Ancient Trails, Modern Tales
Many visitors to Japan are familiar with the Tokaido Shinkansen. What they may not know is that the tracks run alongside an ancient route built not for bullet-train carriages but rather palanquins. We take a tour through Kanagawa Prefecture to explore past and present.
Traversing Kanagawa reveals paths from long ago and comforts of today.
To keep feudal lords loyal during the Edo Period, the Tokugawa shoguns forced them to live in the new capital of Edo every other year. And when they returned to their home province, they had to leave their families behind in the capital as hostages.
The back-and-forth journey they had to make was long, something we discover firsthand on a hot and sunny autumn day under the guidance of local Shin Kaneko. As the nationally licensed tour guide leads us along a stone-paved road running through the beautiful forest—beams of sunlight piercing the leafy canopy of towering cedar trees—we find ourselves on a trek made by nobles and commoners alike for hundreds of years.
Many visitors to Japan are familiar with the Tokaido Shinkansen. What they may not know is that the tracks run alongside an ancient route built not for bullet-train carriages but rather palanquins. Thankfully, unlike passengers of old, today’s travelers need not bite on rope to protect their tongues from the rough ride.
Born and raised in Hakone, Kaneko also spent six years in France and five in the United States growing up. Later, he studied business at the University of Southern California and set off on a career as a strategist for Japanese retail giant Aeon Co., Ltd. But the call of home—and nature—grew louder and louder, and he left Tokyo life in 2015 to make his way back to the lakeside haunts of his childhood.
As Kaneko observed English-speaking visitors staring holes through maps as they tried to guide their own way, he decided to create Explore Hakone, a bespoke agency that provides tours limited to one group per day. And by group, I mean a family, a couple, or a solo adventurer. This personal treatment has made Kaneko’s adventures very popular among those seeking to experience authentic Japan. And today, we get to experience it for ourselves.
The development of the Old Tokaido Road, Kaneko explains, is tied to key events in Japanese history, and the preferred paths through the Hakone area have changed over the centuries. Some 1,300 years ago, during the Nara and Heian Periods, people used the longer, flatter Ashigara Mountain Pass to the north, which runs along the border of Kanagawa and Shizuoka Prefectures. But when Mount Fuji erupted in 802, the path was covered in ash and became difficult to traverse. Travelers began opting for the shorter but more mountainous route we are taking today.
I can only imagine how difficult the climb up and down these hills must have been in those days, when the path was paved with thinly cut and dried bamboo. It wasn’t until 1860 that the large stones which now mark the trail were put in place.
As we make our way through the tranquil woods on our seven-hour, 6.5-kilometer hike, Kaneko shares an enormous amount of the trail’s fascinating history.
The section of the 500-kilometer Old Tokaido Road that we’re traversing is known as the Hakone Hachiri, the 32-kilometer stretch between the Odawara and the Mishima post stations. Hakone Sekisho is located at Lake Ashi, one of 53 checkpoints erected by the Tokugawa Shogunate. Due to the very steep climbs—the total elevation change is about 900 meters—travelers during the Edo Period needed regular breaks. There were once nine teahouses on the route offering refreshment. Today, just one remains: Amazake Chaya.
We stop for an energizing cup of amazake, the warm non-alcoholic rice drink from which the rustic rest stop takes its name. Paired with two surprisingly filling pieces of mochi rice cake, the amazake was a welcome respite, as it must have been for those ancient sojourners.
While rejuvenating for the next leg of our journey under the thatched roof of history, we talk to Satoshi Yamamoto, the current owner of the business that has been passed through his family for 13 generations.
For more than 400 years, the doors of Amazake Chaya have been open, every single day. The only time they were closed was for a brief period during the coronavirus pandemic.
“I want to keep the teahouse as it has always been, serving people in a traditional way,” Yamamoto says. “Although we own the teahouse, the atmosphere is created by our customers. We only provide service. The culture and story behind [Amazake Chaya] have been made by travelers for centuries.”
He says he also enjoys meeting travelers from abroad and learning more about other cultures while sharing his own.
“While the world might change, communication between us and the travelers will never change,” Yamamoto adds. “They may have different outfits, they may speak different languages, but the concept of welcoming guests will always remain the same.”
Back on the road with renewed energy, we pass across one of the highest points between Tokyo and Kyoto and begin our descent to Lake Ashi, our final destination.
As we near the Hakone Sekisho checkpoint, we walk under the shade of 400-year-old cedar trees planted by the shogun to shelter travelers from the elements at this key point of their long journey. A nice gesture. But off in the distance is Otamaga Pond, named after a woman who was captured and beheaded for sneaking out of Edo. So, while the shogun could show kindness, he also showed no mercy. You played by his rules. But those rules also brought peace to Japan after nearly two centuries of civil war and upheaval, allowing art and culture to bloom and the society we know today to take shape.
Kijitei Hoeiso
After the long hike along the Old Tokaido Road, my legs are demanding a reprieve. Fortunately, Kijitei Hoeiso ryokan was happy to oblige.
Nestled in the verdant hills of Hakone, the traditional Japanese inn is a delightful escape from the stresses of modern life. Like Hakone Hachiri, Hoeiso transports you to a simpler time when nature was an integral part of life.
We are welcomed by the inn’s owner, Kenichiro Hara, who shares a bit of the property’s history as we gaze out windows that dissolve against the lush backdrop of the mountainside. In the distance, we see the open-air hot springs we’ll visit later tonight.
And as a tease of the delectable flavors to come, we are offered yumochi, a traditional Japanese sweet made of rice flour. During my 27 years in Japan, I’ve enjoyed many such sweets, but this is truly a standout. (I even went out of my way to visit the shop near Hakone Yumoto Station the next day and buy more as gifts.)
After the exertion of the day’s hike, I’m certainly feeling peckish, and a highlight of my stay is the cuisine. Hoeiso is renowned for its menu that features pheasant—a game bird often associated with the British countryside that is actually native to Asia—and the chef’s creativity does not disappoint.
Of particular note is how Hoeiso can accommodate various dietary needs and preferences. While the pheasant menu is very popular, vegetarian options are readily available—something not easy to find in Japan.
I opted mostly the standard course, but, because I do not eat most seafood, Hoeiso prepared a course that was perfect for my palette. This is often a sticking point for me in Japan, but is no problem here.
Steamed pheasant egg custard with ginger and tri-colored dango dumplings lead the way ahead of pheasant round with salt from Sado Island, sashimi of fresh pheasant breast with ponzu, and pheasant and shiso porridge. Just highlights of an overflowing kaiseki course dinner bursting with color and flavor.
As dusk gives way to the darkness of night, I grab my towel and make my way to the private outdoor onsen situated alongside a mountain stream. I cannot adequately express how rejuvenating it is to sit alone in the steaming water, the sound of the trickling stream dancing in the background as I look up at the twinkling stars in the pitch-black sky. I’ve rarely felt so connected to the universe as in this moment. It’s as if the energy of distant worlds is flowing around me.
Retiring to my spacious room, I gaze out the windows at the night sky that is normally obscured by city light and recall those childhood evenings of stargazing in my grandmother’s countryside front yard.
Carefully prepared amenities make for a restful night.
The next morning, Hara and several Hoeiso staff see me off as I board the bus to Hakone Yumoto Station. An impeccable ending to an absolutely relaxing stay.
Kamakura Gardens
From Hakone, we make our way around Sagami Bay to Kamakura, seat of the first Kamakura shogun, Minamoto Yoritomo, more than 400 years before the Tokugawa shogunate developed the Old Tokaido Road. But we’re not here to see the usual landmarks such as the Great Buddha. Instead, our journey today takes us around the historic city to explore its rich heritage through gardens.
We meet our guide, Saori Imoto, just outside Kita-Kamakura Station. Imoto is a garden designer who studied in Japan before moving to the United Kingdom. The Kamakura local joined her husband there when he was transferred for work and found the perfect opportunity to build on her love of horticulture. Studying in London, she became an expert in English garden design and has won multiple awards for her work. Since returning to Japan, in addition to crafting landscapes for clients, she has been sharing the beauty and history of Kamakura with visitors through private guided tours.
Central to our adventure are the area’s Zen temples, home to many of Kamakura’s most beautiful gardens. And our first stop is Engaku-ji. Founded in 1282, it is one of Japan’s most important temples and the second of what are known as Kamakura’s Five Mountains or Gozan.
“The reason I choose this temple,” she explains, “is that it has a beautiful Japanese garden and is surrounded by mountains, so we can see a lot of natural scenery as well.”
As we approach the Butsuden main hall, small children from the nearby kindergarten are practicing in the courtyard for their upcoming undokai, or sports day. Surrounded by a circle of seven juniper trees, they run, jump, and laugh as popular kids’ music plays on portable speakers. It’s a striking juxtaposition of ancient and modern culture and traditions.
The excitement of the children also contrasts with the reason we find evergreens here.
“Zen temples are very strict, and the monks need to concentrate on meditation and train very hard every day,” Imoto explains. “If there are a lot of deciduous trees, like cherry trees or Japanese maples, the monks can enjoy the seasonal transformation. They’re not allowed to do that, so Zen temples prefer planting evergreen trees, which create a calm and unchanging atmosphere, and show longevity.”
And the reason for seven? “Odd numbers are believed to bring good fortune,” Imoto says. “When we plant symbolic trees, we never use even numbers; we use odd numbers, because they cannot be divided.”
After touring the temple’s halls, we come upon a tranquil garden that reflects the landscape of Japan. A small pond at the center represents the sea, undulations conjure mountains, and gravel paints the coast.
To Western eyes, the lack of color may seem unusual. But, Imoto explains, there’s a reason for the absence of flowers. “In Japanese gardens, we try to replicate the natural scenery of Japan.” That means mountains, not fields—some 70 percent of Japan is mountainous. “Mountains are covered with trees, so we use a lot of trees instead of flowers,” she adds. “This creates a calm atmosphere, highlighting the simple beauty typical of Japanese gardens.”
In need of a rest, we stop at Butsunichian, an open-air café on the temple grounds that serves green tea as well as other light drinks. The tea is refreshing—I opt for hot matcha despite the unseasonably warm day—and am soon ready for the hike to our next destination.
As we leave the temple grounds and walk along backstreets, the lack of tourists is noticeable. While Kamakura teems with visitors, we’re enjoying a quiet tour using routes only the locals know. And we’re learning a great deal about the area along the way as Imoto shares details about the hidden spots we pass.
After a long walk, we arrive at Eisho-ji, Kamakura’s only nunnery, founded by a wife of Tokugawa Ieyasu in 1636.
The grounds are covered by higanbana, or red spider lily. This striking flower, Imoto explains, is a symbol of Ohigan, a Buddhist period that falls around the spring and autumnal equinoxes. Higanbana mark the September observance. During this time, whose name means “other shore,” Higan, the world of enlightenment, and Shigan, our own world of greed and earthly desires, are believed to come closest to one another. This makes it the ideal time to remember those who have passed and to focus on spiritual awakening.
To end our exploration of Kamakura, we visit a cemetery at nearby Jufuku-ji Temple where Hojo Masako, the wife of the first Kamakura shogun Minamoto Yoritomo, is said to be buried. Masako was key to Yoritomo’s success and the power of the Kamakura Shogunate. Following his death in 1199, she became a nun but continued to yield great influence over the government until she passed away in 1225.
As we search for her final resting spot, we cross paths with a group of students who have dropped by the graveyard after school. Given Masako’s place in history, Imoto notes, they study about her in class and are curious to see the tomb firsthand. Like us, they use smartphones and GPS to locate the alcove tucked away in the back of the grounds.
As has happened many times during our two days in Kanagawa, past and present intersect in ways that highlight just how far back the history and culture of Japan stretch. There’s also something new to learn and explore.
Learn more and plan your visit …
Hakone Reset
✉️ info@explore-hakone.com
Kijitei Hoeiso
✉️ kiji@hoeiso.jp
Kamakura’s Gardens
✉️ info@mitate.kyoto
Cities on the Hills
While Tokyo has established itself as one of the world’s leading urban centers, it can still improve its cultural magnetism, livability, and attractiveness for overseas businesses. Helping the city rise in the world’s esteem by gradually transforming Tokyo is at the heart of Mori Building’s mission.
Mori Building’s signature complexes connect communities
Azabudai Hills
In our globalized society, it is only natural to compare cities to one another—assessing their relative strengths and weaknesses to help us determine exactly where they stand in the world.
And while Tokyo has established itself as one of the world’s leading urban centers, it can still improve its cultural magnetism, livability, and attractiveness for overseas businesses.
Helping the city rise in the world’s esteem by gradually transforming Tokyo is at the heart of Mori Building’s mission. And central to this goal is the development of its Hills projects, starting with ARK Hills in 1986. This was followed by Roppongi Hills in 2003; Toranomon Hills, with its four distinctive towers and new metro station that were in development from 2014 to 2023; and finally, Azabudai Hills, which just opened in November.
The Hills are the brainchild of late Chairperson Minoru Mori, who espoused the concept of “vertical garden cities,” which are based on the ideas of the famed architect Le Corbusier and infused with advanced technology and modern perspectives. The complexes are built tall, on single large floor plates that have been created out of small plots of land, which Mori aggregates by negotiating with individual landowners over decades.
As well as being architecturally impressive, these complexes are united by common themes. They are green, they are locations that improve the safety of their surrounding neighborhoods, and they offer a stimulating cultural atmosphere.
Azabudai Hills Food Hall
A Green Base
When visiting the Hills, you are not only struck by the towering skyscrapers that are the complexes’ hubs, but by the greenery that can be found at their ground levels.
As Mariko Murata from Mori Building’s Environmental Promotion Unit explains, nowhere is this more apparent than at Azabudai Hills. “Based on the design and concept by Heatherwick Studio, who designed the landscape of the low-rise area of Azabudai Hills, about 320 plant species have been selected that express each season. For example, the Central Square is planned around deciduous trees from the native vegetation of the area, so that visitors can feel the changes of the four seasons.”
