launched Ruzizi III as of February 2020. Ruizizi III is a regional hydropower project
which will generate electricity to be shared by the Democratic Republic of Congo, Burondi and
Rwanda and results from the contribution of these partners together with the EIB35.
As for delivery methods, some NPBIs and RPBIs might be involved in providing equity instruments
directly to SMEs; however, a common way of delivering financial instruments to SMEs is actually
through loan guarantees provided to commercial banks. Both types of financing are important,depending on the specific needs of the SME and specially on how fast the SME needs the money.
However, the conducted interviews suggest that factors such as discussions over ownership
percentages, the value of the business and the legal work involved make equity more time
consuming. As such, access to loans assumes an important role for EU SMEs, namely when there
is a need to receive the money quickly.
When acting as guarantee providers, NPBIs and RPBIs play an important role in supporting SMEs
accessing debt-based financing. According to the European Association of Guarantee Institutions(AECM). “if an entrepreneur would like to have a loan and the commercial bank states that there islack of collateral, our members could be asked to provide a guarantee of on average 80%. Like thisthe bank remains only with an own risk of 20% and grants the loan.”36
The process can be triggered by the bank (indirect support) or by the entrepreneur (direct support).
When a guarantee is provided indirectly by the financial intermediary, the communication isconducted between the commercial bank and the guarantee institution and the entrepreneur only
communicates with the commercial bank (Figure 6).

RUBIO, Eulalia, 2018, p. 17. Making better use of public funding; The role of national promotional banks and institutions in the
nextEUbudget.
Jacques
DelorsInstitute.
Study
No.
115.
July.
Availablein:
http://www.astridonline.it/static/upload/the_/the_role_of_npbis_in_the_eu_budget.pdf
34 For more information, please see: https://www.eib.org/en/press/all/2020-057-eib-to-support-green-infrastructure-developmentand-climate-resilience-in-asean-countries-with-eur-150-million
35 For more information, please see: https://www.eib.org/en/press/all/2019-338-hydrogen-council-and-eib-signadvisory-agreement-to-address-climate-change-with-increased-investment-in-hydrogen
36 AECM. 2020. Information provided by personal communication.
33

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In turn, when direct application of theguarantee takes place, the firstcommunicationisestablishedbetween the entrepreneur and theguarantee institution and, upon
confirmation of the guarantee
commitment by the guarantee
institution, the process continues
with the commercial bank (Figure 7).
As the process can be triggered by
the entrepreneur himself via directcommunication with the guarantee
institutions, a mapping of relevant
stakeholders might be a useful for
SMEs. Annexes I and II of the thisreport combines the results of a
mapping exercise which includes,
among others, information on
guarantee and equity providers at
the Member States level.

Figure 6. Indirect application of guarantees by financial
intermediaries. Source: AECM, 2019, by personal communication

B. Role in the delivery of EU-backed
instruments
Due to their knowledge and close
contact to the local markets, NPBIs
and RPBIs are in a better position tochannel the guarantee and equity
mandates of the EIB Group to local
authorities and businesses. They arecapable of providing a better use of
EU funds by tailoring instruments inorder to suit the local reality, needs
and regulations. These institutions
are well aware of the financial
instruments and financing policies at
the national and regional level, what
helps to avoid duplication and ensurecomplementarity.

Figure 7. Direct application of guarantees by financial

intermediaries. Source: AECM, 2019, by personal communication

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The question is, however, how exactly do they intervene in the delivery of EU-backed financial
instruments? In some cases, NPBIs can provide financial products directly to businesses but
generally they channel EU instruments to other financial intermediaries they choose to appoint,
such as commercial banks, credit institutions and credit funds at the national level.

NPBI acting as
financial
partner
Tailored

NPBIs acting as
financialintermediaries

Financialintermediary 1

TailoredFinancialintermediary 2

SME 1

SME 2

3

SME 1

SME 2

SME 3

1

SME 4

SME 5

SME 6

SME 1

SME 3

SME 2

SME 4

2

Figure 8. The roles of promotional banks in the delivery of EU-backed financial instruments.
Source: own elaboration

As shown in figure 8, NPBIs can benefit from EU guarantees directly from the European
Commission, or through the EIB Group, depending if they are acting as financial intermediaries orfinancial partners for a particular instrument. Thus, broadly speaking, NPBIs can assume the roleof financial partners or financial intermediaries in the delivery of EU-backed instruments. When
acting as financial intermediaries, NPBIs benefit from EU guarantees through the EIB Group; whenacting as financial partners, they benefit from EU guarantees directly from the European
Commission. The role of financial partner allows them to turn EU-backed instruments into tailored
instruments, adapted to the local needs. It is relevant to note, however, that all NPBIs can act asfinancial intermediaries of the EIB Group, but not all of them can currently operate as entrusted
implementing financial partners.
In order to act as eligible financial partners and implement financial instruments directly on behalfof the Commission, NPBIs and RPBIs also have to be pillar accessed. This pillar assessment is

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an entrustment procedure for an entity that requests to be an implementing partner of the EU
budget under indirect management. The terms of reference can be found in the Commission
Decision of 17 April 201937 and the process can take up to 1-3 years. The most recently established
NPBIs, as well as others whose structure/mandate either went through changes and/or began theassessment process later on, are still being pillar assessed. However, it doesn’t mean they do notprovide financial instruments to SMEs, it just means that they are either operating as financial
intermediaries of the EIB Group, or that such instruments are not backed by EU funds.

3. Assessment of EU funds and programmes
Information about sources of finance available throughout the EU, including national sources at theMember States level, can be found at the Access2Finance platform38. In turn, information about
calls for tenders, for instance, can be accessed on the tenders opportunities section of theEuropean Commission website. 39 Notwithstanding the existence of other relevant initiatives, thecurrent section provides a brief overview on selected EU funds and programs, based on theirsuitability for EU SMEs internationalisation in Japan. The overview is thus provided within three
categories:
1

Structural funds

2

Sectoral Programs (Investment Plan for Europe)3

InvestEU

3.1. Structural funds (Cohesion Policy)
On a background note, the Cohesion Policy was created with the aim of reducing the disparities
between the various regions of the European Union. It is the policy behind the several projects
funded under the European Structural and Investment Funds (ESIF), widely referred to just as‘Structural Funds’. The ESIF are composed by 5 funds: the European Regional Development Fund(ERDF), the European Social Fund (ESF), the Cohesion Fund (CF), the European Agricultural Fundfor Rural Development (EAFRD) and the European Maritime and Fisheries Fund (EMFF).

European Commission. 2019. Commission Decision on establishing new terms of reference for the pillar assessment
methodology to be used under Regulation (EU, Euratom) 2018/ 1046 of the European Parliament and the Council. Official
JournaloftheEuropean
Union,
2019C
191/02.
Surce:
https://eur-lex.europa.eu/legalcontent/EN/TXT/PDF/?uri=CELEX:32019D0606(01)&from=EN
38 Please see the direct link to the Access2Finance platform: www.access2finance.eu
39 Please see the direct link to the tenders opportunities section available at the EU Commission website:
https://ec.europa.eu/info/funding-tenders/opportunities/portal/screen/home37

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What are the priorities for investment?
The below table shows how each one of the five ESIF funds supports 11 priority objectives (please
see table 5). Each one of the funds matches with specific objectives which are considered thepriorities for investments under that particular fund.
Table 1. Priorities for investment in each one of the ESI Funds.

1
2
3
4
5
6
7
8
9
10
11

Objectives:

Main Funds

Other eligible

Research, technological development and innovation
Access to information and communication technologies
Support for small and medium sized enterprises
Environment, supporting the achievement of a low-carbon economy
Climate change – adaptation, management and prevention
Efficiency of resources
Transport – promoting sustainability and improving network structures
Employment - sustainability, quality and supporting labor mobility
Social inclusion and combating poverty and discrimination
Education and training
Improving the efficiency of public administration

ERDF
ERDF
ERDF
ERDF, CF
CF
CF
CF
ESF
ESF
ESF
ESF, CFESF, ERDF
ESF, ERDF
ESF, CFCF, ERDF
ERDF
ERDF
ERDF
ERDF
ERDF
ERDF
ERDF

Source: Own elaboration from European Commission40

Whereas the ERDF can support investments in all the 11 priority objectives, it is the fund that suits
SMEs internationalisation the most. ERDF co-finances activities in a broad range of areas, such as
entrepreneurship, innovation, competitiveness, access to capital and business cooperation for
SMEs in the growth and start-up phase. To a lesser extent, the European Social Fund and theCohesion Fund can also back investments to support SMEs. However, under the current framework(2014-2020), the CF is only suitable for Member States with a GDP lower than the EU average,
excluding Croatia.

•

How are the funds managed?
The Commission and the Parliament jointly define the budget and the rules for the Cohesion Policy;
however, none of them is involved in selecting projects (except for a small number of large-scale
projects). The European Commission only discusses the contents of the Partnership Agreements
presented by the countries’ national authorities, where they outline priorities and operation
programs to be implemented 41 . The selection, monitorization and evaluation of projects isorganized by the managing authorities of the country, which are nominated and appointed by the

Information can be accessed on https://ec.europa.eu/regional_policy/en/policy/how/priorities
The list of Operational Programmes (OPs) to be financed under the European Regional Development Fund (ERDF) and theCohesion Fund (CF) can be accessed on the following link: https://ec.europa.eu/regional_policy/en/atlas/programmes/. In turn,
the
list
of
OPs
to
be
financedbytheEuropeanSocial
Fund
can
be
found
here:
https://ec.europa.eu/esf/main.jsp?catId=576&langId=en
40
41

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government of each Member State. Each nominated managing authority 42 will then be responsible
for the management and implementation of an operational programme. It is important to note,however, that the managing authorities might delegate to intermediate entities, specialized in theareas covered by a particular program, and select implementing authorities which are closer to thefinancial beneficiaries. Bottom line, it is the managing authorities of the member states who decide
where and how the European Structural and Investment Funds are invested.
As for SMEs’ support specifically, the managing authorities are mandated to design specificsupport measures for SMEs, what means that the Structural Funds can be used for to support
internationalization operations beyond the EU. An exemple of a programme that used ERDF funds(ESIF) for internationalisation beyond the EU is the Exporting for Growth Funding Programme,developed by the Department of International Trade (DIT) Yorkshire. The programme supports
SMEs located in the Seffield City Region, Leeds City Region or Humber LEP to developinternationally or get started in international trade 43. Among others, the programme supports thecosts of overseas tradeshows, design and production of international marketing material, overallmarketing strategy and international market research. Thus far, it has supported 14 companies
looking to export their goods or services into Japan. They have conducted 14 missions that included
Japan, 2 of these missions targeted Japan exclusively.
Nonetheless, the list of available programmes varies in each member state, depending on theindividual operational programmes. Thus, the best way to get information of and, consequently,
access financing support backed by Structural Funds is reaching out to the managing
authorities and/or implementing authorities at the national level.

3.2. Sectoral Programs under the Investment Plan for Europe
3.2.1. European Fund for Strategic Investments
Initially established as part of the Investment Plan for Europe, widely known as Juncker Plan, theEuropean Fund for Strategic Investments (EFSI) is currently integrated under the umbrella
programme InvestEU. In broad terms, the EFSI is an EU guarantee, complemented by a capital
contribution from the EIB, created to overcome market failures in strategic sectors, such as:

The list of the designated managing authorities for the European Regional Development Fund (ERDF) and the Cohesion Fund
(CF) in each member state can be accessed in https://ec.europa.eu/regional_policy/index.cfm/en/atlas/managing-authorities/. The
list for the European Social Fund (ESF), can be accessed in https://ec.europa.eu/esf/main.jsp?catId=45&langId=en
43 UK Department for International Trade. Source: https://www.brchamber.co.uk/wp-content/uploads/2018/06/Exporting-forGrowth-Flyer_edited-1.jpg
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Transport, energy and digital economy

Environment and resource efficiency

Human capital, culture and healthResearch, development and innovation

Support to SMEs and midcaps

Market failures in these strategic sectors are addressed through two specific windows: a) an
infrastructure and innovation window, which is deployed by the EIB; b) an SME window, which is
deployed by the EIF.
The fund guarantee is used to support or invest in projects with a higher risk profile (but stillbankable) than the usual EIB activities. Financial products which will result from the EFSI will be
repayable instruments (loans, guarantees and equity); no grants or subsidies will be provided
through the EFSI. For this reason, and as the financing under EFSI is demand-driven, there are no
sector or country quotas.Through the EFSI, the EIB Group is able to support SMEs and mid-caps.
For instance, the European Growth Finance Facility, backed by the EFSI, enables the EIB offering
long-term venture debt financing through financial intermediaries. The facility covers up to 50% of
the investment costs44 to support EU SMEs and midcaps with their investments in research anddevelopment across several policy priorities 45. The EFSI funds can also be combined with otherEU funds 46 , for as long as there is no double financing for the same part of the project.
Different funds should fund different parts of the project.
NOTE: The European Fund for Strategic Investments (EFSI) must not be confused with
the European Structural and Investment Funds (ESIF). While the EFSI is under indirect
management with the EIB, the ESI funds are under shared management with thenational authorities of the member states. Even though both funds can be combined for
as long as there is no double financing for the same part of the project47.

3.2.2. COSME – Competitiveness of Enterprises and SMEs
COSME is an EU initiative created to enhance the competitiveness of enterprises and SMEs. It iscoordinated by DG GROW and managed by the Executive Agency for SMEs (EASME), withexception for the access to finance dimension of the program which is managed by the EIF. Oneof the main objectives of the program is improving SMEs access to finance, offering different
funding opportunities (grants and tenders) and financing opportunities, both loan/guarantee
For more information on criteria and eligibility please access https://www.eib.org/en/products/equity/venture-debt.htm
For more information please access the following link: https://www.eib.org/en/about/priorities/sme/index.htm
46
For more information about the combination between EFSI funds and other EU funds, please see:https://ec.europa.eu/commission/sites/beta-political/files/combining_efsi_other_eu_funds_en.pdf
47
For more information about the complementarity between the EFSI and the ESIF, please consult
https://ec.europa.eu/regional_policy/sources/thefunds/fin_inst/pdf/efsi_esif_compl_en.pdf
44
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instruments (COSME Loan Guarantee Facility) and equity instruments (COSME Equity Facility for
Growth). The loan and equity facilities of the program will soon be integrated under the umbrella ofInvestEU. As previously mentioned, the Loan Guarantee Facility (LGF) is one of the windows of
the Single EU Debt Financial Instrument; whereas the Equity Facility for Growth (EFG) is one of
the windows of the Single EU Equity Financial Instrument.
According to the latest EIF’s implementation update of the Loan Guarantee Facility, 86.1% of total
number of SMEs supported have less than 10 employees. Thus far, Italy is largely the country thatmost benefited from COSME, both in terms of the number of SMEs supported and amounts
committed (33.7%), followed by Spain (14.9%) and France (14.7%). As for sectors, wholesale andretail trade, repair of motor vehicles and motorcycles (28.3%) and manufacturing (21%) have been
the most supported sectors, as well as construction (10.4%)48
In order to apply for a COSME-backed loan, SMEs should contact the COSME financial
intermediaries and sub-intermediaries in their country. The full list of financial intermediaries andsub-intermediaries can be found at the EIF website 49 . Some programmes promoted by thesefinancial intermediaries can result from a combination between COSME Loan Guarantee Facility(LGF) financial instruments and EFSI funds. Examples of such programmes are the Start-up LoanStartGeld programme by the German bank KfW and the recently launched specific COVID-19
support program 50 , which provides additional guarantees with enhanced conditions to support
SMEs with financing for working capital. Interested SMEs can consult with the LGF financial
intermediaries in their home country to check whether they have applied to this program, or checkwith the EIF through the contacts page.
Thus far, Japan is not one of the non-EU participants in COSME51 and therefore not eligible tobenefit from COSME-backed financial instruments. Nonetheless, equity agreements with investors
allow for indirect investments into businesses in non-eligible countries. This means that an eligible
equity investor can also invest into businesses in Japan or other non-eligible countries with financial
instruments backed by COSME or Horizon 2020.

EIF. 2019. COSME – Loan Guarantee Facility: Implementation Update. Source:
https://www.eif.org/what_we_do/guarantees/single_eu_debt_instrument/cosme-loan-facility-growth/implementation_status.pdf
49
Pleaseaccess
the
full
list
of
financialintermediaries
inthefollowinglink:
https://www.eif.org/what_we_do/guarantees/single_eu_debt_instrument/cosme-loan-facility-growth/cosme_lgf_signatures.pdf
The
list
of
sub-intermediaries
can
be
found
in
the
followinglink:
https://www.eif.org/what_we_do/guarantees/single_eu_debt_instrument/cosme-loan-facility-growth/Sub_Intermediaries.pdf
50 The COVID-19 is the guarantee support program launched as response to the COVID-19 pandemic outbreak. The program isbacked by the EFSI funds and the Single EU Debt Financial Instrument (COSME and Horizon2020). More information can befound in the following link: https://www.eif.org/what_we_do/guarantees/single_eu_debt_instrument/cosme-loan-facilitygrowth/index.htm
51 The list of non-EU participants can be found on the following link: https://ec.europa.eu/docsroom/documents/39579
48

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3.2.3. Horizon-Europe
Building on the success of Horizon2020, Horizon-Europe was launched on the 1st of January 2020.
The program which counts with a *proposed* budget of 100 billion euros 52, aims at participating inresearch and innovation funding programmes under two windows - the R&I Window and the SME
Window – across three priority pillars (Figure 9). The main aim is to finance high-risk projects thatare not yet bankable.

Figure 9. The three pillars of Horizon Europe. Source: European Commission, 2019

The program proposes flexible co-funding schemes, based in synergies with other programes.
Even though Horizon-Europe targets start-ups and SMEs, in exceptional cases non-bankable midcaps can also be financed. 35% of the budgetary target is to be applied in trackling climate change,
and 70% of the budget is to be applied in supporting SMEs that are too risky for private investors.
Beginning in 2021, if the EU member states reach an agreement for the EU’s multiannual budget
for 2021-2027 soon, the Horizon Europe framework programme will include several missions. Eachmission will count with a board of 15 experts for each one of them, targeting specific societal
challenges, such as cancer; adaptation to climate change; oceans, seas, coastal and inland waters;
climate-neutral and smart-cities; soil health and food. 53
Horizon-Europe is open to international participation of third countries, such as Japan, which havegood capacity in science, technology and innovation. Such participation is made available throughintensified targeted actions, such as joint calls. Japanese organisations can participate in
The European Parliament has already endorsed the proposal. For more information, please see:https://ec.europa.eu/commission/presscorner/detail/en/STATEMENT_19_2163
53 European Commission. 2019. Horizon Europe – The next EU research & innovation investment programme (2021-2027).
Research and Innovation. Available in:https://ec.europa.eu/info/sites/info/files/research_and_innovation/strategy_on_research_and_innovation/presentations/horizon_
europe_en_investing_to_shape_our_future.pdf
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collaborative research projects and Japanese researchers can participate in the mobility schemes
for individual researchers, the Marie Skłodowska-Curie Actions (MSCA) and the European
Research Council (ERC). However, without contributing to the budget, international partners are
not eligible for automatic funding in research projects, unless their participation isconsidered strictly essential.54 This is why several countries are currently considering joining
Horizon Europe, including Japan55. In November 2019, the Japanese government announced
its interest in becoming an associate member of Horizon Europe, starting with an annual
contribution of 10 million euros 56 and one of the biggest Japanese research institutes, Riken
institute, opened an office in Brussels 57. Some initiatives, such as InnovFin, are still operating under
Horizon2020. This is the case of the InnovFin SME Guarantee Facility 5859 and the InnovFin
Equity60, which includes equity finance for technology transfer, business angels, venture capitaland fund-of-funds.

3.2.4 EIC Pilot
The European Innovation Council (EIC) pilot is an EU accelerator managed by the Enterprise
Europe Network (EEN) that offers funding (grants) and equity, as well as coaching and mentoring,to high-risk SMEs with high potential. The accelerator supports SMEs of any size (including startups) with no sector specification. The pilot works as an umbrella for four funding instruments: theEIC Accelerator (SME Instrument)61, the Fast Track to Innovation (FTI)62, the EIC Pathfinder Pilot(previous Future and Emerging Technologies) 63 and the Open and Horizon Prizes. 64 To
understand the differences between the four funding instruments, please refer to Table 6.
Additionally, the pilot offers a tool to support SMEs finding the most suitable funding instrument
called EIC wizard. The tool can be accessed here. 65

Parrone, Federico. 2019. Open Science, Evolving Societies: New Horizons for EU-Japan Research, Vrije Universiteit Brussel,
22
October.
Availablein:
http://www.office.kobe-u.ac.jp/ipiep/materials/EuropeanCenterSymposium2019/2-36_Mr.FedericoPerrone.pdf
55 Kelly and Hudson in Science Business. 2019. Source: https://sciencebusiness.net/framework-programmes/news/conferencereport-what-non-eu-countries-want-horizon-europe
56 Hudson, 2019. Japan eyes possible €10M a year for Horizon Europe partnerships. Science Business, 6 November. Available
in: https://sciencebusiness.net/framework-programmes/news/japan-eyes-possible-eu10m-year-horizon-europe-partnerships
57 Kelly and Hudson in Science Business. 2019. Source: https://sciencebusiness.net/framework-programmes/news/conferencereport-what-non-eu-countries-want-horizon-europe
58
More
information
about
the
InnovFin
SME
Guarantee
Facilitycanbeaccessedin
https://www.eif.org/what_we_do/guarantees/single_eu_debt_instrument/innovfin-guarantee-facility/index.htm
59 The COVID-19 guarantee support program is also common to Horizon2020.
60
For
more
information
about
the
Innovfin
Equitypleaseaccesshttps://www.eif.org/what_we_do/equity/single_eu_equity_instrument/innovfin-equity/index.htm
61
European Commission website. More information about the EIC Accerator (SME Instrument) in:
https://ec.europa.eu/easme/en/section/sme-instrument/eic-accelerator-sme-instrument-funding-opportunities
62 European Commission website. More information about the FTI in: https://ec.europa.eu/programmes/horizon2020/en/h2020section/fast-track-innovation-pilot
63 European Commission website. More information about FET in: https://ec.europa.eu/programmes/horizon2020/en/h2020section/future-and-emerging-technologies
64
EuropeanCommission
website.
More
information
about
the
Open
and
HorizonPrizesinhttps://ec.europa.eu/research/eic/index.cfm?pg=prizes
65 European Commission website. Source: https://ec.europa.eu/research/eic/index.cfm?pg=funding
54

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Table 2. Differences between the four EIC Pilot funding instruments.
Eligible entities
Not-forprofit

Funding
instrument

Size/ Growth stage

EIC Accelerator(SME Instrument)

High risk SMEs of any sizewith ambitions to scale-up

Yes.

No

Fast Track toInnovation (FTI)

Mature, close to the market

Yes
(70%)

Yes (100%)

EIC Pathfinder
Pilot (Pathfinder
open andPathfinder
proactive)

Early-stage and innovation
projects

Yes

Yes

Open and Horizon
PrizesIdea stage, proposal ofsolutions for societal
challenges

Yes

Yes

ProfitSectorType offinancialsupportNo specified sector but breakthrough innovation is required.
Subject to open calls 66 –some have thematic
objectives

Grants, equity
or blended(grants andequitycombined)

No specified sector.

GrantsConsortia only (3 to 5
entities in threedifferent EU Member
States)Research & Innovation

GrantsIndividual
participants ourgroups of participantsSocietal challenges, depends
on the open calls67

Individual
prizesType
Single SME or
consortia (withexternal partners thatmight bring addedvalue)
Industry-driven
onsortia only (3 to 5
entities in threedifferent EU Member
States)Eligibility for third country participants: Only businesses established in an EU Member State orin a Horizon 2020 associated country can apply directly to the accelerator. However, large
companies, research canters and individual scientists from other countries can participate as
subcontractors or third parties.
Equity investment from third country participants: An EIC equity fund will soon be establishedunder the EIC Pilot to manage equity investments 68. The European Investment Council is always
looking for private investors to co-invest in EU SMEs under the EIC Pilot. Japanese investors are
eligible to invest in the companies that have already been selected (list here) by the EIC for blended
finance, however, thus far, no involvement from Japanese investors has been reported 6970
Lastly, an important remark to take into account is that under its new EU SME Strategy, theEuropean Commission aims at tripling the number of women-led SMEs benefiting from EIC.71
In the date of writing there is an open call – Green Deal - finishing at 19th May 2020. All open calls for the EIC Accelerator (SME
Instrument)
can
be
found
in
the
following
website:https://ec.europa.eu/info/fundingtenders/opportunities/portal/screen/opportunities/topicsearch;freeTextSearchKeyword=;typeCodes=1;statusCodes=31094501,31094502,31094503;programCode=H2020;programDiv
isionCode=null;focusAreaCode=null;crossCuttingPriorityCode=null;callCode=H2020-EIC-SMEINST-20182020;sortQuery=submissionStatus;orderBy=asc;onlyTenders=false;topicListKey=callTopicSearchTableState
67 At the time of writing, there is an open call for 10 million euros for space technologies. The deadline for submission is June
2021. Under the criteria of the EIC Pilot, only entities established in an EU Member State or in a Horizon2020 country can apply
directly. However, entities from Japan might be able to participate as third parties in the consortium. The overall description andcriteria can be found in https://ec.europa.eu/research/participants/data/ref/h2020/other/prizes/contest_rules/h2020-prizes-eicrules-low-cost-space-launch_en.pdf
68 European Commission, 2020. European Innovation Council pilot: €344 million to 107 visionary ideas of start-ups, SMEs andresearchers.
DG
for
ResearchandInnovation.
12
March.
Brussels.
Source:https://ec.europa.eu/research/eic/pdf/ec_rtd_expert-group-on-strengthening-management-with-pm-eic.pdf
69 European Innovation Council. 2020. Information provided by personal communication.
70 The updated list of selected companies can be found in the following link: https://ec.europa.eu/research/eic/pdf/ec_rtd_eicaccelerator-blended-finance.pdf
71 European Commission. 2020, p.16. An SME Strategy for a sustainable and digital Europe. Brussels. 10.3.2020. COM (2020)
103 final. Source: https://ec.europa.eu/info/sites/info/files/communication-sme-strategy-march-2020_en.pdf
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3.3. InvestEU
The European Commission has acknowledged the multiplication of agreements, policies,
managing bodies and stakeholders create a problem of fragmentation and overlap between
financial instruments at the EU level, makes it complex for SMEs to access the instruments the EU
has made available for them. Thus, in order to solve this issue, the Commission has decided tointegrate previous programmes (e.g. EFSI and COSME) into the same umbrella: the InvestEU
Programme, which will run from 2021 until 2027.
As one can observe in Figure 10, InvestEU is a combination of equity, guarantee and risk sharing
instruments that came into place to blend all program and rules into one single regulation, one
single program and one single agreement with implementing partners. This will simplify theblending of grants with other programes, with InvestEU rules applying for the entire Project undera single rulebook.

