Introduction: 2022 marks the 250th anniversary of the normalization of diplomatic relations between China and Japan. Over the past half a century, China-Japan relations have become one of the bilateral relations with the deepest integration of interests and the widest areas of cooperation. Wang Xi, a columnist of Observer Network and general manager of Shanghai Haowen Business Service Co., Ltd., had in-depth exchanges with Mr. Okamotoki, former chairman of Japan's Risui Bank China Company and winner of Shanghai Magnolia Award, on topics such as China-Japan economy and trade, China-Japan relations, etc.
[Interview, Translation/Wang Xi]
Note: Mr. Okamotoki and I met at a meeting in Shanghai. At that time, he went on stage as a guest to speak on the stage. When he spoke in Chinese, he spoke with a straightforward word. In addition, his long-term work background as chairman of a Chinese company in , Ruisui Bank, one of the three major banks in Japan, made people feel very unusual. Mr. Okamotoki is a cheerful and talkative person. After returning to Japan, he served as the Director of Affairs at the Japan-China Investment Promotion Agency (also served as the Director of the Bank of Ruisui), which was established in 1990 to promote Japanese companies or groups to invest in China and cooperate with Chinese companies. In the interview with
, while searching for a mobile phone, Mr. Okamotoki told me about the popular Sichuan restaurant in Tokyo, and also talked about the Japanese " Hualiu " drama, such as " Long Song Xing ". He praised "very high quality!" Now Chinese TV series has become popular in Japan, which is also the change brought about by the continuous exchanges on the 50th anniversary of the establishment of diplomatic relations between China and Japan.
Wang Xi: Let me briefly introduce your work experience in China. What are the most impressive things?
Okamatsuki : I started working in Beijing and Shanghai since 1993. I included the time I was sent to Hong Kong. I worked in China for a total of 21 years and returned to Japan in 2019.
I have experienced the process of foreign banks participating in the construction of China's financial system, especially Ruisui Bank, as the first foreign bank to engage in RMB business, opened branches in Beijing and Shanghai, issuing corporate bonds to support large Chinese state-owned banks and enterprises to raise funds at home and abroad, and participate in the issuance of syndicated loans, etc.
Therefore, I was selected as one of the "40 Foreigners on the 40th Anniversary of China's Reform and Opening-up" and also won the Magnolia Award.
Mr. Okamotoki won the Shanghai "Magnolia" Award in 2019. Photo from the author
privately, I like to travel around China and get in touch with China's nature and culture. I have been to Yunnan, Inner Mongolia, Xinjiang, Tibet, Qinghai, etc., and I have left a deep impression on the local scenery and ethnic minority culture. I like the mountains in China very much. Japan does not have such high mountains. I always want to share these feelings about traveling with my friends in Japan.
Mr. Okamotoki's travel notes in China in Japanese
Wang Xi: Economic exchanges have always been the core of Sino-Japanese relations. What do you think Japanese companies currently have about China?
Okamatsuki : This year marks the 50th anniversary of the establishment of diplomatic relations between China and Japan. Looking back on this history, I would like to thank the two governments and industry predecessors again for their efforts. Japanese companies have invested in China for 40 years. Now there are more than 30,000 Japanese companies stationed in China, and the total investment has reached a handful of scale in the world.
As the saying goes, Japan and China are neighbors with one side, and have established very close relationships in history, culture and economy. In the future, I believe that Chinese and Japanese companies can further strengthen cooperation and complementary relationships, especially taking the advantageous business of individual companies as an opportunity to promote cooperation between the two parties, and accumulate wisdom for win-win cooperation in this process. Japanese companies are currently looking forward to the fields of environment, medical care, and elderly care, and believe that the complementarity of Japan-China industrial cooperation is very strong.
For example, the "Japan-China Energy Conservation and Environment Comprehensive Forum" (energy cooperation for decarbonized society) held in December every year is a large-scale event jointly invested by officials and the people. It has far-reaching significance and various information is of great reference value.
In addition, there are new energy fields (ultra-high-speed charging system for electric vehicle EV, cooperation of commercial fuel cell car FCV, motor and other components, automation fields), and aging-related healthcare fields (telemedicine and preventive medical tourism, high medical care), using small and medium-sized enterprise finance and digital technology venture capital, safe and secure agriculture, food, inbound tourism, etc., among which content industries such as animation, film and television are also highly valued. The epidemic has come to an end. Japan is expected to restart inbound tourism in 2022, and it is also worth looking forward to the resumption of personnel exchanges between Japan and China.