She points out that by building high on a large scale, the Hills projects are not only able to support beautiful green spaces but also be more environmentally sound. “With this method, we can increase green coverage by up to 30 percent and energy efficiency by up to 40 percent. In addition, we can significantly improve environmental performance, as the buildings have a much longer life and the use of energy and resources is a great deal more efficient.”
Azabudai Hills orchard
Safe Havens
The Hills also stand out for their safety. As well as featuring structures that can easily withstand natural disasters such as earthquakes, they are central locations where residents can go in times of need. As Takashi Hosoda, senior manager at Mori Building’s Disaster Emergency Office points out, “Mori Building has been engaged in redevelopment projects in its hometown of Minato Ward under the slogan, ‘cities to escape to, rather than flee from.’” Roppongi Hills can accommodate 5,000 people, Toranomon Hills 5,200 people and Azabudai Hills 3,600 people who may be unable to return home in the case of an emergency.
The company has taken the lessons of the past—such as the Great Hanshin-Awaji Earthquake of 1995 and the Great East Japan Earthquake of 2011—to heart, recognizing the necessity for secure systems and infrastructures. Through cooperation between the public and private sectors, Mori Building has strengthened both the hardware and software systems of the complexes to ensure the safety of tenants, residents, visitors, neighbors, and the employees who use the buildings and facilities it manages and operates.
Hosoda adds that the complexes will allow the quantity and quality of disaster preparedness in Minato Ward to improve, helping “the urban structure to be transformed to one in which ‘homes, offices and the town [Hills] where you are now are the safest places to be.’”
Toranomon Hills dampers
Grand Designs
As well as creating areas around Minato Ward that are both green and secure, Mori Building aims to strengthen their cultural capital. Yoshinao Matsushima, the PR and Promotion Group senior manager in the Cultural Affairs Department, explains that with Roppongi Hills, which is home to the Mori Art Museum, the company was inspired to address the fact that Tokyo needed a cultural center to rival locations such as New York’s Lincoln Center, London’s Covent Garden, and Paris’ Centre Georges Pompidou.
To establish locations that are culturally rich, the Hills complexes not only house galleries with exhibits by the world’s leading artists, but pieces of public art that are meant to create spaces that enrich people’s everyday aesthetic lives, Matsushima points out. “The Hills feature artworks that visitors to the city can touch and enjoy. There are many works by internationally acclaimed artists, so visitors can enjoy high-quality, genuine art experiences at any time.”
United by the aim of drawing people in with green oases and stunning art, while also creating safe refuges, Mori Building has its eyes not just on the immediate future, but generations ahead. As Murata reveals: “In this era of fierce intercity competition, where people, goods, capital, and knowledge gather in attractive cities across borders, a city’s potential and possibilities have a great impact on the economy as well as the future of urban living. In this context, Mori Building has created the grand design for Tokyo with a long-term perspective of 50 to 100 years and is striving to achieve it.”
Azabudai Arena at dusk
Cracking the Code
As digital transformation touches every aspect of how we work and communicate, businesses face ever more complex challenges. The evolution of cybersecurity means that companies must rethink how they hire for this critical task. Robert Half shares how to secure the best cybersecurity talent.
Recruiter Robert Half shares how to find the best cybersecurity talent.
From left: Robert Half cybersecurity team members Fabrizio Fumagalli, Steven Li, Kani Taeng, and Naoto Hamada
As digital transformation (DX) touches every aspect of how we work and communicate, businesses face ever more complex challenges when it comes to protecting data—whether it is their own or that of customers. The evolution of cybersecurity means that companies must rethink how they hire for this critical task.
Steven Li, senior division director for cybersecurity at recruitment company Robert Half, told The ACCJ Journal that they see a lot of companies going through digital or IT transformations to shared service models, including for security.
“One of the challenges with security is that it’s all about data, and it’s all about being able to see your entire ecosystem or environment using a single source of truth or a single tool,” he said. “And a problem you may face is how to bring different business units that you’ve acquired onto a common platform for security operations and vulnerability management, so that when someone asks, ‘Are we impacted by this incident?’ you can answer with a degree of confidence.”
Robert Half advises clients on how to do just that and helps them find the right people to lead that transformation.
Expertise Matters
From a people perspective, previously siloed teams are being consolidated on a group level to create a centralized point of contact for cybersecurity that then provides support to each business unit, Li explained. Instead of outsourcing technical tasks to consultants, companies are now looking to hire specialists for their internal teams. But with much of this talent coming from outside Japan, domestic salaries are an obstacle.
“Employees here in Japan are typically rewarded based on tenure and age instead of merit and skill,” he noted. “To get around this, some companies have started to offer contracting solutions. They’ll say, let’s do a fixed-term contract. And with this fixed-term contract, we can step outside the bounds of our salary structure and give the specialist what the [global] market is paying, and a little bit more.”
This is important as there is an estimated shortfall of 190,000 cybersecurity professionals in Japan.
“Our clients are sharing that they need people who are application security engineers and can dynamically test the code.”
“Japanese companies are not used to hiring mid-career security professionals. They are used to hiring graduates, so to bring in someone mid-career, they don’t know how to do it, where to find them,” Li explained.
“Good cybersecurity engineers don’t typically fit the traditional model of an IT person. They may not have finished university, but they are adept at problem-solving and seeing patterns that other people might miss. We’ve placed people like this, and our clients have been absolutely happy with them,” he added.
Recruiting Manager for Cybersecurity Naoto Hamada shared an example of how Robert Half successfully placed a candidate who made a big difference for their client. But to do so, they had to overcome a challenge common in Japan: hesitation to change jobs.
“It was for a key project, and closing the role was a high priority. However, it’s challenging to find this talent in Japan,” Hamada explained. “We were able to find a match, and he received a competitive offer. But just one day before the deadline, on a weekend, he messaged me and said, ‘I can’t take this.’”
The problem wasn’t the offer but that he felt sympathetic towards his current manager should he leave.
“After receiving the message, he asked me to come meet at his station in person. I outlined the benefits of joining this international company and how it would provide him the career growth opportunities in line with his goals,” Hamada explained. “In the end, the key element was that we helped him visualize his priorities, then compare them to his current company. Based on this exchange, he decided to sign the offer and is now a key member in the newly created incident response team at his new company.”
Working hands-on in this way is at the core of Robert Half’s approach to recruitment. An important part of that are cyber risk meetups, which they host to bring together security professionals to share information and experiences which can help bridge the gap in cyber skills. A recent senior leaders’ meetup at Deloitte focused on ransomware resilience, and a public security meetup at Microsoft focused on software supply chain security.
“If we all share best ideas, best practices, and experiences, and implement those, perhaps we can improve cybersecurity maturity in Japan,” Li said.
Changing Regulations
Another thing to consider is the impact of changing regulations. Fabrizio Fumagalli, Robert Half’s recruiting associate director for cybersecurity, pointed out changes to ISO 27001, an international standard for information security management systems.
“This was updated in 2022, and companies have three years to comply,” Fumagalli said. “There are a few notable requirements on code security and the code supply chain. Companies need to be extremely careful about what’s in their code and conduct appropriate audits to assess where vulnerabilities may be.”
On average, about 80 percent of the code in a typical application is open source, Fumagalli noted, so it can be difficult to know what vulnerabilities may be hiding there. As a result, companies will need people in security who are proficient in software development.
“Instead of relying on documents from an external vendor, companies need a specialist who can check the code to ensure it is secure. Teaching security is easier than teaching the development side, so that is where companies’ priorities should be,” he added.
Specific to Japan, he said, is the need for mid-career cybersecurity talent. “You cannot randomly reassign, or do rotations, as most Japanese companies do. Due to the specific set of skills needed for the role, there is an urgent need for individuals who are experts in cybersecurity.”
Li added: “Our clients are sharing that they need people who are application security engineers and can dynamically test the code, play around with it, see if they can break it. Or do static analysis by reading the code itself and figuring out where the logic problems are. These skills are in extremely high demand.”
Partner for Success and Security
In closing, Li said that Robert Half is working to change the perception of recruitment in Japan and to help clients look beyond the numbers and the next quarter. If you are reassessing your cybersecurity, Li, Fumagalli, Hamada, Taeng, and the Robert Half team are ready to expand upon this approach and partner with you to build the best teams for today and the future.
Register now to learn, connect, and get inspired by Robert Half Japan networking events: roberthalf.jp
2023 Tax Reform Proposals
On December 16, 2022, the Government of Japan released its 2023 tax reform proposals. The amendments contain changes to the rules related to gifts and inheritance tax. The proposals are usually promulgated into law by the end of March and enter into force on April 1. Here is an overview of what to expect.
How changes to gift tax rules and audits may impact you
On December 16, 2022, the Government of Japan released its 2023 tax reform proposals. The amendments contain changes to the rules related to gifts and inheritance tax. The proposals have been promulgated into law and entered into force on April 1. Here is an overview of the changes.
Seven Year Lookback for Gifts
Currently, gifts bestowed within three years of the giver’s death are added back to the estate of the deceased for Japan inheritance tax (IHT) purposes. The value of the assets is reduced by any gift tax paid at the time the gift was received, and this amount is then subject to IHT along with the other assets of the deceased.
To offset this, one aspect of long-term estate planning is to make small annual gifts which are taxed at gift-tax rates lower than the effective IHT rate that would be levied if the gifts had remained part of the estate.
The reforms increased the lookback period to seven years for gifts made on or after January 1, 2024. This brings Japan in line with countries such as the United Kingdom.
Unlike the UK, however, there is no gradual reduction in the value of the gift over the seven-year period. One hundred percent of the gift’s value is added back to the taxable estate, regardless of whether it was made seven years or one day prior to death. A ¥1 million deduction is allowed for gifts made between three and seven years prior to someone’s passing.
The chart below shows this in action:
This change has a significant impact on lifetime estate planning, as gifts made on or after January 1, 2024, will be subject to a seven-year lookback for inheritance tax purposes.
For expats, discussion about Japan IHT planning with overseas parents can be difficult—especially if being subject to the Japanese rules would impact overseas planning. However, these proposed changes will accelerate the need for gift planning during 2023.
Valuation Methods for High-Rise Apartments
Although there are no specific amendments, another issue that needs to be considered in the near future is the government’s discussion of amending the rules surrounding the IHT valuation of apartments in high-rises.
Currently, there can be a large disparity between the fair market value of an apartment and its tax basis for IHT purposes. This is due to the use of various tax valuations that reduce the IHT value. For apartments in certain parts of Tokyo, the IHT value can be significantly lower than the fair market value. This disparity can be used to reduce the value of an estate considerably for IHT purposes. The government has indicated that it will look to close this avenue for tax planning in the future.
Tax Audit Statistics
The government also released its tax audit statistics in December, covering audits conducted between July 2021 and June 2022. Direct comparisons to previous years are unreliable due to the impact of the Covid-19 pandemic on the tax authority’s ability to conduct audits. However, the number of audits involving overseas assets increased by 20 percent over the previous year and is approaching the level seen prior to the pandemic. About two-thirds of the cases involved undisclosed assets in North America or Asia.
Additionally, the number of simple inquiries where the tax office contacts a taxpayer by post or phone increased by eight percent over the previous year and is 40 percent higher than pre-pandemic levels. This indicates that the tax office has shifted to less formal inquiries as a means of identifying taxpayers who require a full audit.
Summary
The increase in the lookback period for gifts accelerates the need for planning before the end of the year. This will be necessary to ensure that gifts fall out of the scope of IHT sooner. Current planning utilizing high-rise apartments may also need to be revisited in light of the anticipated changes.
As always, with any informal contact from the tax office, it is wise to consult with your tax advisor before submitting a response.
For more information, please contact Grant Thornton Japan at info@jp.gt.com or visit www.grantthornton.jp/en
Fantastical Fukui
There are many reasons to visit Fukui, a small tadpole-shaped prefecture facing the Sea of Japan. It’s home to a bevy of traditional crafts, magnificent temples, rugged landscapes, and some of Japan’s best freshly caught winter crab and sweet shrimp. All this begs the question: Why isn’t Fukui more well-known? We take you on a visit.
Nestled near the Sea of Japan, Fukui Prefecture is rich in cultural experiences
Presented in partnership with Fukui Prefecture
Photos by Florentyna Leow
An artisan at work in the Takefu Knife Village
There are many reasons to visit Fukui, a small tadpole-shaped prefecture facing the Sea of Japan. It’s home to a bevy of traditional crafts, including washi papermaking and knife forging, a world-class dinosaur museum (complete with life-sized raptor animatronics), magnificent temples, rugged landscapes, and some of Japan’s best freshly caught winter crab and sweet shrimp. Situated between tourist favorites Kanazawa and Kyoto, it’s an obvious pitstop when visiting both cities.
All this begs the question: Why isn’t Fukui more well-known?
Call it a serious case of middle-child syndrome. Although Fukui has all the ingredients for a fun weekend getaway, it’s often overlooked in favor of its glamorous neighbors. But this makes it ideal if you’re looking for travel minus the crowds. When planned right, a visit to this ferociously underrated prefecture offers an eye-opening look into Japanese craft, cuisine, and culture.
Paper Matters
Paper rarely merits a second glance in our daily lives. Money, flyers, utility bills—paper is just there in the background. But a sheet of washi is a different story. From uchiwa (summer fans) to wagashi wrapping, handmade paper has a warmth and elegance unmatched by most machine-made papers.
If Fukui has a signature craft, it’s Echizen washi paper. There are many varieties, all beautifully textured and supple, delicate yet durable. With its 1,500-year history of washi production, Echizen City is one of Japan’s top washi producers in terms of quality, quantity, and variety—more than earning its nickname "washi no sato," or the home of Japanese paper.