Figure 10. Financial instruments and schemes integrated into the umbrella program InvestEU.
Source: European Commission

Building on its experience in the management and implementation of the European Fund for
Strategic Investments (EFSI), the EIB will be the main implementing partner of InvestEU,
implementing around 75% of the guarantee through its financial intermediaries (including NPBIs
and RPBIs acting as financial intermediaries). International Financial Institutions acting as
entrusted financial partners, will implement the remaining 25% (European Commission 72). These
International Financing Institutions (IFIs) include the European Bank for Reconstruction andMore information about the InvestEu Program can
https://ec.europa.eu/commission/presscorner/detail/et/memo_19_2135
72

be

found

in

the

following

link

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Development (EBRD) and the Council of Europe Development Bank (COE Bank), but also national
promotional banks and institutions acting as financial partners for a particular instrument. All ofthem will have direct access to the EU guarantee.
As explained above, the business model of the EU relies on financial intermediaries and, therefore,
the decision to provide financing and the financing conditions (amount, duration, interest rates andfees) are made by these local implementing partners - mostly commercial banks, venture capitalists
and angel investors – which are capable of providing additional resources of their own. In order toknow the conditions of each instruments, SMEs can reach out to one of the implementing financial
institutions that can be found in Annexes I-II. Although the current MFF is still being negotiated, as
per the Commission’s communication on the new EU SME Strategy launched in 202073, the SME
Window of InvestEU will be focused on the below priorities (Table 7) and introduce the following
initiatives (Table 8):
Table 3. Forthcoming initiatives under InvestEU presented at the Commission’s Communication EU SME Strategy.
Source: Own elaboration from European Commission, 2020.
Sectors/ Priorities

Type of FI

1

Guarantees for innovative SMEs

Guarantees

2

Guarantees for SMEs from the cultural and creative sectors

Guarantees

3

Guarantees for SMEs transitioning to more sustainable energy models

Guarantees

4

Guarantees for SMEs adopting digital business practices

Guarantees

5

SMEs and small mid-caps in the space and defense industry (1)Equity6

SMEs and small mid-caps in sustainability (1)Equity7

SMEs and small mid-caps in innovation (1)Equity8

SMEs and small mid-caps which are women-led (1)Equity9

SMEs and small mid-caps in deep tech (1)Equity10

SMEs and small mid-caps in green tech (1)Equity(1) Areas identified as of special EU policy interest
Table 4. Forthcoming initiatives under InvestEU presented at the Commission’s Communication EU SME Strategy.
Source: Own elaboration from European Commission, 2020.
Initiative

Description

Fund to support Initial Public Offerings (IPO)of SMEs

Creation of a new private-public fund under InvestEU to support Initial
Public Offerings (IPO) for SMEs
Risk/reward mechanism to boost venture capital funds and private
investments for scalling up in the EU, The program was alreadylaunched.

ESCALAR initiative
Gender-smart financing initiative

Initiative to support funding for women-led companies

European Commission. 2020. An SME Strategy for a sustainable and digital Europe. Brussels. 10.3.2020. COM (2020) 103
final. Source: https://ec.europa.eu/info/sites/info/files/communication-sme-strategy-march-2020_en.pdf
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Green-tech investment initiative

Initiative to increase the access to equity finance to support SMEs andstart-ups developing green tech solutions

Blockchain-based initiative

Initiative to enabling issuance and trading of SME bonds through theEuropean Blockchain Services Infrastructure.

Pilot project on tech due diligence services

The pilot project will support more precise valuations for high tech startups

Even though none of the mentioned initiatives targets internationalization beyond the EU per se,
the Communication encourages SMEs to use EU investment programs to grow within andbeyond the European Union.74•

Allocation of resources
The InvestEU program expects to mobilize around EUR 650000 million through financial
intermediaries, with an overall allocation of EUR 38000 million from the EU budget (Casoni, 2019).
The allocation of resources will be divided in three tools: a Fund, an Advisory Hub and an
Investment Portal.
The InvestEU Fund: Building from the European Fund for Strategic Investments (EFSI), the InvestEU
fund will back the investment of projects through financial partners, being the main one the EIB Group 75,
mobilizing public and private investment through a *proposed* EU guarantee of €38 billion taken fromthe EU budget. Thus far, the guarantee is expected to be provisioned at 40% 76 (Casoni, 2019), targeting
sub-optimal investment situations, such as SMEs lack of collateral, in four policy windows: sustainableinfrastructure (€11.5 billion), research, Innovation and digitalization (€11.25 billion), SMEs (€11.25
billion), social investment and skills (€4 billion).The budget allocated to each one of the policy windows
can be adjusted up to 15%, considering the market demand. The guarantee requests will be approvedby an Investment Committee, composed of external experts.
The InvestEU Advisory Hub: The InvestEU Advisory Hub (EIAH) is a partnership between theEuropean Investment Bank Group and the European Commission designed to act as a single accesspoint to various types of advisory and technical assistance services. The Advisory Hub is expected tointegrate 13 different advisory services.
The InvestEU Portal – prior European Investment Project Portal (EIPP): The InvestEU Portal is adatabase that connects investors and supported projects.
European Commission. 2020, p.2. An SME Strategy for a sustainable and digital Europe. Brussels. 10.3.2020. COM (2020)
103 final. Source: https://ec.europa.eu/info/sites/info/files/communication-sme-strategy-march-2020_en.pdf
75 The EIB is the main financial partner of InvestEU and will implement around 75% of the guarantee through its financial
intermediaries. International Financial Institutions and National Promotional Banks will implement the remaining 25%. For more
information about the InvestEU program please access the following link: More information about the InvestEu Program can befound in the following link https://ec.europa.eu/commission/presscorner/detail/et/memo_19_2135
76 Casoni, Giorgio Charion. 2019. The InvestEU Programme: an instrument to support investment in the next MFF. European
Commission, 5 April. Available in: http://www.finlombarda.it/c/document_library/get_file?uuid=327e0499-9e0d-481a-885c951008f19ed4&groupId=1004759
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Key findings
This section provides a summary of the findings identified throughout the desk review andstakeholders’ consultation with regard to the availability of EU-backed financing support within the
EU. It thus identifies the main challenges/barriers to SMEs access to finance observed throughout
the research, the key takeaway on the provision of EU-backed financial instruments, relevant
insights on the suitability of EU initiatives to internationalisation beyond the EU. Moreover,as outcome of the mapping research, this report provides the below lists of initiatives andstakeholders across the EU and the MS:
1. National and regional promotional banks and institutions (Annex I)
2. Other relevant financial institutions in the EU MS (Annex II)
3. Relevant support associations, networks and tools (Annex III)
4. EU initiatives/ financing schemes (Annex IV)
5. National initiatives in the EU MS (Annex V)

1. Challenges/barriers to SMEs access to financing opportunities in the EU
The below box sums up the findings of the comprehensive analysis with regard to the managementand delivery of EU-backed financial instruments.
Table 5. Suitability of the 4 selected EU programmes for internationalisation beyond the EU
Barriers

Sustainability of EU funds

Bank-based finance accounts for nearly 90%77 of SMEs finance needs.
Even though loans remain an important source of financing for EU SMEs,
access to financial products in commercial banks is still very limited.
Lack of suitable financing sources for innovative and fast-growing SMEs
and startups
Fragmentation of information on available financing support acrossseveral policy units and stakeholders and consequent lack of awarenessof EU SMEs in regard to availability of financing support

Commission’s response
Shift from traditional grant funding to a more extensive
use of blended finance, in view of leveraging capitalfrom private sources.
Business model based on financial intermediaries.
Several EU support programmes offering guarantees/
risk sharing schemes delivered to financial
intermediaries in view of increasing their capability toprovide for SMEs.
2020 SME Strategy: Encouragement for thedevelopment of more innovative solutions for SMEs
finance (e.g. blockchain technology)
Umbrella programme InvestEU

2. Provision of EU-backed financial instruments to EU SMEs
The below box sums up the findings of the comprehensive analysis with regard to the managementand delivery of EU-backed financial instruments.

European Commission. 2020. An SME Strategy for a sustainable and digital Europe. Brussels. 10.3.2020. COM(2020) 103 final. Source: https://ec.europa.eu/info/sites/info/files/communication-sme-strategy-march-2020_en.pdf
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The EIF does not provide direct debt/ equity to SMEs and startups
Most financial instruments under EU programmes are managed by the EIB Group on behalf of the Commission.
The business model for the delivery of financial instruments (loans/ guarantees and equity) relies on selectedfinancial intermediaries at the national and local level. This to say that the Commission – and notably the EIF,
being EU’s specialized bank for SME finance – provisions financial instruments to selected financial
intermediaries who are then responsible for the selection of final beneficiaries (SMEs) for EU-backed
instruments. Thus, in order to access EU-backed financial instruments, EU SMEs should consult with the
EIF and EIB financial intermediaries in their home country. These selected financial intermediaries include
a broad range of financial institutions, such as NPBIs, RPBIs, commercial banks, equity firms. This is valid bothfor programs supported by EU funds (e.g. Structural funds) and for financial instruments under specific programs(e.g. COSME, Horizon2020, LIFE, Blue Economy Window).
A non-exhaustive list of potential financial intermediaries is provided as an outcome of this report and canbe found under Annex X. Other useful links are:••••Portal Access to FinanceFull list of EIB’s financial intermediaries
Full list of EIF’s financial intermediaries
Full list of EIF’s intermediaries operating specifically under EFSI equity

3. Suitability of EU initiatives
Although this study observed a range of national initiatives backed with EU support available withinseveral EU member states, these are likely to be available only for national businesses. Thus, thecurrent findings focus exclusively on programs offered at the EU level and therefore open SMEs
registered in every EU MS without distinction.
Following the specific criteria of EU-backed financing support for internationalisation beyond theEU, four programmes seem to stand out: INOWWIDE, COSME, Horizon2020 and the EIC
Accelerator.
Table 6. Suitability of the 4 selected EU programmes for internationalisation beyond the EU
Suitable financing support for EU
SMEs internationalisation beyond the
EUInternationali
sationdedicated
Other sector/
policyobjectives

INNOWWIDECOSME
HorizonEurope
EIC
Accelerator

Provision of FIs into non-partner
businesses outside of the EU

Loans

EquityGrants

Loans

EquityGrants--Direct---Indirect

Indirect

Direct-Indirect-

Indirect

Indirect

Direct-Indirect--

DirectDirect

-

-

-

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The above table shows the suitability and delivery mode of the financial instruments/ funding
support under these programs for internationalisation beyond the EU (including in Japan), as wellas the possibility for provision of financial instruments into businesses in non-eligible countries. As
for the delivery mode, indirect stands for instruments delivered to EU SMEs through financial
intermediaries, whereas direct stands for instruments provisioned directly by the promoting entity
to EU SMEs. The table also distinguishes the selected programmes according to their focus on
SMEs internationalisation. This distinction seems relevant mostly because internationalisationdedicated programs are more likely to provide specific financing for internationalisation activities,
such as the development of internationalisation strategies, identity shaping and market intelligencegathering.
In view of providing a simplified overview of these programmes to EU SMEs, a summary of the four
programmes can be found below.

INNOWWIDE is a one of its kind initiatives, aimed
specifically at supporting EU SMEs internationalisation
beyond the EU. Even though it is not an initiative of theEuropean Commission per se 1 , it is funded with EU
support (through Horizon2020) and open to theparticipation of SMEs registered in an EU Member Stateor Horizon2020 country without reservations. The
program does not provide financial instruments, howeverunder this initiative SMEs can access grants to financeworldwide international growth.

COSME, the only EU program exclusively dedicated to the
supporting of SMEs, offers both debt (LGF) and equity
instruments (EFG) aimed at supporting SMEs
internationalisation and access to new markets. Both FIs
will be integrated into the forthcoming InvestEU fund. The
program has already provided a tremendous contribution
to the internationalisation of EU SMEs by financing theEnterprise Europe Network (EEN) and the European
Cluster Collaboration Platform (ECCP). In order to apply
for a COSME-backed loan, SMEs should contact
COSME’s financial intermediaries and sub-intermediaries
in their home country. As for COSME-backed equities,
they should reach out to the EFG financial intermediaries.

Horizon2020 is a research and innovation program,providing both debt/guarantees (InnovFin SME
Guarantee Facility) and equity (InnovFin Equity) for
promising innovative projects. In order to apply to these
instruments, SMEs should reach out to the InnovFin SME
Guarantee Facility financial intermediaries or subintermediaries in their home country. As for InnovFinbacked equities, they should reach out to their local
InnovEquity financial intermediaries. Whereas the
programme is still running, Horizon Europe will be its
predecessor for the period of 2020-2027. Under Horizon
Europe the InnovFin financial instruments will be
integrated into the InvestEU Fund. As the InvestEU Fundhas a bankability criterion, the EIC Accelerator will replace
the financing demand for projects that are not yet
bankable.

The EIC Accelerator is an integrated program that
supports highly innovative and close-to-market SMEs. The
Accelerator provides business acceleration services andcoaching (via EEN), as well as solely grant funding or
blended finance (grants and equity). Equity instruments
are provided through the EIC Fund (established in June2019) to selected SMEs in the pre-seed, seed and earlystage – usually companies with no (or very limited turnover). It’s indeed a promising initiative offering to introduce
portfolio companies to a network of EU and foreign
investors. As the financial instruments of Horizon2020 will
fall under InvestEU (that has a bankability criteria), the EIC
Fund will suppress the financing demand for high-risk
projects that do not fall under this bankability criteria.

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Although these programmes seem to suit the criteria of internationalisation beyond the EU without
any distinctions on nationality, it doesn’t mean that other EU programmes targeting different
priorities can’t as well support internationalisation-related activities beyond the EU.
The EU Commission has several initiatives targeting different sector/ policy priorities (such as
innovation and R&D) which aim at facilitating investments in infrastructure, machinery, staff andresearch within these specific policy aims. Although many of these programmes do not target
internationalisation specifically, the covered investments do not provide distinction whether
the final products or services are exported or not. This means they can still support
internationalisation activities, provided that the specific objectives of the programme are fulfilled.

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Chapter 2 – Financing opportunities in JapanCHAPTER 2 Financing opportunities in Japan
Bilateral cooperation: EUJapan in Connectivity
Overview of trends, priorities and strategic
sectors for EU-Japan collaborations in ouroutside of Japan, with a focus for the EUJapan Connectivity.

Financing by Japaneseinstitutions
Assessment of suitable instruments
for EU SMEs offered by Japaneseinstitutions

Opportunities &stakeholders mapping

Other sources offinancing

Mapping of relevant stakeholders
and initiatives that can potentially
support EU SMEs
internationalisation in Japan –ANNEXES VI-VII.

Main trends in the private capital
ecosystem and the state of R&D
and early stage investment inJapan

Chapter overview
In a changing international order marked by the rise of unilateralism and protectionism, the EU andJapan have pronounced their commitment to multilateralism, promoting trade and economic
liberalization through several cooperation agreements. The EU-Japan Economic Partnership
Agreement (EPA), which entered into force in 2019, February 1st, led to the creation of the world’s
largest free trade zone, creating new opportunities for EU SMEs internationalisation through theremoval of tariff and non-tariff barriers. The outcomes are already positive. According to the current
Head of Trade Section of the EU Delegation in Japan, as of July 2019, EU exports of agricultural
products to Japan increased 20.8%, fisheries 9.5% and industrial products 7%, comparing to thesame period (February-July) before the EPA. 78
Notwithstanding, the proximity between the EU and Japan went well beyond the EPA. As analternative to the Belt and Road (BRI) Initiative pursued by the Chinese government, aimed at
improving China’s connectivity to the world, on 27 of September 2019 the EU and Japan signed a
Partnership on Connectivity and Quality Infrastructure. As for financing cooperation, three
Memorandums of Understanding (MoUs) between the EIB and the Japanese Bank forInternational Cooperation (JBIC), the Japan International Cooperation Agency (JICA) and the
Hannonen, Marjut. 2019. “Presentation of the EU-Japan Economic Partnership Agreement”. Information provided on the occasionof the EBOWWN Tokyo Meeting, hosted by the EU Delegation in Tokyo. 2-12-2019.
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Nippon Export and Investment Insurance (NEXI) have also been signed. These developments
express evidence on the growing importance of Japan as EU’s strategic partner in Asia and havethe . at the private level, in view of providing a more diversified mapping of opportunities. Throughdesk research and interviews with Japanese experts and stakeholders, the current chapter intends
to explore:•••

Potential opportunities triggered by means of bilateral cooperation between the EU and Japan.
Subchapter 1 overviews the EU-Japan Connectivity, bringing into attention the MOUs signed between the
EIB and Japanese institutions. With Japan being increasingly perceived as a gateway to other markets 79,
it seems relevant to identify the priorities and strategic sectors that can make ground for EU-Japanbusiness collaborations in or outside of Japan.
Financing instruments offered by Japanese institutions that can become available to EU SMEs
teaming up with Japanese companies. Several institutions, namely JBIC and JOIN, offer financing
support for Japanese companies operating in third countries. Under a logic of national interest, Japaneseinstitutions are unlikely to provide financing support to EU SMEs per se. However, some opportunities
might become available for EU SMEs teaming up with Japanese companies. Subchapter 2 observes thefinancial instruments offered by Japanese institutions and identifies the ones that might be available for
EU-Japan business partnerships.
The state of R&D and early stage investment in Japan. Subchapter 3 will be dedicated to understanding
the startup and venture capital ecosystem in Japan in order to identify relevant stakeholders and potential
opportunities for EU startups. Whilst this study does not aim to be exhaustive, it can constitute relevant
background for EU startups looking for financing opportunities among business angels and venture
capitalists in Japan.

The exploratory study behind the three dedicated subchapters will be conducted having thefollowing questions in mind: To what public financial instruments are EU SMEs eligible to apply?
What is the eligibility criteria and priority sectors? Is there any available capital offered by private
stakeholders in Japan? The opportunities identified throughout the three levels of assessment will
be comprised in a stakeholders mapping, available under ANNEXES VI-VII. The key findings, aswell as relevant takeaways, are provided at the end of this chapter.

1. Bilateral cooperation: EU-Japan in Connectivity
On the 27th September 2020, a Partnership Agreement on Sustainable Connectivity andQuality Infrastructure (here referred as ‘Connectivity Agreement‘)80 has been signed between theEuropean Commission and Japan, as a result of the EU-Asia Connectivity Forum and theEuropean-Asia Connectivity Strategy. The signature of this agreement occurs in the context of asignificant demand for connectivity in developing countries and in response to the US-led Blue Dot
This assumption and background references are further explored in the current chapter under topic 1.1. EU-Japan Connectivity.
MOFA. 2020. The Partnership on Sustainable Connectivity and Quality Infrastructure between Japan and the European Union.
Available in: https://www.mofa.go.jp/files/000521432.pdf
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Network (BDN)81 and the Beijing’s Belt and Road (BRI) infrastructure strategy, aimed at connecting
China to the rest of the world. 82. The Connectivity Agreement obviously includes, but is not limited
to, infrastructure networks. Broadly speaking, the concept also includes other forms of connectivity,
such as energy, digital, trade and investment networks. The current section explores some drivers
for EU-Japan business collaboration in third markets, as well as priority sectors for EU-Japan
Connectivity and co-financing possibilities following the signature of the MOUs between the EIB
and JICA, JBIC and NEXI.

EU-Japan business collaborations in third markets
The Japanese market is increasingly perceived as a gateway to other markets and the EUJapan Connectivity Agreement is expected to create additional opportunities for EU-Japanbusiness collaborations. A study carried on by the German Chamber of Commerce in Japanobserves that more than two thirds of German companies in Japan are involved in projects withJapanese businesses outside of Japan. Additionally, nearly half of the German companies present
in the Japanese market is generating revenues outside of Japan (to the same extent as in Japan
itself) by partnering up with Japanese companies in third markets. 83 84 Aware of this trend, theMinistry of Foreign Affairs of Japan (MOFA) is also conducting a survey on EU-Japan businesscollaborations in third markets, whose results should be available in the close future85.
On the occasion of a conference organized by the EU-Japan Centre, EU business representatives
mentioned that partnering up with Japanese companies provides better accessibility to othermarkets, namely in ASEAN.86 Among others, drivers for EU-Japan cooperation highlighted in theconference include:

The “Blue Dot” Network, is a joint project between the US Overseas Private Investment Corporation (OPIC), the Japan Bankfor International Cooperation (JBIC) and the Australian Department of Foreign Affairs and Trade which was announced in
November 2019 in the occasion of the Indo-Pacific Business Forum. The project intends to evaluate infrastructure projects,
providing guidance on infrastructure, and trying to address potential debt problems in economically fragile countries. Whether it is
not officially clear whether the Blue Dot Network is or not a response to the fear of developing countries loan-dependence ofChina, it is often perceived as such. For more information about the Blue Dot Network, please access the following link
https://www.state.gov/blue-dot-network/#nav__primary-nav
82 The funding of the One Belt, One Road (OBOR) initiative is based on the Silk and Road Fund (founded by state institutions
using currency reserves), loans from policy banks (such as China Development Bank, China Export-Import Bank) and China
Agricultural Development Bank), the Asian Infrastructural Investment Bank (AIIB), created in 2016, the BRICS New Development
Bank and the investments of Chinese providential governments and banks. More information about the OBOR can be found inthefollowinglink
https://css.ethz.ch/content/dam/ethz/special-interest/gess/cis/center-for-securitiesstudies/pdfs/CSSAnalyse195-EN.pdf
83 German Chamber of Commerce and Industry in Japan. 2019. Presentation on the occasion of the Seminar on EU-Japan
Business Collaborations in Third Market, organised by the EU-Japan Centre for Industrial Cooperation , 3.12.2019
84 German Chamber of Commerce and Industry. 2019. Business Climate Survey – German businesses in Japan. Available in:https://japan.ahk.de/fileadmin/AHK_Japan/Dokumente/German_Business_in_Japan_2019_EN.pdf
85 MOFA. 2020. Information provided by personal communication.
86 An interesting overview of this phenomena can be found in an article by Philippe du Taxis du Poet (General Manager of the EUJapan Centre for Industrial Cooperation) for Eurobiz Japan, on February 2020.
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•
•
•
•

The saturation of the Japanese market per se87
The growing infrastructure demand in ASEAN88
The market know-how and cultural understanding of Japan of these markets89
The well-established presence of Japanese subsidiaries in these markets.90

Concrete examples of EU-Japan Business Collaborations in ASEAN and in the APAC region
include the Thyssenkrupp and Mitsubishi Heavy Industries (in Indonesia) 91 , the Vestas Wind
Systems and Mitsubishi Heavy Industries (Taiwan, South Korea) 92 , the Bouygues Asia andSumitomo (in Hong Kong). 93
Notwithstanding, there are also successful stories of EU-Japan business collaborations 94 in Southand Latin America, such as the acquisition of the Spanish EVERIS, with activities in Latin America,
by NTT Data. 95 In this regard, an observation by the EU Chamber of Commerce of Industry
highlights that whereas Japan’s bilateral trade with Brazil is significant (with Brazil having one of
the largest Japanese communities in the world), overall bilateral trade with the remaining
MERCOSUR countries remains low96.
A concrete example of EU-Japan business collaboration in the African continent is indeed the
Toshiba/ Vinci Construction partnership for hydro and geothermal projects which utilizes
geothermal resources centered on the Great Rift Valley97. However, other examples could also be
observed in other African countries, notably in Côte d’Ivoire. In fact, the EU Chamber of Commerceand Industry of Côte d’Ivoire observed that the Japanese government often provides grants to
African governments to support infrastructure projects. According to the Chamber of Commerce,
there is a tendency for Japanese companies who win the bids to team up with European

