Report from the Commission to the European Parliament and Council on the evaluation of the programme of specific measures and actions to improve access of European Union goods and cross-border services to Japan
Date: 2000-10-12
Institutions: European Commission
Subjects: Japan, action programme, export (EU), market access, trade promotion

COMMISSION OF THE EUROPEAN COMMUNITIES

Brussels, 12.10.2000
COM(2000) 638 final

REPORT FROM THE COMMISSION
TO THE EUROPEAN PARLIAMENT AND COUNCIL

on the evaluation of the programme of specific measures and actions to improve access
of European Union goods and cross-border services to Japan

TABLE OF CONTENTS

INTRODUCTION ................................................................................................................. 3

1.

2.

2.1.

2.2.

2.3.

3.

3.1.

3.2.

3.3.

4.

5.

OVERVIEW OF THE JAPAN PROGRAMMES ..................................................... 4

THE EXECUTIVE TRAINING PROGRAMME IN JAPAN.................................... 5

Results of the control and monitoring operations financed ........................................ 5

Contractual obligations and principles of sound and efficient management ............... 6

Cost effectiveness analysis ....................................................................................... 6

THE EU GATEWAY TO JAPAN EXPORT PROMOTION CAMPAIGN............... 7

Results of the control and monitoring operations financed ........................................ 7

Contractual obligations and principles of sound and efficient management ............... 8

Cost effectiveness analysis ....................................................................................... 8

THE ‘AD HOC’ PROJECTS SCHEME ................................................................... 8

CONCLUSIONS...................................................................................................... 9

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INTRODUCTION

This report is submitted to the European Parliament and the Council pursuant to article 3(1) of
Council Regulation (EC) No 1035/1999 ‘on the implementation by the Commission of a
programme of specific measures and actions to improve access of European Union goods and
cross-border services to Japan’1 (hereinafter referred to as ‘the Japan regulation’). Article 3(1)
stipulates that: “The Commission shall present to the European Parliament and the Council
by 1 September 2000 an evaluation report including the results of the control and monitoring
operations financed; this report shall also take account of contractual obligations and
principles of sound and efficient management. It shall
include the results of a cost
effectiveness analysis.”

Following the adoption of the Japan regulation in May 1999 and the allocation of
commitment credits to the Japan budget line B7-851 in July of the same year, the Commission
launched the appropriate procedures in order to select two independent external contractors to
evaluate the two main programmes covered by the regulation:
the ‘Executive Training
Programme in Japan’ (ETP) and the ‘EU Gateway to Japan’ export promotion campaign
(GTJ). Contracts for the evaluation of GTJ and ETP were signed in autumn 1999 and winter
2000 respectively; the Final Evaluation Reports were presented to the Commission in July
and August 2000 respectively. The two Evaluation reports were subsequently transmitted to
the members of the Advisory Committee assisting the Commission in carrying out the
activities covered by the Japan regulation, which is composed of representatives of Member
States.

The present report includes the main conclusions and results of the aforementioned Final
Reports, in so far they were relevant to the requirements set for this evaluation report by
article 3(1) of the Japan regulation. The ‘Executive Summary’ of both Evaluation Reports are
annexed to this report (English only).

This report and the two full Evaluation Reports will be made available to the general public
on DG RELEX’s Website.

1

Council Regulation (EC) No 1035/1999 of 11 May 1999, OJ L 127, 21.5.1999, p. 1.

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1.

OVERVIEW OF THE JAPAN PROGRAMMES

The Japanese market is widely regarded as very specific and demanding, posing
additional market access difficulties to those encountered by EU industry on other
markets of
industrialised countries. Language and cultural barriers, complex
distribution structures and an intricate regulatory environment are some of the
challenges EU enterprises wishing to penetrate this vast and important market are
confronted with. With a view to assisting EU industry to overcome these difficulties
in the early stages of their marketing and investment efforts, the Commission has
designed and set up the Japan programmes which complement and bring added value
to the efforts undertaken by Member States on the Japanese market. The Japan
programmes consist of three pillars: ‘The Executive Training Programme in Japan’
(ETP), the ‘EU Gateway to Japan’ export promotion campaign and the ‘Ad-hoc
projects’ scheme. In carrying out the Japan programmes, the Commission is assisted
by an Advisory Committee composed of the representatives of the Member States.

The ETP Japan is an 18-month programme consisting of a 12-month full-time
intensive Japanese language course in Tokyo followed by 6 months on-the-job
training in Japanese firms. A parallel programme of lectures and seminars on various
aspects of doing business in Japan, as well as a programme of visits to Japanese
institutions and industrial plants, is organised during the 18-month period. The
objective of this programme is to build up a pool of European executives with the
necessary language, cultural and business skills to operate successfully in the
Japanese business environment. Since its inception in 1979, more than 700
executives have acquired through this programme the competencies needed to give
effective assistance to their organisations in accessing the Japanese market.