Faced with a decline in demand for washi—in large part due to fewer people using partitions and screen doors—papermakers have had to get creative with new paper products for contemporary consumers. These days, you can find washi earrings, bags, and even socks and jackets. The lampshades by Osada Washi, a family-run washi company in the Imadate district of Echizen City, are especially modern and striking. The intricate floral patterns are all drawn freehand with paper pulp and wrapped around acrylic stands as tall as totem poles.
But to appreciate washi, there’s no substitute for making a sheet of paper by yourself. I visited Ryozo Paper Mill, another family-run business in the Imadate district, to experience the production process.
It was early winter, and the snow was starting to pile up. Winter is the best season for papermaking, I was told, because the raw material in the pulp doesn’t spoil as quickly in the cold. I quickly realized two things: handling paper pulp feels like plunging your hands into a vat of ice-cold egg white; and papermaking is bloody hard work. Made the traditional way, tesuki washi (handmade paper) involves quickly dipping a large wooden frame fitted with a bamboo screen into a tub of paper pulp, then swishing liquid pulp back and forth until the screen is evenly coated. The frame is heavy enough that I almost dropped it the first time.
With no small amount of assistance from Kyoko Yanase, one of Ryozo Paper Mill’s main craftspeople, I finally managed to get even coverage on the screen. She set the frame on the ground and placed a large spiral-patterned metal mold on top—like a stencil, but in reverse. Following instructions, I flicked a showerhead up and down while moving it across and above, the spray of water droplets creating thousands of tiny holes in the paper. When she lifted the mold, before us lay a large sheet of perforated washi embossed with spirals. Dried, the paper resembled embroidered lace.
I had made a sheet of rakusui-shi, or “water-dropping paper,” an uncommon variety of washi made by very few craftspeople in Japan. It was gorgeous. I couldn’t believe how much fun I’d had making it. Suddenly, every sheet of washi I’d seen in Fukui made sense, each the result of skill and technique honed over a lifetime.
Sharp as a Knife
If paper is best made in the cold, the fiery process of knife-making feels like its thermal opposite. Working near the charcoal-powered forge, with its constant heat, can make your time in a knife workshop warm, toasty, and downright sweaty—from the physical labor involved in making knives, that is.
Once known as Takefu, Echizen’s history of knife-making stretches back 700 years, beginning with sickles and fighting swords to bonsai tools and chef’s knives. Today, Japanese chef’s knives are loved worldwide for their quality, sharpness, and durability. One small facility in particular attracts a steady stream of knife enthusiasts from all over the world looking to add to their collection and learn more about the traditions and techniques behind Echizen’s hand-forged knives.
Started as a cooperative between a dozen local independent knife manufacturers, Takefu Knife Village is something of a curiosity. The facility was built in 1993 but, looking at these incongruously sleek buildings in the middle of rural Fukui, you’d be forgiven for thinking it new and under-promoted. The 20-minute drive there from JR Takefu Station is poorly signposted for what’s meant to attract tourists. It’s the kind of place where “if you know, you know.”
At Takefu Knife Village, you can shop for knives, but also learn about local knife-making history, take a workshop, and watch the artisans at work from an observation deck. Because it’s a cooperative by name and in practice, the craftspeople from all the different knife companies share equipment and make their products in the same space. There’s no secretive squirrelling-away of technique and know-how; it’s an unusually democratic operation compared to many other industries.
Speaking of workshops: If you have six hours, you can learn the basics of making a knife from one of the craftspeople in the dedicated backyard building, experiencing almost every step of the process from hammering to forging to attaching the handle. If you don’t, an hour or two can give you the skills required to sharpen chef’s knives at home like a pro.
I didn’t have six hours, or even an hour, so I compromised by trying out a treadle hammer to flatten vaguely blade-shaped bits of steel. Most knifemakers work on a single blade at a time. Here, they stack two blades together and hammer them simultaneously, in what is a technique supposedly unique to the Echizen region. I appreciated the efficiency of getting to screw up two blades at the same time.
Using a treadle hammer, if you have never tried it, is an awesome and challenging feat of hand-foot-eye coordination plus some physical strength (neither of which I possess). You heat two steel molds in fire until they’re bright red, remove them with tongs, and set them under the hammer. With your right foot, you gently press a pedal to activate the murderous pulverizing hammer while simultaneously moving the blades counterclockwise, making sure the hammer pounds the surface evenly while the steel is still hot and malleable. Lose your grip and your blades will come out weird. Move too slowly and the cooled steel will simply break. The phrase “strike while the iron is hot” suddenly made complete sense.
It was one of the coolest things I’d ever done in my life. I would also never have visited this place without a car. As with most places in rural Japan, the lack of public transportation infrastructure is probably Fukui’s largest barrier to becoming a more tourist-friendly destination. Officially named “Geisha de GO,” the “one-coin taxi” service offered by Echizen City is an ingenious stopgap solution. Buy taxi tickets (each worth ¥500) at the tourist information center near JR Takefu Station, hop into a taxi (or ring one up), point at one place on a list of major tourist destinations in the area (including the paper mills and Takefu Knife Village), and they’ll drive you there.
Disappearing Art
Fortunately, not every place of interest requires a taxi ride, especially if you only have time for a quick wander around one stop in the prefecture. For example, Oyanagi Tansu, the fourth-generation maker of tansu (Japanese storage chests or cabinets), is a mere 15-minute walk from JR Takefu Station.
A workshop tour here offers incredible insight into the disappearing art of tansu-making, which requires a mastery of three separate crafts: sashimono (wood joinery), lacquering, and metalwork. A dwindling number of craftspeople specializing in each of these tasks means that Oyanagi now handles the entire process from start to finish. Completing a single tansu can take anywhere from six months to a year. I’ve never been so dazzled by cabinets, and have to hastily leave before I shell out several hundred thousand yen for a karakuri tansu full of hidden trick mechanisms and secret drawers—perfect for hiding my stack of diaries. If home ownership ever becomes a reality for me, this is where I’d order my storage chests.
Even nearer Takefu Station—seven minutes on foot—is Urushiya, a buckwheat noodle restaurant set in a traditional wooden house. Its claim to fame is having once served Echizen oroshi soba (soba with grated radish) to the Showa emperor. We ate our way through plates of pressed sushi, tempura, and an array of bite-sized appetizers. The noodles alone were worth the wait.
If you’re alighting at JR Fukui Station, you could take a 10-minute bus ride to Komego Miso for a fun afternoon diversion. Take a guided tour of the factory (they’ve been making miso for 190 years, which the staff mentioned almost as an afterthought), join a flavored miso ball-making workshop (which you then use to make instant miso soup in a mug), buy miso by weight, or have lunch at second-floor cafe misola, where everything from beer and ice cream to soup is spiked with miso.
Maybe you’re only in Fukui for a lunchtime train transfer. In that case, drop by Fukufuku Chaya in the Tourism Promotion Building next to Fukui Station for the Echizen Seikogani-zukushi, a winter-only snow crab-themed feast. A crab-stravaganza, if you will. Wedged between two souvenir shops, it’s hardly the most atmospheric restaurant, but who cares when lunch consists of four crab dishes, several sides, and soba to finish?
Morning Mantra
However, if I could only choose one experience worth the extra trek out of central Fukui, it would be joining the morning prayers at Eiheiji, whose name translates to “Temple of Eternal Peace.”
Ensconced on a cedar-covered mountain slope 15 kilometers east of Fukui City, this 13th-century Zen Buddhist temple complex is one of the largest, most-visited temples in Japan. (Fun fact: Steve Jobs almost took tonsure here.) It’s not far, but with more forest than buildings in its vicinity, this serene monastery is remote enough to feel a world away.
In 2019, Eiheiji and tourism corporation Fujita Kanko teamed up to open Hakujukan, an 18-room inn located in front of the monastery that embodies traditional Japanese aesthetics. The facility caters largely to foreign tourists interested in experiencing the world of Zen without forgoing material comforts like multi-course dinners, alcohol, and hot spring baths. This may induce mild cognitive dissonance, but Eiheiji has always been a temple and popular destination for tourists. It’s never pretended otherwise.
At 5:30 a.m., we gathered in the lobby and followed our guide up the slope to the temple, trudging through ankle-deep snow in the dark. It took us at least 40 minutes to get through the doors, remove our shoes, listen to an opening lecture by one of the senior monks, and climb a succession of staircases through winding corridors before we reached the main hall—and we’d still seen but a fraction of the 70-building complex.
At half past six, dozens of barefoot monks clad in black robes filed into the hall, sat in orderly rows, and began the morning prayers. I was raised in a culturally Buddhist environment, so listening to monks chant sutras wasn’t new, but listening to about 60 of them do it in perfect unison was. A monk at the front set the pace and rhythm with a drum. Another struck prayer bells at regular intervals, each bong echoing in the hall. I had no idea what any of the words meant. My pulse quickened, I felt compelled to sit straighter. Their voices seemed to coalesce into a single booming entity, expanding to fill the air. A tidal wave of sound enveloped us, and it felt like I was drifting on a vast, inky sea. It shifts your perspective, when you can see yourself taking part in a centuries-old practice of people coming together to pray. It felt good to feel so small.
Was this worth the trip to Fukui? I certainly thought so. Only time will tell if Fukui receives the attention it deserves. In the meantime, I’d pay it a visit before everyone else finds out.
Learn more and plan your visit …
Osada Washi
Ryozo (Japanese only)
Takefu Knife Village (Japanese only)
Oyanagi Tansu (Japanese only)
Urushiya (Japanese only)
Komego Miso
Fukufuku Chaya (Japanese only)
Eiheiji
Hakujukan
Past Meets Future
The glass panel separating the Enoura Observatory’s gallery from Sagami Bay erupts in an orange glow. It’s the summer solstice and the sun rises in perfect alignment with the long, narrow gallery designed by Japanese contemporary artist Hiroshi Sugimoto. The fiery spectacle is just one of the wonders that awaits travelers in Kanagawa Prefecture.
Kanagawa Prefecture offers travelers a gateway to Japanese culture, tradition, and breathtaking nature
Photo © Odawara Art Foundation
The glass panel separating the Enoura Observatory’s gallery from Sagami Bay erupts in an orange glow. It’s the summer solstice and the sun rises in perfect alignment with the long, narrow gallery designed by Japanese contemporary artist Hiroshi Sugimoto. The fiery spectacle, a cornerstone of this extraordinary project which intertwines art and nature, illuminates Sugimoto’s famous black-and-white seascapes photography series, which lines the wall and leads you to the edge of the water.
Visiting this gallery is an incredible start to our tour of four stops in Kanagawa Prefecture that take us through time, capturing deep tradition and forward-looking vision. While Tokyo may top the list for travelers exploring Japan, neighboring Kanagawa once played the same role and today is home to some of the nation’s most beautiful scenery and opportunities to come face to face with Japan’s deep history.
This first stop, the expansive facility nestled in the Enoura district of Odawara along the outermost edge of the Hakone Mountains in Kanagawa Prefecture, opened in 2017 and is home to many of Sugimoto’s works. It is managed by the Odawara Art Foundation, which he established in 2009.
As we stand alongside a long wooden table supported by a massive stone, Odawara Art Foundation Director Haruko Hoyle starts our tour by explaining how the observatory has grown. The striking table was designed by Sugimoto using 1,000-year-old cedar saved from Yakushima, a small island south of Kyushu, in Kagoshima Prefecture, whose ancient forest was designated a World Heritage Site in 1993. The stone was once a washbasin at a temple on Mount Koya and has been crafted into a leg for the table. The design reflects the mission of Sugimoto’s New Material Research Laboratory, which the artist set up in 2008 with architect Tomoyuki Sakakida, to preserve traditional methods of craftsmanship as well as traditional materials.
Stones play a major part in the Enoura Observatory concept. Sugimoto, who has made New York City his home since 1974, was in Japan during the pandemic and could not get back to New York for three years, Hoyle explains. “So, he kept buying more stones and developing this site.” The result is inspiring. A variety of stones from around Japan, each with an interesting history and connection to the country’s past, are preserved on 9,500 square meters of a former citrus grove.
Exploring the observatory is a contemplative experience—and that’s by design. “[Sugimoto] didn’t want people to just stay inside, looking at his artwork, so he developed this concept,” Hoyle says. “People can come here, get away from their busy life, and contemplate where they came from, where they are going, and their ideal relationship with nature.”
The architectural alignment that allows the summer solstice spectacle is an example of this intentional reconnection with nature. So is the design of a 70-meter-long tunnel of stone and rusted corten steel which runs underneath the gallery and creates a similar view of the winter solstice. A light well at its center provides a refuge for contemplation. This reflection on how ancient people looked to the sky and built astronomical markers, such as Stonehenge in England, is part of Sugimoto’s philosophy.
“He really wants this to be a future ruin,” Hoyle explains. “Five thousand years from now, all the glass will be shattered, no wooden structure will remain. All that future people might see are the stones and tunnel.”
They may also see the remnants of the hillside amphitheater, where the Odawara Art Foundation presents classical theater and avant-garde stage performances, including traditional Japanese Noh.
The stone steps and seats were meticulously designed by Sugimoto, who traveled to Italy to measure those of an amphitheater there to precisely recreate a millennium-old venue for artistic presentation. The seating looks out on a stage of optical glass that aligns with sunrise on the winter solstice.
Another reflection on Japan’s past, and a reprieve from modern life, can be found in the Uchoten teahouse, the style of which was inspired by that of a national treasure in Kyoto and designed by 16th-century tea master Sen no Rikyu. But Sugimoto gave the small space a local touch.
“As this was an abandoned citrus grove, there was a small storage [shed] which was used for harvesting,” Hoyle explains. “He took the corrugated tin roof off very carefully and placed it on top of the teahouse. Today, when it rains, you hear the ‘ton, ton, ton’ sound of the falling drops, so he named it Uchoten, ‘rain-listen-heaven’.”
Inside is a scroll bearing calligraphy, written by Sugimoto himself.