EU business representatives. 2019. On the occasion of the Seminar on EU-Japan Business Collaborations in Third Market,
organised by the EU-Japan Centre for Industrial Cooperation, 3.12.2019
88 For more information about the infrastructure demand in ASEAN, please see Chapter 2, section 2.6. Japan Overseas
Infrastructure Investment Corporation for Transport & Urban Development (JOIN) of this report.
89 EU Chamber of Commerce and Industry in Singapore. 2019. Presentation on the occasion of the Seminar on EU-Japan Business
Collaborations in Third Market, organised by the EU-Japan Centre for Industrial Cooperation, 3.12.2019
90 EU business representatives. 2019. On the occasion of the Seminar on EU-Japan Business Collaborations in Third Market,
organised by the EU-Japan Centre for Industrial Cooperation, 3.12.2019
91 German Chamber of Commerce and Industry in Japan. 2019. Presentation on the occasion of the Seminar on EU-Japan Business
Collaborations in Third Market, organised by the EU-Japan Centre for Industrial Cooperation, 3.12.2019
92 JBIC. 2020. Information provided by personal communication.
93 Bouygues Asia. 2019. Presentation on the occasion of the Seminar on EU-Japan Business Collaborations in Third Market,
organised by the EU-Japan Centre for Industrial Cooperation, 3.12.2019
94 For a comprehensive analysis of several EU-Japan Business Collaborations case studies, please see my colleague Masami
Marbot’s report. Available at: https://www.eu-japan.eu/minerva-past-reports-20142019#95 EU Chamber of Commerce and Industry in Brazil. 2019. On the occasion of the Seminar on EU-Japan Business Collaborations in
Third Market, organised by the EU-Japan Centre for Industrial Cooperation, 3.12.2019
96 EU Chamber of Commerce and Industry in Brazil. 2019. On the occasion of the Seminar on EU-Japan Business Collaborationsin Third Market, organised by the EU-Japan Centre for Industrial Cooperation, 3.12.2019
97 Toshiba. 2019. On the occasion of the Seminar on EU-Japan Business Collaborations in Third Market, organised by the EUJapan Centre for Industrial Cooperation, 3.12.2019
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companies to save costs, as they are usually more experienced in the market and are more likely
to have operational local teams in the region 98.
Besides the reasons that motivate partnering up with Japanese companies overseas, some EU
companies even pointed out that successful experiences with Japanese companies in othermarkets made it easier to access the Japanese market itself afterwards 99.
Financing for infrastructure
As mentioned above, there is a gap between the available offer and the increasing world demandfor infrastructure, namely in developing countries. For instance, the World Bank estimates thatdeveloping countries will need between $3.3 to $4.5 trillion investment per year to meet theirinfrastructure needs, what currently represents a financing gap of $2.5 trillion. 100 The global
demand for infrastructure investment for the current period between 2016-2030 is estimated innearly $95 trillion by the OECD 101 , of which nearly 26$ trillion infrastructure investment will beneeded in developing Asia, according to the ADB.102 The gap between the offer and the demandfor infrastructure in Central and Southeast Asia has actually been highlighted by official
representatives from Southeast Asian countries, notably from Thailand and Indonesia, present at
the 5th Seminar on the Japanese Investments for Overseas Infrastructure.
Upon the occasion of the G20 leaders in the G20 Osaka Summit on the 28th and 29th of June 2019,
six principles for quality infrastructure investment have been approved, in view of integrating
current environmental and social concerns. Maximizing the impact on sustainable growth,environmental considerations and resilience to natural disasters rank among these principles. Withhigh quality infrastructure products and a notable experience in technology and products adapted
to natural disasters, Japan seems to be determined to capture the momentum to accelerate its
infrastructure exports. In fact, following the Osaka Summit, the Nippon Export and Investment
Insurance (NEXI) has launched a new insurance scheme aimed at mobilizing private funding
capital from institutional investors in order to meet this global demand for infrastructure investment,
namely in developing countries. This financing scheme provides insurance cover for infrastructure
funds and project bonds and aims at mobilising private investment through several Memorandumsof Understanding with foreign entities, including European private financial institutions, such as
Deutsche Bank and BNP Paribas103
EU Chamber of Commerce and Industry in Côte D’Ivoire. 2019. On the occasion of the Seminar on EU-Japan Business
Collaborations in Third Market, organised by the EU-Japan Centre for Industrial Cooperation, 3.12.2019
99 Hafele. 2019. Presentation in the occasion of the EBOWWN Tokyo Meeting, hosted by the EU Delegation in Tokyo. 2.12.2019.
100 International Finance Corporation. 2019. “Fresh Ideas About Business in Emerging Markets Compass.” Source:
http://documents.worldbank.org/curated/en/738131573041414269/pdf/Closing-the-SDG-Financing-Gap-Trends-and-Data.pdf
101 OECD. 2017, pp. 28. “Investing in Climate, Investing in Growth”, OECD Publishing, Paris. Source: https://www.oecdilibrary.org/docserver/9789264273528en.pdf?expires=1588849084&id=id&accname=guest&checksum=2E10094EBC4A7BD900C2D8D7238B7E43
102 ADB. 2017. “Meeting Asia’s infrastructure needs”. Source: https://www.adb.org/sites/default/files/publication/227496/specialreport-infrastructure.pdf
103 In view of mobilising private investment, NEXI has signed 13 MoUs on business cooperation with several private financial
institutions, including in Europe: Mizuho Bank, MUFG Bank, Sumitorno Mitsui Banking Corporation, Australia and New Zealand
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Over the past ten years, the Japanese government has passed series of new laws to encourage
the participation of the private sector in financing/ operating in public infrastructure andventuring overseas. Examples include the amended Act on Promotion of Private FinanceInitiative, in 2011, and the action plan for promoting PPP/PFI programmes, in 2016. On theinstitutional level, the establishment of the ministerial “Meeting on Strategy relating Infrastructure
Export and Economic Cooperation” that already met 44 times since its creation in 2013, and theestablishment of the Japan Overseas Infrastructure Investment Corporation for Transport & Urban
Development (JOIN), in 2014, also provide evidence on the effort to take the infrastructure businessoverseas. 104
As the private sector alone can’t bear all the risks associated with large-scale projects, the current
infrastructure demand calls for increased cooperation among Japanese institutions, on the one
hand, and between the private and the public sector, on the other. Institutional cooperationrefers to overseas collaboration initiatives between JETRO, JBIC, NEXI, JICA and JOIN, but also
UR, J-CODE (Japan Conference on Overseas Development of Eco-cities), JIBH (Japan
International Association for the Industry of Building and Housing) and JHBUD (Japan Global
Exchange Forum for Housing, Building and Urban Development) 105.
With respect to public-private cooperation, several initiatives aimed at facilitating the provision offinancing in infrastructure joint projects overseas involving companies from other countries could
be observed. This is the case of the UK who, following Brexit, has recently launched a third
countries infrastructure development initiative106 with Japan in the context of the UK-Japan
Joint Statement 107 , signed in January 2019. The joint statement stands, among others, for theengagement of the UK and Japanese public and private sector in UK-Japan cooperation in third
countries, with particular attention to infrastructure. Financing for such joint projects relies onbilateral MoUs between the UK and Japanese export trade agencies, UKEF and NEXI. Other MoUs
have also been signed between the UK DIT and other Japanese institutions, namely JBIC andJETRO. Smart cities, regional development, roads, intercity highways and suburban railroad,
airport maintenance, water and sewage and healthcare rank among the priority sectors forcooperation in third countries, particularly in Asia and Africa.

Banking Group Limited, BNP Paribas, Citi Bank, Credit Agricole Corporate Investment Bank, Deutsche Bank, Goldman Sachs Japan
Co, ING Bank, Societe General, Standard Chartered Bank and The Hongkong and Shanghai Banking Corporation Limited. Moreinformation available on the following link: https://www.nexi.go.jp/en/topics/newsrelease/2019060701.html
104 Special Advisor to the Prime Minister of Japan, Aroto Izumi, 2020. Presentation on the occasion of the 5 th Seminar on theJapanese Investments for Overseas Infrastructure. JOIN. Tokyo, 21.2.2020.
105 Special Advisor to the Prime Minister of Japan, Aroto Izumi, 2020. Presentation on the occasion of the 5th Seminar on theJapanese Investments for Overseas Infrastructure. JOIN. Tokyo, 21.2.2020.
106 British Market Council (BMC). “Japan-UK Collaboration for 3rd Country Infrastructure”. Source: https://britishmc.com/japan_uk/index.html
107 MOFA. 2019. “UK-Japan Joint Statement”. Source: https://www.mofa.go.jp/mofaj/files/000436675.pdf

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Smart cities
The current focus on infrastructure foresees the implementation of smart-city strategies in several
countries, in view of contributing to the achievement of the Sustainable Development Goals(SDGs). Smart cities take information and communication technologies as drivers for improving thelife quality of inhabitants and businesses, as well as the quality and responsivity of the services
provided by public administration. This interconnectivity, however, again calls for cooperation
between the public and the private sector through innovative financing instruments, such as
blending between Public Private Partnerships (PPPs) and public-private equity investment.
Faced with rapid urbanisation, ASEAN leaders have been trying to cooperate in common goals forsustainable urban development. The creation of the ASEAN Smart Cities Network, in 2018, is
probably one of the most evident outcomes of these efforts that are very much focused in securing
funding and support from external partners. A concrete case that has been raised within the context
of the 5th Seminar on the Japanese Investments for Overseas Infrastructure and called specificallyfor external collaboration is the movement of the Indonesian capital from Jakarta to East
Kalimantan, nearly 1300 km away from Jakarta. With an estimated initial cost of $35 billion, themovement of the capital is deemed to be the largest infrastructure project ever undertaken inIndonesia. The fact that the city is being designed to be an environmentally friendly smart city
triggers significant business opportunities not only in infrastructure, but also in other sectors suchas agriculture, renewable energy, sustainable mining and tourism. The presented regional
development plan for the province of East Kalimantan also suggests the future development ofrelated sectors, namely in the cities of Balikpapan and Samarinda. Sectors referred include
pharmacy, oleo chemical, maritime logistic and technology, information and communication 108.
Also, in the context of the above-mentioned seminar, official representatives from ASEAN countries
made the importance of Japan as strategic external partner very clear. Through its Official
Development Assistance (ODA) loans, among other instruments, Japan has been very active insupporting social, economic and infrastructure development in ASEAN. It’s not surprising thatJapan’s Foreign Direct Investment (FDI) has dramatically increased in ASEAN in the last 10
years.109 Notable examples of Japanese involvement in a smart-city project is the road network in
Yangon (Myanmar) and the Urban Transport Plan in Phnom Penh Capital City, both with JICA’s
support. On an informative note, the latter Phnom Penh project was focused on the developmentof a system of public and private transport plan, combining road, public transportation and traffic
management. The project also included a smart lighting project aimed at saving energy throughwireless diming control, conducted by Minebea Mitzumi. 110 This provides evidence on how
integrated smart-city projects are, triggering opportunities in a wide variety of sectors.

Ex-Member Advisory of the President of the Republic of Indonesia, Ginandjar Kartasasmita, 2020. Presentation on the occasionof the 5th Seminar on the Japanese Investments for Overseas Infrastructure. JOIN. Tokyo, 21.2.2020.
109 Kikuchi, Unzaki. 2019. “Japanese Infrastructure Investment in Southeast Asia.” Nayang Technological University Singapore.
Source: https://www.rsis.edu.sg/wp-content/uploads/2019/05/PR190503_Japanese-Infrastructure-Investmentin-in-SEA.pdf
110 JICA. 2014. The Project for Comprehensive Urban Transport Plan in Phnom Penh Capital City (PPUTMP).
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Co-financing between the EIB and Japanese institutions
With regard to financing per se, the Connectivity Agreement has been followed by the signature ofseveral Memorandums of Understanding between the European Investment Bank and Japaneseinstitutions, such as the Japan International Cooperation Agency (JICA), the Japan Bank forInternational Cooperation (JBIC) and the Nippon Export and Investment Insurance (NEXI). These
MoUs are expected to facilitate EU-Japan cooperation in financing connectivity projects,
however, up to now, there are no operational tools in place that can materialize these MoUs into
specific financing schemes.
For instance, the interviews conducted suggest that while the EIB has operational expectations 111,
the Japanese side understands the MOU as an instrument to facilitate the dialogue between thetwo parties in view of identifying specific sectors for joint cooperation. 112 The Connectivity
Agreement clearly expresses the aim of coordinating efforts, not only in Europe, but also in Asia
and Africa. Yet, in the interviews conducted to JBIC, the institution referred that the below sectors
for potential joint cooperation identified throughout the discussions with the EIB are:••“Renewable energy projects within and outside of Europe (but mostly within)” 113;
“New technology, such as hydrogen and offshore wind technology. This one is probably
pre-mature in Africa but can also be developed in Europe” 114.

Moreover, de facto possibilities of co-financing between the EIB and Japanese institutions, areunderlined by the following factors:
1. In order to be eligible for EU financing, Japanese institutions have to be pillar assessed –a process that can take between 1-3 years.
2. Co-financing possibilities are under discussion between the EIB and Japanese institutions,notably following the signature of three MOUs between the EIB and JBIC, JICA andNEXI. Although these MOUs indicate a common framework of action, they are not legallybinding and neither do they involve exchange of money. Thus far, no operational outcomes
have been produced.
3. The conducted interviews suggest that the lack of operational outcomes have its roots inthe seemingly prevalence of legal and technical constraints, notably with regards to public
procurement.

EIB. 2020. Information provided by personal communication
JBIC. 2020. Information provided by personal communication
113 JBIC. 2020. Information provided by personal communication
114 JBIC. 2020. Information provided by personal communication
111
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Notwithstanding, the EIB and Japanese institutions can agree to finance the same project inthe EIB’s countries of operation, with the interested borrower contacting both entities and, most
likely, with both of them signing an agreement with a third party 115.
Still in this regard, a final remark that can be made is that cooperation in financing does not haveto be limited to the EIB. In fact, some Japanese institutions hold signed bilateral agreements with
European countries, including with EU National Development Banks and Institutions (NPBIs)116.
This is the case for Cassa depositi e Prestiti of Italy, for instance, who signed an MoU with JBIC in
April 2019 to encourage business opportunities for Italian and Japanese companies in Italy, Japanand third countries. 117 NEXI also holds agreements with several European export credit agencies
in Italy, Spain, France, Austria, Belgium, Germany, Czech Republic, the Netherlands and the UK.

2. Financing support by Japanese institutions
2.1.

Nippon Export and Investment Insurance (NEXI)The Nippon Export and Investment Insurance (NEXI) is the insurance arm of the Japanese
government, offering export insurance to various types of Japanese companies (including SMEs),
which aim at expanding globally. Some financial tools are available for Japanese companies
partnered with EU companies in third markets, under co-financed schemes with the EIB andother EU export credit agencies.
In view of creating a single window for export contacts involving companies from multiple countries
in joint projects in third countries, NEXI has signed several agreements with EU export credit
agencies. Examples include the Italian Servizi Assicurativi Del Commercio Estero (SACE), thedutch Atradius (ATRADIUS), the Belgium Ducroire / Delcredere (ONDD), the German Euler
Hermes Germany (EULER HERMES), the Austrian Oesterreichische Kontrollbank
Aktiengesellschaft (OeKB), the Finnish FINNERVA PLC, the Spanish Compañía Españoal a deSeguros de Crédito a la Exportación (CESCE), the French Bpifrance and the Czech Export
Guarantee and Insurance Corporation (EGAP). Under this window, reinsurance by NEXI is
provided to the portion exported from Japan, whereas the portion exported from an EU
member state is supported by the related export credit agency. The main purpose is promoting

The list of EIB’s financial intermediaries can be found in the following link:
https://www.eib.org/intermediarieslist/search/result?country=JP
116 For more information about the role of NPBIs please see Chapter 1, section 2.3. Financial intermediaries and Promotional Banksand Institutions of this report.
117 JBIC. 2019. JBIC Signs MOU with Cassa depositi e prestiti of Italy – Promoting cooperation between Japan and Italy to createbusiness opportunities. April 26. Available in: https://www.jbic.go.jp/en/information/press/press-2019/0426-012136.html
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industrial cooperation between Japan and the related country and supporting exports of Japanese
products where a transaction involves an EU member state.118
More recently, a new insurance scheme has been launched by NEXI in 2019, in view of mobilizing
private funding capital to meet the global demand for infrastructure investment, namely indeveloping countries. As previously mentioned, this financing scheme provides insurance cover for
infrastructure funds and project bonds through several Memorandums of Understanding withforeign entities, including European private financial institutions, such as Deutsche Bank and BNPParibas119

2.2. Japan International Cooperation Agency (JICA)
The Japan International Cooperation Agency (JICA) is the official development aid assistance bodyto developing countries. Linked to the Ministry of Foreign Affairs of Japan (MOFA), it provides
technical assistance to developing countries, being mandated to lend to sovereign entities throughits Official Development Assistance (ODA) loans or, in some particular projects, via equity.
Whereas the Japan Bank for International Cooperation (JBIC) evaluates projects based on financial
return, JICA is more focused on policy priorities.
ODA loans often result in open tenders for businesses. However, the technical specifications ofsuch tenders can potentially leave EU companies out. Interviews conducted to EU experts showthat often only Japanese companies can meet the technical specifications of these tenders and,
therefore, EU companies are only entitled to apply in very exceptional cases when Japanesecompanies can’t meet the criteria.
Notwithstanding, it does not mean that there are no opportunities for EU SMEs in this regard. Theinterviews also suggest that operational maintenance of facilities overseas is not commonly
handled by Japanese companies, but rather outsourced to foreign companies. As EU SMEs
are used to operational maintenance, this could be an interesting area for cooperation in third
markets, namely in Africa. Following this statement, it seems relevant to highlight again theobservation of the EU Chamber of Commerce and Industry of Côte d’Ivoire, who referred thetendency for Japanese companies who win the bids to team up with European companies to savecosts. Reasons include, among others, a more established EU presence in Africa, the market knowhow and the presence of operational local teams.

NEXI. 2017. “Conclusion of Reinsurance Agreement with UKEF”. Source:
https://www.nexi.go.jp/en/topics/newsrelease/2017091503_2.html
119 In view of mobilising private investment, NEXI has signed 13 MoUs on business cooperation with several private financial
institutions, including in Europe: Mizuho Bank, MUFG Bank, Sumitorno Mitsui Banking Corporation, Australia and New Zealand
Banking Group Limited, BNP Paribas, Citi Bank, Credit Agricole Corporate Investment Bank, Deutsche Bank, Goldman Sachs Japan
Co, ING Bank, Societe General, Standard Chartered Bank and The Hongkong and Shanghai Banking Corporation Limited. Moreinformation available on the following link: https://www.nexi.go.jp/en/topics/newsrelease/2019060701.html
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2.3. Japan Bank for International Cooperation (JBIC)
The Japan Bank for International Cooperation (JBIC) is the commercial private sector transactions
entity of the Japanese government, operating in developed and developing countries. In view of
improving the competitiveness and overseas business of Japanese industries, JBIC offers a wide
portfolio of financial products to private financial institutions (mostly guaranteed loans in this case)and Japanese companies in third markets, including loans and equity. 120
The bank is particularly interested in the following sectors:a) Natural resources, aiming at supporting Japanese companies’ acquisition or developmentof natural resourcesb) Quality infrastructure, aiming at supporting competitiveness in quality infrastructure (e.g.
high-speed railway projects)c) Environmental preservation, aiming at supporting projects related to environmental
preservation. Compared to the previous ones, this priority is still quite underdeveloped.
As a bank, JBIC does not provide subsidies or grants, only financial products. The main and mostused product is the Overseas Investment Loan (OIL). With nearly 70% commitment, it is also thehighest commitment of the Bank. With respect to its equity products, JBIC can provision equity tosupport Japanese companies per se, for as long as these companies also participate with their own
capital, or to support their equities overseas. As one can observe in the below figure (Figure 11),
joint ventures are a typical way of providing equity capital. As such, based on the financial return,joint-ventures between EU and Japanese businesses might also be eligible for support under the
OIL.
A notable exemple of a JBIC’s overseas investment is the offshore wind business in Japan, abusiness collaboration between Mitsubishi Heavy Industries (MHI) 121 and Vestas Wind Systems(Denmark)122. To provide some details on the partnership, MHI was strong in onshore but not in
offshore. In turn, Vestas Wind Systems was impacted by the Lehman shock and needed both
capital and partners to expand its business in offshore wind. Offshore requires more wind turbineswith a bigger size, what makes it a more costly business than onshore wind turbines. Plus, MHI
had a strong experience in the Asia-Pacific (APAC) region and also in dealing with difficult natural
conditions, such as typhoons and earthquakes, as products and technology in Japan are adapted
to natural disasters. JBIC and Mitsubishi Heavy Industries acquired shares of the MHI Vestas in2014. Since then, JBIC has been supporting the execution of the joint venture strategy throughequity investment that, in turn, supports the development of new products and, besides Japan, theaccess to third markets such as Taiwan, South Korea and US.

JBIC. Role and Function. Available in: https://www.jbic.go.jp/ja/about/role-function/images/jbic-brochure-english.pdf
MHI also acquired Rocla, Oyj, a manufacturer of electric warehouse trucks in Finland (2008)
122 For detailed information about this EU-Japan business partnership, please consult the report on EU-Japan business collaborationsin third markets developed by the EU-Japan Centre for Industrial Cooperation MINERVA Fellow Masami Marbot (2020), available athttps://www.eu-japan.eu/minerva-past-reports-20142019
120
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Figure 11. Delivery of Overseas Investment Loans (OIL) by JBIC. Source: JBIC, 2020123

Concerning the access to JBIC’s financial instruments, it’s important to note that there’s no specificapplication scheme in place for SMEs, such as open calls for proposals. Projects are usually
evaluated on a case by case basis, following the direct contact of a project developer. As per JBIC,
this is also the modus operandi for the co-financed projects with the EIB. The project developer
reaches out to JBIC looking for financing from both the EIB and JBIC and then the discussions
between the two banks are initiated. A relevant aspect, however, is that access to financial
instruments offered by JBIC are meant for to support Japanese companies and, therefore, EU
SMEs need to have a Japanese partner in order to be eligible.
Unlike the EIB, JBIC’s products are usually provided directly to the final beneficiaries. However,the bank’s mandate also allows it to lend to foreign banks which then on-lend to businesses.
Concrete cases of loans provided to local banks in Thailand, Vietnam and the Philippines havebeen referred throughout the interviews. There is no doubt JBIC can develop many projects inSoutheast Asia due to its geographical and historical ties to the region, however, the interviewed
representatives highlighted that no region of the world is excluded. When asked about priority
regions and sectors, JBIC showed interest in expanding its activities in Africa, namely in the power
sector as they are already participating in some projects in this sector, and in Asia, namely in
Bangladesh and Myanmar.

The document on the role and function of JBIC has been obtained via personal interview with two representatives of the New
Energy and Power Finance Department I, Infrastructure and Environment Finance Group of JBIC. However, it can also be accessedin the following link: https://www.jbic.go.jp/ja/about/role-function/images/jbic-brochure-english.pdf
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Finally, and even though not specifically relevant for EU SMEs aiming at internationalizing to Japan,
but still interesting for EU SMEs importing from Japan, another instrument offered by JBIC is theexport loan. JBIC provides loans for importers in foreign countries if they don’t have enough money
to buy from Japanese exporters. This instrument is provided within the guidelines of the OECD
Arrangement 124.

JBIC IG Partners
JBIC IG Partners is an investment advisory and agency business firm established in joint venture
by Japan Bank for International Cooperation (JBIC), which owns 51%, and the Industrial Growth
Platform, Inc (IGPI), which owns 49%. The joint-venture is member of the Japan Investment
Advisors Association and the Type II Financial Instruments Firms Association 125.
The firm can invest outside of Japan through its venture capital and private equity funds. Thus,
through its investment arms JBIC IG Partners can either proceed with investments in overseas
companies with the aim to expand transactions with target foreign and Japanese companies, or
joint investments, sharing the risks with Japanese companies. As the firm expects to exit
seven years from investment, its main target are venture, growth and buyout businesses.
Currently, in the EU area JBIC IG is running Nordic Ninja, in joint venture with BaltCap126 127. Nordic
Ninja is a new venture capital fund based in the EU, interested in investing in early stage start-ups
in the Nordic and Baltic regions. Having started its operations in 2019, it is not only the firstJapanese venture capital firm in Europe, but also the first JBIC-backed VC. In fact, JBIC is the main
capital provider of the firm, followed by other three Japanese companies (Honda, Panasonic andOmron).
It might also be worth to mention that besides the previous cooperation of Baltcap with the EIF,
some of the start-ups in which Nordic Ninja invested in also benefited from EU financial instruments(e.g. BOLT).128

2.4. Japan External Trade Organisation (JETRO)The Japan External Trade Organisation (JETRO) is the Japanese official trade promotion
organisation. Its main aim is to promote trade and investment between Japan and other countries,
For more information about the OECD Arrangement on Officially Supported Export Credits, launched in 2018, please check thefollowing link:
http://www.oecd.org/officialdocuments/publicdisplaydocumentpdf/?cote=TAD/PG(2018)1&docLanguage=En
125 The Financial Instruments and Exchange Act of Japan (FIEA) classifies financial instruments according to four types. Moreinformation can be found in https://gettingthedealthrough.com/area/107/jurisdiction/36/financial-services-compliance-japan/
126 For more informations about the specificities of this EU-Japan partnership, please check the EU-Japan Centre MINERVA report
Masami, 2020. For more information about Nordic Ninja please access https://nordicninja.vc
127 Baltcap already has an history of cooperation with the EIF. In 2017, it established a fund to invest in SMEs across the Baltic region.
The fund was backed by the EIF through a joint initiative with the national agencies KredEx (Estonia), Altum (Latvia) and Invega(Lithuania). More information in:
http://www.eif.europa.eu/what_we_do/equity/news/2017/eif-and-baltcap-launch-new-fund.htm
128 Nordic Ninja. 2020. Information provided by personal communication.
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into Japan. As for the latter, it’s important to note that Japan’s inward FDI stock is low whencompared to other advanced economies. 129
JETRO offers no funding or financing support to EU start-ups and SMEs but it offers seminars
for pitching and networking between European start-ups and big Japanese corporations. However,these seminars are not open, they require direct invitations, usually from JETRO’s foreign offices.
According to a representative from JETRO, most companies who receive direct invitations are in
the high-tech sector130.
Other service offered by JETRO that can be relevant to EU start-ups is incubation. JETRO helps
companies that would like to set up an office in Japan, by offering 50 free days in its incubation
centers. After the 50 days expire, start-ups can expect to start paying a small fee. In order to accessthis service, companies should reach out to JETRO’s closest office. Nonetheless, JETRO’s Tokyo
office has advisors (experts in several areas) that can also be reached out by EU SMEs. The firstmeeting with the advisor is free of charge and can also be conducted via videoconference.
Even though not related to finance, interviews conducted to JETRO’s representatives provided
some hints on how to make business with Japan and priority sectors that might be useful to EU
SMEs.
1. The importance of relationships in doing business with Japan. As per the comments
provided by a JETRO representative, relationship is the first priority of Japanesebusinesses and technology is often second. It is very common for Japanese costumers to
select the company that has a contact person in Japan, even if the technology is inferior.
2. The importance of a customized service. Japanese companies rank customized service
high in their priorities. The recommendation of JETRO is that EU SMEs get a small
subsidiary in Japan which can manage several distributors directly from Japan. Even
though having a sales partner can be helpful, it is not always the best solution because
usually sales partners are unable to provide a customized service.
3. An observed gap in deep-tech. As Japanese companies are week on deep tech, this
sector is considered a priority in every region of the world.
4. Other priority sectors include renewable energy (mostly wind power and biomass, solar
power is not so much of a priority), bio and healthcare (new drugs, especially for Cancer,
Alzheimer and Parkinson), nudging robots and edu-tech (robots for education).