The ‘Gateway to Japan’ campaign is an integrated export promotion campaign aimed
at assisting European SMEs to successfully introduce their products on the Japanese
market. The programme consists of the recruitment, preparation and participation of
EU companies in sectoral exhibitions, trade missions and other promotional activities
in Japan. It is implemented in close co-operation with Member States who provide
commercial services to the participants (market research, programme of business
meetings, interpretation, etc.) through their representations in Japan. Following a
pilot campaign run between 1990 and 1993, the first Gateway campaign took place
between 1994 and 1996. The current - second -Gateway campaign, running from
1997 to the end of 2000, covers 10 different industrial sectors and will bring to Japan
more than 900 companies in the 34 events that will have been implemented in this
period.

the
In addition to and complementing the two above mentioned programmes,
Commission provides financial support on an ad-hoc basis to European organisations
implementing activities in the areas described in article 2(2) of the Japan Regulation.
Activities to be co-financed are typically selected through a ‘Call for Proposals’
published in the Official Journal of the European Communities. One of the main
criteria for selection of a project is that at least five Member States will participate in
the proposed project. Before the adoption of the Japan regulation, the rate of co-
financing offered varied from 10% to a maximum of 50% of the project’s
expenditure. In the current exercise (year 2000) the Commission co-finances up to a
maximum of 35% of the project’s expenditure. Additional funding typically comes

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from participating fees, the organiser(s) and/or national promotion bodies. Being a
grant-based scheme, selected projects are managed by the beneficiary, who reports to
the Commission on the results of the activities and the use made of the public funds
awarded.

2.

THE EXECUTIVE TRAINING PROGRAMME IN JAPAN

The purpose of the independent ETP evaluation that the Commission contracted out
to the company “The Evaluation Partnership” was to determine the effectiveness,
relevance and efficiency of the programme on the basis of the analysis of all ETP
editions completed (ETP’s 1 to 18). Drawing on the evaluation results, the evaluators
were asked to make recommendations on how the format, duration, conditions and
content of the programme could be improved. This report draws on the summary of
evaluation findings which can be found in chapter 9 of the ETP evaluation report.

2.1.

Results of the control and monitoring operations financed

The main conclusion reached by the evaluators is that “the ETP programme is a very
effective instrument of policy, highly valued by its clientele and one which continues
to be relevant to the problems facing businesses seeking to enter or develop business
relations with Japan. It is also an efficient programme but there is potential for
improvement”.

The overall appreciation of the beneficiaries of the ETP programme is very high.
Virtually all (99%) ETP participants are satisfied with the ETP programme, with
73% describing it as “very valuable” and 26% as “useful”. Sponsor companies and
current employers were also very positive in their assessment showing a 97%
satisfaction rate with 62% finding ETP “very valuable” and 34% “useful”.

On effectiveness, the evaluators concluded that ETP is a highly effective programme
as its objectives of creating a pool of EU executives equipped with the specific
linguistic, cultural and business skills necessary to operate in Japan and to give
effective assistance to their organisations in penetrating the Japanese market, are
fundamentally met. ETP is considered as a comprehensive Human Resources
Development tool and its individual components are of high quality. The programme
also carries a high added value being implemented at European level.

The ETP participants are very positive about the skills and knowledge they have
acquired through the programme. 96% of participants believe that ETP has made
them accustomed to Japanese business practices and market requirements. 88% of
participants see themselves in a position to help develop their company’s expertise in
Japan and 98% feel that they can now help their companies understand Japan. 87%
of participants feel confident working in the Japanese culture.

There is evidence that ETP has a strong impact on the professional career and
personal life of the participants. This is shown by the fact that after completing ETP
a large proportion of participants stay in Japan to work for their companies on a long-
term basis. On average 41% of a participant’s life is spent in Japan after ETP, while
participants have been working with the Japanese market on average for 61% of their
life after ETP. These are considerable results especially if one considers that ETP
started 20 years ago.

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Sponsor companies and subsequent employers consider that ETP has a positive
impact on the company’s performance. Companies feel that ETP participants brought
to their organisation a high level of competence in the Japanese language (90%) and
a high level of ease in handling Japanese courtesies, values and culture (94%). The
evaluators reported that there is substantial evidence that companies which employ
ETP alumni, particularly from the earlier editions, have significantly improved their
market access. 95% of participants believe that, after having completed ETP, they
can do business with Japan more effectively and about two thirds of sponsors and
employers are positive about the role of ETP in developing their business presence in
Japan and in improving the access of their goods and services to Japan.