Like the stone stage, the room is aligned with the equinox. “On that morning,” Hoyle says, “we open the door and take the scroll down. The sun shines through the entrance and the alcove becomes pink.”
It’s yet another example of the precision with which Sugimoto has created a loving and visionary tribute not only to nature and art but to nature as art. It’s well worth a trip to Odawara to traverse the tunnel, stroll through the groves, and sense the pulse of history presented in unexpected ways.
Okada Museum of Art
Photo © Okada Museum of Art
From the coast of Sagami Bay, we wound our way along mountain roads into the depths of Hakone to visit the Okada Museum of Art.
The facility welcomed its first guests in 2013 and is celebrating its 10th anniversary this year. With an exhibition area of 5,000 square meters (54,000 square feet), it is the area’s largest museum.
The first glimpse of art can be seen on approach to the museum entrance. At 30 meters (98 feet) wide by 12 meters (39 feet) high, it is difficult to miss. Kotaro Fukui’s enormous mural entitled Kaze/Toki (Wind/Time) depicts the Wind God and Thunder God, painted on 640 gold-ground panels. These guardian deities of Hakone soar through the air overlooking the popular foot baths in front of the museum. The baths are continuously filled with natural alkaline hot spring water and are free to use for guests or ¥500 for those not viewing the exhibits. Drinks and sweets are available from the accompanying café.
As we made our way around the museum exterior, we came upon trails running up the hillside. The area is particularly beautiful in autumn, when the foliage is ablaze in fiery colors, but also tantalizingly tranquil in winter, when snowfall casts the sloping hill in ethereal white. A mix of wooded areas, trickling streams, delicate waterfalls, and picturesque ponds, the entire path around the garden and can take 10–20 minutes to fully traverse. Admission is currently free and open to the public.
Photos © Okada Museum of Art (except lower right)
But the true delights are inside the five-story museum, where you’ll find an extensive collection of more than 450 treasures from Japan, South Korea, China, and other East Asian countries.
As the doors slide open to the first collection, I’m astounded by the spaciousness of the presentation. Museums in Tokyo can often present challenges to the viewer, who finds themself competing for position in tight spaces just to see works amid crowds. But here, in the dimly lit vastness, there’s no difficulty in getting up close, and the austere dark blue walls provide a framing which vividly brings these incredible works of art to life.
Learning about the art is easy, thanks to the LCD touch screens placed in front of many pieces which offer notes in Japanese, English, Chinese, and Korean.
Each of the first two exhibition floors has a distinct flavor and story to tell as you stroll the timeline of artistic and cultural history.
The first houses ceramics from China’s Han Dynasty (206 BC–AD 220), Tang Dynasty (618–907), and Qing Dynasty (1644–1911), along with those from Korea’s Goryeo (918–1392) and Joseon Dynasties.
The second features Japanese art, primarily screen paintings from the Momoyama (1573–1600) and Edo (1603–1868) Periods. Taikan Yokoyama’s 1926 work Mt. Fuji, a sprawling 94x873 centimeter hanging scroll, is a centerpiece of the floor’s collection and is on display through June 4.
Images © Okada Museum of Art
The third floor is reserved for special exhibitions. For example, at the time of our visit, Jakuchu and Isson • Transcending Time, an exhibition featuring Edo-Period painter Jakuchu Ito and Isson Tanaka, an artist from the Showa Period, was on display. Part 1 of the Okada Museum of Art’s 10th anniversary celebration, the exhibition continues through June 4, and if you visit on your birthday, you and a companion can view it for free. Part 2, featuring Utamaro and Hokusai, will run from June 11 to December 10.
On the fifth floor are pieces of religious art, including sutra manuscripts, paintings, and Buddha statues from Japan’s Heian (794–1185) and Kamakura (1185–1333) Periods. The craftsmanship of these wood-carved figures is astounding.
With such a wealth of art on display, it takes about two hours to view the entire collection.
After browsing the works, return to the garden entrance and Kaikatei to unwind against the backdrop of nature as the soothing splash of a waterfall can be heard across the carp pond. Named after a hotel popular with foreign visitors that stood on the same property in the late 1800s, the renovated Japanese house is a memorable place to enjoy dishes such as horse mackerel tempura udon and dorayaki, a small pancake-like sandwich filled with sweet red bean paste.
A visit to the Okada Museum of Art is not only a delightful way to learn about the history of Japan and the region, but a refreshing escape to nature.
Admission is ¥2,800 for adults and university students and ¥1,800 for elementary through high school ages.
Jochi-ji Houan
An hour from Tokyo, hidden in a forested valley behind Jochi-ji Temple in Kita-Kamakura, is a quaint little tea house that time forgot.
Built in 1934 by journalist Tai Sekiguchi, Houan is home to three tea rooms—one an eight-tatami space that accommodates eight to 10 people and a smaller room of four mats which looks out onto the garden behind the house. Smaller still, a separate tea house based on the famous Ihoan tea hut inside Kyoto’s Kodai-ji Temple offers an intimate ceremony space for two people.
Houan was designed by Bunzo Yamaguchi, one of the leaders of Japan’s modernist architectural movement, and is an example of the sukiya style of Japanese architecture, which dates back to the Momoyama Period (1573–1600). Based on a natural aesthetic and rustic simplicity, sukiya is intended to exist in harmony with the surroundings; and Houan certainly does.
But as Yukiyo Matsuzaki, planner at Kyoto-based travel experience company Mitate, Ltd. and founder of Kamakura Mind explains, “Yamaguchi studied modernist architecture in Germany, so Houan is a fusion of traditional Japanese and modernist styles which creates a unique tea house.”
We explore the house on arrival with Matsuzaki and Southi Yokoyama, a professor of the Omotesenke school of tea ceremony. Yokoyama shares about the connection green tea has to the area, and some of its roles in Japanese history.
“Kamakura had a lot of Zen temples and many people practiced Zen meditation, so they used green tea as a sort of stimulate to keep awake during meditation,” she explains. And on a fiercer note, she adds, green tea was a favorite of samurai warriors before going into battle.
Samurai, we learn, were once buried in the caves along the back side of the garden, which were also used as a training ground and a grave for Zen monks.
We turn our attention to the main space and the tokonoma, the alcove commonly found in Japanese-style rooms, or washitsu. In the space is a kakejiku (hanging scroll) with calligraphy showing Zen words appropriate for the season, and alongside an ikebana flower arrangement. In recognition of the sacred nature of the tearoom, we bow to each and carefully read the inscription.
As we prepare to take part in the tea ceremony, we learn the proper way to wash our hands in the tsukubai (washbasin) outside before entering the tea house.
Hands cleansed, we take our positions, kneeling on the tatami, and Yokoyama explains each step of the ceremony. (Don’t worry, if kneeling for an extended period isn’t your style, Houan can provide chairs.)
Having watched the master prepare the tea, it’s now time to learn the proper way to drink and to show appreciation, as well as to savor the delectable wagashi (Japanese sweet) which accompanies the tea to take away the bitterness. I’ve eaten more wagashi than I can count in my many years in Japan, but this morsel, crafted by local artisan Kuu, is easily one of the most delicious I’ve ever tasted, with a splash of citrus that is eye opening. You can learn to make wagashi from Kuu in another experience offered here by Kamakura Mind. You can even enjoy your creation as part of the tea ceremony.
When the time comes to drink, admiring the beauty of the bowl is a key part of the experience. I take a close look at the playful yet restrained craftsmanship as I gently rotate the cup in my hands. Finally, I sip the tea and gently slice the wagashi in half. Savoring these flavors through the silent steps of this centuries-old tradition is a momentary escape into tranquility.
In addition to tea ceremony, Kamakura Mind also offers workshops for other traditional Japanese arts, hosts corporate training retreats, provides a venue for Zen meditation, and even guides hiking tours along the trail to the Daibutsu, the Great Buddha of Kamakura—a journey that takes about an hour and a half at a leisurely pace.
A mix of historical perspective and cultural immersion, our hour-long visit to Houan made for a particularly peaceful and memorable morning in this beautiful city that served as Japan’s capital for almost 150 years.
Hasedera
Just a short walk from Hase Station on the quaint and historic Enoden train line is Hasedera, an eighth-century Buddhist Temple that is one the oldest and most significant in Kamakura.
Formally the Kaikozan Jishion Hasedera, it is believed to have been founded in 736 after an 11-faced Kannon Boddhisattva statue washed ashore on Nagaiura Beach in Sagaminokuni and was brought to Kamakura.
Hasedera is the fourth of the four temples on the Bando 33 Kannon pilgrimage route, and as we arrive a group of visitors were gathering near the entrance to conclude their own journey.
We’re greeted by one of the temple’s monks who will lead us on a guided tour of the beautiful grounds featuring koi ponds, rock gardens, waterfalls, and a variety of trees and flowers. Famed for its hydrangea in summer, Hasedera is also delicately painted pink in spring, when the cherry blossoms burst forth, and brilliantly picturesque in fall, when the leaves turn. As we tour in late January, plum blossoms are beginning to dot the branches.
As we stroll through this tranquil setting, we come to Bentendo Hall, where we see the eight-armed statue of Benzaiten, the Goddess of Water and Wealth and the only female among the Japanese Seven Gods of Fortune. As we move past her, we enter the darkness of the Bentenkutsu Cave. Inside, Benzaiten and her 16 followers are chiseled out of rock walls.
As our guide explains, legend says that Kobo Daishi, known as Kukai when he was alive, traveled across Japan to spread Buddhism and secluded himself in this very cave. Here, he meditated and attained a state of spiritual communication with Benzaiten, and carved a wooden statue of the goddess with eight arms. Kukai, who lived from 775 to 835, founded the Shingon school of Japanese Buddhism.
Past the stone figures, we duck deeper into the cave. The low ceilings mean we must crouch to navigate the catacomb-like corridors. Partway through, we happen upon a small chamber filled with miniature Buddhas on which visitors have copied sutras as they wish for good fortune.
Emerging from the cave, we make our way up the hill and into Kannondo Hall, which houses the statue of the Kannon Boddhisattva that is said to have washed ashore in 736. Standing an astonishing 9.18 meters (30.1 feet) tall, it is one of the largest wooden Buddhist statues in Japan and is the centerpiece of Hasedera. According to legend, it has been enshrined here since the temple’s founding 1,300 years ago.
As the hall long predates the advent of electric lights, viewing the statue was not always as easy as it is today. Long ago, our guide explains, lanterns were hoisted up alongside the statue so that it was possible to see the Kannon Boddhisattva’s face in the darkness.
A particular treat during this part of our tour was the recitation by our guide of a sutra, “Enmei Jukku Kannon Gyo” or the “Life-Extending Ten-Line Kannon Sutra.” We joined in by following the words provided in both kanji and romaji.
In the Kannon sutra, Kannon appears in 33 different forms to best appeal to the nature of each individual whom they are guiding out of suffering and toward enlightenment. We come face to face with these 33 avatars in the form of exquisitely detailed, life-size wood carved statues as we make our way through the museum which adjoins the chamber where the nine-meter Kannon Boddhisattva resides. Opened in 1980 as one of the first temple museums in Japan, the space presents many ancient artifacts that tell the history of Buddhism and the area surrounding Hasedera.
Upper left photo © Hasedera
We also examine the bonsho (temple bell), made in 1264 and now preserved in a glass case. The third oldest bonsho in Kamakura, it bears the earliest known inscription of the name Hasedera. It was replaced in 1984 with the current bell after an astonishing 720 years of service.
As our tour draws to a close, we make our final stop at the Kaikoan Restaurant where we enjoy green tea and mitarashi dango, a Japanese sweet of three skewered rice dumplings glazed with a sweet and savory sauce. The restaurant even offers vegan options based on the traditional recipes of Buddhist monks.
As we unwind by the window, the panoramic view across Yuigahama Beach and Sagami Bay is enchanting, and it is easy to understand why Kamakura drew so many seeking connection with nature here all those centuries ago.
Learn more and plan your visit …
Enoura Observatory
📞 0465-42-9170
Odawara Art Foundation
✉️ info@odawara-af.com
Okada Museum of Art
📞 0460-87-3931 ✉️ nishidate.hiroshi@okada-museum.com
Hasedera
📞 0467-22-6300 ✉️ soumu@hasedera.jp
Japan to Foster Global Cooperation at the G7
In May 2023, the G7 Summit will be hosted in Hiroshima against the backdrop of a severe global energy crisis and supply chain disruptions that are stoking the fires of inflation, shaking consumer confidence, and threatening the most economically vulnerable in our society. METI will focus on three key policy areas: trade, climate and energy, and digitalization.
METI focuses on three key policy areas: trade, climate and energy, and digitalization
In May 2023, the G7 Summit will be hosted in Hiroshima against the backdrop of a severe global energy crisis and supply chain disruptions that are stoking the fires of inflation, shaking consumer confidence, and threatening the most economically vulnerable in our society.
Climate change, Covid-19, and Russia’s aggression against Ukraine are fueling global concern. In a speech given at the Center for Strategic and International Studies in January, Yasutoshi Nishimura, Japan’s Minister of Economy, Trade, and Industry, expressed his alarm, saying “the global shocks that have occurred, one after the other in the span of only a little more than two years, have truly been a wake-up call.”
All three challenges are likely to be high on the agenda at the G7 Summit and relevant ministerial-level meetings to be held throughout the year. The Ministry of Economy, Trade and Industry (METI) will take the lead at the ministerial meetings, along with relevant ministries, and aims to drive discussion and policy action in three key areas—trade, climate change and energy, and digitalization.
Revitalizing Global Trade and Investment
Trade is a key policy issue, especially given the rise of serious supply chain disruptions due to Russia’s devastating war in Ukraine.
“Russia’s aggression against Ukraine has shaken the international order, and there are concerns about a global economic slowdown,” said Takuya Kimura, principal director of METI’s Multilateral Trade System Department. “At the G7 meetings, we would like to emphasize the importance of upholding the free and fair economic order.”