JETRO. 2019. Information provided upon the occasion of the Seminar on EU-Japan Business Collaborations in Third Countries,
organized by the EU-Japan Centre for Industrial Cooperation.
130 JETRO. 2020. Information provided by personal communication.
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2.5. Japan Overseas Infrastructure Investment Corporation for Transport and Urban
Development (JOIN)
The Japan Overseas Infrastructure Investment Corporation for Transport and Urban Development(JOIN) is, according to JOIN’s out statements, the “first and only government sponsored equity
provider in Japan specialized in infrastructure investments.” 131 It cooperates with privatecompanies and Japanese institutions in infrastructure investments and negotiates with hostgovernments. The participation of local and third countries companies is also predicted in JOIN’s
business model, for as long as they can contribute with their own capital (Figure 12).

Figure 12. How JOIN operates in the overseas infrastructure market. Source: JOIN, 2020132

In fact, JOIN invests in infrastructure projects overseas with or through a global network ofoverseas local partners and financial institutions, with whom they have signed Memorandumsof Understanding (MOUs) and Cooperation (MOCs). Thus far, 15 MOUs and MOCs have beensigned with a wide range of partners. Even though this report does not aim at providing an
exhaustive list of JOIN’s overseas partners, the international networks map of Figure 13 canprovide some hints on the type of partners JOIN teams up with and where they are located.
Awareness of JOIN’s international networks might be useful for EU businesses interested inpartnering up with Japanese companies in the infrastructure sector.

JOIN, 2020. Presentation on the occasion of the 5th Seminar on the Japanese Investments for Overseas Infrastructure. JOIN.
Tokyo, 21.2.2020.
132 JOIN, 2020. Presentation on the occasion of the 5th Seminar on the Japanese Investments for Overseas Infrastructure. JOIN.
Tokyo, 21.2.2020.
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Figure 13. The International Networks of JOIN. Source: JOIN, 2020133

According to information provided on the occasion of the 5th Seminar on the Japanese Investments
for Overseas Infrastructure, it seems JOIN has currently 103 projects in the pipeline, across 8
sectorial priorities, which will launch due diligence soon. High-speed railways, urban railways,
airport terminals, logistics, port terminals, toll roads, urban development and ships/offshore units
are included JOIN’s focused sectors.

2.6. INCJ, Ltd. and Japan Investment Corporation (JIC)
Established in 2018 from a previous institution called Innovation Network Corporation of Japan (産業革新機構 sangyo kakushin kiko) and supervised by METI, the Japan Investment Corporation (産業革新投資機構 sangyo kakushin toshi kiko) is the first state-backed investment fund in Japan.
Besides the Japanese government (who is the biggest shareholder), JIC has 25 Japanese large
companies as shareholders 134.
Whereas JIC’s concrete achievements are still to be accessed, its antecessor Innovation Network
Corporation of Japan (INCJ) had a track record of investments, with concrete success stories ofrestructuring and refinancing Japanese businesses. Even if in a lesser extent, INCJ also has
supported Japanese acquisitions acquisitions under its overseas management resources scheme.
In the period of 2009-2017, INCJ invested in 13 international companies, 6 of which in Europe,
including in the UK and Switzerland. The great majority of investment was through joint acquisition
between INCJ and Japanese large companies, but there are also cases of single investments. A
JOIN, 2020. Presentation on the occasion of the 5th Seminar on the Japanese Investments for Overseas Infrastructure. JOIN.
Tokyo, 21.2.2020.
134 JIC official webpage. Source: https://www.j-ic.co.jp/en/
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table comprising an overview of the INCJ investments through its overseas management resources
scheme can be found under Annex IX.
After the new restructuration, INCJ continues to operate as INCJ, Ltd., under the framework of theIndustrial Competitiveness Enhancement Act. The Japanese Investment Corporation (JIC), in turn,was inactive for a while following mass resignations from the board. However, as of November
2019 a new board has been appointed and the activities of JIC are expected to restart.

2.7. Japan Finance Corporation (JFC)
The Japan Finance Corporation (JFC) is a government-affiliated financial institution established in
October 2008 through a merger of the roles of 4 policy-based institutions: the National Life Finance
Cooperation (NLFC), the Agriculture Forestry and Fisheries Finance Corporation (AFC), the Japan
Finance Corporation for Small and Medium Enterprises (JASME), as well as the international
finance and overseas economic cooperation operations of JBIC.
In order to meet the long-term financing needs of Japanese SMEs, JFC has an SME window which
focuses on providing long-term loans for equipment and working capital. This SME window
operates under the Small and Medium Enterprise (SME) Unit which developed from JASEME.
However, the institution also provides small loans or micro/ small businesses (including startups)
under its Micro Business and Individual Unit. Information provided by JFC observes that nearly
79% of the outstanding loans have been provisioned to companies with 20 employees or more.
From these companies, approximately 94% have a capital of 10 million yen or more.
With regard to financial products, it might be interesting to note that JFC offers both secured andunsecured loans. The interest rates of secured loans rank between 0.5% to 2.0% lower than thoseof unsecured loans, but it is always up to SMEs if they want to provide collateral or not 135. JFC’s
financial products obviously target Japanese companies; however, the institution also engages inoverseas projects through its international arm – the Japan Bank for International Cooperation(JBIC). The international dimension of JFC’s operations include promoting overseas development
and acquisition of important natural resources to Japan, promoting overseas businesses andimproving the international competitiveness of Japanese industries.136 The table below shows thetypes of businesses supported by JFC and the industries covered.

135
136

JFC. 2020. Information provided by personal communication
JBIC. 2011. Profiles of JFC and JBIC. Source: https://www.jbic.go.jp/en/information/annual-report/pdf/2011_01.pdf

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Table 7. JFC supported businesses per size and type. Source: JFC, 2020 (personal communication)

2.8. Japan Development Bank (DBJ)
Established by the Japanese government, the Japan Development Bank (DBJ) is a policy-based
financial institution offering integrated investments and loans, as well as advisory services tobusinesses. In view of supporting Japan’s socioeconomic growth, the institution focuses on a longterm perspective, providing funds for economic revitalization, industrial restructuring, quality of lifeand renewable energies, for example. Even if on a lesser extent, the bank also supports overseas
development through its principal investment team who does equity investment in SMEs
overseas, including in Europe, but only if a Japanese acquirer is involved137. For this reason, DBJ
has a European office, based in London. An example of an overseas investment in Europe is thebank’s joint acquisition of the National Car Parks Limited (UK), with Park24 Co., Ltd. (Japan). 138
It’s nevertheless important to note that such investments are rare, as DBJ is tied with Japanesefinancing requirements139, that are often difficult to be filled in by European businesses.
With regard to cooperation with the EU, DBJ holds bilateral MoUs with EU organisations aimed atpromoting cooperation between Japanese businesses and EU businesses. The most recent
MoU has been signed with Business Finland in November 2019. 140 Together with JBIC, DBJ is as
well member of the D20 Long Term Investors Club. The D20 Long-term investors club is a groupof long-term investors and financial institutions from all over the world funded in 2009 by theEuropean Investment Bank, Caisse de Dépots, Cassa Depositi e Prestiti and KfW. The last meetingof the network was held in Tokyo in April 2019.141

137 Development Bank of Japan. 2020. Information provided by personal communication.

Park24 Co. Ltd. 2017. Source: https://www.park24.co.jp/en/news/files/f132b1c90e3d929b65bcbb0096099119.pdf
Development Bank of Japan. 2020. Information provided by personal communication.
140 DBJ. 2019. Source: https://www.dbj.jp/en/topics/dbj_news/2019/html/20191126_79729.html
141 D20 LTIC. 2019. Source: http://www.d20-ltic.org/
138
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3. Other opportunities
3.1. The uniqueness of Japanese general trading houses
Japanese general trading houses, or sōgō shōsha, are colossal players in the Japanese economy.
When we refer to sōgō shōshas, we are actually referring to seven major trading houses: Mitsubishi
Corporation, Mitsui & Co. Ltd., Itochu Corporation, Sumitomo Corporation, Marubeni Corporation,
Toyota Tsusho Corporation and Sojitz Corporation.
These corporations are active international investors, investing in startups overseas, often asmeans of outsourcing R&D. In fact, even though not focused exclusively on general trading
houses, a recent report by JETRO about the state of global investment observes that someJapanese companies have expanded into new markets and business fields through collaboration
with emerging foreign companies, namely startups. 142 The recent partnership between the Italianstartup D-Orbit and Marubeni Corporation provides a notable example of how Japanese general
trading houses engage with startups. As the amount of communication data in the world is expected
to increase, and so is the demand for communication satellites, the trading house commissioned
research at satellite launching to the Japanese startup Interstellar Technologies Inc. (IST). In thecurrent month (April 2020), Marubeni decided to capture the demand for small satellite launching,adding the aerospace Italian startup D-Orbit to the current partnership. 143
This example also provides evidence on the diversification of Japanese general trading houses. Asa matter of fact, Marubeni is widely known for its strength in electric power plants, just like Mitsubishi
and Mitsui are known in the metal and mineral resources sector. However, their products andservices are extremely diversified. In fact, this is where where general (“sōgō”) comes from. Having
said this, this study observes some characteristics of Japanese general trading houses:•••

Low degree of specialization: As shown by the above example, Japanese general trading
houses have a low degree of specialization, what contrasts with the European trading
houses who are usually specified in particular products or services. 144
Large dimension: They are very large entities. In average, Japanese general trading
houses might have around 500 group companies and most likely the same number ofsubsidiaries.
Broad range of service sectors: They are involved in a broad range of service sectors.
Regardless of trade being their core competence, Japanese general trading houses are not

142 JETRO. 2019. “JETRO Global Trade Investment Report 2019 – the fluctuating international economic order and global businessin the future – Key points”. Source: https://www.jetro.go.jp/ext_images/_News/releases/2019/f25b1986b750a9f9/1.pdf
143
Marubeni
Corporation.
2020.
“Business
Partnership
for
Small
Satellite
LaunchBusiness”.
Source:https://www.marubeni.com/en/news/2020/release/20200414E.pdf
144 Japan Times. 2018. Source: https://www.japantimes.co.jp/news/2018/10/16/business/reflecting-nations-history-sogo-shoshaunique-japan/#article_history

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simply traders, they are also wholesalers and distributors, accumulating insurance,transport and logistics functions, as well as acting as investment banks and private equities.
Finance is one of their essential functions: They are involved in providing credit, loans,debt guarantees, investment and ownership in core businesses, as well as risk
management and providing project finance for large-scale projects145.
Close links with government cycles: Japanese general trading houses have close links
with government cycles, both in Japan and in developing countries, particularly in ASEAN.

As for the latter, it seems relevant to mention that the historical growth of Japanese trading houses
was significantly supported by the government in the context of several past protectionist
measures, what resulted in persisting links between them and governmental institutions. Based on
the same grounds, the Japanese government also relies on sōgō shōshas’ worldwide subsidiaries
to pursue state-led development aims. In the words of Patrick Ryan, a Senior Analyst at Marubeni
Research Institute146, the co-operation with the private industry is very characteristic of theJapanese way of state-led development147. The author even adds up that “about the only places
the sōgō shōsha are fairly well-known outside Japan are among those in government circles of
emerging and developing countries due to the sōgō shōsha’s role as organizers of large-scale
infrastructure projects.” 148 With regard to the organization of large-scale infrastructure projects,
Japanese institutions, with special reference for JBIC, JOIN and JETRO, assume an important rolein negotiating with governments and other potential clients.
In terms of worldwide investment, UNCTAD observes that despite the decline in foreign direct
investment (FDI) by Japanese big corporations from 2017 to 2018, such decline didn’t stop themfrom becoming the largest investors in the world. In fact, the FDI outflow in developed countries
has indeed decreased nearly 40%, being particularly evident in the US and the UK. Investments in
Asia, however, suffered a significant increase – 31% in total -, namely in China, India and theRepublic of Korea.149 As for EU businesses, whether the decrease in FDI outflow in developed
countries might seem not very attractive for EU SMEs and startups, the growing interest in China,
India and the Republic of Korea might present opportunities for collaboration with Japanese
corporations in these markets.

Ryan, Patrick via The Japan Times. 2018. https://www.japantimes.co.jp/news/2018/10/22/business/distinguishing-features-definesogo-shosha/#.Xpwqny2ZMdU
146 The Marubeni Research Institute is the research arm of the Marubeni Corporation, which is currently one of the big seven sōgō
shōsha in Japan.
147 Reader, Soederberg. 2000. Japanese influences and presence in Asia. Routledge.
148 Ryan Patrick via The Japan Times. 2018. Source: https://www.japantimes.co.jp/news/2018/10/16/business/reflecting-nationshistory-sogo-shosha-unique-japan/#article_history
149 UNCTAD. 2019, p. 6. World Investment Report 2019. Source: https://unctad.org/en/PublicationsLibrary/wir2019_en.pdf
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3.2. Venture capital and early stage investment in Japan
Japan is known by high levels in innovation, with the robotics sector being the country’s mostobvious landmark. However, it is also known by an entrenched culture of risk aversion, that defines
the way investment capital flows within and outside the country. For several years, studies
observed that Japanese investors often preferred to take smaller returns, rather than taking earlystage (and therefore riskier) bets. Risk aversion led venture capitalists into investing into middlestage startups a couple of years before an IPO, what resulted in lack of investment for startups inearlier stages. However, more recent numbers show a very different scenario. In a study publishedin April 2020, the OECD observes a drastic reversal of VC investment composition in the
country. From 2009 to 2017 (the latest available data we could find), early-stage investments
increased almost by 30%. As of 2017, investments in seed and early stages accounted for 62.9%
of total capital investments, against 37.1% in later stages150.
In fact, a study conducted by Natalie Meyer for the EU-Japan Centre about the Startups Ecosystem
in Japan (2017), actually observed a poll of unused investment capital in Japan, explained,
among others, by the small number of startups in the country. 151 Japan is definitely not the only
country facing challenges in the development of a more entrepreneurial mindset, however, the fearof failure in Japan takes it to another level. While some countries, such as the US and some EU
Member States, welcome failure as a learning opportunity, this is not the case in Japan. Fear of
failure leads young graduates into aiming at long-term careers in already well-establishedcompanies instead of pursuing more entrepreneurial ventures. This is one of the reasons why theJapanese startup ecosystem is still very young.
Notwithstanding, with strong support from the government for the creation of startups, Japan seems
to be experiencing a change of mindset that has been triggering the development of a startup
ecosystem in the country in the past years, that triggers many opportunities. This section begins
to explore the main characteristics of the current Japanese startup ecosystem and,
consequently, the state of early stage investment in the country. Proceeding from here, it
explores new trends and opportunities that can be of relevance to EU startups.

3.2.1. The current ecosystem•

Initial Public Offering (IPO) is the most common exit for Japanese start-ups
Startups can exit through merger or acquisition (M&A) by a larger company or by initial public
offering (IPO). In Japan, the most common exit for startups is through IPO and even though M&A
OECD. 2020. Financing for SMEs and Entrepreneurs 2020: An OECD Scoreboard. OECD Publications. Available in:https://www.oecd-ilibrary.org/sites/5989eb3a-en/index.html?itemId=/content/component/5989eb3a-en
151
Meyer,
Natalie.
2017.
“The
Japanese
Startup
Ecosystem:
Opportunities
forEU
collaboration”
https://www.eubusinessinjapan.eu/sites/default/files/the_japanese_startup_ecosystem_-_opportunities_for_eu_collaboration.pdf
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Conducted studies observe that market capitalization of startups in Japan is comparable to thecapitalization of US startups that already in the middle stage. 153 This contrasts with the overalltendency in Europe and in the US, where many startups and SMEs simply can’t afford the costs ofgoing public in order to reach liquidity154.
•

Corporate venture capital (CVC) is big in Japan
Most venture capital funds in the country are associated with large companies and while numbers
slightly differ across researches on the topic, the percentages invested by corporations are
significantly superior when compared the ones invested by independent VC firms andgovernmental agencies155 For instance, according to 500 Startups, a well-known VC & Private
Equity company based in the United States, “20% of startup investment in the U.S. is from
corporates, 80% is from independent firms. In Japan, it is roughly the opposite” 156.
In terms of early stage investment, the conducted research suggests that the main barriers to earlystage investment, however, do not lie in the number of VCs and CVCs in the country. The
conducted research suggests there is available capital in Japan. For instance, the Japan Venture
Capital Association (JVCA), an organisation created to assist VC firms and venture businesssupports, currently counts among its members 100 Venture Capitalists, 65 Corporate Venture
Capitalists (CVCs) and 69 other supporting members 157 ; however, other online platforms offer
information about existing venture capital in the country.
Contrasting to other countries, such as the US (where VC funds are usually specialized in eachstage of business development)158, most venture firms in Japan provide funds for all stages offinancing. The challenges observed, though, are that due to lack of specialization corporate
venture capital funds might turn into lack of expertise to understand technology prior to its practicalapplication and know-how to engage with startups. Additionally, there seems to be gap between
the usual duration of VC funds and the listing requirements of the Japanese market. A recent
survey on the state of support for research-and-development-type startups, released by the Center
for Research and Development Strategy (CRDS), part of the Japan Science Technology Agency
Asakura, 2017. A brief overview of the current startup ecosystem in Japan. SVNJ Working 2017-1. Available in:https://static1.squarespace.com/static/54b4afe7e4b096f7dca62bef/t/58a351fbc534a55930b614a1/1487098383652/SVNJ+working+paper+2017-1.pdf
153 Asakura, 2017. A brief overview of the current startup ecosystem in Japan. SVNJ Working 2017-1. Available in:https://static1.squarespace.com/static/54b4afe7e4b096f7dca62bef/t/58a351fbc534a55930b614a1/1487098383652/SVNJ+working+paper+2017-1.pdf
154 Setting an IPO takes cash and years of planning in order to get all the financial documents audited. Even though IPOs enablebusinesses to gather big amounts of funding, the decision to offer a first initial stock to the public very costly and time demanding.
155 Examplesof researches on the topic are the 2019 Japan Startup Finance Report (https://s3-ap-northeast1.amazonaws.com/entrepedia-public/japan-startup-finance-2019h1.pdf) and the article by Norihiko Isawa at TechEU(https://tech.eu/features/24647/the-rise-of-deep-tech-startups-in-japan-and-why-european-companies-should-take-note/)
156 500 Startups. Source: https://500.co/japan-startup-ecosystem-founders-investors/
157 For a full list of members, please access the JVCA website in the following link: https://jvca.jp/en/
158
Tegos. 2017. Japanese venture capital blooms but lacks specialization compared to the US. Source:
https://www.techinasia.com/japan-vc-tech-in-asia-tokyo-2017
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Chapter 2 – Financing opportunities in Japan(JST), observes that whereas VC funds have the usual duration of 8 to 10 years, the Japanesemarket requires about 10 to 15 years to overcome the regulatory hurdles and, finally, listing. Thismight discourage VC firms to invest in early stage startups and choose to invest in later stage ones,
that are closer to IPO.
Notwithstanding, as the startup ecosystem in Japan begins to bloom, some specialized VC firms
and funds also start to emerge. This the case of Deepcore (Artificial Intelligence) 159, the Drone
Fund (drone technology)160 and the Real Tech Fund (Technology), just to name a few. Later in thischapter, Subtopic 4 provides a non-exhaustive mapping of relevant stakeholders that also includes
some specialized VC funds in Japan.

•

3.2.2. New trends and opportunities
Observed increase the entrepreneurial mindset of Japanese universities
The number of university-affiliated startups is growing161, what seems to suggest a shift to a more
entrepreneurial mindset among Japanese graduates. These startups come mostly from top
Japanese universities, with the University of Tokyo playing a leading role. In fact, the University ofTokyo, for instance, has been producing significant numbers of deep-tech start-ups and evenventure capital funds (e.g. The University of Tokyo Edge Capital) 162. The funding ecosystem ofuniversity-based startups seems to be gaining some energy as well, particularly after theJapanese government has decided to lift the ban on investment in start-ups by state-backed
research institutions in 2017. 163 Notwithstanding, it seems that investments by state-backed
research institutions is still far from reaching its full potential. In 2019, the Japanese Ministry of
Economy, Trade and Industry (METI) published the Guidelines for Universities’ Acquisition of
Shares and Share Options of their University-Oriented Venture Business, observing that
Universities still lack know-how and knowledge to acquire stocks from university-initiatedventures. 164•

Strong support from the government to the creation of startups
The number of public support measures to the creation of startups increased significantly
following the economic growth policy implemented by the Abe Administration in 2013. Under theenactment of the Industrial Competitiveness Enhancement Act, not only METI allocated nearly 100
The fund website can be accessed in the following link: https://deepcore.jp
The fund website can be accessed in the following link: https://dronefund.vc. It has invested in more than 11 startups in Japan (e.g.
iRobotics, Drone Japan and YodayodaI, but also worldwide, being the Aerodyne Group the Fund’s latest investment.
(https://aerodyne.group/en/services.html).
161 Narron, 2018 in Medium Corporation. On University-Supported Startups and Research Spinoffs in Japan. Available in:https://medium.com/innovators-in-japan/on-university-supported-startups-and-research-spinoffs-in-japan-e213f7dca45e
162 INITIAL. 2020. 2020 年、大学発スタートアップを取り巻く環境の今. Available in: https://initial.inc/articles/startup-newrules20200228
163 Nikkei
Asian Review. 2020. Japan to let state-backed R&D agencies invest in the private sector. Source:
https://asia.nikkei.com/Politics/Japan-to-let-state-backed-R-D-agencies-invest-in-private-sector
164 METI. 2019. 「 大 学 に よ る 大 学 発 ベ ン チ ャ ー の 株 式 ・ 新 株 予 約 権 取 得 等 に 関 す る 手 引 き 」 を 策 定 し ま し た . Source:
https://www.meti.go.jp/press/2019/05/20190508002/20190508002.html
159
160

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Chapter 2 – Financing opportunities in Japanbillion yen to several universities, but it also opened the path for VC funds investment by national
university corporations and some national R&D agencies, including the Japan Science andTechology Agency (JST) and the New Energy and Industrial Technology Development
Organization (NEDO).
An example of an initiative that enabled JST to financially support the commercialization of its
research outputs was the “Support Programme of Capital Contribution to Early-Stage Companies(SUCCESS). 165 In turn, under the Commercialization support for Seed-stage Technology-based
Startups (STS) programme, the New Energy and Industrial Technology Development Organization(NEDO) certified 24 public and private venture capital firms overseas, e.g. US and Singapore, inview of attracting seed-stage investment. 166 167 RealTech Fund, one of the very few specialized
funds in Japan, is actually one of the VC funds certified by NEDO.
The below findings show that such governmental efforts seem to persist:
•

•

•

•

In June 2018, the Japanese Ministry of Economy, Trade and Industry (METI) launched a
new initiative called “J-Startup” Program 168 which aims supporting selected startups,
including for internationalization overseas. As part of this program, it established a “JStartup Supporters”169 composed by large companies, venture capitals and accelerators.
In October last year, the Tokyo Metropolitan Government (TMG), the Japan Business
Federation (KEIDANREN), JETRO and Project Nippon Co., Ltd, signed a partnership called
Tokyo Global Startup Ecosystem Partnership Agreement, which was designed todevelop the Startup ecosystem 170. In fact, while efforts to foster the startup environment inother cities, such as Osaka and Fukuoka, the great majority of money invested (76%) went
to businesses in the Japanese capital in the first semester of 2019. 171172
The Japanese government established the target of doubling the ratio of VC investments
by 2020 under the “Venture Challenge 2020”, adopted in 2016 by the Headquarters forJapan’s Economic Revitalization, under the direct leadership of the Prime-Minister.
Last but not least, the Japanese government created a startup visa system, with the very
ambitious goal of attracting foreign entrepreneurs in order to create 20 unicorns by 2023.173

More information in https://tech.eu/features/24647/the-rise-of-deep-tech-startups-in-japan-and-why-european-companies-shouldtake-note/
166 JST. 2018. Support for research-and-development-type startups overseas. Center for Research and Development Strategy.
Source: https://www.jst.go.jp/crds/pdf/en/CRDS-FY2017-OR-01_EN.pdf
167 NEDO. 2017. The 3rd Additional Certification of Venture Capital Firms to Partner in NEDO Technology-based Startup Support
Programme. https://www.nedo.go.jp/english/CA2e_100136.html
168 For more information about the program, please access: https://www.meti.go.jp/english/press/2018/0611_003.html andhttps://www.j-startup.go.jp/en/about/
169 The full list of supporters can be found in https://www.j-startup.go.jp/en/supporters/
170 More information in https://www.innovatorsmag.com/tokyos-global-startup-ecosystem/
171 Entrepedia. 2020, p. 21. Japan Startup Finance Report 2019 H1 (国内スタートアップの資金調達動向). Source: https://s3-apnortheast-1.amazonaws.com/entrepedia-public/japan-startup-finance-2019h1.pdf
172 Cabinet Office. 2019. スタートアップ・エコシステム拠点都市. Available in:165

https://www8.cao.go.jp/cstp/openinnovation/ecosystem/index.html

JETRO. 2019. “JETRO Global Trade Investment Report 2019 – the fluctuating international economic order and global businessin the future – Key points”. Source: https://www.jetro.go.jp/ext_images/_News/releases/2019/f25b1986b750a9f9/1.pdf
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Automobiles, space, fintech, healthcare and AI among the priority sectors
With reference to relevant industrial sectors for domestic startup funding, the latest Japan
Startup Finance report by Entrepedia observes the majority funding was collected by startups in
the fields of automobiles and space in the first half of 2019. 174 Nevertheless, the list of fundedstartups in the previous report also observes a significant investment in Fintech, Healthcaretechnology and Artificial Intelligence. 175 It is important to note that these numbers refer only todomestic startup funding and priority sectors might be different if we consider exclusively overseas
startup investment. In any case, as most Japanese investors are more willing to invest in domestic
startups, these numbers also provide relevant insights for EU SMEs on the interests of Japanese
investors.