The relevance of the programme was also one of the key issues examined. In
particular it was assessed to what extent the programme objectives were relevant to
the needs of the Community enterprises wishing to overcome the difficulties
encountered in establishing business relationships in Japan. The findings of the
evaluation show that ETP continues to be an appropriate instrument of human
resource development
to help EU companies take advantage of new business
opportunities in Japan. ETP contributes to overcoming the practical barriers to trade
and investment by immersing its participants in the intricacies of Japanese language,
to contribute positively to the
It continues
business practice and culture.
improvement of EU-Japan trade relations. In addition,
the evaluation findings
confirm that ETP enjoys wide support from the Japanese and European business
communities and that its unique position as a policy instrument makes it a valuable
asset for its key constituencies.

The evaluators concluded that the rationale of ETP needs little adjustment to fit into
the present and future situation, particularly as an HRD programme targeted at
business executives. It is clear that both the programme and its participants over the
years have been able to adapt successfully to the changing (economic) circumstances
in Japan. ETP continues to produce alumni who have the capability to engage in the
new EU/Japan business environment. The programme would therefore appear to
have high relevance for the future.

2.2.

Contractual obligations and principles of sound and efficient management

The evaluators reported that ETP is managed professionally and effectively both in
Brussels and in the Commission’s Delegation in Tokyo. In particular it was reported
that there was evidence of a separation of duties between the operational and
financial officers, that deliverables and penalty clauses are built into key contracts
and that actions and expenditures are very visible and can be easily verified. With
regard to the on-going assessment of the programme, ETP has been reviewed every
four years, this being the 5th full-scale evaluation. In addition, the programme has a
built-in system of monitoring and adjustment based on feedback from participants
and others as a source for continuous improvement. The evaluators concluded that
sufficient evidence was gathered to suggest that the programme is implemented in
conformity with SEM principles and in a conscientious manner.

2.3.

Cost effectiveness analysis

According to the evaluators, the evidence gathered on programme costs indicates that
the activities have been implemented within the planned and agreed budget and that
unit costs have been contained. While expressing a positive assessment of the cost-

6

effectiveness of the programme, the evaluators also suggested there was scope to
moderately improve the efficiency of the programme. In this respect it was suggested
to enlarge the proportion of variable costs, to revisit the participants allowances and
to seek economies of scale by managing several Asian training programme together
(e.g. ETP Japan and ETP Korea). The total personnel and administration cost stood
at 5.3% of programme cost. This was considered in line with other leading
Commission framework programmes and the unit cost of programme delivery was
considered to be reasonable.

3.

THE EU GATEWAY TO JAPAN EXPORT PROMOTION CAMPAIGN

to carry out a mid-term
The Commission contracted Inparco Consult
independent evaluation study of the EU ‘Gateway to Japan’ campaign. The
objectives of this study were to evaluate the effectiveness and efficiency of the
campaign and, where necessary, give suggestions for improvement.

scrl

3.1.

Results of the control and monitoring operations financed

The main conclusion of the report is that “the EU Gateway to Japan programme has
generally succeeded in meeting its objectives. It has provided support to companies
in all Member States and the feed-back from the companies has been positive.”

34% of the participating companies have received orders as a result of their
participation. In total, 60% of the companies surveyed are actually doing business
with Japan and more than half of them attribute this business to their participation in
the campaign (in the long term these numbers are likely to grow as most of the
companies not doing business with Japan at present are continuing to talk to potential
customers with a view of exporting in the near future). Moreover, 26% of the
companies state that they would not have gone to Japan without the ‘Gateway to
Japan’ campaign.

15% of participating companies have generated additional employment as a result of
their participation and each EURO spent in the programme has generated
3.5 in
additional investment by participating companies to absorb the increased business.

€

The research conducted demonstrates the widespread opinion “that the EU Gateway
to Japan campaign and its services respond to the needs of the target audience”. In
the opinion of the evaluators, it has been “almost universally recognised that the
European dimension and identity is very useful in Japan” and in cases where the
campaign co-exists with similar national programmes the EU Gateway to Japan
“appears to work reasonably well with these programmes, with the national co-
ordinators having a good picture of which programmes are more suitable for which
clients, enabling them to exploit both to the best advantage”. In this respect, the
participation in the programme of Member States’ commercial offices in Tokyo has
been widely appreciated with more than 90% of respondents being satisfied or very
satisfied with the services provided by their national commercial office.

The evaluation report has also identified a number of beneficial spin-offs of the
programme, such as the campaign’s positive impact on EU-Japan trade relations in
general and the on-going Deregulation process in particular, its contribution to the

7

enhancement of the visibility of the EU in Japan and the improved networking
achieved among European participants from different Member States.