Topics will include:
- Promotion of trade and investment
- World Trade Organization reform
- How the G7 will deal with unfair trade practices that distort markets
- Proposals for strengthening economic security
Even if these key issues are addressed, the global economy faces insurmountable hurdles without the existence of healthy trade and investment relationships between nations. METI’s work at the upcoming G7 Summit will include laying the foundation for future progress.
Around the world, shortsighted trade practices could lead to unfair trade. Such practices include forced technology transfer, whereby foreign companies operating in a host nation are required to carry out all processes—from design and development to the manufacturing of advanced technology products—in that nation, possibly forcing companies to share their sensitive technologies with the host nation’s companies.
Nishimura said that we must build a world where “countries will come together based on trust and strengthen their cooperation under the banner of free trade, without slipping into protectionism.”
Climate Change and Energy in Focus
Japan is looking to promote green transformation, or GX, which can rewrite the rules of the prevailing socioeconomic system by inducing transformational changes, without shoehorning emission reductions and economic growth into an either-or relationship.
“Green transformation is a major keyword in Japan,” explained Shinichi Kihara, deputy director general for technology and environment at METI. “The idea is that emissions reduction and economic growth are not in a trade-off relationship. Instead, they can coexist.”
GX will not stop at Japan’s borders, and the government will make efforts to approach countries responsible for major emission outputs while also providing appropriate support to developing nations that are in the process of transitioning to a green regime. Ultimately, Japan seeks to promote GX in all sectors, including energy and industry.
At the same time, the energy crisis has put the spotlight on global energy security. Nishimura believes it is necessary to undertake decarbonization in a way that is fully compatible with ensuring a stable supply of energy, and that it will be important to undertake various and practical pathways that fit the needs and expectations of individual nations.
Japan will make the utmost efforts to promote its clean energy transition, including installing the greatest possible amount of renewable energy facilities and using nuclear plants as much as possible.
Minister Yasutoshi Nishimura
Boosting Digitalization
Another major transformation underway is digital transformation, or DX, which has been defined as the creation of new value through innovation made possible by the adoption of digital technology that aims for the creation of a more prosperous society. The role of digitalization as a bulwark against unpredictable events has been highlighted in recent years by global challenges such as the Covid-19 pandemic and Russia’s aggression against Ukraine.
The free flow of data in the face of arbitrary restrictions and ensuring data integrity are essential if the digitalized world is to operate as intended.
In a move that has garnered positive international feedback, Japan proposed a guiding principle, Data Free Flow with Trust (DFFT), which seeks to enable cross-border free flow of data while addressing privacy, data protection, intellectual property rights, and security concerns. The principle was first suggested by then-Prime Minister Shinzo Abe at Davos 2019, and later endorsed at the G20 Osaka Summit in June 2019. Since then, the DFFT has been widely accepted as a primary principle for international digital policy coordination in various international forums.
Reaching a global consensus or convergence on the rules that involve privacy and security will take time. The G7, currently under Japanese presidency, is expected to formulate the priorities in operationalizing the DFFT so that countries can work together despite their varied approaches to data governance. Vigorously moving the DFFT into its operational phase, the Japanese government has announced that it will establish an institutional arrangement to promote interoperability across data regimes, implement the priorities that have been identified by the international forum, and advance solutions for cross-border data transfer through public–private cooperation.
It is also important to redesign governance for a digitalized society. DX technologies, such as artificial intelligence, the Internet of Things, and the metaverse, now have the ability to fundamentally reshape the way companies operate and how individuals relate to society.
It is vital to explore new governance options, including involving multiple stakeholders in discussions on how to flexibly update governance systems in response to changes in the operating environment.
International Cooperation Is the Only Way Forward
At the end of the day, the G7 is not just about the interests of advanced industrialized nations, but about building a way forward together with the entire international community.
“In 2023, Japan will host the G7 Summit, and the United States, India, and Indonesia will chair APEC, the G20 Summit and ASEAN, respectively,” Nishimura said. “While working in cooperation to deal with global-level issues, we will lay out for the international community a path forward for building a new economic order.” It will be also essential for Japan to work in coordination with the Global South to tackle various global challenges. “Japan, working within that partnership, is fully determined to fulfill its significant responsibilities.”
The Toranomon Hills Station Tower: Transforming a Neighborhood
Home to a buzzing community that melds business and art with innovation and tradition, Toranomon is one of Tokyo’s most vibrant and interesting neighborhoods. And later this year, the area will take a bold step with the opening of Toranomon Hills Station Tower.
This fall, Mori Building's new project will elevate innovation in business, retail, and art
Tokyo Node Hall
Home to a buzzing community that melds business and art with innovation and tradition, Toranomon is one of Tokyo’s most vibrant and interesting neighborhoods. And later this year, the area will take a bold step with the opening of Toranomon Hills Station Tower. The new facility will help to expand and evolve the Toranomon Hills complex as a new international hub and global business center where various businesses and global players gather to disseminate new ideas and values.
The 49-story tower will be located above Toranomon Hills Station, the first new station on the Hibiya Line in 56 years. For many visitors, the first experience will be stepping into the Station Atrium—an impressive three-story, 2,000-square-meter plaza brilliantly illuminated with natural light. The space serves not just as a point of passage for travelers and commuters, but a welcoming entrance to the entire area.
Toranomon Hills Station Tower will be completely integrated with the new station and connected to Mori Tower’s Oval Square by the large-scale pedestrian T-Deck, significantly improving pedestrian flows. This continues the work done with the construction of Toranomon Hills Mori Tower, which integrates with Loop Road No. 2, seamlessly connecting central Tokyo with Haneda Airport.
In addition, a bus terminal on the first floor of Toranomon Hills Business Tower offers access to airport limousine buses and the Tokyo Bus Rapid Transit network. Together, these will strengthen Toranomon Hills as a transportation node of the gateway connecting central Tokyo with the world.
The pedestrian path to the Toranomon Hills Station Tower, nicknamed “The T-Deck.”
The Station Atrium
Along with 32 floors of office space, Toranomon Hills Station Tower features the innovative Tokyo Node, a 10,000-square-meter interactive communication facility that will take up part of the eighth floor and the 45th to 49th floors. Tokyo Node features a main hall and three galleries, which can be used on their own or as a single integrated space. The space will also be home to four dining facilities that can be used in conjunction with events.
On the rooftop, a sky garden and pool help create an unforgettable atmosphere for events. On the eighth floor, the facility features a cutting-edge laboratory for research into future urban experiences. Tokyo Node aims to be a space from which new content and creativity can be shared with the world.
The Station Tower completes the redevelopment of Toranomon Hills that began in 2014 with the opening of Toranomon Hills Mori Tower. This was followed by the Toranomon Hills Business Tower in 2020, which is home to Arch, an incubation center for business creation that has attracted more than 110 major corporations, as well as CIC Tokyo, an innovative coworking space that serves as a hub for the startup ecosystem in the city. In 2022, Toranomon Hills Residential Tower opened in the complex, providing an unmatched standard for urban residential living. In total, the urban complex will include about 300,000 square meters of office space, 730 residential units, 26,000 square meters of retail space, 370 hotel rooms, and 21,000 square meters of green areas.
Tokyo Node sits atop the Toranomon Hills Station Tower.
Spaces for All
Shoppers will have a great deal to look forward to this fall, as there will be a broad variety of stores in Toranomon Hills Station Tower. Spanning from B2 to the seventh floor, a retail space featuring about 80 stores will cater to a broad range of needs. One of the highlights will be the T-Market, boasting 27 restaurants, delis, and food stores where shoppers can pick up an array of gourmet items. Altogether, the retail space will more than double what is currently available in the Toranomon Hills area.
The tower will also house the Hotel Toranomon Hills, the first in Hyatt’s Unbound Collection to be launched in Tokyo. Space Copenhagen of Denmark is responsible for the hotel’s stunning interior design, which combines natural materials with traditional Japanese architecture.
The sleek and modern look of Toranomon Hills Station Tower itself was designed by Shohei Shigematsu, partner at international architecture design group OMA. The tower’s design is informed by the idea of creating an “urban axis” that links Toranomon Hills with the surrounding neighborhood in a seamless, natural way.
Throughout the engaging and welcoming space, there will be captivating works of public art—from a scintillating work created with software-controlled LEDs to paintings and sculptures. These aesthetic touches combine to create an inspired atmosphere.
Toranomon Hills Station Tower is set to help Toranomon Hills continue to steadily evolve as a mixed-use complex that integrates with the urban infrastructure, achieving an impact comparable to that of Mori Building’s epoch-making Roppongi Hills. This fall, the new project will elevate the neighborhood to greater heights of innovation in business, retail, and art.
Investing in Biotech
To help Japan capture a market forecast to grow to up to $4 trillion by 2040, METI has created an $8 billion fund to support biomanufacturing, a field that encompasses technologies which leverage genetic technology to maximize the ability of microorganisms to produce substances.
From plastics that melt in the sea to cultured foie gras, Japan is pushing innovative technologies forward with government support
In terms of taste, IntegriCulture’s prototype cultured foie gras has been praised by culinary experts as having a good balance of richness and sweetness.
A decade on from Dr. Shinya Yamanaka’s win of a Nobel Prize for his research into induced pluripotent stem cells, or iPS cells, Japan is lagging in bringing biotechnology to a market forecast to grow to up to $4 trillion by 2040.
To help capture this huge opportunity, Japan’s Ministry of Economy, Trade and Industry (METI) revealed plans last fall for an $8 billion (¥1 trillion) fund to support biomanufacturing. The field encompasses technologies that leverage genetic technology to maximize the ability of microorganisms to produce substances.
Hirokazu Shimoda, director of METI’s Bio-Industry Division, explained why the country plans to go big on bio.
“It is only a matter of time before the global manufacturing industry is replaced by bioprocesses,” he said. “That’s why we are making medium- to long-term investments on the scale of about ¥1 trillion to build a system for companies in the biotechnology and drug discovery markets to develop and manufacture in Japan, then earn money in the global marketplace.”
As well as driving economic growth, biomanufacturing is also expected to be key in solving global issues such as marine pollution, global warming, and food shortages. Some top players in Japan’s biomanufacturing field are already making a difference in those areas.
Green Planet
In 2011, Kaneka Corporation achieved the world’s first commercial production of plastic that degrades in the ocean. The Osaka-based company plans to quadruple the production capacity of its biodegradable biopolymer called Green Planet to 20,000 tons in January 2024.
Kaneka began developing Green Planet in the early 1990s, when global environmental problems such as global warming began to emerge. The project was launched due to the strong desire of researchers to provide environmentally friendly products that don’t depend on fossil fuels.
Green Planet has qualified for the BiomassPla Identification and Labelling system, awarded to materials composed of biomass. It has also received the OK Biodegradable MARINE certification, issued by TÜV Austria Belgium NV/SA for materials that biodegrade in seawater.
Osaka-based Kaneka Corporation plans to quadruple the production capacity of its biodegradable biopolymer called Green Planet to 20,000 tons in January 2024.
Currently, Green Planet is used in straws, plastic shopping bags, cutlery, food containers and agricultural supplies. Seedling pots made with the material can be left to biodegrade after being buried in the soil. Kaneka is studying the material’s effects on natural cycles, including changes to bacteria in the soil.
“The focus of our research is to expand the range of physical applications for which Green Planet can be used,” explains Dr. Shunsuke Sato, a researcher at Kaneka’s Agri-Bio & Supplement Research Laboratories. According to the company’s own estimates, the combined annual production volume of plastic alternatives in Japan, the United States, and Europe currently is about 25 million tons. The market for Green Planet as a substitute for traditional plastic is expected to expand as regulations tighten and awareness grows.
Looking to capture this demand, Kaneka is focusing on carbon dioxide (CO2) as a new raw material for mass production of Green Planet. The goal is to recycle CO2 using microorganisms thereby creating a new process of manufacturing that can address both environmental problems and economic development. Sato explains: “We have the technology to do this in the lab. For mass production, we need to develop a culture process that efficiently converts gas components, such as CO2 and H2 [Dihydrogen], into Green Planet.”
Redefining Meat
Culturing has deep roots. For hundreds of years, humans have used and improved upon it to make wine, cheese, and more. In recent years, new culturing techniques have unlocked the process for making lab-grown cultured meat, redefining what we believed to be possible.
One pioneer of this movement is IntegriCulture Inc. As competition in the development of cultured meat heats up globally, this Japanese startup is the world’s first to succeed in producing cultured foie gras. Dr. Yuki Hanyu, IntegriCulture’s CEO, began research in 2014 on the CulNet System, a unique cell culture technology for manufacturing cultured meat. In 2019, he completed a prototype of cultured foie gras using duck liver cells.
The expansion of the worldwide market for cultured meat provides a tailwind for development. According to market forecasts by US consultancy A.T. Kearney, cultured meat will make up 35 percent of the meat market by 2040. Hanyu believes that the spread of cultured meat will depend on price, taste, and consumers’ belief in its safety.
In terms of taste, IntegriCulture’s prototype cultured foie gras has been praised by culinary experts as having a good balance of richness and sweetness. The first commercial sales are planned for 2024 in Singapore, a market with a precedent. In 2020, Singapore approved the sale of cultured chicken developed by a US company. Domestically, IntegriCulture is aiming to begin sales in 2025, but Japan’s screening standards for areas such as safety have not yet been decided.
Kaneka researcher Shunsuke Sato
IntegriCulture CEO Yuki Hanyu
The potential advantages that come with cultured meat are enormous. IntegriCulture’s CulNet System makes it possible to produce cultured meat at about one ten-thousandth the cost of conventional culture methods. With conventional methods of cultivation, ingredients contained in the blood, such as the serum necessary for cell culture, are expensive and seen as an obstacle to commercialization. However, with CulNet System, IntegriCulture has succeeded in maintaining the appropriate nutritional content without using expensive ingredients. It can also culture cells from various animals including fish.