•

Even though the overseas focus of venture investors remains the US, the interest in European
startups is growing
In an attempt to access the interest of Japanese investors in Europe, throughout this research theauthor has tried to contact some early stage and scale-up investors in Japan. Even though thesample can’t be considered representative of the overall community of investors in Japan, theresponses collected (and sometimes a certain unwillingness to respond) seems to suggest that
venture and early stage capital in Japan is still being delivered upon engagement in closed circuits
and the focus of investments, and namely early stage investments, is being placed mostly in the
US startup ecosystem.
As for the latter, most of the venture capital funds and firms the author has been successful inreaching out to have mentioned the US as target investment destination. This was particularly
evident in the case of an investment fund focused in the tech/IT industry (whose privacy is obviously
being protected), who clearly stated that in this sector there are not many startups in Europe whencompared to the US. If on the one hand, this single assumption is not representative, on the other
hand it might provide an illustration of a generalized perception towards the European startup
ecosystem. Likewise, Bistream, a Berlin-based company that links European startups withinvestors and Japanese companies, also referred that the small number of Japanese investors
that are interested in startups have been mostly focused in Silicon Valley176.
As a matter of fact, Japan is still one of the largest investors in Silicon Valley. However, the regionis seemingly getting saturated and highly priced, what has led some investors to seek alternatives
in Europe. Nordic Ninja, the above mentioned JBIC-backed venture capital firm of around 100
million euros focused in the startup community in the Baltic region, seems to provide a notableevidence of a growing interest in European startups. More examples can be provided by recent
Entrepedia. 2020. Japan Startup Finance Report 2019 H1 (国内スタートアップの資金調達動向). Source: https://s3-ap-northeast1.amazonaws.com/entrepedia-public/japan-startup-finance-2019h1.pdf
175 Entrepedia. 2018. Japan Startup Finance Report 2018 (国内スタートアップ資金調達 総まとめ). Source:
174

https://initial.inc/enterprise/report/jsf2018-h1/
176 Bistream. 2020. Information provided by personal communication.

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investments by Japanese large companies, such as the partnership between Marubeni and the
Italian startup D-Orbit and the partnership of JR East with Infarm, a German agricultural
startup177178.
Another important aspect to be taken into account is that Europe shares common public policy
concerns with Japan, notably the aging population phenomenon that is particularly severe in
Japan. As per Bistream, not only Japanese investors are starting to acknowledge the talent ofEuropean startups, but also these common challenges that provide interesting opportunities forbusiness collaboration. The company also adds up that in Europe more and more startups arecoming up in this field and the truth is if a startup comes up with a service that helps mitigatingsome of the disadvantages of this demographic issue, it should also be applicable in Japan 179.
Conducted interviews suggest, however, that some barriers might be preventing Japanese
investors from looking into more opportunities in Europe, notably the fragmentation of thecontinent, with different cultures and regulations making it hard for investors to take advantage of
the EU population as a whole, the absence of networks and language barriers, with multiple
languages being spoken around Europe and good command of English not always being a reality.
With regard to the absence of networks, an important remark to be made is that VC investment ispretty much a local business, thus networks and personal connections still play a big role in thematter. As for the language barriers, an interviewed Japanese CVC has highlighted that many
universities don’t disclose information about their spinouts in English language, what makes it hardfor investors to understand their business well.
As a best practice example, the CVC highlighted that the US Small Business Innovation Research(SBIR) and the Small Business Technology Transfer (STTR) disclose information about the startups they are supporting through their competitive awards-based program, what makes it easier forinvestors to spot investment opportunities through a quick key-words search in the website. As
apparently this strategy seems to be facilitating foreign investments into US spin-outs, a suggestion
would be the further development of a similar approach in the EU, notably through the incorporationof some elements into the recently established EIC Fund Pilot.
On a last remark, the interviews conducted suggest that supporting EU businesses in writing
proper pitch decks is an extremely valuable help. Thus, a recommendation given is thedevelopment of a training program on how to craft a good pitch deck by the EU-Japan Centre andits further incorporation into the EU SME Finance Helpdesk.

Huffington Post. 2020. “ ス ー パ ー マ ー ケ ッ ト の 中 に 「 農 場 」 を 。 ド イ ツ の 農 業 ベ ン チ ャ ー 「 イ ン フ ァ ー ム 」 が 日 本 ” Source:
https://www.huffingtonpost.jp/entry/infarm_jp_5e672275c5b68d616459819d
178 As an informative note, Infarm has initiated a partnership with Bistream in March 2020. Bistream. 2020. Information provided bypersonal communication.
179 Bistream. 2020. Informational provided by personal communication.
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3.3. EU-Japan R&D Collaboration
Building on the success of previous joint programs such as JUPISTE (2013-2016) and EUJOLIMMS (2011-2016), the research ties between the EU and Japan keep on being strengthened.
Evidence of this is the Japanese interest in becoming associated partner of Horizon-Europe,on the one hand, and the European Commission’s particular encouragement for theparticipation of Japanese research centers under the program’s strategy for international
cooperation, on the other. 180181 Sectors specifically mentioning the interest of Japan’s
participation under Horizon-Europe are:••Technologies for first responders (SU-DRS02-2018-2019-2020), including light-weightenergy sources, UAV and robots, drones, internet of things (IoT), virtual reality.
Currently open until 27 August 2020.
Human factors, and social, societal, and organizational aspects for disaster resilient
societies (SU-DRS01-2018-2019-2020), including disaster risk reduction (namely natural
disasters). Currently open until 27 August 2020.

As Japanese partners can’t yet benefit directly from Horizon-Europe funding (for more information
about this please see Chapter 1, subsection 3.2.3), a list of available local funding opportunities forJapanese partners can be found in the Japan country page section of the European Commission
website. 182 Such opportunities include funding from Japanese institutions, such as the Japan
Science and Technology Agency (JST) and the Ministry of Education, Culture, Sports and Science
Technology (MEXT).183
If on the European side, there’s an obvious encouragement for Japanese collaboration under
Horizon-Europe, it is also possible to observe similar efforts for increasing international cooperation
in R&D on the Japanese side. A notable example is the launching of the Moonshot program by
the government of Japan in an attempt to increase international collaboration in science, and willingto have European contributions on board. Opportunities for EU-Japan research collaboration
funding can be found under the European Commission’s EURAXESS Japan. The portal alsoenables individual researchers to find collaborators or hosts for mobility projects. 184

European Commission. 2020. Horizon 2020 Work Programme 2018-2020. Revised version based on the European Commission
Decision C(2020)1862 of 25 March 2020. Source: https://ec.europa.eu/research/participants/data/ref/h2020/wp/20182020/main/h2020-wp1820-security_en.pdf
181 A brochure by the European Commission on why to participate in Horizon2020 translated in Japanese language can be foundunder https://ec.europa.eu/research/iscp/pdf/h2020_why_flyer_practical_information_jp_web.pdf#view=fit&pagemode=none
182 European Commission. Horizon2020 - Japan Country Page Section. Source:
https://ec.europa.eu/research/participants/data/ref/h2020/other/hi/h2020_localsupp_japan_en.pdf
183 The Japanese Science and Technology (JST) is providing funding opportunities for Japanese partners under Topic Technologies
for first responders (SU-DRS02-2018-2019-2020). Source:
https://ec.europa.eu/research/participants/data/ref/h2020/other/hi/h2020_localsupp_japan_en.pdf
184 EURAXESS Japan. Source: https://euraxess.ec.europa.eu/worldwide/japan
180

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3.3.1. The R&D ecosystem in JapanThe conducted research observes that research and development spending by the private
sector is very significant in Japan, with many R&D intensive start ups being established in the
manufacturing technology industry. In fact, according to an article published on Nippon, corporate
research spending represents more than 70% of the total research spending in the country185.
The results of the Survey on Research and Development, released by the Statistics Bureau ofJapan in 2019, also observe that the R&D expenditure by business enterprises in 2019 wassignificantly higher than the spending from universities and public organisations, with a total
expenditure of 14.23 billion yen (refer to Figure 14).186 This contrasts with the overall tendency inEurope, who focuses its research investment in universities.

Figure 14. The growth of R&D expenditures by sector from 2017 to 2018. Source: Statistics Bureau Japan,
2019187

It is also worth mentioning the industrial sectors concerned. Referring to the total expenditures in
R&D by business enterprises, another figure from the report shows that “Transportationequipment” collected the highest expenditures amount, with “Medicines” and “Electricalmachinery, equipment and supplies” also ranking high among all industries (Figure 15). Several
big companies in Japan have increased their budget amounts for R&D and, according to
information provided by the companies themselves to Nikkei Asian Review, “more than 40% ofcorporations covered by the study reported their biggest R&D budget ever in the current fiscal

Nippon. 2019. Japan’s science and technology research spending at new high. Source: https://www.nippon.com/en/japandata/h00388/japan’s-science-and-technology-research-spending-at-new-high.html
186 Statistics Bureau of Japan. 2019. Results of the Survey of Research and Development. Source:
https://www.stat.go.jp/english/data/kagaku/1546.html
187 Statistics Bureau of Japan. 2019. Results of the Survey of Research and Development. Source:
https://www.stat.go.jp/english/data/kagaku/1546.html
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Chapter 2 – Financing opportunities in Japanyear”, being Toyota, Honda and Nissan in the top three spenders on artificial intelligence,robotics and new tech.188

Figure 15. R&D expenditures by business enterprises by industrial sector from 2017 to 2018. Source: Statistics
Bureau of Japan, 2019189

Strictly connected to the weight of corporate research spending in the country, another interestingfinding of this research relates to tax credit benefits. Even though tax credit benefits do not fallwithin the scope of financing opportunities per se, the fact is that they constitute a valuable asset
for SMEs involved in R&D that should be taken into consideration in the calculations for entering a
new overseas market, namely in Japan.
Tax credit benefits can usually be declared at the end of each fiscal year, whether the R&D projectis being conducted or still running. Whereas in some countries require the SME to declare
beforehand, in Japan the expenses only have to be declared afterwards. Additionally, in order to
get R&D tax credit benefits in Japan, companies can work with all types of companies, even if they
are not certified as R&D, what is an added advantage. However, according to FI Group, in Japan
there are only a few companies declaring R&D expenses in order to get tax credit benefits.

More information can be found in Nikkei Asian Review. 2019. “Japan’s R&D spending hits record for nearly half of companies”.
Akkira Oikawa. September 14. https://asia.nikkei.com/Business/Business-trends/Japan-s-R-D-spending-hits-record-for-nearly-halfof-companies
189 Statistics Bureau of Japan. 2019. Results of the Survey of Research and Development. Source:
https://www.stat.go.jp/english/data/kagaku/1546.html
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FI Group is a private company dedicated to support companies getting dedicated incentives suchas tax credit benefits from R&D activities worldwide. The company, that has recently establishedactivity in Japan, states that in Japan big companies can get between 6-14% benefit, while SMEs
can get between 12-17% benefit. If they collaborate with public entities, such as universities, thetax credit benefit can go up to 30% and 20% for private entities. For collaboration with R&D ventures(entities that create their own means of doing R&D, such as own equipment), the benefit can go up
to 25%, and 40% if the claimant is a R&D venture himself. For collaboration matters, the tax credit
is limited to 10% of the tax liability. If a company is running a bigger R&D investment than its 3years average sales, it is considered doing high R&D intensity. Tax credit rates are increasingly
quicker and an additional 10% of tax liability can be covered. 190

Key findings
This section sums up the findings identified throughout the desk review and stakeholders
consultations with regard to the availability of financing support for EU SMEs in Japan. Thesefindings reflect the three dimensions considered in the conducted multilevel analysis: cofinancing opportunities stemming from the latest developments in EU-Japan bilateral
cooperation, availability of public financing support in Japan that can potentially beaccessed by EU SMEs and, finally, availability of private capital in Japan. Moreover, as an
outcome of the research, this report maps out institutional stakeholders (Annex VI), as well asother relevant stakeholders, including potential capital providers such as CVCs and VCs(Annex VII)
1.

EU-Japan connectivity and co-financing opportunities between the EIB andJapanese institutions

Besides the EU-Japan Economic Partnership Agreement (EPA) that entered into force inFebruary 2019, a Partnership Agreement on Connectivity and Quality Infrastructure has beensigned between the European Commission and Japan, on the 27th September 2019, as a result of
the EU-Asia Connectivity Forum and the European-Asia Connectivity Strategy. The strengtheningof EU-Japan relations reflects an important political intention and diplomatic savvy in conturbatedtimes. On the one hand, they can be considered an expression in favor of multilateralism, following
the raise of protectionist measures in several parts of the world. On the other hand, they reflect theimportance of strategic collaboration between the EU and Japan facing the increasing demand forinfrastructure in developing countries. As for the latter, the momentum for EU-Japan cooperation
should be understood the light of the BRI infrastructure strategy pursued by Beijing, as well as the190

FI Group. 2020. Informational provided by personal communication

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US-led Blue Dot Network, that can be interpreted as a response to the fear of loan-dependence ofdeveloping countries towards China within this infrastructure demand.
With regard to business opportunities, the Connectivity Agreement can be a driver for EU-Japanbusiness collaboration in third markets. In fact, the three Memoranda of Understanding signed
between the EIB and JICA, JBIC and NEXI are indeed expected to facilitate EU-Japan financing
cooperation in connectivity projects. The interviews conducted to EU and Japan experts suggestthat these MOUs are already perceived as relevant channels for regular dialogue on co-financing
opportunities between the EIB and Japan. In fact, several sectors for joint cooperation have alreadybeen identified throughout these discussions, notably renewable energy projects and newtechnology, such as hydrogen and offshore wind technology.
However, what operational outcomes can businesses expect from these MOUs? On apreliminary remark, it seems relevant to mention that even though the EIB’s mandate allows for theprovision of financial instruments overseas, as a high-income country Japan is not included in the
EIB’s eligible or potentially eligible third countries of operation. Although financing can be madeavailable for entities outside of this geography with whom the EIB holds signed agreements,
currently no agreements in place between the EIB and Japanese banks have been signed191.
Co-financing possibilities are indeed under discussion between the EIB and Japanese institutions,notably following the signature of three MOUs between the EIB and JBIC, JICA and NEXI.
However, although these MOUs indicate a common framework of action, they are not legallybinding and neither do they involve exchange of money. Thus far, no operational outcomes havebeen produced. The conducted interviews suggest that the lack of operational outcomes haveits roots in the seemingly prevalence of legal and technical constraints, notably with regards topublic procurement.
Notwithstanding, co-financing possibilities between the EU and Japan are not exhausted with the
MOUs. One the one hand, the EIB and Japanese institutions can still agree to finance the same
project in the EIB’s countries of operation, with the interested borrower contacting both entities and,most likely, with both of them signing an agreement with a third party. One the other hand, bilateralco-financing between Japanese institutions and national stakeholders across the EU is also a
possibility. In fact, several EU stakeholders, such as NPBIs, already hold signed agreements withJapan, notably with JBIC and NEXI.

2.

Availability of financing support for EU SMEs provided by Japanese institutions
within and outside of Japan

With regard to public financing support in Japan, the key aspect to take into account is that this
support is obviously meant to support the competitiveness of Japanese companies in the
191 For the EIB’s worldwide intermediaries list, please see https://www.eib.org/intermediarieslist/search/result?country=JP

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Chapter 2 – Financing opportunities in Japanfirst place. Thus, even though the mandate of some Japanese institutions allows for the provisionof financial instruments into businesses outside of Japan, such cases turn out to be very
exceptional. On the one hand, Japanese institutions are tied with Japanese financing
requirements, that are often hard to meet by EU SMEs. On the other hand, they are unlikely toprovide any financing for EU SMEs unless there is a Japanese company involved. Cases ofindividual investments in foreign companies are thus rare, with most of investments overseas being
in fact joint investments between a Japanese institution and a Japanese acquirer. Subtopic 2(Chapter 2) provides information on some financial instruments provided by Japanese institutions
that can potentially be accessed by EU SMEs, as well as some concrete case studies. Ultimately,
however, partnering up with a Japanese company seems to be the key differentiating
element. The conducted interviews also suggest EU SMEs seem to be well aware of theimportance of having a Japanese partner, provided that nearly all of them referred support inmatchmaking as the key service to be provided by the EU-Japan Centre for Industrial Cooperation.
As for EU-Japan business collaborations, another important element that’s worth a close follow-up
is the increasing perception of Japan as a gateway to other markets as an important drive of a
growing trend among EU SMEs for partnering up with Japanese companies in third markets.
The study conducted by the German Chamber of Commerce and Industry of Japan, the interest of
MOFA in EU-Japan business collaborations in third markets, as well as the statements of EU
representatives on the occasion of the Seminar on EU-Japan Business Collaborations in Third
Markets provide important evidence in this regard. Other drivers for joint cooperation in third
markets include, among others, the momentum for EU-Japan Connectivity, following a highdemand for infrastructure in developing countries, the saturation of the Japanese market
per se, the market understanding and strong presence of Japanese subsidiaries in ASEAN
vis-a-vis the EU’s historical ties and market know-how in Africa and South/Latin America and,last but not least, the greater accessibility of the Japanese market itself as an outcome of a
successful EU-Japan partnership in third markets.
The below table provides some relevant priority sectors. Whether these priority sectors do notconstitute financing opportunities per se, they can provide useful hints on potential opportunity
areas that could be further explored. This non-exhaustive list draws exclusively highlighted in theinterviews to Japanese stakeholders (JBIC, JOIN and JETRO) and, therefore, do not disregard anyother opportunities that might exist.
Table 8. Priority sectors in third markets referred by Japanese institutions. Source: Own elaboration, based on
personal communications from JBIC, JOIN and JETRO.
Area/Sector

Subsectors

EnergyRenewable energy projects

EnergyHydrogen technology

Target country/ Region
Within and outside ofEurope (but mostly within)
EuropeType

SourceCurrent investments

JBIC

Current investments

JBIC

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EnergyInfrastructure
Infrastructure
InfrastructureWind power and biomass
High-speed railways
Urban railways/transport system
Airport terminals

Japan
Third markets (1)Third markets (1)Third markets (1)Current investments
Current investments
Current investments
Current investments

Infrastructure
Infrastructure
Infrastructure
Infrastructure
Infrastructure
Deep tech

Logistics
Port terminals
Toll roads
Urban development
Ships/Offshore units
New drugs, specially for Cancer,
Alzheimer and Parkinson
Nudging robots
Edu-tech robots

Third markets (1)Third markets (1)Third markets (1)Third markets (1)Third markets (1)Japan

Current investments
Current investments
Current investments
Current investments
Current investments
Inbound acquisition

JETRO
JOIN
JOIN
JOIN
JOIN
JOIN
JOIN
JOIN
JOIN
JETRO

Japan

Inbound acquisition

JETRO

Japan
Japan

Inbound acquisition
Inbound acquisition

JETRO

Healthcare
Robotics
Robotics

(1)

3.

JETRO

For target country information on the ongoing investments in this subsector, please refer to figure 21, subtopic 2.5. ofthe current chapter.

Availability of private capital in Japan

Other relevant opportunities for EU businesses internationalisation into Japan are provided by
Japanese big corporations and their subsidiaries, who can be valuable partners within andoutside of Japan. General trading houses are overall active investors overseas, notably instartups, as means of outsourcing R&D. Also, in this regard, it’s worth to highlight the significative
expression of R&D expenditures by the private sector that are, unlike other countries,
significantly higher than the spending of universities and public organisations. Based on this, tax
credit benefits in Japan should also be brought into the attention of EU SMEs in this area.
As for startups specifically, not least important is the strong support from the Japanese
government for the creation and attraction of startups through several initiatives, with specialreference to the startup visa system, and the drastic reversal of the VC investment
composition towards early-stage investments. As the young startup ecosystem in Japan
blooms, and whereas corporate venture capital is still extremely significant, some specialized
funds willing to invest overseas start coming up. Notwithstanding the fact that the US are still
the main target market for Japanese investors, their interest in EU startups seems to be
growing. Triggers of this interest are the saturation of Silicon Valley and the common policy
concerns between the EU and Japan, that forcibly create some sector-focus convergence. As an
example, EU startups providing solutions to ongoing challenges that can also be observed inJapan, such as the aging population, are likely to have an added value in the Japanese market aswell. Notwithstanding, this report draws the attention to EU policymakers for some barriers
identified throughout the interviews with Japanese investors that might be hampering the attractionof investment from Japanese VCs and CVCs. Identified obstacles include the fragmentation of thecontinent and language barriers, that make it hard for investors to take advantage of the EU
population as a whole, the absence of networks in the EU, and ineffective pitch decks.

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Conclusions and recommendations

CONCLUSIONS AND RECOMMENDATIONS
In its attempt to provide an overview on the availability of financing opportunities for EU SMEs
internationalisation in Japan, this study draws on desk research and participatory interviews tonearly 60 stakeholders and experts. The two chapters comprising this report are the result of
a comprehensive analysis, aimed at facilitating the understanding on the provision offinancial instruments (1), and a mapping research, aimed at informing about potential
sources of financial support (2). Considering that the main audience of this report is the EU
Japan Centre and, ultimately, EU SMEs willing to internationalise to Japan, this blended
exercise has been conducted across the origin market (EU) and the destination market(Japan).
If one general conclusion can be taken from research is that there is no one-size-fits-all solution
for EU SMEs financing needs. Accurate advice on the most suitable financing lines should betailored to each company’s size and sector, as well as to their specific financial needs andtargets. Notwithstanding, besides the key findings from the two levels of analysis which can befound at the end of each chapter, several initiatives and stakeholders across the EU and Japan
have been mapped out. These lists can be found under ANNEXES I-VII. The following
conclusions are thus a set of recommendations that can help improving SMEs accessing
the finance they need to carry out their international activity beyond the EU. In order tosupport the EU-Japan Centre in its own aim of improving the capacity of its services to EU
SMEs, the perspective underlining this research is the one of EU SMEs. In this sense, theinsights here contained are thus useful for European Business Support Organisations, as wellas to policy makers in their efforts to improving SMEs financing-related services and increasing
SMEs awareness of ongoing support initiatives.
Financing for internationalisation beyond the EU – three takeaways on the current landscape
Wide range of EU initiatives: The European Commission acknowledges that in the coming years“90% of global growth will originate outside the EU” 192. This is supported by the establishmentof several initiatives and organisations supporting EU SMEs in doing business in third markets –this is the case of EEN, ECCP, as well as several new EU Chambers of Commerce, notably in
Africa. As for Japan, the EU-Japan Centre itself provides a very good example of such efforts.

Little expertise on financing for internationalisation beyond the EU: Even though some ofthese support organisations developed financing-related services – for instance the EEN ThematicGroup on Finance – the conducted research observes that most of the expertise is concentrated
European Commission. SME internationalisation beyond the EU. Source: https://ec.europa.eu/growth/smes/access-tomarkets/internationalisation_en
192

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Conclusions and recommendationsin internationalisation within the European Union, what is somewhat understandable consideringthat not every EU SME is able to compete in distant markets.
Fragmentation of information about financing sources: The multiplicity of stakeholders
involved in the management, provision and promotion of financial instruments creates a
fragmentation of information within different policy units and across different institutions/organisations. On the one hand, this fragmentation adds up challenges in processing the existing
information among EU SMEs, who are, as a result, highly unaware of financing support
schemes. On the other, it creates a knowledge gap that can also be observed among European
Business Support Organisations, namely in third markets. These organisations are often referred
as contact points for information on financing opportunities, but otherwise have no full overview
on the available initiatives, or specific expertise in financial matters.