Wang Xi: In actual cooperation, Chinese and Japanese companies need to spend time running-in on specific issues, such as grasping speed, rhythm, risk management, etc. If they are not handled well, they may easily lead to misunderstandings. How do you view this situation?
Okamatsuki: key is communication. Even people from the same country and family members under the same roof may not be smooth. I think to handle communication well, important matters must be communicated regularly, even if it is limited by the epidemic, it is necessary to communicate online. In addition to working relationships, private communication is also important, and private relationships that trust each other at critical moments can play an unexpected role.
For example, looking back at the history of the normalization of diplomatic relations between China and Japan, it was precisely because there were Chinese and Japanese leaders in the top leaders of the two countries who had long-term mutual trust and good personal relationships, which played an important role in promoting them. These historical experiences are worth cherishing and inheriting, and are applied to the process of dealing with other companies.
Wang Xi: Since January 1 this year, RCEP signed by China, Japan, South Korea and ASEAN have officially come into effect. In a sense, China and Japan have established a free trade agreement relationship for the first time, and many chambers of commerce in China have immediately followed up to provide service information to enterprises. Does the Japanese industry attach importance to this? What aspects do they pay more attention to?
Okamatsuki : The Japanese industry attaches great importance to this! Regional Comprehensive Economic Partnership Agreement (RCEP) has 15 countries including Japan and China. Although it came into effect on January 1 this year, it was announced that the negotiation process was entered as early as November 2012, with 31 negotiation meetings, 19 ministerial meetings and 4 summits, and signed the fourth RCEP summit in November 2020, and finally settled. The
RCEP agreement is expected to become a large-scale trade agreement that accounts for more than 30% of the world's total trade volume and population. For Japan, for the first time, it signed an economic cooperation agreement with China and South Korea, and trade covered more than half of Japan's territory. Before
, agreements were signed separately between countries, which were jointly signed by 15 countries. Based on common rules of origin and customs procedures, all export places in the region can use the special tariffs in the agreement.
In addition, from the ease of use of the RCEP rule of origin, the cost and burden of issuing certificate of origin , and the cumulative regulations, it is more conducive to the construction of supply chains in various countries than the existing economic cooperation agreements. At the same time, RCEP has also made regulations on investment, intellectual property rights, and e-commerce, which is relatively comprehensive.
In Japan, the industry has great expectations for "expanding exports in various fields of manufacturing with parts and materials as the center" and "helping the internal and external environment to promote a broader export market."
According to the Japanese government's calculations, RCEP will increase Japan's GDP by 2.7%, which will increase job opportunities of 570,000 people. Moreover, the "Cumulative System of Rules of Origin" in RCEP may also amplify the effect of tariff reduction and exemption.
The free trade agreement between the two countries (FTA) is only for the exemption of tariffs, and only products produced by the other country are "substantive" products. However, in RCEP, all parts produced in 15 countries that are franchised are considered to be manufactured by their own countries even if imported. To quote the experts, it is: "It is beneficial to automobile and electronic equipment manufacturers with supply chains in Asia." I am also looking forward to it myself.
Wang Xi: There have been some new changes recently, and some Japanese companies have withdrawn from China, and this is often discussed on the Chinese Internet.From your perspective, has there been any changes in the Japanese industry's idea of laying out China?
Okamatsuki : Thank you for asking this question! In Japan, due to the impact of the new crown epidemic in the past two years, a lot of reviews have been made on supply chain security issues and more and more in-depth discussions have been conducted. According to our survey, in the world semiconductor market, China accounts for 37%, ranking first, and the United States is 24%, ranking second. China is actively promoting the localization of semiconductor , and the demand in the semiconductor market will increase by 1.5 times in the next five years.
Japan's main advantages in semiconductors are manufacturing equipment and materials. Although Japan has discussions on industrial chain security and has different opinions, I think it will not simply and roughly cut off the supply and demand relationship with China. In this regard, the two sides still have a lot of room for cooperation to create a win-win situation. In fact, Chinese and Japanese companies are also carrying out diverse cooperation.
At the same time, in the field of automotive and electronic manufacturing, partial interruptions in the supply chain around semiconductor supply have caused enterprises to face problems such as production cessation. Many unexpected things have happened and have a considerable impact to this day. This also indirectly proves the penetration of the horizontal division of labor model globally.