IntegriCulture plans to sell the CulNet System to food manufacturers and other organizations, and to work together with them to develop technologies that will enable mass production.
“Leveraging our core strength of engineering technology, we want our system to find its proper place in the world,” said Hanyu, who first got involved in so-called cellular farming because he wanted to make the cultured meat he read about as a child in science fiction novels. To this day, he continues to strategize about what he can make with biotechnology, taking inspiration from his beloved world of science fiction.
Companies such as Kaneka and IntegriCulture are just the tip of the iceberg in terms of Japanese biotechnology’s true potential. “Japan is good at the zero-to-one stage of research and development, but is often less adept at scaling up as an industry on the global level,” explains Kaneka’s Sato. That’s exactly what METI aims to change, helping these pioneers and other like them with the funding they need to mass produce and commercialize their innovative biotechnologies.
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Perfect Powder
Hakuba Hotel Group (HHG) has been a driving force behind the development of the area over the past 10 years and manages a portfolio of more than 50 premium chalets and apartments situated in prime locations surrounding the Happo-One Resort. ACCJ members get 10 percent off at any HHG property this winter.
A luxurious winter escape from Tokyo is just a few hours away in Hakuba
Glistening lakes and rivers in summer, flamingly vibrant foliage in fall, and delicate powder snow in winter have made Hakuba a top destination for Japan’s international residents in recent years. The explosion of expats flocking to the valley for powder skiing and reconnecting with nature is boosted by other things that separate Hakuba from similar resort areas in Japan: its proximity to Tokyo and its international flair.
Hakuba Hotel Group (HHG) has been a driving force behind the development of the area over the past 10 years. Launched in 2012 with the purchase of the Hakuba Springs Hotel, HHG has grown from a small hotel operator to the Hakuba Valley’s largest hospitality company. The group owns or manages hotels, apartments, chalets, travel agencies, and events, as well as restaurants and bars featuring some of Asia’s most premium accommodations and dining. HHG is truly all things Hakuba.
Chalets and Apartments
HHG manages a portfolio of more than 50 premium chalets and apartments situated in prime locations surrounding the Happo-One Resort, host to downhill and Super-G Alpine skiing during the 1998 Nagano Winter Olympic and Paralympic Games. The properties combine the creature comforts of Western homes with the convenience of a fully serviced hotel. Guests can access a 24-hour concierge team, receive food and wine deliveries, and use complimentary resort and restaurant shuttle services.
The newest property is the ski-in, ski-out Roka Apartments. Completed in 2021, the eight serviced luxury units are the most exclusive in Hakuba.
Hotels
HHG hotels range from rustic and cozy to modern and sleek. The flagship property The Happo is among the most modern in Hakuba, having recently reopened after extensive renovation. With 30 rooms in the heart of Happo Village, 200 meters from the Happo-One slopes and surrounded by Hakuba’s best dining and nightlife, The Happo features onsen and Finnish sauna, a restaurant, bar, café, rental shop, and retail store.
Dining
Mimi’s Restaurant & Bar is the jewel of the Hakuba culinary scene and among the few true fine-dining experiences in the valley. This HHG venue has ranked as Hakuba’s No. 1 restaurant on TripAdvisor for several years running. Other group restaurants include The Rabbit Hole, Blizzard Pizza, and The Grill.
Premium Partnerships
HHG is proud to be partnering with Land Rover to provide the most stylish shuttle service in Hakuba. Chalet and apartment guests receive complimentary shuttles to the ski slopes and local restaurants in Range Rover and Defender vehicles.
The group has also teamed up with Hyperice to help guests at The Happo recover and recharge with premium massage guns after a day of powder skiing.
Book Now for a Discounted Vacation
We’re proud to offer all ACCJ members 10 percent off any HHG property this winter.
Visit hakubahotelgroup.com and use booking code ACCJ2023 to secure your discounted accommodations.
Yonezawa Artistry
Legacy and vision. Two words that describe and drive Gentaro Nitta’s Nitta Textile Arts and Michiko Yamakuchi’s Yozando. Both are eminent textile enterprises based in Yonezawa City, Yamagata Prefecture, and manifest a celebration of the past as the industry looks toward the future.
Local textiles reflect a passion to create and determination to preserve
Formal kimono safflower with luxurious crimson hue. Photo: Nitta Fabric Art Inc.
Legacy and vision. Two words that describe and drive Gentaro Nitta’s Nitta Textile Arts and Michiko Yamakuchi’s Yozando. Both are eminent textile enterprises based in Yonezawa City, Yamagata Prefecture, and manifest a celebration of the past as the industry looks toward the future.
Nitta Textile Art Inc.
To fifth-generation head Gentaro Nitta, “the past is not a burden, but a window.” Nitta Textile Art’s forward-thinking production model triumphantly draws on the past to produce one-of-a-kind, hand-crafted elegance made from the highest quality silk, woven on wooden looms by local experts employing skills passed down for centuries. These silk masterpieces, painstakingly colored with locally sourced dyes made from hand-picked safflowers, radiate colors ranging from the subtlest hues of pearl to the company’s renowned shades of crimson.
It’s not that Nitta’s traditions—its safflower cultivation and silk dyeing techniques—are separate processes; rather the agricultural and artistic traditions merge to form an integrated whole, developed together over centuries and applied organically and harmoniously in response to the land and local climate.
Conditions, Nitta explains, change throughout the year, according to the season. In sum, the human arts—be they agricultural or artistic—depend on and reflect the demands of the land and the challenges of the climate.
The Yoneori Komon range includes a wide variety of products with seasonal as well as traditional designs. Photo: Yamakuchi Orimono Yozando
Yamakuchi Orimono Yozando
Designer, proprietress, and curator Michiko Yamakuchi leads a whirlwind tour of her multiple facilities, including a quaint retail shop, coffee-house art gallery, and petite cabin that houses her coffee bean roasting ovens. An extraordinary manufacturing site reveals the enormous Japanese-Italian weaving machines which bring Michiko’s designs to life, while a cavernous art gallery houses art pieces by internationally recognized artist Hideo Yamakuchi.
Michiko’s creativity is manifest in the intricate, unbroken patterns of her seasonal designs (shown above), be they purses, handbags, tablemats, coasters, or traditional furoshiki wrapping cloths. The seamless patterns echo the finest, perfectly aligned wallpapers.
Colors and designs are abundant and change with the seasons; winter holiday products are currently on view. Items are reversible—for example, red on white on one side, white on red on the other.
Most other products affirm the designer’s emphasis on a practical aesthetic that instills beauty in everyday objects, such as bags for smartphones and temple diaries, and by using washable cotton fabrics and creating designs that reduce leftover materials.
Together, Nitta Textile Art and Yamakuchi Orimono Yozando provide a window not only into Yonezawa’s artistic past but also its future.
Supply Chain Woes
Nowadays, it is common to hear and to read in the news that the world is experiencing unprecedented supply chain woes. China lacks coal and paper. The United States has a shortage of toilet paper and toys. And India is low on microchips. Why is this happening? Here are four current issues that negatively impact the world’s supply chains.
Four causes of worldwide shortages and how to address them
Photo: Photo by Tom Fisk from Pexels
Nowadays, it is common to hear and to read in the news that the world is experiencing unprecedented supply chain woes. China lacks coal and paper. The United States has a shortage of toilet paper and toys. And India is low on microchips. Even we, the masses, have experienced delivery delays and found that certain items, previously one click away, are out of stock. Why is this happening? Below are four current issues that negatively impact the world’s supply chains.
1. Lockdowns (Still) in the World’s Factory: China
Economists say that companies with an overreliance on factories in China are the most vulnerable in this supply chain crisis. But this describes most companies. Back in the early 2000s, when an outbreak of severe acute respiratory syndrome, or SARS, forced China to temporarily shut its manufacturing capacity to control the virus, the country had just the sixth-largest economy in the world, with a nominal gross domestic product (GDP) of $1.4 trillion. Fewer than 20 years later, China’s economy had grown to be the world’s second largest, with a nominal GDP of $14.72 trillion in 2020.
China has also become the producer of 28.7 percent of all the world’s goods, and exports $2.6 trillion of worth of products annually. This makes it the top exporting economy. Coupled with its number-two ranking for imports, it’s no wonder China has garnered the moniker “the world’s factory.”
How did China achieve such a rise? By making itself a manufacturing powerhouse and primary recipient of foreign investments thanks to a large, cheap, but capable labor force and low tax rates. With these manufacturing credentials under its belt, and huge amounts of trade coming in and out, China became a key player on the world stage.
More than two years into the coronavirus pandemic, as vaccines were being rolled out and populations inoculated around the globe, Covid-19 became a norm in our daily lives. We all thought that lockdowns were a thing of the past. But China has continued to implement a zero-Covid strategy, loosening its grip on the population only as 2022 draws to a close under growing pressure from weary citizens.
China’s zero-Covid policy required strict quarantine, even if just a handful of cases are reported. As a result, tens of millions of people in at least 30 regions of China have been ordered to stay at home under partial or full lockdowns. How changes will affect the severity and impact of countermeasures remains to be seen. Until now, these lockdowns have caused massive disruptions to China’s manufacturing activities that have translated into worldwide supply chain interruptions.
2. Worldwide port congestions and bottlenecks
As we all get back to our normal lives and try to move on from the bad memories of the pandemic, economic activity has restarted and demand for various goods are returning to pre-pandemic levels. This hefty appetite from various economies—on top of the prevailing delivery backlogs and shortages caused by the pandemic—has put massive strain on the world’s ports. The situation has been exacerbated by various businesses trying to pile up their respective stocks in the face of supply uncertainties.
Ninety percent of global trade is transported via sea. Delays caused by port congestion have driven up the cost of many goods or, in the worst cases, caused depleted stock of some much-needed items. For example, the United States, the world’s largest importer and second-largest exporter, has seen its ports experience unprecedented cargo ship backlogs. Billions of dollars’ worth of goods are stranded off the coasts of the United States as there’s neither enough manpower nor resources to unload them. Ultimately, this causes delays in delivery to end users. The same thing is happening at major ports around the world.
This existing issue has caused cargo prices, as well as average port-to-port waiting times, to multiply to record levels.
3. Power levels: on red alert
As businesses around the world struggle to address the ongoing logistical and manufacturing disruptions caused by the pandemic and existing production backlogs, another problem has arisen: Where to source power?
It is a given that power is necessary to fuel manufacturing capacity around the world and keep goods in production, but meeting demand means overcoming challenges.
In the Pacific, China last summer experienced its worst heatwave and drought in six decades, and its power source portfolio suffered. Hydroelectricity, the country’s second-largest source of power, yielded an all-time low output due to the much lower water levels at hydroelectric plants. To conserve electricity, the government took steps such as ordering the closure of factories, demanding that air conditioners be set to above 26 degrees Celsius, or shutting down elevators for the first three floors in some provinces. The regions affected are key manufacturing centers for semiconductors, solar panels, and batteries, and the reduced production affected some of the world’s largest electronics companies.
Europe has been on red alert since March as economic sanctions imposed on Russia for its war in Ukraine, measures which include the cessation of gas imports from Russia, have diminished energy supplies. Russian gas normally accounts for about 40 percent of European Union (EU) fuel imports. As winter starts, the EU is bracing for two scenarios—one in which a few member states experience power cuts and another in which blackouts occur in many member states at the same time. Can you imagine the famous Eiffel Tower on a lights-off schedule? The EU is also the location of some of the world’s biggest manufacturing brands, hence this development will mean further disruptions to the global supply chain.
4. Russia’s economic embargo, Part II
As the West and its allies impose costly economic sanctions on Russia to cripple its economy and ability to fund its military operations in Ukraine, they have also cut themselves off from what Russia contributes to the supply chain. Aside from oil and petroleum products, industry relies on the country for metals, including nickel, palladium, platinum, rhodium, aluminum, and copper. These minerals are key components in the production of automobiles, semiconductors, aerospace components, packaging, renewable energy, and other industrial products.
Russia also specializes in chemical production, particularly of the potassium compound potash and ammonia, key ingredients in fertilizers. This area may be impacted most as Russia accounts for roughly 10 percent of ammonia and five percent of urea production globally, as well as 20–25 percent of global ammonia exports. The country is also a significant producer and exporter of potash, delivering about 18 percent of the world’s supply in 2021. Low or no supply from Russia, combined with the existing issue of high energy prices, is likely to result in significant disruption to the supply of fertilizers for the foreseeable future.
It is very evident that manufacturing companies were caught flat-footed as these developments were thrust upon us and found to be overly reliant on certain countries to produce their products. Many have preferred suppliers for materials and labor located in countries where conditions have impacted manufacturing. As these supply chain woes were often not considered in corporate contingency plans, it is normal to execute short-term reactive solutions, such as stockpiling supplies and chartering private container ships. But companies know that these are just temporary fixes and recognize the need for permanent solutions.
Recently, we began to see companies start to implement long-term strategies to “de-risk” their supply chains. Steps may include finding new and more diverse sources of raw materials, widening the list of suppliers, and setting up independent factories in multiple parts of the world to cater to demand in specific regions, diversify operations, and minimize risk.
Even though these long-term action plans will further exhaust significant resources, it is indeed worth the investment for a company to secure its operations and, most importantly, to ensure an uninterrupted supply chain to meet consumers’ unending demand for goods.
For more information, please contact Grant Thornton Japan at info@jp.gt.com or visit www.grantthornton.jp/en
Setting the Stage for Green Transformation
If renewable energy production is not doubled by 2030, power outages and energy system disruptions could become everyday affairs. To help the international community rise to what may be this generation’s greatest challenge, and to showcase some of the technologies that will assist the world in meeting it, the Ministry of Economy, Trade and Industry (METI) organized Tokyo GX (Green Transformation) Week. The 10-day event ran from September 26 to October 7.