1. Recommendations to EU policymakers
In order to avoid an asymmetric distribution of relevant information among the actors involvedin supporting SMEs, the depth of cooperation and information-sharing between theEuropean Commission and external stakeholders, namely the ones providing public
services to EU SMEs, should be increased. Based on this, the following recommendations
are given to the European Commission:a) Increasing information-sharing with external stakeholders
It is crucial that information on new funding/financing opportunities and their suitability
for internationalisation investments and/or potential synergies with other financial
instruments is communicated more effectively between the European Commission andexternal stakeholders, namely the ones located outside the internal market. In this regard, theEU Delegations, organisations such as the EU-Japan Centre for Industrial Cooperation, as
well as associations of trade promotion organisations (e.g. through the European Trade
Promotion Organisations Association), among others, can play an important role asmultipliers193, ensuring a wider distribution of information and maximizing the use and potentialof financial instruments. Such entities work much closer to EU SMEs that are, ultimately, thefinal beneficiaries of these financing schemes. The multipliers strategy has actually been
adopted in the Business Beyond Borders platform and by the NRW.Bank who has been using

Bpifrance, BBB, CDP, ICO, KfW. 2018. “France, Germany, Italy, Spain and the United Kingdom – Internationalisation ofEuropean SMEs – taking stock and moving ahead.” Source: https://www.kfw.de/PDF/DownloadCenter/Konzernthemen/Research/PDF-Dokumente-Studien-und-Materialien/Internationalisation-of-European-SMEs.pdf
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multipliers to raise awareness about financial instruments in an effective way among German
businesses.
b) The geographical outreach of the EIAH’s financial advisory services should be widened toinclude financing advise for internationalisation in third markets:
The establishment of the European Investment Advisory Hub (EIAH) is sought to contribute to
the reduction of information fragmentation with regard to EU financing schemes by integrating
all relevant information and providing a one-stop-shop for EU financial advice. Simultaneously,
it can improve significantly the expertise and financing-related advisory services capacity of
public authorities and bodies involved in supporting SMEs growth, such as national
promotional banks. Even though EIAH provides financial advisory services in a wide range ofsectors, such as financial support for EU SMEs and small midcaps, R&D, energy, infrastructure
and ICT, its advisory scope is currently limited to the European Union. This leaves EU entities
operating in third markets deprived from the financial advisory support that could help themincreasing their support capacity to EU SMEs. Thus, the offer seems to be limited even though
the demand for financial advisory services for internationalisation beyond the EU appears tobe high. According to a study commissioned by the EIB itself to support improving the capacityof the EIAH’s advisory services194,
1) The identification of financing sources, assistance in fundraising andinternationalisation rank among the biggest challenges faced by SMEs, withinternationalisation standing out as the biggest challenge of all – with 70% of theinterviewed companies calling it a major challenge
2) A large proportion of SMEs is not aware of internationalisation programs, even though
they believe enhanced advisory services could tackle their internationalisation
challenges
Based in this, widening the expertise of the EIAH to include financial advisory services thatcan support internationalisation beyond the EU seems to be beneficial to everyone: for EU
public entities and others operating in third markets and for EU SMEs. Ultimately, this is also
beneficial for the overall European Union economic growth, considering that SMEs are the

PwC Luxembourg. 2017. “European Investment Bank – Market Gap Analysis for Advisory Services under the European
Investment Advisory Hub (EIAH) – Phase II.” Source: https://eiah.eib.org/publications/attachments/market-gap-analysis-advisorysmes-phase-ii-en.pdf
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backbone of EU’s economy and in the coming years 90% of the global opportunities will beoutside of the EU (European Commission’s own statements195).
2. Recommendations to the EU-Japan Centre – implementation of an EU SME FinanceHelpdesk
The following recommendations draw on the findings of this research, as well as on specificrecommendations provided by EU SMEs, EU experts, Japanese institutions and otherstakeholders consulted in the course of the research. The below box provides a summary of theactionable insights that should be implemented within the EU SME Finance Helpdesk.
Summary of the recommendations
•

•

•
•
•

•

Implementation of regular channels of communication with external stakeholders via twoworking groups: the EU Working Group on Finance and the EU-Japan Interinstitutional
Working Group
Creation of active partnerships with governmental and non-governmental tradepromotion organisations, adopting a multipliers strategy to ensure the outreach of the EUJapan Centre’s services to EU SMEs, namely to the ones that have no operations in Japan yet.
Close follow up with the EIB on the discussions related to the MOUs with JBIC, JICA andNEXI.
Organisation of a joint seminar on financing opportunities with Japanese stakeholders,which should include a matchmaking event.
Connecting EU businesses and private investment in Japan: establishment of a Venture
Capital Network, development of a training course/ session on how to craft a good pitch
deck and disclosing information on businesses looking for private capital under the EUJapan Centre webpage.
Specific recommendations on how to strengthen collaboration with external stakeholders

2.1. Services scope
The EU SME Finance Helpdesk should focus in providing two types of services: advisory
services and facilitation services. Whereas advisory services should be focused on
informing EU SMEs about current financing opportunities based on their queries, the facilitation
services should support EU SMEs in gaining access to finance by helping them connecting

195 European Commission. SME internationalisation beyond the EU. Source: https://ec.europa.eu/growth/smes/access-to-markets/internationalisation_en72

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with financial providers and with Japanese partners in order to become eligible for applying for
financial instruments provided by Japanese institutions.
Even though the EU SME Finance Helpdesk should be exclusively managed by the EU-Japan
Centre, its advisory and facilitation roles can only be accomplished through the creation ofregular channels of communication with stakeholders and through the organization of
exceptional activities in joint collaboration (please refer to Figure 16).
Before proceeding with the operational tools, this section highlights that the EU-Japan Centre
should seize the momentum to follow-up with the stakeholders with whom we have alreadyestablished a first contact in the course of this research. For this purpose, a stakeholders
mapping with direct contacts and relevant insights will be presented as a confidential
attachment to the EU-Japan Centre.
With the continuation of the helpdesk, allocating one dedicated staff member to financing
matters and to the implementation of the EU SME Finance Helpdesk would keep the EU-Japan
Centre constantly updated on financing support schemes could allow for the development ofrelationships with new stakeholders (e.g. private investors). As the helpdesk enters into fulloperationalization, the EU-Japan Centre should progressively start to be able to identify theinterests of Japanese business angels, venture capitalists, CVCs and trading houses investors
in Japan and support EU SMEs preparing for interacting with them.
1.2. Governance structure
Keeping an on-going consultation with key people related to the relevant financing support
schemes (that can also lead into second degree connections as new financing schemes arelaunched) is the backbone of the establishment of an EU SME Finance Helpdesk. Due to theirmore permanent nature, the regular channels of communication should be established throughtwo operational working groups, incorporated into the governance structure of the new
helpdesk.
•

The EU Working Group on Financing Opportunities, composed by EU experts in SME
Financing, such as the contact point of the EEN Access to Finance Working Group, acontact point in Unit H3/ Access to Finance for SMEs, the EU-Japan Centre contact point
in EASME, ECCP and the EIC Fund Accelerator. This WG should hold its first meeting
after the agreement of the next MFF 2021-2027 and meet every three months to discusscurrent calls and opportunities. The meetings can be held via videoconference for as longas information is exchanged regularly. On the one hand, it seems relevant to keep policy
makers aware of how instruments are translated into practice beyond the EU. On the other
hand, it seems relevant that the EU-Japan Centre is constantly updated on the current

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financing instruments. Also, in this regard, financing issues should be included in theagenda of the meetings of the EU-Japan Centre EU General Manager in Brussels.
•

The EU-Japan Interinstitutional Working Group should be composed by relevant
financial providers in Japan, such as JBIC and JOIN. To leverage resources, this groupshould be common to the EU SME Finance Helpdesk and to the EU-Japan Business
Collaborations Helpdesk. The main aim of this working group is to discuss financing andnon-financing opportunities, such as priority sectors and third markets, for EU-Japanbusiness collaborations. Even though the working group is to be composed by local
stakeholders in Japan, the meeting agenda should always reflect insights stemming froma:a) close follow-up with the EIB’s representatives involved in the MoUs with JBIC,NEXI and JICA;b) active partnerships with governmental and non-governmental European Trade
Promotion Organisations to ensure the outreach of the EU-Japan Centre’s services
to EU SMEs and namely to the ones that have no operations in Japan yet;c) queries received by EU SMEs through the two helpdesks (EU SME FinanceHelpdesk and EU-Japan Business Collaborations Helpdesk).

More details about the specificities and governance structure of this working group can befound in Annex II.

2.2. Operational activities
2.2.1. Joint seminar on Financing Opportunities
The EU-Japan Centre should consider the joint organisation of a Seminar on Financing
Opportunities, in view of presenting the financial tools of EIB, JBIC, JICA and NEXI which aresuitable for EU-Japan business collaborations in third markets. Based on the suggestions ofseveral companies interviewed and a NEXI representative, the seminar should include amatchmaking event aimed at connecting EU SMEs with potential local financial providers.
The fact that this seminar was suggested by a NEXI representative represents a great
opportunity to trigger cooperation between the EU-Japan Centre and financial providers inJapan, so as to initiate discussions towards the establishment of the EU-Japan
Interinstitutional Working Group.

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2.2.2. Facilitating the connection between EU businesses and private investors in Japan
Throughout the exploratory analysis on the state of venture capital in Japan, this study
collected some best practice initiatives aimed at connecting SMEs and startups with private
capital in Japan, organised with the involvement of public bodies.
A recent good practice of a similar endeavor is the one organized by Business Finland, in
partnership with the Embassy of Finland and Sumitomo Mitsui Banking Corporation. The event
aimed at connecting Japanese companies with innovative Finish health sector startups. 196 A
more consolidated and sector-wise less restrictive example of a similar endeavor is the “Japan
Venture Capital Connect”, organised by NASSCOM and the Embassy of India in Tokyo. The
initiative is centered in the development of a network of venture capitalists and pitching eventsfor companies selected through an application process. An application process open to
startups based in India was launched and after an internal screening process by NASSCOM
and the Embassy of India in Tokyo, the shortlisted companies were put into vote by the VC
Network itself. The companies selected by the VC Network participated in a 2 days pitchingsession in Tokyo, covering up their own logistic arrangements. Building on the success of thefirst pilot in September 2019, the program scaled-up to include not only Tokyo, but also Osaka,
in its second edition197198
Building on these initiatives, the EU-Japan Centre should consider the establishment of a
Venture Capital Network under the EU SME Finance Helpdesk. This network, composed byBusiness Angels/VCs and CVCs who are interested in investing EU startups, should be invited
to participate in live pitching sessions arranged by the EU-Japan Centre. As for the preparationof the pitching sessions, the development of a training program on how to craft a goodpitch deck, following on the recommendations collected from interviews with Japanese CVCs,
should be further considered.
Lastly, as Japanese CVCs point out that it’s hard to find investment opportunities in Europe, auseful resource would be disclosing information in english on EU businesses andstartups looking for private capital in Japan under the EU-Japan Centre webpage, basedon the queries received by the EU SME Finance Helpdesk. This would make it easier forJapanese VCs and CVCs to spot investment opportunities in the EU. The information to bedisclosed could follow the sample used by the EIC Accelerator to gather foreign investment for
its selected companies199.
Business Finland. 2019. Source: https://www.businessfinland.fi/en/whats-new/news/invest-in-finland/2019/japanese-companiesconnect-with-innovative-finnish-health-startups/
197 NASSCOM, Embassy of India, Tokyo. 2020. Japanese Venture Capital (Sakura Edition). Source:
http://www.10000startups.com/public/mailer/2020/japan-vc-2/
198 NASSCOM, 2020. Source: https://nasscomforstartups.in/events/29876
199 The list of selected companies for blended finance under the EIC Fund Accelerator can be found in the following link:
https://ec.europa.eu/research/eic/pdf/ec_rtd_eic-accelerator-blended-finance.pdf
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2.3.

Strengthening collaboration with external stakeholders

Building on the recommendations of several EU experts at the European Investment Bank
Group and at the European Commission, including a Policy Manager in DG Grow, Unit H3,
Access to Finance for SMEs, the EU Japan-Centre should strengthen cooperation with
relevant stakeholders. Relevant stakeholders include, for example, ESIF authorities and theEuropean Investment Advisory Hub, but also private financial providers (Business Angels,
Venture Capitalists), through already established networks (e.g. EBAN, EBN) and platforms
for matching investors with enterprises. A similar recommendation has been provided by theEEN on its Annual Guidance Note 2020, which also suggests a close cooperation with EUrelevant platforms that match investors with businesses, such as the European Investment
Project Portal and the European Innovation Council (EIC) Pilot.200 Based on this, we propose
three steps approach for strengthening collaboration with relevant stakeholders in three steps.
The first step is the conduction of a stakeholder mapping exercise, with contact points/
representatives in order to identify the most appropriate stakeholders. As an output of the
mapping exercise, this report provides a list of stakeholders with contact points across the EU
and Japan (please refer to ANNEXES I-VII) which can become working documents to befurther updated by the EU SME Finance Helpdesk.
The second step is the evaluation of the stakeholders capacity, added value andcomplementarity in order in view of establishing an effective and tailored engagement planwith appropriate partnerships, joint activities and channels of communication. Based on thisreasoning, we suggest the division of the stakeholders in two main groups:a) Advisory stakeholders, whose added value is providing the EU-Japan Centre withinformation about financing opportunitiesb) Facilitation stakeholders, whose role is to support the EU-Japan Centre connectingwith relevant financial providers
The third step is the preparation of an engagement plan, based on each interest group, withconcrete activities, channels of communication and feedback and monitorization tools. The
previous topic suggests communication and operational activities to support ongoing
communication with external stakeholders.
On a final remark, strengthening collaboration with stakeholders with financial literacy, experiencein SME financing and with already established networks of financial providers, allows the EUJapan Centre to bring complementary strengths and focus on its scope of activity, whilestill gaining access to information on financing opportunities.

200

EEN (2020). Enterprise Europe Network Annual Guidance Note 2020.

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EU SME Query

Methods

Roles

EU SME Finance Helpdesk

Advisory

Facilitation

Information on financing programs andrelevant stakeholders

Connecting EU SMEs with potential
financial providers

Desk research

Regular channels of communication withstakeholders
EU WG on Financing
opportunities

Joint collaboration activities
with stakeholders

JP WG on EU-Japan
Partnerships

Outputs

Bilateral cooperation with the EIB and governmental andnon-governmental trade promotion organisations

Joint seminars and matchmaking
eventsinputsProgram mapping

Stakeholders engagement

Working documents

Monitorization

Programs list

Stakeholders list
Activity Reports

Engagement plan

WG Meetings Reports
Challenges/ Successstories

Program level

Stakeholder level

Figure 16. Implementation of an EU SME Finance Helpdesk

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References & Annexes

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World Bank (2017). Addressing the SME Finance Problem. Facundo Abraham and Sergio Schmukler. ResearchandPolicyBriefsWorld
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World Bank (2020). Unlocking finance for youth entrepreneurs – Evidence from a Global Stocktaking. The WorldBank Group.

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ANNEX I – Mapping of National and Regional Promotional Banks and Institutions
Table 9. List of National Promotional Banks and Institutions (NPBIs)
CountryName

WebsiteAustria

Austria Wirtschaftsservice (AWS)

https://www.aws.at/en/

Belgium

The Federal Holding and Investment Company (SFPIFPIM)

https://finance.belgium.be/en/about_fps/instit
utions_dependent_upon_fps_finance/the_fed
eral_holding_and_investment_company

Bulgaria

Bulgarian Development Bank

https://bbr.bg/en

Croatia

Hrvatska banka za obnovu I razvitak (HBOR)

https://www.hbor.hr/en/

CyprusCyprus Development Bank (CDB)

https://www.cdb.com.cy

Czech RepublicCzech-Moravian Guarantee and Development Bank(CMZRB)https://www.cmzrb.cz

Denmark

Vaekstfonden (Danish Growth Fund)

https://vf.dk/en/

Kommunekredit

https://www.kommunekredit.dk/en/

KredExhttps://kredex.ee/en

FINNVERA

https://www.finnvera.fi/eng/

Municipality of Finance Pic

https://fasolutions.com/reference/munifin/

Bpifrance

https://www.bpifrance.fr

Caisse des Dépôts et Consignations (CDC)

https://www.caissedesdepots.fr

Societé de Financement Local (SFIL)

https://sfil.fr/en/missions/local-refinancing/

Agence France Locale

http://www.agence-france-locale.fr

German Kreditanstalt für Wiederaufbau (KfW)

https://www.kfw.de/KfW-Group/

Estonia
FinlandFranceGermany
National Retenbank
GreeceGreek Development Bank201

https://www.rentenbank.de/en/aboutus/rentenbank/https://balkaneu.com/the-greekdevelopment-bank-starts-with-a-piggy-bankof-eur-5-billion/

Hungarian Development Bank (MFB)

https://www.mfb.hu/en/

Hungarian EXIMBANK

https://exim.hu

Strategic Banking Corporation of Ireland (SBCI)

https://sbci.gov.ie

Italian Cassa depositi e prestiti (CDP)

https://www.cdp.it

Banca del Mezzogiorno – MedioCredito Centrale S.p.A.

https://www.mcc.it/

Development Finance Institution (ALTUM)

http://www.altum.lv

Hungary
IrelandItaly
Latvia201

The Greek Development Bank is not fully operational yet.

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Lithuania

INVEGA

https://invega.lt/en/

Luxembourg

Société Nationale de Crédit et d’Investiseement (SNCI)

https://www.snci.lu

Malta

Malta Development Bank Working Group (MT)https://mdb.org.mt

Bank Nederlandse Gemeeten (BNG)

https://www.bngbank.com

Nederlandse Waterschaps Bank (NWB)

https://www.nwbbank.com/en/

PolandPolish Bank Gospodarstwa Krajowego (BGK)

https://www.en.bgk.pl

PortugalPortuguese Institutional Financial Development Institution(IFID)

http://www.ifd.pt/en/contacts/

Romania

Exim Bank

Netherlands

https://www.eximbank.ro/en/contact/

Slovensky Investicny Holding
Slovakia
Slovenska Zarucna a Rozvojova Banka

https://www.szrb.sk

Slovenia

SID Bank

https://www.sid.si/en/

Spain

Instituto de Crédito Oficial (ICO)

SwedenKommuninvest of Sweden Local Government Debt Officehttps://kommuninvest.se/en/contact/

Table 10. Non-exhaustive list of Regional Promotional Banks and Institutions (RPBIs)

CountryName

Websitehttp://www.sowalfin.be

Belgium

Société Wallonne de Financement et de Garantie desPetites et Moyennes Entreprises (SOWALFIN)
Participatiemaatscha ppij Vlaanderen (PMV)NRW BANK

https://www.nrwbank.de/de/index.html

L-Bank Landeskreditbank Baden-Württemberg

https://www.l-bank.de/

Förderbank Investitionsbank Berlin

Investitionsbank des Landes Brandenburg

https://www.ibb.de/de/startseite/startseite.ht
mlhttps://lfa.de/website/de/index.php?f=www.lf
a.dehttps://www.ilb.de/de/index.html

Hamburgische Investitions- und Förderbank

https://www.ifbhh.deLandesförderinstitut MecklenburgVorpommern
Investitions- und Strukturbank Rheinland-Pfalz
Investitionsbank Sachsen-Anhalt

https://www.lfi-mv.de

Investitionsbank Schleswig-Holstein

https://www.ib-sh.de

LFA Bayern
Germany202

202

https://www.pmv.eu/en

https://www.ib-sachsen-anhalt.de

For a complete list of the German regional banks per region, please see https://www.investitionsbank.info

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Spain

Saarländische Investitionskreditban k AG

https://www.sikb.de

Bremer Aufbaubank

https://www.bab-bremen.de

State Development Bank of the Free State of Saxony(SAB)
Thüringer Aufbaubank

https://www.sab.sachsen.de/en/index.jsp

WirtschaftsInfrastrukturbank Hessen (WiBank)

https://www.wibank.de/wibank/

IDEA Agency (Innovation and Development of Andalusia)

https://www.juntadeandalucia.es/

Instituto Valenciano de Finanzas

http://www.ivf.gva.es

Instituto Catalan de Financas (ICF)

http://www.icf.cat/en/inici/

https://www.aufbaubank.de

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ANNEX II – Mapping of other relevant financial institutions in the EU MS
Please note that the below list is not exhaustive and does not include the EIB’s financial
intermediaries (e.g. local commercial banks). The exhaustive list of the EIB’s financial
intermediaries can be found in the EIB website203.
Table 11. List of relevant financial institutions per member state

CountryName

WebsiteAustria

NÖ Bürgschaften und Beteiligungen GmbH (NÖBEG)https://www.noebeg.at

Credendo

https://www.credendo.com

Fonds Bruxellois de Garantie - Brussels Waarborgfonds

http://www.fondsbruxelloisdegarantie.be

Municipal Guarantee Fund for SMEs of Sofia

www.ogf-sofia.com/en/

National Guarantee Fund EAD

http://www.ngf.bg/

HAMAG-BICRO

https://hamagbicro.hr

Européenne de Cautionnement

https://www.eurocaution.net

Fédération Nationale des SOCAMA

http://www.socama.com

SIAGI

http://www.siagi.com

Belgium

Bulgaria
Croatia

FranceStefan a-t-il
Germany

Verband Deutscher Bürgschaftsbanken

https://www.vdb-info.de

GreeceTMEDE - Greek Engineers and Public Works Contractors Fund

http://tmede.gr

AVHGA - Rural Credit Guarantee Foundation

https://avhga.hu

Garantiqa Hitelgarancia Zrt.

https://garantiqa.hu

MVA - Hungarian Foundation for Enterprise Promotion

http://www.mva.hu

Assoconfidi

https://aecm.eu/assoconfidi/

ISMEA

http://www.ismea.it/istituto-di-servizi-per-ilmercato-agricolo-alimentare

Garfondas - Agricultural Credit Guarantee Fund

https://garfondas.lt

INVEGA UAB - Investiciju ir verslo Garantijos

https://invega.lt/lt/

Mutualité de Cautionnement - MC

http://www.cautionnement.lu

Mutualité des p.m.e.

http://www.mpme.lu/fr

RVO - Rijksdienst voor Ondernemend Nederland

https://www.rvo.nl

Hungary

Italy

Lithuania

Luxembourg
Netherlands

The list of financial intermediaries can be found in the following link:
https://www.eib.org/intermediarieslist/search/index

203

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Portugal

Iapmei – Public Agency for SME and Innovation

https://www.iapmei.pt

SAPGM – Sociedade de Investimento, SA

https://www.spgm.pt/pt/

COSEC S.A. – Companhia de Seguro de Créditos

https://www.cosec.pt

FGCR - Romanian Rural Credit Guarantee Fund

http://fgcr.ro

FNGCIMM - National credit guarantee fund for SMEs

https://www.fngcimm.ro

FRC S.C. Fondul Roman de Contragarantare S.A.

http://www.frcg.ro/webincident/ro/cinesuntem.html

FRGC - Romanian Loan Guarantee Fund

https://www.frgc.ro

SEF - Slovene Enterprise Fund

https://aecm.eu/sef-slovene-enterprisefund/Romania

Slovenia

Spain

Slovenian Regional Development Fund/ Slovenski Regionalno
Razvojni SkladCESGAR - Confederation of Spanish Mutual Guarantee
Societies

http://www.regionalnisklad.si
http://www.cesgar.es

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ANNEX III – List of relevant support associations, networks and tools
Table 12. List of relevant support associations, networks and tools at the EU level
Name

Type

Description

Netwo
rk

The network is composed by more than 600
member organisations (including chambers ofcommerce, innovation support organisations,
universities and research institutes, EEN supportsbusinesses innovating and growing internationally.
This also includes linking EU businesses withprivate investors and assistance in applying for EU
risk finance via the EIC Accelerator Pilot (pleasesee section 3.2.4 of this chapter). The EU-Japan
Centre for Industrial Cooperation is the EEN
network partner in Japan.

European Business Network

Netwo
rk

The network is composed by around 140 EU
business and innovation centers and 40 otherorganisations that support the development of
SMEs and startups. The network partner in Japanis the European Business Council (EBC)

European Trade Association for
Business Angels, Seed Funds,
and other Early Stage Market
Players (EBAN)

Netwo
rk

EBAN does not interact directly with SMEs.
However, its members list can provide a goodstarting point for EU businesses looking forpotential seed and early stage investors

http://www.eb
an.orgEuropean Association of Public
Banks (EAPB)

Netwo
rk

EAPB’s represents the European public banking
sectors. Its members are European national andregional promotional banks, municipality funding
agencies and public commercial banks.

https://www.ea
pb.eu

Netwo
rk

NEFI’s members are financial institutions providing
FIs to small medium enterprises in their homecountries, including national and regional
promotional banks. Its list of members can be
useful for EU SMEs looking for financing
opportunities.

http://www.nefi.eu/nefi/

Enterprise Europe Network

Network of European Financial
Institutions for Small andMedium Sized Enterprises(NEFI)Long Term Investors Club

Netwo
rk

Funded in 2009 by Caisse des Dépots, Cassa
Deposity e Prestiti, KfW and the EIB, the D20
Long-Term Investors Club aims at encouraging
cooperation between long-term investors on D20
topics. Its members are composed by financial
institutions and institutional investors worldwide,
including JBIC and Development Bank of Japan

Website• https://een.
ec.europa.eu• https://www.
eu-japan.eu• https://ebn.
eu• https://ebcjp.com/about/

http://www.d2
0-ltic.org/

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2019.

European Association Longterm Investors (ELTIA)

European Guarantee
Institutions Association (AECM)

European Angels Fund (EAF)204

Portal Access to Finance

Euroquity

Pitchbook

Netwo
rk

ELTIA members are composed by EU financial
institutions and institutional investors acting as
long-term investors in the EU.

https://www.elt
ia.eu

Netwo
rk

AECM’s 48 members are composed by public
institutions that provide loan guarantees for SMEs.
This includes guarantee funds (public institutions
and development banks with a guarantee division)and mutual, private and sector guarantee
schemes.

http://aecm.eu

Netwo
rk

The EAF is an initiative that provides equity to
Business Angels and other investors, boosting
their capacity to invest in innovative SMEs in all
sectors. Rather than case by case contracts, theinitiative is based on long-term contractual
relations with investors.

https://www.eif.org/what_we_
do/equity/eaf/index.htm

Tool

Platform with information about several sources offinancing at the Member States level. The platform
allows to choose by country.

https://europa.
eu/youreurope/business/fina
ncefunding/getting
funding/acces
sfinance/index_
en.htmTool

Matchmaking platform for growth companies
created by BPIfrance and Kfw. The platform
regroupes a wide range of potential investors.

Tool

Pitchbook is a private database of global venture
capital, private equity and public markets with
headquarters in the US and Brussels. It includes
research companies, funds, investors and service
providers from around the world.

https://www.eu
roquity.com/en/home

https://pitchbo
ok.com/The EAF is currently operational in Austria, Denmark, Finland, Germany, Ireland, the Netherlands and Spain. The list of Business
Angels can be found in the following link: https://www.eif.org/what_we_do/equity/eaf/selected-angels.pdf
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ANNEX IV – List of EU initiatives/ financing schemes
Table 13. List of initiatives at the EU level.

Name

Type

Description

WebsiteFinancial
instruments(loans,guarantees andequity)A 10 billion euros joint initiative to accelerate the transition toa sustainable and circular economy, launched in July 2019by the EIB and five European NPBIs: BGK (Poland), CDC
and BPifrance (France), CDP (Italy), ICO (Spain) and KfW(Germany). The joint initiative will provide loans, equity
investment and guarantees to eligible projects, targeting abroad range of final beneficiaries, such as municipalities,businesses of different sizes and R&D projects. SMEs fromthese countries should reach out to their NPBIs or relevant
national institutions.

https://www.eib.org/en/press/all/
2019-191eur-10billion-tosupportthecirculareconomyin-the-eu

INNOWWIDE

GrantsINNOWWIDE is a Horizon2020 project focused oninternationalisation, which aims to fund EU innovative SMEs
and start-ups in markets outside of the EU, including inJapan. The program supports all SMEs established in an
EU Member State or a Horizon2020 associated country. The
financial support has a fixed maximum grant of 60000 euros
per project and the support rate is fixed at 70% of eligible
costs. INOWWIDE launched two calls thus far. It is worth tofollow up whether the project will be continued following theclosing of the last call – the last call closed on the 31st ofMarch 2020.