In this regard, Japanese companies need to capture the unchanging factors in responding to the epidemic and changes in the international situation to build a long-term vision and guide the implementation of business strategy and supply chain countermeasures.
Most knowledgeable people believe that the turbulent international situation represented by the Russian-Ukrainian war and the symbiosis between human beings and the epidemic will become long-term. If the risk is that you cannot see where the export is, then a long-term strategy is imperative, and various companies need to consider the strategy of building strategies from a long-term perspective. Japanese companies need to communicate closely with Chinese companies and continue to work hard to rebuild supply chains in both trade and investment in existing international rules.
The global economy is facing a slowdown in growth, and inflation and extreme exchange rate changes, especially in the depreciation of the yen and the appreciation of the US dollar, mutual cooperation between the government and enterprises is also necessary in the formulation of economic and financial policies. In short, supply chain reconstruction cannot be concluded in a few simple discussions, but requires careful response.
The Japanese economy's dependence on China's economy has increased year by year. According to the survey conducted by our agency in May this year, companies (manufacturing) that really intend to withdraw from China only account for 2% of the survey data, which is very limited, and most companies are very confident in China. The retreat is because it is not suitable for the Chinese market and is a metabolism in the normal overseas business layout of enterprises.
Japanese media: The yen continues to depreciate, which has a huge blow to Japanese companies and people's livelihood.
Wang Xi: On the occasion of the 50th anniversary of the establishment of diplomatic relations between China and Japan, what new issues are faced by China-Japan corporate cooperation?
Okamatsuki : I am very looking forward to 2022. In our organization's 2021 Corporate Awareness Survey, regarding how to view the business risks and opportunities brought by Sino-US relations, although the Japanese companies surveyed believe that US-China relations are complex, they also have high expectations for the US-China in the medium and long term.
According to the survey, China's vote rate is 47% (ranked first by country) and the United States 32.8% (third), and the market's growth, scale and profitability are respectively.
On the other hand, as a matter of concern in career strategy, the first negative matter is Sino-US trade friction, followed by the COVID-19 pandemic, semiconductor inadequacies, etc. From this point of view, what Japanese companies are most concerned about is Sino-US relations.
At the same time, the survey showed that 54% of companies did not discuss business decoupling, and 23% of companies had discussed the decoupling issue and implemented countermeasures. Overall, it was still on the verge of sight. Japanese companies are extremely concerned and reliant on the US-China economy.
For Japanese companies, on the one hand, they need to "preserve" that can cope with international risks, and at the same time, they also need to "energy", that is, to allocate business resources to the field of cooperation in the Chinese market after evaluating the company's strengths. The balance between the two is very important.
Wang Xi: What else do you think need to be done to further improve Sino-Japanese relations?
Okamatsuki : I have the opportunity to communicate with Japanese teenagers and feel that it is necessary to improve their understanding of China, because future Japan-China relations will depend on mutual understanding among this generation of teenagers. Our generation has developed great interest and yearning for China after watching the documentary "Silk Road" by NHK in the early 1980s.
The younger generation is an era of IT, the Internet and social media, and teenagers in Japan and China are more likely to get close to. For example, I have also invited several Chinese college students to board at home. It is a very precious friend and experience for my son and daughter who are in her 20s.
According to the current trend, it is only a matter of time before the tourism market restarts. The opportunities for young Chinese people to visit Japan will increase. We look forward to the soft power of hot springs, Japanese cuisine, and flower appreciation to become the center of exchanges.
Beijing: "Eternal Neighbors - Photography Exhibition Commemorating the 50th Anniversary of the Normalization of Sino-Japanese Diplomatic Relations" was held. Source: Visual China
The Japanese government also believes that in the field of youth exchanges, there is no need to worry about the influence of international relations. For Japan, if we want to consider how to maintain and develop future Japan-China relations, then business activities centered on young Chinese and Japanese people are very important.
From the perspective of enterprises, the content industries such as art, drama, animation, etc. that young people like are more intuitive and easier to promote cooperation between Japanese and Chinese enterprises.
In addition, revitalizing the local economy is one of the topics of the Japanese government. We are looking forward to the expansion of sales of Japanese agricultural products and specialties in China. These are all communications at the soft power level, but the positive impact it brings cannot be underestimated.
Most of the year 2022 has passed, and the epidemic has also experienced two and a half years. The important thing in the second half of this year is to obtain information from various channels and correctly and timely convey the situation in China through online lectures, reports, etc. I am not pessimistic about the future.
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