Japan gathers leaders and experts for key conference on decarbonization
If renewable energy production is not doubled by 2030, power outages and energy system disruptions could become everyday affairs. The World Meteorological Organization’s State of Climate Services annual report, released on October 11, has found that nations around the world are far off the 7.1-terawatt target needed to keep global temperatures from rising 1.5 degrees Celsius above pre-industrial levels.
Setting 2050 net-zero goals is well and good, but it is clear even more immediate action is needed.
To help the international community rise to what may be this generation’s greatest challenge, and to showcase some of the technology that will assist the world in meeting it, the Ministry of Economy, Trade and Industry (METI) organized Tokyo GX (Green Transformation) Week. The 10-day event, which ran from September 26 to October 7, was a series of 10 international conferences focused on the many aspects of GX. The conferences covered everything from clean energy sources to carbon capture, highlighted some of the latest technological developments in a wide variety of fields, and explored joint policy frameworks in Asia.
Tokyo GX Week wrapped up a month ahead of the 2022 United Nations Climate Change Conference (COP27), which was held November 6–20 in Sharm El Sheikh, Egypt. The GX Week conferences looked ahead to the issues that this key global gathering would address. Japan will also host the G7 meeting next year, and world leaders can build on the groundwork established during Tokyo GX Week to reach ambitious and sustainable strategies that will influence the future of our planet.
Inaugural Meeting
More than 140 countries aim to be carbon neutral by 2050, but achieving this goal is no simple matter. GX offers a way forward. The strategy is a bold one, and seeks to bring about a change in economic, social, and industrial structures, so that they are driven by clean energy and spur economic growth and development through emissions mitigation.
To drive this strategy, METI hosted the inaugural Global Green Transformation Conference (GGX) on October 7, the final day of Tokyo GX Week. GGX was the first time that leaders and industry experts gathered to begin charting a path towards global GX.
The GGX addressed everything from how to incentivize the public and companies to turn to green products and services to introducing a new way to evaluate the reduction in CO2 emissions by using these products and services. It also tackled the tough questions related to establishing a more workable framework for decarbonization and rule-making that will help the whole world thrive.
Drawing the World
The conference was held in a hybrid format and more than 1,300 people attended online and in person. Given the significance of the event, it drew an impressive selection of participants. Speakers and panelists included representatives from five G7 countries, two international organizations, and 12 universities as well as research institutes and private companies.
Keynote speeches were delivered by prominent speakers from around the world:
- Shinichi Nakatani, state minister of METI
- John Kerry, special presidential envoy for climate from the United States
- Peter Bakker, president and chief executive officer of the World Business Council for Sustainable Development (WBCSD)
- Frans Timmermans, executive vice president of the European Commission
- Mathias Cormann, secretary-general of the Organisation for Economic Co-operation and Development
- The Right Honorable Lord Callanan, parliamentary under secretary of state (minister for business, energy, and corporate responsibility) of the United Kingdom
- Fatih Birol, executive director of the International Energy Agency
In his keynote address, Nakatani pointed out that the time for the world to act is now and highlighted some of the ways in which Japan has set a rigorous path for itself.
“First, by the end of the year, we will formulate a 10-year roadmap for GX investment, which aims to realize ¥1.1 trillion in investment through public–private sector cooperation over the next 10 years,” he explained. “Second, we will establish the GX League, a voluntary emissions trading framework for companies with ambitious reduction targets, which will be fully operational by 2023. And third, we will promote transition finance in the industrial sector, particularly high emissions industries.”
State Minister Shinichi Nakatani delivers his keynote address.
Nakatani also introduced the key topic of “mitigation contribution”—a means of evaluating the positive effects of a company’s influence on decarbonization that may lie outside its supply chain or national boundaries. The topic was subsequently referred to as “avoided emissions” at COP27. He explored this by presenting the example of a company selling heat pumps. If inefficient gas heating systems are replaced by efficient heat pumps the company produces, this may lead to a reduction in total global emissions. However, the company’s own emissions may rise due to the increased production of the heat pumps. While such a company is positively contributing to global emission reduction, it may be criticized for increasing emissions. This does not undermine the crucial importance of emission reduction from the company, but clearly indicates the need to recognize a new perspective.
Currently, mainstream frameworks focus on the reduction of greenhouse gas (GHG) emissions of a specific organization or entity, and it is key to continue to support the efforts based on these frameworks. But if a mechanism can be created to appropriately value avoided emissions, and resources such as finance can be directed to entities that are promoting these efforts, it will encourage the diffusion of green products and services and promote the achievement of net-zero emissions through economic growth.
Avoided emissions are being explored in the private sector through international partnerships, but if governments begin to support the concept and encourage more companies to incorporate it in their decarbonization efforts, it can lead to greater innovation across a wide swath of industries.
Looking ahead to the G7 in Hiroshima next year, Nakatani was optimistic.
“While each country has its own position, Japan will support the world’s GX while furthering international goals so that developing and developed countries will work in unison to promote initiatives that transcend barriers,” he said.
The G7 and other international forums will also offer the Japanese government opportunities to further discuss and refine the avoided emissions concept.
In his initial remarks, Peter Bakker put the task of the conference in stark relief, given the need to develop a strategy to combat climate change.
“We need full-fledged system transformation … We need to change everything,” he said. “The energy we use, the food we eat, the transport solutions that we look for. Therefore, being here at the Global Green Transformation Conference is a unique opportunity to engage with all of you about what needs to happen.”
First Movers
GGX was also groundbreaking because it marked the first event in Asia for the First Movers Coalition (FMC) of the World Economic Forum (WEF). The coalition was launched in November 2021, following COP26, with a distinct aim to decarbonize key economic sectors—such as materials and long-range transportation—which are critical to organizations around the world, but which generate 30 percent of annual GHG emissions.
More than 50 companies are members of the FMC and, as Nancy Gillis, program head for Climate Action and the FMC with the WEF, explained, their participation sends a message.
“When a company joins the First Movers Coalition, what they are doing is signing a demand commitment,” she explained. “That means that they are making a commitment to buy products and services [as] they do now. But instead of buying the products and services that they’ve bought historically, they choose those with more GHG emissions consequences.”
Gillis said the FMC is a natural fit for Japan, given the country’s dedication to innovative, green technologies. She added that transportation company Mitsui O.S.K. Lines, Ltd. made an ideal member of the FMC, and its commitment to decarbonization can drive innovation in many fields. Toshiaki Tanaka, the company’s representative director and executive vice president, explained that the time was right to join the coalition: “What we need now is to take concrete actions to reduce our value chain emissions. But at the same time, we are going beyond the value chain and taking urgent action to mitigate emissions outside of our value chain by supporting emerging [carbon dioxide removal] technologies. Therefore, we decided to take part in the First Movers Coalition, a platform where we can leverage our collective purchasing power to develop and scale zero carbon technologies.”
From left: Nancy Gillis, Shinichi Nakatani, Acting Deputy Chief of Mission for the US Embassy in Japan Philip Roskamp, and Toshiaki Tanaka at the FMC in Japan panel discussion.
Towards a Greener Society
Other panel discussions during GGX tackled the ways in which GX can be implemented in markets, the setting of standards, and international cooperation. “Designing a Green Market” explored methods for reducing emissions from the perspectives of supply and demand. Panelists agreed that there is no single policy that will lead to net-zero GHG emissions, but that it is necessary to create an environment which leads to the greater diffusion of green products.
The topic of avoided emissions was a recurring theme during the conference, and in the panel discussion “Standards and Evaluations Promoting Green Products/Services,” participants explored it in detail. They concurred that it is important to expand evaluation frameworks beyond the reduction of supply chain emissions to consider how countries and companies are helping cut GHG emissions through indirect means.
One key point that needs to be addressed when it comes to avoided emissions is to which products and sectors efforts can be applied. Participants in the discussion brought up the idea that it is important to establish clear differences between avoided emissions and existing GHG protocols and nationally determined contributions (NDCs), because the concept’s importance lies in additionally evaluating the contribution to global emission reduction, rather than undermining the efforts of a company to reduce its own emissions.
Panelists also pointed out that it is necessary to establish a strict method for evaluating avoided emissions. For example, subtracting avoided emissions from NDCs and Scope 1–3—that is, a company’s direct and indirect emissions—would be a form of greenwashing, and should be avoided when establishing these guidelines.
Finally, in the panel discussion “International Cooperation for Developing a Green Society,” participants delved into the thorny topic of working across borders to develop decarbonization strategies. The participants pointed out the importance of recognizing each country’s circumstances in setting cross-border policies. Considering the increasing dichotomy between the positions of developed and developing countries, the importance of developing a society which realizes both economic growth and emission reduction was also raised as an important topic. Business is an important enabler for these societies, and frameworks such as the Joint Crediting Mechanism—a system by which developed nations collaborate with developing nations to reduce greenhouse gas emissions—and business in adaptation could offer win–win actions for both developed and developing countries.
Following on the insightful conversations at GGX, METI hosted an event at COP27 about avoided emissions. During the session, the WBCSD—which founded the Scope 1–3 standards—gave an overview of their developing guidance for the concept. METI has also included countries such as the United Arab Emirates, host of COP28, and the United States, as well as representatives of the financial sector, including members of the Glasgow Financial Alliance for Net Zero, in the discussion.
Conversations that began at GGX are expanding to a wider group of stakeholders, and next year, when Japan hosts the G7 meeting, METI will escalate the dialogue on these key issues that will help future generations live on a greener Earth.
Tax and Trends
Yamada & Partners can help non-Japanese better understand how their assets are taxed and assist them in reducing their tax liability while accurately reporting income and assets.
Understanding Japan’s asset-related taxation system and shifts in audits
Understanding how income and assets are taxed in Japan can be a challenge for anyone, whether citizen or non-Japanese resident. And for those with significant wealth, investments, and real estate, a lack of understanding can lead to higher-than-expected taxes. Finding your way around the meshwork of regulations and calculations can be difficult, however, as most documents published by Japan’s National Tax Agency are only available in Japanese. Likewise, filings must be done in Japanese.
Yamada & Partners can help non-Japanese better understand how their assets are taxed and assist them in reducing their tax liability while accurately reporting income and assets.
“The tax system in Japan is one of the most complex in the world,” said Saori Koiso, an Osaka-based certified public accountant and senior tax manager with Yamada & Partners. The firm, founded in 1981, specializes in international tax consulting, inheritance and real estate, and tax compliance, among other services. Koiso hosts the webinar which covers:
- Individual income tax
- Inheritance tax
- Gift tax
- Audit trends
Individual Tax on Financial Investments and Real Estate
Individual income tax in Japan ranges from 15.105 to 55.945 percent. In the webinar, Koiso explains the brackets, deductions, and how capital gains, foreign assets, and real estate are taxed.
Capital gains derived from the sale of land and buildings are taxed separately from other income, and at different rates depending on whether they are considered short- or long-term. Various other factors, such as location of the property, residency status of the owner, and how the lessee uses the property also play a role.
Assets and liabilities—both domestic and foreign—must also be reported. The value of those assets at the time of taxation could be impacted by the international currency market, which has seen great turmoil with regard to Japan in 2022. On October 20, the Japanese yen slipped past ¥150 against the US dollar for the first time since August 1990, and there are warnings that it could slide to ¥170. This dramatic shift in currency value can have a significant impact on taxation for those who hold financial assets or own real estate overseas.
Understanding value thresholds and who must report what, and when, can make a big difference in minimizing the chance of an audit and avoiding penalties for misreporting. In the webinar, Koiso explains the key points of the system.
Inheritance Tax
Planning for the future is also important, but can be tricky when dealing with an unfamiliar system and language. If you live in Japan and continue living here, and one day pass away here, then your family members will be responsible for paying inheritance tax in Japan.
Japanese inheritance tax rates are among the highest in the world, Koiso said, in some cases reaching 53.2 percent. Understanding the rules that determine this amount is vital to minimize the impact, but can be difficult when most documents explaining the system are only available in Japanese.
Yamada & Partners’ on-demand English webinar will help you understand the rules contained in these documents.
An important thing to note is that individual heirs are taxed rather than the estate itself, as is done in the United States and many other countries. What’s more, the scope of the tax depends on a variety of factors, including:
- Whether or not the heir lives in Japan
- The heir’s visa status
- The nationality of both the heir and decedent
Another factor that has been used to determine inheritance tax liability is the period of residence, but changes were made to this in the 2021 tax reform. Under the new rules, those who have maintained a domicile in Japan for fewer than 10 of the past 15 years are only taxed on assets located in Japan rather than worldwide, as was the case before. This applies to particular types of visas, as defined by the Immigration Control and Refugee Recognition Act, but many categories are applicable to American Chamber of Commerce in Japan members, including investor/business manager, legal/accounting services, researcher, and intracompany transferee.
Also important to consider are ways to ease the process for a spouse or children left behind. Japan has rules which differ from those of the United States and other countries, and inheritance tax in Japan is calculated in accordance with the statutory inheritance ratio set forth in the Japanese Civil Code. And because there is no probate system in Japan, transferring money from a bank account can be complex for heirs if there is no will.
There are many more complexities to navigate when planning for the eventual inheritance tax, and this on-demand English webinar will help you better understand the rules and plan accordingly.
Tax Audit Trends
There have also been changes in how the National Tax Agency approaches audits. Due to the growing diversification and internationalization of asset management, the agency has increased active investigation of high-net-worth individuals with an eye towards overseas assets. Those with significant securities, real estate investments, and particularly high ordinary income have been on the radar.
The number of incorrect declaration cases grew each year from 2016 to 2019 before dropping in 2020 due to the coronavirus pandemic curtailing investigations. Of the 4,463 audits of personal income tax filings by wealthy individuals conducted in 2019, incorrect declarations were found in 3,837. The average amount of underreported income per case was ¥17.67 million and additional tax levied was ¥5.81 million. And while audits dropped to 2,158 in the first year of the pandemic, the average unreported income rose to ¥22.59 million, an increase of 127.8 percent year over year. Additional tax averaged ¥5.43 million.