Blue Economy
Window (Blue
Invest)Several/Financial andnon-financial
supportSupports investment and access to finance for early-stage
businesses (SMEs and scale-ups). The platform provides
several support tools, such coaching and b2b matchmaking,but also grants (BlueInvest Grants) and financial instruments(BlueInvest Fund205). WSENSE is an example of a company
that has been funded by the Blue SME Window206

Joint Initiative on
Circular Economy(JICE)EIC Fund (EIC
Accelerator

Financialsupport (grants
and equity)

The EIC Accelerator is an integrated program that supports
highly innovative and close-to-market SMEs. The
Accelerator provides business acceleration services andcoaching (via EEN), as well as solely grant funding or
blended finance (grants and equity). Equity instruments areprovided through the EIC Fund (established in June 2019)
to selected SMEs in the pre-seed, seed and early stage –usually companies with no (or very limited turn-over). The
EIC Fund is indeed a promising initiative offering tohttps://inno
wwide.eu/

https://web
gate.ec.eur
opa.eu/mar
itimeforum/
en/frontpag
e/1451
https://ec.e
uropa.eu/easme/sites/
easmesite/files/ei
c_accelerat
or_fund_pil
ot_investm
ent_guideli
nes_for_ap
plicants.pdf

The BlueInvest Fund is backed by the ESIF
https://ec.europa.eu/easme/sites/easme-site/files/emff_archeosub_sucess_story_2019.pdf
https://ec.europa.eu/easme/en/2019-european-maritime-and-fisheries-fund-info-day
https://ec.europa.eu/easme/en/autonomous-underwater-robotic-and-sensing-systems-cultural-heritage-discovery-conservation-andsitu
205
206

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introduce portfolio companies to a network of investors.
More information can be found under section 3.2.

Loan Guarantee
Facility (LGF)
COSME

Equity Facility for
Growth (EFG)
COSME

InnovFin SME
Guarantee

InnovFin Equity(Horizon2020)

Financialsupport(debt/guarantee)Loan Guarantee Facility (LGF) is one of the windows of theSingle EU Debt Financial Instrument. It supports the growthof EU SMEs by enabling financial intermediaries to provide
more loan and lease finance to SMEs through guarantees
and counter-guarantees. Eligible activities include access to
new markets and internationalisation. Some non-EU
countries can also benefit from COSME (Japan notincluded). The list of non-EU COSME countries can beaccessed here.

Financialsupport(equity)

The Equity Facility for Growth (EFG) is one of the windowsof the EU Single Equity Instrument. It supports the growth of
EU SMEs by investing in selected funds that provide venture
capital and mezzanine finance to SMEs. Eligible activities
include access to new markets and internationalisation.
Equity agreements with investors allow for indirect
investments into businesses in non-eligible countries. Thismeans that an eligible equity investor can also invest intobusinesses in Japan or other non-eligible countries withfinancial instruments backed by COSME. More information
can be found under section 3.2. Besides EU countries,
Some non-EU countries can also benefit from COSME(Japan not included). The list of non-EU COSME countries
can be accessed here.

Financialsupport(debt/guarantee)Part of Horizon 2020, the InnovFin SME Guarantee provides
loans and guarantees to financial intermediaries in view of
improving access to finance for riskier innovative businesses
and other innovative entities. The programme focuses on
research and innovation. Besides EU member states andHorizon2020 associated countries, other third countries arealso eligible for funding (thus far, Japan not included). The
list of associated countries can be accessed here. The list ofother eligible countries can be accessed here.

Financialsupport(equity)

Part of Horizon 2020, the InnovFin Equity invests in selected
funds in view of improving access to finance for riskier
innovative businesses and other innovative entities. The
programme focuses on research and innovation. Equity
agreements with investors allow for indirect investments intobusinesses in non-eligible countries. This means that aneligible equity investor can also invest into businesses inJapan or other non-eligible countries with financial
instruments backed by COSME or Horizon 2020. Moreinformation can be found under section 3.2. The list of
associated countries can be accessed here. The list of othereligible countries can be accessed here.

https://ec.e
uropa.eu/gr
owth/access-tofinance/cos
mefinancialinstruments_en

https://ec.e
uropa.eu/gr
owth/access-tofinance/cos
mefinancialinstruments_en

https://ec.
europa.eu/
programm
es/horizon
2020/enhttps://ec.e
uropa.eu/pr
ogrammes/
horizon202
0/en

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SMEs GoInternational
Technical
AssistanceFacility (European
Cluster
Collaboration
Platform)

Non-financial

InvestHorizon

Accelerator/Mat
chmaking

ESCALARFiancial
support (equity)

GlobalStars(EUREKA)

Financialsupport(grants)

TechTourAccelerator/Mat
chmaking

The European Cluster Collaboration Platform (ECCP) willsoon launch the ‘SMEs Go International’ Technical
Assistance Facility. It will support 25 EU SMEs developing
their business projects in partnership with local stakeholders
in non-EU markets.

Accelerator programme financed and promoted by the EC,
in association with EUREKA. It is designed to facilitate
access to Series A funding for selected deep-techbusinesses.
Under the ESCALAR Programme, financial intermediaries
who can support the internationalisation of portfolio
companies score higher in the evaluation process. No
specific limitations in terms of geographical reach. Thus,
financial intermediaries under ESCALAR might be able tosupport internationalisation investments of EU SMEs.
GlobalStars is an initiative that aims at facilitatinginternational R&D&I cooperation between EUREKA
members and a country that is not yet a member of
EUREKA. In 2020 the target country will be Japan. The callwill open in early June and run until early September 2020.
Applications are open to participants (including SMEs) fromthe UK, Canada, Czech Republic, France, Germany, Israel,
Spain and Japan. All sectors are eligible, except for nuclear
and pharmaceutical projects.207
Techtour coordinates INNOWWIDE, a Horizon 2020 project
which counts with the participation of, among others, Invest
Horizon and EBN. Some companies that do not getinvestment under the EIC can eventually be supported by
Invest Horizon and Tech Tour. Tech Tour is open to connectbusinesses from Horizon2020 and EUREKA countries withinvestors worldwide (mostly through the Invest Horizon’sInternational Network Venture Club). Mitsui andKamamutsu are currently part of this network. Services areusually free for EU businesses.

https://www.clustercollaboration.
eu/news/up
comingsmes-gointernation
altechnicalassistancefacility

https://inve
sthorizon.eu/https://www.eif.org/w
hat_we_do/equity/esc
alar/index.
htm
https://www.eujapan.eu/event
s/webinareurekaglobalstarsinitiative-newcall-nedo-japan

https://techtour.
com/

207 EUREKA, 2020. Information provided by personal communication

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ANNEX V – List of national initiatives within the EU MS
The below table provides a list of some national initiatives at the EU Member States level that have been collected throughout the current
research. The list is not meant to be exhaustive and it doesn’t disregard other potential financing support provided by these or otherstakeholders.
Table 14. Non-exhaustive list of initiatives at the EU Member States level
Initiative

Stakeholder

Global Incubator
Network Austria

Austria
Wirtschaftsservice
GmbH andÖsterreichische
Forschungsförderungsgesellsc
haftGuarantees forinternationalization ofAustrian Enterprises

Primo FundCountryType

SectorDescription

WebsiteAustria

Tool/Nonfinancial
supportGeneral/ SMEs
Internationalisation

GIN tries to connect overseas ICT businesses with
the EU market. Preference for later stage start-ups
from Hong-Kong, Israel, Japan, Singapore, China
and South Korea. Matches Asian participants withinvestors and business angels.

https://www.ginaustria.com/Austria
Wirtschaftsservice
Gesellschaft mbH(AWS)

Austria

Financialsupport/guarantees

General/ SMEs
InternationalisationPrimomiglio SGR

EU andItaly

Financialsupport/equitySpace industry

AWS provides guarantees to support theinternationalization of Austrian businesses.

Fund created by Primomiglio SGR208 (backed by
the InnovFin Space Equity Pilot 209 ) to invest in
early stage SMEs in the space industry. The fundhas a target size of 80 million euros and around
70% of the capital will be invested in Italy (where
the firm is based). However, the remaining 30%

https://www.aws.at/en/awsguarantee/
internation
alisation/

https://www.primomi
gliosgr.it/

Primomiglio SGR is an early-stage tech investor based in Italy.
The InnovFin Space Equity Pilot, recently launched by the EIF, will invest in EU venture capital funds which support businesses in the space sector. The first investment fund selected
was Primo Fund, however more funds will be selected within the framework of the program. For more information about the equity pilot, please accesshttps://www.eif.org/what_we_do/guarantees/news/2020/efsi-innovfin-arianegroup.htm
208
209

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will be invested in EU businesses across Europe.
The fund is ready to support internationalization
beyond the European Union, including in Japan.

Primomiglio SGR

Primomiglio SGR

Export Trade
Financing Export
ProgramFinnveraTeam Finland Network‘s financing services

Team Finland
Network

Exporting for growth

UK DIT

EU andItaly

FinlandFinlandUK

Financialsupport/equitySoftware,internet, digitalbusinesses

Besides the Primo Fund (for the space industry),
the investment firm has funds targeting othersectors (software, internet and digital businesses).

Workshop/
Non-financial
supportGeneral/ SMEs
InternationalisationFinnvera (the Finnish NPBI) provides regular
export financing workshops for Finnish SMEs.

Network

General/ SMEs
InternationalisationTeam Finland is a network that brings together all
public internationalization services. Its member
organisations provide a wide range of financial
instruments to Finnish SMEs (aid, grants, loans
and guarantees).

Funding

General/ SMEs
InternationalisationBacked by EU structural funds, this initiative
provides financial support to UK businesses
internationalization beyond the EU. Only valid forbusinesses must located in Seffield City Region,
Leeds City Region or Humber LEP

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https://www.primomi
gliosgr.it/
https://www.finnvera.
fi/eng/exp
ort/financi
ng-theexporttradetransactio
ns-ofsmes
https://www.teamfinland.fi/en/servicesforcompanies/financingservices/
https://www.brchamber.co.uk/
wpcontent/up
loads/201
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Subsidies for thedevelopment ofinternational businessactivities

BistreamInternational Growth
Loan/ Equity
Investment

Entrepreneur Loan

Flanders
Investment andTrade (FIT)

Bistream

BPI France

KfW

Belgium

Germany

FranceGermany

Funding

General/ SMEs
Internationalisation

FIT provides specific subsidies for theinternationalization of Belgian SMEs in markets
outside of the EU. This includes the costs ofprospecting trips, the participation of foreign trade
fairs and niche events, the development of digitalbusiness communication and internationalcustomization.

https://www.flandersinvestment
andtrade.c
om/export/
subsidies

Platform/
PrivateGeneral/ SMEs
InternationalisationBistream is a german company that supports EU
companies to expand to Japan, connecting
European companies with Japanese investors.
Even though Bistream is more active in theGerman market, they are open to support SMEs
from other Member States.

http://www.bistream.
deFinancialsupport/ debt
and equity

Financialsupport/ debt

General/ SMEs
InternationalisationGeneral/ SMEs
InternationalisationBpifrance covers intangible investments SMEs
have to make when going abroad through its
international growth loan. However, the French
NPBI also provides equity investment to support
French businesses in their internationalisation
activities

Besides other products (e.g. grants), KfW offers anentrepreneur loan aiming at long-term investmentsof German SMEs. KfW’s entrepreneur loan isprovided to financing partners (e.g. commercial
banks). Recently, in response to COVID-29, Kfw

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file:///Users/user/Do
wnloads/Pl
aquette%2
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pifrance%
20(version%20anglaise)%20(1).PDF
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fWGroup/Ne
wsroom/L
atestNews/Pres
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has extended the outreach of its Entrepreneur loan
assuming up to 90% of the partner’s risk.210

Italian Export andInternationalisation
Hub

CDP (throughSACE and
SIMEST)

Italy

FinancialsupportGeneral/Internationalisation

The Italian Export and Internationalisation Hubprovides a single access point with a broad rangeof financial instruments. SACE is the national
export credit agency, whereas SIMEST is anational agency for companies development

ICO provides credit facilities to finance exports andinvestments both for SMEs based in Spain.
However, it also has international products
available for SMEs from other countries (whenthere is a Spanish interest). ICO has several
financing facilities that received funding from theEIB but also from other NPBIs, notably KfW.

Direct loans,international
guarantees andprivate equity
schemes

ICO

Spain

FinancialsupportGeneral/InternationalisationBuyer credits

Kfw IPEX-Bank (incooperation with
Northstar Europe)

Germanyand EU

FinancialsupportGeneral/Internationalisation

Kfw IPEX-Bank finances export projects,
infrastructure projects and climate projection
projects for German and European enterprises.

General/InternationalisationNRW.Bank’s universal loan applies for all kinds ofbusiness activities – this loan can also support
internationalisation and working-spaces. Available
only for SMEs in the North Rhine-Westphalia. It isalso relevant to note that NRW.Bank is also an
EEN partner.

Universal loan

NRW. Bank

Germany

Financialsupporthttps://www.sacesim
est.it/en/aboutus/thecompanies/simest/si
mest

https://www.ico.es/en/web/ico_en/financin
g-facilities

https://www.ico.es/w
eb/ico_en/
financingfacilities

https://www.nrwbank.de/de/ind
ex.html

Deloitte. 2020. KfW Entrepreneur Loan (037/047). Source: https://www2.deloitte.com/content/dam/Deloitte/de/Documents/about-deloitte/COVID-19_KfW-Entrepreneur-LoanFactsheet.pdf
210

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Zabaldu Programme

Basque Trade &Investments

Spain

CredimiCredimiItaly

FinancialsupportFinancialsupport/Crowdlending

General/ SMEs
InternationalisationBasque Trade & Investments offers a specificprogramme to support companies increasing theirpresence abroad. The programme covers up to
50%
of
the
costs
associatedwithinternationalisation investments (e.g. consultancy,
promocional expenses, industrial property, plantand facilities abroad).

General/ SMEs

Launched in 2017 and funded by institutional
investors, Credimi is an Italian web-based lending
platform that delivers digital factoring solutions to
SMEs.

General/ SMEs

Creditshelf is a pioneer in the field of digital SME
financing in Germany, providing a marketplace thatenables investors and borrowers to connect. It’s
currently the largest loan platform in the country byfunding volume.

211

Creditshelf

Germany

Financialsupport/Crowdlending

October

OctoberFrance,Spain,
Italy andthe
Netherlands

Financialsupport/Crowdlending

General/ SMEs

As for the largest loan platform in France, there is
October. The platform provides marketplace thatenables borrowers and investors to connect.
Following the success in France, October’s
operations have been extended to Spain, Italy
and the Netherlands.

AsiaBerlin

AsiaBerlin

Germany

Internationalis
ation support

Startups/
InternationalisationAsiaBerlin supports german startups’ accelerationin Asia, including in Japan.

Creditshelfhttps://www.euskadi.e
us/web01tramite/es/c
ontenidos/ayuda_subve
ncion/spri_
zabaldu_20
19/es_spri_z/es_arch.ht
mlhttps://www.credimi.com/https://www.creditshelf.com/de/https://octo
ber.eu/https://startupasiaberlin.
com/

Crowdlending is a category of crowdfunding investment that enables businesses to get financing from a group of different investors. It’s considered an innovative way for small
businesses to access financing. The EC and the EIF have been encouraging the use of crowdlending (e.g. new SME Strategy and the EFSI Private Credit Programme) even among
institutional investors. In fact, the EIF already invested in several debt funds originated through crowdlending. More information can be accessed in
https://www.eif.org/news_centre/publications/efsi-private-credit-investor-protection.htm
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ANNEX VI – Institutional stakeholders in Japan
Table 15. Relevant institutional stakeholders in the Japanese market

Name

WebsiteInformation

Japan Bank for International Cooperation(JBIC)

https://www.jbic.go.jp/en/

Please see section 2.3.

Japan External Trade Organization (JETRO)

https://www.jetr
o.go.jp/en/

Please see section 2.4.

Japan International Cooperation Agency(JICA)

https://www.jica.go.jp/english/

Please see section 2.2.

Nippon Export and Investment Insurance(NEXI)

https://www.ne
xi.go.jp/en/

Please see section 2.1.

Japan Overseas Infrastructure Investment
Corporation for Transport & Urban
Development (JOIN)

http://www.joinfuture.co.jp/eng
lish/about/index.html

Please see section 2.5.

INCJ, Ltd. and Japan Investment Corporation(JIC)

https://www.jic.co.jp/en/

Please see section 2.6.

https://www.jfc.
go.jp/n/english/

Please see section 2.7.

Japan Finance Corporation (JFC)
Japan Development Bank (DBJ)
JBIC IG Partners

Japan Venture Capital Association (JVCA)

Organization for Small & Medium Enterprises
and Regional Innovation - SME Support
Japan (SMRJ)

Please see section 2.9.
https://www.jbic
ig.com/en/aboutus

https://jvca.jp/en/https://www.sm
rj.go.jp/english/

Please see subsection 2.3.1.

Established in 2002, JVCA is an organization that aims at
assisting VC firms and business support organizations.
Even though its focus is not interacting with businesses,
JVCA’s members include a broad range of venture
capitalists, corporate venture capitalists and othersupporting members that might be of relevance to EU
SMEs looking for private/ business support investment inJapan.

The organization provides tailored support for SMEs incollaboration with government agencies, SME support
organisations and financial institutions

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ANNEX VII – List of non-institutional stakeholders in Japn
Table 16. Relevant non-institutional stakeholders in the Japanese market (non-exhaustivelist).

Name

Industrial Growth Platform,
Inc. (IGPI)

Japan Venture Capital
Association (JVCA)

Websitehttps://igpi.co.jp/en/

Type of support

Information

Financial services

IGPI is a private entity that provides
operational and financial services tocompanies. IGPI Inc. has offices
worldwide and a track record ofinvestments with JBIC both indeveloped and developing countries.

Association/ network

Established in 2002, JVCA is anorganization that aims at assisting VC
firms and business support
organizations. Even though its focus is
not interacting with businesses, JVCA’s
members include a broad range ofventure capitalists, corporate venture
capitalists and other supporting
members that might be of relevance to
EU SMEs looking for private/ businesssupport investment in Japan.

https://jvca.jp/en/

SME Support Japan

https://www.smrj.go.jp/
english/about/

Support/ Matchmaking
Platform

SME Support Japan supports individual
SME needs through collaboration withseveral support organisations such as
municipalities, government agencies.
They are currently focused instrengthening their global businessthrough several initiatives. One of themis the J-GoodTech platform, an online
business matching platform that alreadycounts with 20 000 SMES, both
Japanese and foreign. More information
here.

Samurai Incubate 212

http://www.samuraiincubate.asia/

Seed/ Early stage investor

Source: Meyer, Natalie. 2017

Skyland Ventures

http://www.skyland.vc/

Seed/ Early stage investor

Source: Meyer, Natalie. 2017ANRI

http://anri.vc/

Seed/ Early stage investor

Source: Meyer, Natalie. 2017

Nippon Venture Capital(NVCC)

http://www.nvcc.co.jp/

Growth stage investor

Source: Meyer, Natalie. 2017

Sumitomo Mitsui Banking
Corporation (SMBC)
Venture Capital

http://www.smbcvc.co.jp/

Growth stage investor

Source: Meyer, Natalie. 2017

On an informative note: In joint venture with Terakubo (a young Japanese investor), Samurai Incubator launched
Leapfrog Ventures, now called Samurai Incubator Africa, a seed fund for startups in Sub-saharan Africa. The young
entrepreneur is currently working with JICA in Rwanda, for instance, in the context of their innovation ecosystemstrengthening project. More information in The Bridge. 2018. https://thebridge.jp/2018/05/takuma-terakubo-fundlaunch
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JAFCO

http://www.jafco.co.jp/english/Growth stage investor

Source: Meyer, Natalie. 2017

Globis Capital Partners

http://www.globiscapita
l.co.jp/en/

Growth stage investor

Source: Meyer, Natalie. 2017

Infinity Venture Partners

http://www.infinityventu
res.com/main_eng

Growth stage investor

Source: Meyer, Natalie. 2017

Mitsubishi UFG Capital(MUCAP)

https://www.mucap.co.jp/Growth stage investor

Source: Meyer, Natalie. 2017

YJ Capital

http://yj-capital.co.jp/

Corporate Venture Capital

Source: Meyer, Natalie. 2017

CyberAgent Ventures

https://www.cyberagentventures.com/en/

Corporate Venture Capital

Investments in Asia in the internet
sector. Source: Meyer, Natalie. 2017

GREE Ventures

https://www.greeventur
es.com/en/

Corporate Venture Capital

Invests in Southeast Asia and India,
focused in the mobile games sector.
Source: Meyer, Natalie. 2017

Salesforce.com, Inc.

https://www.cyberagentventures.com/en/

Key foreign investors

Source: Meyer, Natalie. 2017

Eight Roads

https://eightroads.com/en

Key foreign investors

Source: Meyer, Natalie. 2017

Seed/ Early stage investor /Deepcore213

https://deepcore.jp
Incubator (Specialized)

Drone Fund

https://dronefund.vc

Seed and growth stage
investor (Specialized)

Specialized fund investing in Artificial
Intelligence companies from seed toearly stage, with no discrimination inregards to technology – the fundinvested in a broad range oftechnologies from hardware to
SaaS/DaaS. From the track record of 40
investments, 10 have been conductedabroad (1 in Canada, 1 in Kenya andthe remaining in the US). Even though
the fund is mostly focused in Japanesecompanies they are obviously open to
overseas investments would be happy
to invest in Europe. The fund is currently
gearing up for a third investment cycle,
targeting more than $100M.
The Drone Fund is one of the very few(if not the only in the world) specialized
VC that invests only in drone related
startups. It is composed by a Limited
Partners (LP) Ecosystem (larger
corporates or investment firms) and an
Investee Ecosystem (start-ups).

Source: Japan Venture Capital
Association (JVCA)

Coral Capital

213

https://coralcap.co/?lang=en

Seed/ Early stage investor

Coral Capital was founded by the teamof 500 Startups Japan.

The most recent investment of Deepcore is Laboratik in Mar 9, 2020.

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The University of Tokyo
Edge Capital Co., Ltd.

https://www.utec.co.jp/english/

Seed/ Early stage investor

Focused in technology.

DG Daiwa Ventures/ DG
Lab Fundhttps://dg-daiwav.com/en/

Seed Investor

Invests in Blockchain, xR, AI, security
and biohealth.

Hitachi Ventures GmbH,Ltd.

https://www.hitachi.eu/
en/press/hitachiestablishes-corporateventure-capital-fundsupport-startupsinnovation-partner

Toppako Capital

https://toppakocapital.com

Corporate Venture Capital

Established in April 2019, together with
the Hitachi Ventures Fund. The CVC
aims at worldwide fast-growing
innovative startups.

Investment Platform

Toppako Capital is a unique company
focused on growth capital for SME
expansion strategies between Europe
and Japan. Toppako’s investment teamsupports selected SMEs in their Japan
expansion plans (and vice versa).

Nordic Ninja

https://nordicninja.vc/

Growth stage

Japanese deep tech fund based andfocused in providing scale-up funding in
the Baltic Region (EU). Mostlyinterested in robotics, automation,
health tech, AI and mobility. Nordic
Ninja is a joint-venture between JBIC IG
Partners and Baltcap, also backed by
Honda, Panasonic, Omron and JBIC.

FI GROUP

https://www.finiciativas.com

Tax Credit Advisors/ Private

FI Group is a company dedicated tosupporting businesses getting dedicatedincentives, such as tax credit benefits
from R&D activities worldwide.

Venture Capital Fund

M3 Inc launched a corporate venture
capital (CVC) fund to invest in
healthcare startups (average 1-2
hundred million yen per company).
Investment themes include medical
devices, advanced medical
technologies, rare diseases andhealthcare management.

M3 Inc – Internal Corporate
Venture Capital Fund

https://corporate.m3.co
m/en/ir/release/2019/p
df/191025_CVC_E.pdf

Cell Innovation Partners
Limited (Shinsei Corporate
Investment Limited)

http://www.cell-ip.com/

Specialized investment fund

RealTech Fund

https://www.realtech.fu
nd/en/

Specialized investment fundHello Tomorrow in Japan

https://hellotomorrow.org/otherevents/

Matchmaking opportunities

Cell Innovation Partners is aninvestment fund focused in STEM celland regenerative medicine. The fundinvested in the Spanish
biopharmaceutical company Histocell,
what enabled the company to achieve 6
distribution agreements worldwide. 214
Realtech fund is the largest specialized
fund in Japan. It invests in R&D
technology and has recently launched a
new fund that invests into startups
outside of Japan.
Hello Tomorrrow in Japan is amatchmaking tool that supports
interaction and collaboration between

Histocell. 2018. “Histocell boosts its internationalisation with international investors and new distribution agents”.
Source: http://biotech-spain.com/en/articles/histocell-boosts-its-internationalisation-with-international-investors-andnew-distribution-agreements/
214

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Plug and Play Japan

https://www.plugandpl
aytechcenter.com/japan/

SBI Investment

http://www.sbinvestme
nt.co.jp/funds/transition.html

Mitsui Kinzoku-SBI
Material Innovation
Fund

Matchmaking opportunities

investors, startups, enterprises andpublic entities.
Plug and Play in Japan is an innovation
platform that can link startups from awide range of sectors (e.g. fintech, IoT,
mobility, brand & retail) with several
Japanese corporate partners

Corporate venture capital

SBI Investment is part of the SBIGroup’s asset management business.

https://www.mitsuikinzoku.co.jp/wp/wpcontent/uploads/topics_170
901e.pdf)

Corporate venture capital

Private fund launched by SBI
Investment (SBI Group). Main target
areas are advanced material (nonorganic), Addictive Manufacturing (AM),,MI, carbon capture tech.

Nikon-SBI Innovation
Fund
INTAGE Open
Innovation Fund

http://www.sbigroup.co.jp/n
ews/2016/0704_10352.html

Corporate venture capital

Private fund launched by SBI
Investment (SBI Group).

http://www.sbigroup.co.jp/n
ews/2016/1017_10450.html

Corporate venture capital

Private fund launched by SBI
Investment (SBI Group).

