Magazine article Management Today

Imports Welcome-Official

Magazine article Management Today

Imports Welcome-Official

Article excerpt

The world has become accustomed to the ubiquitous Japanese even if it welcomes them with varying degrees of warmth. There is a high degree of apprehension about Japanese competion in both America and France, for instance, but the British, while, to put it mildy, not totally happy about reciprocal trade, have recognised the advantages to be gained from Japanese investment, and, on the whole given them a warm welcome. It has paid off.

Sony, Nissan and Mitsubishi already have factories here and a huge Toyota car plant rises in Derbyshire, ready to take advantage of the integrated European market of 1992. It seems certain that, at last, the traffic is to become less one-way, as Japan signals that it has become sensitive to Western reservations about the imbalance in trade.

The Japanese government has taken wide-ranging measures to stimulate interest in the Japanese market by exporters from abroad,' affirms John Whiffen, who heads the Import Expansion Programme at JETRO's London office. JETRO, the Japan External Tade Organisation, was established in 1958 with the intention, as can be seen from its title, of promoting exports. Its 35 offices worldwide have now gone into reverse encouraging imports.

Tariffs have been completely eliminated on over a thousand manufactured items, and substantially reduced on others. As a result, almost all the machinery imported into Japan now enters duty-free, Whiffen says. Japanese companies which increase their purchases of imported machinery by 10% or more can receive a tax credit equal to 5% of the increase, or can alternatively opt instead for accelerated depreciation. JETRO anticipates that this measure alone will cost $1 billion a year.

Efforts are also being made, explains Whiffen, to increase the Japanese consumer's knowledge of foreign goods. The organisation is staging import promotion exhibitions in Japanese cities, and has set up a network of 'internationalisation centres' to disseminate information on foreign companies and their products.

Nor is the promotion programme solely passive. 'JETRO has also sent specialist buyers aborad,' says Whiffen, 'to bring back samples of products to put in exhibitions to bring them to people's attention.' To counter allegations of distribution difficulties, distribution centres are being set up in Osaka and nine other major cities. There is also a plan to put foreign goods in mail-order catalogues, and a $1.5 billion low-interest loan programme to help both Japanese and foreign companies.

Despite the budget for this sort of promotional activity being more than $100 million a year, the extent to which British companies are taking advantage of it is difficult to determine. Whiffen himself declines to name any companies using the programme successfully. But nothing ventured, nothing gained, and given the formerly restricted nature of the Japanese market, the latent potential should be at least worth investigating. Despite the summer's financial scandals, the fundamentals of the Japanese economy remain strong -- although under pressure. The visible trade surplus rose again in June for the 10th successive month, and now stands at just under $79 billion. Industrial production is still up on the figure of a year ago, and GNP growth -- yes, growth -- is running at over 10% pa. …

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