3.2.

Contractual obligations and principles of sound and efficient management

The campaign will exceed its initial objective of bringing 900 companies to Japan
and the level of expenditure will be well under the budget agreed. It is the evaluator’s
view that “monitoring appears to be satisfactory. The Commission receives regular
operational reports, financial statements and reports containing feedback from the
participants.” The information contained in these reports is useful and is used to fine-
tune the programme on a continuous basis where scope for this exists.

Separation of duties exists between financial and operational officers and contracts
include measurable targets with penalty clauses in case of under-performance. The
report states that “financial reporting is clear and distinguishes clearly between
expenditure on the different elements of the programme” and that “efforts are made
to cost activities on a continuous basis.”

The evaluators state in their conclusions that the EU Gateway to Japan programme is
very well organised in Japan where participants have rated the organisation of events
as the most valuable service provided by the campaign. The central organisation in
Europe is also “well regarded at an administrative level, providing an efficient
service to national contact points and Commission.”

3.3.

Cost effectiveness analysis

Although the evaluators have been unable to compare EU Gateway to Japan to
similar national and/or regional programmes, figures presented for the campaign are
encouraging. According to the evaluators, every EURO spent in the campaign has
generated so far
37 of additional sales for participating companies.

€

820.000 per
In terms of expected sales, companies have reported an average of
company as expected increase in sales resulting from their participation. This figure
is approximately 57 times the average cost per participant for the campaign which is
14,327. It is therefore the evaluator’s view that “the campaign has
estimated at
generated significant returns on investment for the participating companies and for
the campaign as a whole.”

€

€

Suggestions have been made for improvements, notably with regard to the inclusion
of sectoral expertise in the campaign and to the company selection procedure. The
Commission looks forward to discussing these suggestions with Member States
should this campaign be continued.

4.

THE ‘AD HOC’ PROJECTS SCHEME

With the exception of a one-day conference on Deregulation in Tokyo in December
1999, no project has yet been co-financed under the ‘Ad-hoc projects’ scheme since
the adoption of the Japan regulation in May 1999.

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A ‘Call for Proposals’ was published on 20 April 2000 in the Official Journal2 and it
is expected that projects resulting therefrom will start running in the autumn of 2000.
No evaluation of the scheme can therefore be given in this report.

5.

CONCLUSIONS

This report concludes that the Commission’s programme of specific measures and
actions to improve market access for EU business in Japan has met its objectives and
has been implemented in a cost effective manner and according to principles of
sound and efficient management.

The ‘Executive Training Programme’ in Japan, which was first conceived in 1979
and is widely considered a ‘flagship’ Commission programme, continues to enjoy an
impressive satisfaction rate from its beneficiaries: the young European executives
participating in the programme and their sponsor companies. The evaluation has
shown that the programme is as relevant for EU industry as it was 20 years ago - a
finding of the evaluation which is supported by the persisting demand for the
programme from EU industry. Indeed, the success and continuing relevance of the
programme were acknowledged by the leaders of the EU and Japan at their last
Summit meeting in July 2000 when they concluded:

“Japan and the EU welcome the forthcoming 20th anniversary of the EU’s Executive
Training Programme in Japan and recognise its important role in strengthening the
cultural and business relations between Japan and the EU. They express their strong
support for the continuation of the programme in the future.”3

The ‘Gateway to Japan’ campaign can also boast a high satisfaction rate from its
beneficiaries. It has assisted more than 900 European companies, mostly SMEs, in
successfully introducing their businesses and products on the Japanese market. In
addition, the campaign has made a positive contribution to the improvement of EU-
Japan trade relations and it has been very effective in fostering a positive image in
Japan of EU industry and its products. With regard to the latter, it should be recalled
that participating companies consider the European ‘umbrella’ under which they are
introduced by ‘Gateway’ to the Japanese market as an important factor contributing
to their success.

In conclusion, the Commission considers that the positive results of the evaluation of
the Japan programmes give every reason to continue them. Even though the market
access situation in Japan has improved in recent years, the Commission believes that
this programme should be continued at least for some time beyond the expiry in
December 2001 of the Japan regulation. A Commission proposal for, inter alia, the
renewal of the legal base for the Japan programmes is currently under discussion in
the European Parliament and the Council4. The Commission is confident that the
present report will contribute favourably to the outcome of these discussions.

2

3

4

OJ C 106, 20.4.2000, p. 6.
Japan-EU Summit Joint Conclusions, Tokyo 19 July 2000.
COM (2000) 381 final of 23.6.2000.

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