House Foods Group
Innovation Fund

http://www.sbigroup.co.jp/news/2018/0124_1
0957.html

Corporate venture capital

Private fund launched by SBI
Investment (SBI Group).

SUBARU-SBI
Innovation FundFUSO-SBI Innovation
Fund

http://www.sbigroup.co.jp/n
ews/2018/0710_11155.html

Corporate venture capital

Private fund launched by SBI
Investment (SBI Group).

http://www.sbigroup.co.jp/n
ews/2020/0313_11895.html

Corporate venture capital

Private fund launched by SBI
Investment (SBI Group).

https://jgoodtech.jp/pub/en/

Matchmaking platform

This business matchmaking platform is
operated by SME Support Japan(SMRJ)

Investment Fund

SBI Holdings has established its first
office in Europe, in Berlin. The fund isinterested in Industry 4.0 Sectors suchas IoT, AI, Robotics, Mobility, DLT,
Security, etc.

JGoodTech

Future Industry
Ventures Fund (SBI
Holdings)

Scale-Up Osaka
Programhttps://www.handelsblatt.com/technik/itinternet/technologiesoftbank-ausgruendung-sbiplant-millioneninvestmentsin-europaeische-startups/25823036.html?ticket=
ST-6107792gK6DNJJf9n0ZMbrtmqKuap5
https://www.startupbootcam
p.org/accelerator/scaleosaka/Acceleration Program

ANNEX VIII – Participatory interviews104

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Table 17. Participatory research - Target-groups description

Group

Subgroup

Stakeholder
National Promotional Banks (NPBs)

1A. Development Banks / Institutions

Guarantee institutions

1. Member State
Stakeholders

Regional Promotional Banks (RPBs)

1B. Policy-level (but SME-related)

Trade Promotion Organisations (TPOs)

1C. Private (SME-related)

Bilateral Chambers of Commerce present in Japan

1D. Related financial intermediaries

Investment Funds which received public support

2A. Policy-makers(DGs, Executive Agencies)

Directorate-General for Internal Market, Industry,
Entrepreneurship and SMEs (DG GROW)
Directorate-General for International Cooperation andDevelopment (DG DEVCO)
Directorate-General for Economic and Financial
Affairs (DG ECFIN)
Directorate-General for Financial Stability, Financial
Services and Capital Markets (DG FISMA)
Executive Agency for Small Medium-sizedEnterprises (EASME)

2B. Financial institutions(multilateral banks)

European Investment Bank (EIB)
European Investment Fund (EIF)
Network of European Financial Institutions for Smalland Medium Sized Enterprises (NEFI)
European Association of Guarantee Institutions(AECM)
European Association of Long-Term Investors (ELTI)

2. EU
Stakeholders

The European Trade Association for Business
Angels, Seed Funds and Early Stage Capital Market(EBAN)
2C. Associations/ Networks

EEN – (Working Group on Access to Finance)
EuropeanTrade
Promotion
Organisations
Association (ETPOA)
European Business Associations Worldwide Network(EBOWWN)
European Business Council in Japan
European Collaboration Clusters Platform (ECCP)
Business Europe
D20 Long-term investors Club

2D. Relevant private entities

Investment funds with relevance for the JapanesemarketOther EU businesses with relevance to the aims of
the research

3A. Policy-level

Japan External Trade Organisation (JETRO)105

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Japan International Cooperation Agency (JICA)
Ministry of Foreign Affairs of Japan (MOFA)
Japan Bank for International Cooperation (JBIC)
Nippon Export and Investment Insurance (NEXI)
3B. Financial institutions/

Japan

Governmental Funds

Corporation for Transport & Urban Development

Overseas

Infrastructure

Investment(JOIN)
3. Japan
Stakeholders

Japan Institute for Overseas Investment (JOI)
3C. Associations/ Networks

Japan Investment Advisers Association (JIAA)EU External Action Service - EU Delegation in Japan

3D. EU representation in Japan(Policy-level and Associations/ Networks)

EU-Japan Centre for Industrial Cooperation
European Business Council in Japan
Business Angels

3D. Potential capital providers

Venture Capitalists (VCs)
Corporate Venture Capitalists (CVC)
Joint Ventures

4A. EU-Japan Business Collaborations
MoUs

4. Businesses
4B. Others

Businesses in Japan with relevance for the aims of
the research

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Table 18. Conducted interviews (with no specific order)215

Name

1

2

3

4

Group

Japan Bank forInternational
Cooperation(JBIC)

Japan External
Trade
Organization(JETRO)Japan External
Trade
Organization(JETRO)

Ministry ofForeign Affairsof Japan (MOFA)

Toppako Capital3

SubgroupContact

Date

Location

MethodComments(Confidential)

12-022020

Tokyo, Japan

Presencial
meeting(Confidential)(Confidential)

12-022020

Tokyo, Japan

Presencial
meeting(Confidential)

3A

3

3A

(Confidential)

26-022020

Tokyo, Japan

Presencial
meeting(Confidential)

3

3A(Confidential)

26-022020

Tokyo, Japan

E-mail(Confidential)

3

3A(Confidential)

11-032020

Tokyo, Japan

Presencial
meeting(Confidential)

3

3A(Confidential)

11-032020

Tokyo, Japan

Presencial
meeting(Confidential)

44B

25-022020

Tokyo, Japan

Conference
call(Confidential)(Confidential)

Several national institutions in every EU Member State have been reached through AECM, however not all of them responded. The ones that did have been
included in the current table.
215

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5

EuropeanInvestment Fund
(EIF)

2

2B

6

EuropeanInvestment Bank
(EIB)

2

2B

7

EuropeanInvestment
Advisory Hub(EIAH)

22B

8EEN Access toFinance Working
Group

2

2C

9

DG GROW –Access to Financefor SMEs (Unit
H3)

2

2A

10

DG GROW (Unit
A4)

2

2A

11

DG DEVCO

2

2A

12

EASME (Unit A1,
COSME)

2

2A

13

EASME (Unit A1,
COSME)

2

14

EASME

2

12-022020

Louxembourg, Europe

Conference
call(Confidential)(Confidential)

26-022020

Louxembourg, Europe

Conference
call(Confidential)(Confidential)

24-012020

Brussels,
EuropeE-mailexchange(Confidential)(Confidential)

30-012020

Brussels,
EuropeConference
call(Confidential)(Confidential)

30-012020

Brussels,
EuropeE-mail(Confidential)

30-012020

Brussels,
EuropeE-mail(Confidential)(Confidential)

20-012020

Brussels,
EuropeE-mail(Confidential)(Confidential)

22-012020

Brussels,
EuropeE-mail2A(Confidential)

24-012020

Brussels,
EuropeE-mail2A(Confidential)

24-012020

Brussels,
EuropeE-mails
Exchange(Confidential)

108(Confidential)(Confidential)(Confidential)(Confidential)

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15

EASME

2

2A

(Confidential)

24-012020

Brussels,
EuropeE-mails
Exchange(Confidential)

16

EASME

2

2A

(Confidential)

30-012020

Brussels,
EuropeE-mails
Exchange(Confidential)

17

EEAS - Tokyo

3

3D(Confidential)

5-122019

Tokyo,
Japan

Presencial
Meeting(Confidential)

18

European
Association of
Guarantee
Institutions(AECM)

2

2C(Confidential)

24-022020

Brussels,
EuropeE-mails
Exchange(Confidential)

19

Network ofEuropeanFinancial
Institutions for
SMEs (NEFI)

2

2C(Confidential)

11-022020

Brussels,
EuropeE-mail20

Business Europe

2

2C(Confidential)

14-033030

Brussels,
EuropeE-mail21

Business Europe

2

2C(Confidential)

14-032020

Brussels,
EuropeE-mail22

Nordic Ninja

4

4A(Confidential)

21-022020

FinlandConferencecall

Investing in EU start-ups in theNordic and Baltic region

23

Primo Fund
(Primomiglio)

2

2D(Confidential)

17-022020

Italy

Conferencecall

Investing in the space startups
in Italy and the EU

109(Confidential)(Confidential)(Confidential)

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24

Yuso

4

4A

(Confidential)

29-012019

Belgium

Conference
call(Confidential)(Confidential)

25

Azuri
Technologies,
Ltd.

4

4A

(Confidential)

03-022020

UK

Conference
Call

26

City Beats(Social Coin)

4

4A(Confidential)

13-022020

Spain

Conference
Call(Confidential)

27

WSENSE

4

2D(Confidential)

12-032020

Italy

Conference
Call(Confidential)

28

FI Group – FIGroup Japan
K.K.

4

4B

(Confidential)

18-032020

Tokyo,
Japan

Presencial
meeting

29

Austria
Wirtschaftsservi
ce Gesellschaft
mbH (AWS)

1

1A(Confidential)

4-032020

AustriaE-mail30

Finnvera

1

1A(Confidential)

26-022020

FinlandE-mail31

KfW
Development
Bank

1

1A

(Confidential)

04-022020

Germany

E-mail32

NRW Bank

1

1A(Confidential)

06-052020

Germany

Conference
call

110

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33

Malta
Development
Bank
(MDB)

1

1A

(Confidential)

12-022020

Malta

Conference
call(Confidential)

34

Croatian Bankfor
Recunstruction
andDevelopment(HBOR)

1

1A(Confidential)

13-022020

Croatia

Conference
call(Confidential)

35

Sociedades deGarantia
Recíproca(CESGAR)

1

1A(Confidential)

26-022020

Spain

E-mail(through
AECM)

36

FRC S.C. Fondul
Roman deContragarantare
S.A.

1

1A

(Confidential)

25-022020

N/A

E-mail(through
AECM)

1

1A

(Confidential)

25-022020

LouxembourgE-mail(through
AECM)

06-032020

Belgium

E-mail(through
AECM)

37

Mutualité desPME

38

PMV/ zWaarborgen nv

1

1A(Confidential)

39

L’Européenne deCautionnement
(EDC)

1

1A

(Confidential)

40

Invega1

1A(Confidential)

E-mail(through
AECM)

25-022020

E-mail(through
AECM)

Lithuania

111(Confidential)(Confidential)(Confidential)(Confidential)(Confidential)(Confidential)

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41

Bpi France /InvestHorizon

1

1A(Confidential)

10-042020

N/A

E-mail(through
AECM)

42

European
Cluster
Collaboration
Platform (ECCP)

2

2C(Confidential)

12-052020

N/A

Conference
Call

43

European
InovationCouncil (EIC
Pilot)

2

2C(Confidential)

23-032020

BelgiumE.mail44

The European
Trade
Association for
Business
Angels, Seed
Funds and Early
Stage CapitalMarket (EBAN)

2

2C(Confidential)

08-052020

N/A

E-mail45

Japan FinanceCorporation

3

3B(Confidential)

30-042020

N/A

Conference
call(Confidential)46

D20 Long-Term
Investors Club

07-052020

N/A

Conference
call(Confidential)

06-052020

N/A

E-mailexchange(Confidential)(Confidential)(Confidential)(Confidential)(Confidential)
2

2C(Confidential)

47

JBIC IG Partners

3

3D(Confidential)

112(Confidential)

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48

Drone Fund

3

3D

(Confidential)

07-052020

N/A

E-mailexchange49

UK Department
of International
Trade (UK DIT)

1

1A

(Confidential)

04/05/
2020

N/A

E-mailexchange(Confidential)

50

European Trade
Promotion
Organisations
Association(ETPOA)

2

2C(Confidential)

05-052020

N/A

E-mailExchange(Confidential)

51

Deepcore Inc.

3

3D

(Confidential)

11-052020

N/A

Conference
call(Confidential)

52

InnovFin Space
Equity Fund

3

3D

(Confidential)

14-052020

N/A

E-mail53

ESCALAR

2

2B(Confidential)

15-052020

N/A

E-mail54

Italian Trade
Agency1

1A(Confidential)

12-052020

N/A

E-mail(Confidential)

55

Basque Trade &Investment

1

1A(Confidential)

12-052020

N/A

E-mail(Confidential)

113(Confidential)(Confidential)(Confidential)

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56

Flanders
Investment andTrade (FIT)

1

1A(Confidential)

12-052020

N/A

E-mail57

SBI Investments

3

3D(Confidential)

25-052020

N/A

Conference
call(Confidential)

58

EUREKA
Network

2

2B(Confidential)

25-052020

N/A

Conference
call(Confidential)

59

Techtour2

2B(Confidential)

2-062020

N/A

Conference
call(Confidential)(Confidential)

Table 19. Attended seminars

Name

Organisation

Date

Location

Link

Attended
Yes

European Business Organisations Worldwide Network(EBOWWN) Tokyo Meeting

EU-JAPAN Business Collaborations in Third Markets

欧州研究ユニット主催 - Sustainable connectivity andquality infrastructure: New level of EU-Japan partnership

海外投資セミナー2020：わが国の海外直接投資動向
FDI Seminar 2020: Recent Trends of Japanese FDI

European Business
Organisations Worldwide
Network (EBOWWN)

3-12-2019

Tokyo, Japan

N/A

https://www.eujapan.eu/events/eu-japanbusiness-collaborationsthird-markets

Yes

https://www.waseda.jp/inst/o
ris/news/2019/12/24/3163/
https://www.joi.or.jp/modules/seminarreport/index.php?page=article&storyid=621

Yes

EU-Japan Centre for Industrial
Cooperation

12-12-2019

Tokyo, Japan

Waseda University

12-01-2020

Tokyo, Japan

Japan Bank for International
Cooperation (JBIC) and Japan28-01-2020

Tokyo, Japan

114

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Seminar on Japanese Investments for Overseas
Infrastructure (JOIN)

Seminar on Innovative Financing Instruments to Support
European Private Investment in Third Countries

Stakeholder engagement on the EIB Group’s Climate
Bank Roadmap 2021-2025: Turning ambition into reality

AsiaBerlin Webinar

Institute for Overseas
Investment (JOI)
Japan Overseas Infrastructure
Investment Corporation forTransport & Urban
Development (JOIN)
Business Europe

21-02-2020

Tokyo, Japan

http://www.joinfuture.co.jp/english/news/20
200303_01.html

Yes25-02-2020

Brussels,
Belgiumhttps://www.businesseurope.eu/publications/businesseur
ope-headlines-no-2020-07

No,
Materials
providedby e-mailhttps://www.eib.org/en/about/partners/cso/consultations/it
em/cb-roadmapstakeholderengagement.htm

No,
Materials
providedby e-mailhttps://startupgermany.org/events/asiaberlin-japan/

Yes

EIB

23/26-032020

WEBINAR

AsiaBerlin (initiative by the
Berlin Senate Department for
Economics)

28-05-2020

WEBINAR115

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ANNEX IX – INCJ’s overseas management resources scheme
Table 20. INCJ investments through its overseas management resources scheme. Source: Own
elaboration from INCJ216
Name

Date

Country

Industry

Details on the type of investment

Ambry Genetics
Corporation

2017

US

Health/ Medicine

Joint acquisition between INCJ (60%) and Konica Minolta(40%)
Joint acquisition between INCJ and the Japanesecompany Harmonic Drive Systems Inc. Harmonic Drive
Systems Inc., who already held shares of Harmonic Drive
AG, ended up becoming the whole shareholder ofHarmonic Drive AG.
Growth investment (in view of promoting the creation for
future opportunities for joint investments with Japanesecompanies
Joint acquisition between INCJ, JSR Corporation (JSR)
and CMIC Holdings C. (CMIC)
Joint acquisition between INCJ and Nagatanien Holdings
Co.

Harmonic Drive AG

2016

Germany

Industrial Machinery

Edotco Group Sdn
Bhd

2016

Malaysia

Infrastructure(Telecommunications
infrastructure)

KBI Biopharma

2016

US

Health/ Medicine

2016

UK

Consumers goods/
retail2014

Portugal

Infrastructure (Water
services)

Join acquisition of 100% with Marubeni Corporation.
INCJ’s entire holding has been transferred to Marubeni
Corporation on the 7 May 2019.

Nistica, Inc.

2014

US

Electronic devices

Joint acquisition between INCJ, Fujikura and NTT
Electronics. INCJ’s shares have been sold to Fujikura in2017.

Oji Fibre Solutions(Carter Holt Harvey
Limited Group)

2014

Australia and
NZ

Materials/ Chemicals

Acquisition

Sunrise Healthcare
Service2013

Cambodia

Health/ Medicine

Solar Holding S.R.L.

2013

Italy

Infrastructure (solar
energy)Transphorm, Inc.

2012

US

Electronic devises

Wireless Glue
Networks Inc.

2013

US

EnergySeajacks

2012

UK

Infrastructure (offshore
wind power)

Landis + Gyr

2014

Switzerland

EnergyBroomco/ Chaucer
Food Group
Administração eGestão de Sistemasde Salubridade(AGC)

AguasNuevas

2010

Chile

Infrastructure (water
management)

Trility

2010

Australia

Infrastructure (water
treatment)

216

Joint investment with Kitahara Medical Strategies
International (KMSI). INCJ’s holdings have been sold toSonnedix Italia S.r.I. in 2016.
Total joint acquisition between INCJ, Solar Ventures and
Mitsubishi Corporation.
Joint equity investment with another Japanese company
Nihor Inter Electronics (a INCJ portfolio company)
Joint investment with the Japanese TokyoElectric Co.
and the US venture capital firm Clean Pacific Ventures
Management LLC. INCJ’s shares have been sold toSynaptca Networks Inc. in 2016.
Joint acquisition between INCJ, Marubeni Corporationand the private equity corporation Riverstone Holdings
LLC.
Joint acquisition between INCJ and Toshiba.
Joint acquisition between INCJ and Marubeni
Corporation. INCJ’s shares have been sold to MG
Leasing Corporation, a joint corporation between
Marubeni Corporation and Mizuho Leasing Company
Limited in 2020.
Joint acquisition in Private Public Consortium between
INCJ, Mitsubishi Corporation, JGC Corporation and
Manila Water Company.

INCJ official webpage. Source: https://www.incj.co.jp/

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ANNEX X – Implementation of the EU-Japan Interinstitutional Working GroupThe EU-Japan Interinstitutional Working Group (Figure 17) would be a body composed of representatives of the
EU-Japan Centre for Industrial Cooperation, JBIC, JETRO, JICA and JOIN. It would aim to provide support to boththe EU SME Finance Helpdesk217 and to the EU-Japan Third Country Business Helpdesk218 proposed in thisreport, notably relying on the establishment of a regular channel of communication between the EU-Japan Centre
for Industrial Cooperation and key institutional stakeholders in Japan. Ideally, this Working Group should meet every
three months to discuss financing and non-financing opportunities (e.g. priority sectors and third markets) for EUJapan business collaborations.
The main priorities of the Working Group are to align ambitions and define a common strategy to its EU andJapanese parties, list opportunities, discuss concrete projects and support tools, and coordinate promotional andpolitical initiatives. Indeed, besides the regular meetings, the Working Group is expected to organise joint activities,
such as seminars/training sessions, as well as facilitate matchmaking between EU and Japanese companies. The
matchmaking service should be provided either on a case-by-case basis with the EU-Japan Centre for Industrial
Cooperation briefing its Japanese counterparts on a couple of particularly promising business plans at eachmeeting, either by collaborating on organising comprehensive business missions.
On the financial level, the Working Group should support EU SMEs in connecting with financial providers andJapanese partners to become eligible to apply for financial instruments provided by Japanese institutions. On the
non-financial level, the Working Group should support companies looking for a Japanese partner with whom they
can jointly operate in third markets and/or existing EU-Japan partner companies in exploiting opportunities in third
markets.
In terms of internal preparation for the meetings of the Working Group, the position of the EU-Japan Centre forIndustrial Cooperation should be based on a regular follow-up with the “Advisory Stakeholders” that are:•••

The European Commission, in view of receiving inputs for the overall strategy and progress;
The European Investment Bank, to follow-up on the progress of the MoUs with JBIC, JICA and NEXI);
Governmental and non-governmental trade promotion organisations (national or EU public departments and agencies
working on topics related to trade and/or EU-Japan relations, industry and trade associations and chambers ofcommerce), in view of promoting the helpdesks and exchanging on local opportunities in coordination with local
Japanese institutional and corporate stakeholders.

Table 22 provides a stakeholder mapping, including contact points, for the implementation of the EU-Japan
Interinstitutional Working Group.

Please see the Policy Recommendations to the EU-Japan Centre for Industrial Cooperation section in thecurrent report.
218 See my colleague Masami Marbot’s report on “EU-Japan Business Partnerships in Third Countries.” Available at:https://www.eu-japan.eu/minerva-past-reports-20142019#
217

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Figure 17. Interinstitutional Working Group120

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Table 21. Institutional stakeholder mapping for the EU-Japan Interinstitutional Working Group
Relevance for the EU-Japan Centre

Stakeholder

Japan External
Trade
Organization(JETRO)

MinistryofForeign AffairsofJapan(MOFA)

Type

EU-Japan
Third Market
Collaboration Helpdesk

Comments / Key message(confidential)

Location

Tokyo,
Japan(Confidential)

Support inmatchmaking(Confidential)(Confidential)

Support inpromotional
activities
andmatchmaking(Confidential)(Confidential)

Support ininterinstituti
onalcooperation(Confidential)

Governme
ntal
Tokyo,Japan

Governme
ntal

EU
SME
Finance
Helpdesk

Contact point(confidential)

Potentialforjoint
activities

Tokyo,
Japan(Confidential)
Support ininterinstituti
onalcooperation(Confidential)

121(Confidential)

MINERVA Report
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References & Annexes(Confidential)
Japan
MachineryCenter
for
Trade
and
Investment(JMC)

Business
AssociationTokyo,
Japan(Confidential)

Support inpromotional
activities
andmatchmaking(Confidential)(Confidential)

Japan
ChamberofCommerce
andIndustry/Tokyo Chamber ofCommerce
and Industry

Business
AssociationJapan Bank forInternational
Cooperation(JBIC)

Governme
ntal/
Financial
institution(Confidential)
Tokyo,
Japan(Confidential)(Confidential)
Tokyo,
Japan(Confidential)

Japan
International
Cooperation
Agency (JICA)

Governme
ntal/ State
Aid

Tokyo,
Japan(Confidential)

Support inpromotional
activities
andmatchmakingFinancialsupport for
EU-Japanbusiness
partnerships(loansand equity)

Financialsupport for
EU-Japanbusiness
partnerships in third
markets

122(Confidential)(Confidential)(Confidential)

MINERVA Report
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References & Annexes(available
at the local
level
via
calls
for
tender andunder very
specific
conditions)

Nippon Export
andInvestment
Insurance(NEXI)

Japan
Overseas
Infrastructure
Investment(JOIN)

Japan
Investment
Advisers
Association(JIAA)

Governme
ntal

GovernmentalJapan/
NongovernmentalTokyo,Japan

Tokyo,Japan

Tokyo,
Japan(Confidential)

Financial
Support for
EU-Japanbusiness
partnerships in third
markets.

(Confidential)

Financial
Support for
EU-Japanbusiness
partnerships in third
markets.

(Confidential)(Confidential)

InformingtheEUJapanCentreabout
potential
investors inJapan(Confidential)

123(Confidential)

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EuropeanInvestment
Bank (EIB)The European
Trade
Associationfor Business
Angels, Seed
Funds
and
Early
Stage
Capital Market(EBAN)EEN Access toFinance
WorkingGroup

DG GROW –AccesstoFinanceforSMEs (Unit H3)

EU
Institutions

Nongovernme
ntal

Nongovernme
ntalEUInstitutions

Luxembourg

Brussels,
Belgium

EU level,
Severallocations

Brussels,
Belgium(Confidential)

InformingtheEUJapanCentreabout theprogress of
the MoUs
with JBIC,
JICA and
NEXI(Confidential)

Connecting
the
EUJapanCentre withsmart
capital andangel
investors.

(Confidential)

Providingthe
EUJapanCentre with
relevant
informationonfutureEU funding
programmes(Confidential)(Confidential)

Providingthe
EUJapanCentre with
relevant(Confidential)

124(Confidential)(Confidential)

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informationonfutureEU funding
programmesEuropean
Innocation
Council
Accelerator/
EIC FundNongovernmental

Brussels,
Belgium

NetworkofEuropeanFinancial
Institutions for
Small
and
Medium Sized
Enterprises(NEFI)

Nongovernmental

Brussels,
Belgium

D20 Long Term
Investors Club

Nongovernmental

Brussels,
Belgium(Confidential)

Providingthe
EUJapanCentre with
relevant
information
on grants
and equity
providers(Confidential)

Providingthe
EUJapanCentre with
relevant
information
on national
financingsupportschemesandstakeholdersspecializedinSME
finance(Confidential)

Connecting
the
EUJapanCentre withinvestors

125(Confidential)(Confidential)(Confidential)

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European
Guarantee
Institutions
Association(AECM)Development
Bank of Japan
(DBJ)

JBIC
Partners

IG

Tokyo
Metropolitan
Small
and
MediumEnterpriseCenterSBI
Investments

Nongovernme
ntal

Governme
ntal

Nongovernmental

Brussels,
Belgium

Tokyo,Japan

Tokyo,
Japan(Confidential)

Providingthe
EUJapanCentre with
relevant
information
on national
financingsupportschemes(guarantee/
loans)(Confidential)

Financialsupport for
SMEs(loans andequity)(Confidential)

Connecting
the
EUJapanCentre withinvestment
funds
in
Japan

(Confidential)(Confidential)

NongovernmentalTokyo,
Japan(Confidential)

Connecting
the
EUJapanCentre withfinancingsupport for
EU SMEs inJapan

Nongovernme
ntal/ CVCTokyo,
Japan(Confidential)

Connecting
SMEs withprivatecapital126(Confidential)(Confidential)(Confidential)

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ANNEX XI – Suitability of financing instruments)Figure 18. Suitability of financing instruments for different firm profiles and stages. Source: OECD, 2018219

219 OECD. 2018, p. 11. “Enhancing SME access to diversified financing instruments.” Discussion Paper, 2018 SME Ministerial

Conference. Available in: https://www.oecd.org/cfe/smes/ministerial/documents/2018-SME-Ministerial-Conference-PlenarySession-2.pdf

129