As has been the trend in the past, cash and deposits are the most common underreported assets, and North America is the top region in which these assets are located.
The National Tax Agency is using the Standard for Automatic Exchange of Financial Account Information, better known as the Common Reporting Standard (CRS) to obtain data about individuals’ overseas transactions and assets by effectively utilizing the CRS system. And while the United States has not adopted the system, it does participant in the Global Forum on Transparency and Exchange of Information for Tax Purposes and has a tax treaty with Japan which allows the National Tax Agency to obtain information.
Be Prepared
Whether misreporting involves ordinary income, inheritance or gifts, capital gains, foreign assets, or real estate, understanding the system and rules—and working with professionals who know how to ensure that you are in compliance—is a must in today’s complex and interconnected world of global finance.
For more information, please visit Yamada & Partners at www.yamada-partners.jp/en/
From Mist to Medals
Just over an hour by train from Shinjuku, the Godo area of Isehara, Kanagawa Prefecture, lives up to its name, which means “gate of the gods.” The mists rising from nearby Sagami Bay often shroud the peak in mysterious clouds, leading to the nickname Afuri-yama (Mount Rainfall). And tucked away in the lush foothills is Kikkawa Jozo, a century-old sake brewery that is gaining international acclaim.
Kikkawa Brewery is innovating its way to international gold
Mount Oyama, part of the Tanzawa Mountains, is one of Japan’s most sacred mountains. And tucked away in its lush foothills is Kikkawa Jozo, a century-old sake brewery that is gaining international acclaim.
Just over an hour by train from Shinjuku, the Godo area of Isehara, Kanagawa Prefecture, lives up to its name, which means “gate of the gods.” The mists rising from nearby Sagami Bay often shroud the peak in mysterious clouds, leading to the nickname Afuri-yama (Mount Rainfall).
Abundant rain filters through the rock and becomes the groundwater from which Kikkawa draws to make its sake and instill it with a rich flavor and full aroma.
For six generations, the Kikkawa family has worked its magic. Since the founding of the brewery in 1912, a long line of artisans has been combining the area’s clear water and top-quality rice to create their sake, Kikuyu.
However, in 2020, things were looking bleak. Facing bankruptcy and with no one to take over, it seemed that the sake brewery’s proud tradition was at an end.
Fortunately, the Shimada Group swept in, taking the brewery under its wing and providing a rather unusual kuramoto (brewery owner)—former architect Norimichi Goto—to lead the way. “I aimed for the sky by designing skyscrapers, but now, instead, I am diving into the deep ocean of sake-making traditions, which is very rewarding,” Goto said.
His first months on the job were not easy. “I walked into a rough situation. The brewery was on the brink of closing,” Goto recalls. “They hadn’t even ordered rice for the next season; that’s how dire things were.”
Left: Oyama Afuri Shrine (Photo: Kunihiko Meguro, Shinto Priest of Oyama Afuri Shrine)
Center: Kikkawa toji Masanori Mizuno • Right: Kikkawa Afuri sake
But he soon came to realize the strength of the brewery’s traditions and connections to the Isehara community. And he was impressed by how the toji (master brewer), Masanori Mizuno, and his team refused to abandon ship.
“I was so deeply touched that they stayed, and it is thanks to their hard work, and the support from the community and Oyama Afuri Shrine, that we got things running again so quickly,” Goto said.
While Kikkawa is still producing the locally beloved Kikuyu brand, with the change in leadership in spring of 2021 came a new brand, Afuri. Despite being new, the Afuri brews have already received gold medals at multiple world-class sake competitions. Nari, a refined junmai daiginjo, even won the Platinum Award at the prestigious Kura Master competition in 2022 in Paris.
“We want to push the boundaries of sake, creating new varieties and bringing our products to new markets, to share the culture of sake with as many people as possible,” Goto shared.
This includes combining traditional processes with innovations that allow the brewing process to be more sustainable, such as reducing waste by only polishing away 10 percent of the rice surface or switching from oil-powered steamers to more efficient electric ones.
For those interested in trying Kikkawa’s new generation of brews, why not sample Rosy-Kasumi, a low-alcohol sake (just eight percent) that is gaining attention for its beautiful, fresh flavor. The use of an unusual pink yeast gives several of the Afuri varieties, such as the floral ‘Ohana, a festive, rose-hued tinge. More expert sake drinkers will be enthralled by Terra/Y, another Kura Master gold medalist made using minimally polished rice and slowly aged at low temperatures for an elegantly sweet finish.
This is definitely a brewery to watch.
Learn more about Kikkawa:
www.kikkawa-jozo.com/en/
Plants and Trees
A stone monument, two or three feet tall, with a simple inscription stood before me. It read: “plants and trees.” Somokuto, as they are known in Japanese, are monuments concentrated mainly in Okitama, a region in southern Yamagata Prefecture in Tohoku, the northern part of Japan’s main island of Honshu. Adam Fulford shares more.
Finding the true nature of somokuto in Yonezawa
A somokuto monument inscribed with the Chinese characters for “plants and trees” stands in a forest on the outskirts of Yonezawa City. (Photo: Plat Yonezawa)
A stone monument, two or three feet tall, with a simple inscription stood before me. It read: “plants and trees.” Somokuto, as they are known in Japanese, are monuments concentrated mainly in Okitama, a region in southern Yamagata Prefecture in Tohoku, the northern part of Japan’s main island of Honshu.
I first became aware of somokuto in 2014, when I visited the small community of Nakatsugawa, in the town of Iide, also in Yamagata. I was there as a judge in a national beautiful village contest, and my hosts felt that somokuto might interest visitors.
I was certainly intrigued. Although the phrase somoku (plants and trees) occurs in Buddhist sutras, I was told that the stone monuments were erected by members of the local community, mostly in centuries past and without the direct involvement of shrine or temple representatives.
But for what purpose? At the time, relatively little information was available about somokuto online, but I interpreted them in my own way, as an opportunity to say “please” or “thank you” when entering or leaving the forest.
Later, I became a community consultant in Iide and started to consider the souvenir potential of somokuto. Under the guidance of a local pottery instructor, I made several batches of ceramic mini-somokuto.
With his help, I also made a batch with a group at Denden, a facility in Iide for those with intellectual disabilities.
But I still knew little about the origins of somokuto. And so, when Ruth Jarman of Jarman International invited me to Yonezawa to spend an afternoon learning about somokuto with Yohei Sano, an expert on the subject, I leaped at the chance.
Left: The oldest somokuto in Yamagata dates back to 1780 and is found in the Tazawa district of Yonezawa City.
Right: Ceramic mini-somokuto produced by Denden in Iide Town. (Photos: Plat Yonezawa)
Sano and I went first to Shiojidaira, the site of a once-thriving logging community in the Tazawa district of Yonezawa. Here, I saw the oldest of the 140 somokuto in Yamagata (there are only about 20 elsewhere in Japan). It dates back to 1780.
In those days, the forests of Shiojidaira were a source of “official” firewood and timber for Yozan Uesugi (1751–1822), a famous local lord whose later admirers would include US President John F. Kennedy. After Uesugi’s large mansion in Edo (now Tokyo) burned to the ground in 1772, timber from Shiojidaira would have been used to rebuild it. A few years later, more would have been needed after a big fire in Yonezawa.
For the people of Shiojidaira, a bare mountainside must have been shocking. Have we done something unforgivable? Anxious thoughts of this kind may have culminated in the erection of the first somokuto as a requiem, perhaps, for lost greenery.
Sano explained that, as the years went by, interpretations of somokuto began to shift. They came to be seen as an opportunity to express gratitude to the forest, and later as a reminder to safeguard nature.
My own view of somokuto may be somewhat out of sync with their true nature, but if I’d never encountered them, I wouldn’t have had the chance to get to know Sano, an ideal recipient of the small gift that I gratefully presented to him: a mini-somokuto from Denden.
In a Class of Its Own
In the nearly 160 years since it was founded in the English county of Worcestershire, Malvern College has become synonymous with the very highest levels of education and renowned for producing prime ministers, Nobel laureates, noted authors, and even an Olympic gold medalist. Now, to complement its international campuses in Egypt, Switzerland, and China, the college is to open a state-of-the-art Tokyo school in September 2023.
Malvern College Tokyo plans to offer a richly diverse learning environment
Presented in partnership with Malvern College Tokyo
The Malvern College Tokyo campus
In the nearly 160 years since it was founded in the English county of Worcestershire, Malvern College has become synonymous with the very highest levels of education and renowned for producing prime ministers, Nobel laureates, noted authors, and even an Olympic gold medalist.
Now, to complement its international campuses in Egypt, Switzerland, and China, the college is to open a state-of-the-art Tokyo school in September 2023.
Malvern College Tokyo (MCT) aims to offer the globally acclaimed International Baccalaureate (IB) curriculum, with particular emphasis on technology and entrepreneurship.
Forward Thinking
The school also has a deep commitment to the future of the planet and will provide its students with an enriching Forest School Program, in which they spend time learning in the great outdoors. In addition to giving children the opportunity to learn a variety of skills, the program is designed to foster awareness from a very young age of the importance of our natural environment.
Another key element of a Malvern College education will be a fusion of the school’s British heritage with the values and traditions of Japan. Japanese language classes will be mandatory, while the culture, cuisine, and other key elements of the host nation will be reflected in the learning experience.
By being exposed to the very best of both worlds, MCT graduates will be uniquely equipped to thrive in international settings, believes Mike Spencer, the founding headmaster.
“At the heart of any IB school is a commitment to learning, which is challenging, relevant, and active,” said Spencer. “As we expand Malvern College Tokyo, we aim to develop a curriculum that builds intercultural understanding and tackles issues of global significance.
“We will strive to prepare our students for the best universities but, more importantly, we aspire to equip them with the personal qualities that will serve them and their communities well beyond their school years,” he added.
Spencer arrives in Tokyo after more than 20 years leading schools in India, China, and, most recently, Mozambique. The world has changed greatly in those two decades, he admits, and transformation continues at a rapid pace. “We are aware that we are preparing our students for a world that we can only imagine,” he explained. “This requires us to ensure that today’s students have the skills necessary to be adaptable, resourceful, creative, and confident.”
Creativity and Confidence
A critical part of that is the notion of entrepreneurship.
“Entrepreneurs see opportunities and they take calculated and thoughtful risks to resolve challenges,” Spencer said. “They seek creative solutions and have the confidence to see failure as a learning opportunity. At its heart, entrepreneurship is about adding value, and we would like our pupils to embrace the skills that enable them to add value in all areas of their lives, and in the lives of others.
“We know, too, that technology holds the key to so much of what lies ahead for us all. Our intention is to ensure that each student has access to, and can use, the technological tools that will shape our futures,” he added. “Being open-minded and adaptable to new technologies will be a prerequisite for success.”
In parallel, the importance of sustainability and responsible citizenship “will lie at the heart of a Malvern College education,” he added.
In the short time he has been in Japan, Spencer has been impressed by the “deep sense of identity that Japanese share,” as well as the systems, structures, and traditions that are the bedrock of daily life here. He intends to make sure that the courtesy, kindness, and respect that he has experienced so far are qualities that are also reflected in the MCT experience.
“I do hope that our stakeholders will see and feel that Malvern College is a school that puts its students first, and that cares deeply about the progress, hopes, aspirations, and well-being of each and every one of them,” he stressed. “It will be important to uphold the strong academic traditions of Malvern, so that our students have access to some of the best universities around the world.”
Executive Upgrade
The need for good leadership has never been more pronounced. It impacts hiring, retention, employee engagement, and productivity. And its importance in landing complicated organizational shifts through successful change management is highly visible in the market right now. Half Managing Directors for Robert Half’s Executive Search in Japan Nick Scheele and Andrew Sipus share how to find the right leaders.
Why the right leader matters … and where to find them
Presented in partnership with Robert Half • Photos by Kayo Yamawaki
The need for good leadership has never been more pronounced. It impacts hiring, retention, employee engagement, and productivity. And its importance in landing complicated organizational shifts through successful change management is highly visible in the market right now, said Nick Scheele, managing director of Robert Half’s Executive Search division.
“What we have observed over the past several years is that many global organizations—and this includes both Japanese and foreign—have been making a concerted effort to upgrade their leadership capability,” he added.
With more than 70 years of history, plus 300 locations and some 14,000 employees around the world, Robert Half has a long and deep view of the talent market. “Simply put, we have a global network that’s unlike any other and spans nearly a century of relationships, which we can leverage,” Scheele explained.
Robert Half provides contract and permanent placement solutions for finance, accounting, technology, marketing, and HR in Japan. Protiviti, a fully owned subsidiary of Robert Half, offers internal audit, risk, business, and technology consulting solutions and we regularly partner to offer clients a full suite of services.
What powers it all is their global network. Fellow Executive Search Managing Director Andrew Sipus said this pool of diverse expertise and experience creates synergy between Japan and the United States, as well as the rest of the world, when it comes to Executive Search.
“We are experts in providing bespoke retained search advisory services for finance, accounting, technology, marketing, and HR sectors, with more than 100 Executive Search colleagues around the world who are just a phone call away,” Sipus explained. “If we look to the United States as an example, our Executive Search division received the Forbes 2022 accolade as America’s Best Executive Recruiting Firm, which is certainly a testament to the quality of relationships we have at our disposal … we can easily tap into them, their resources, and their markets to understand the latest market conditions and trends in whatever area we need to better understand.”
“Globally, Robert Half and Protiviti have been named by the Human Rights Campaign Foundation for five consecutive years as one of the best places to work for LGBTQ+ equality.”
Robert Half Japan regularly connects with peers from North and South America, Europe, the Middle East, and the Asia-Pacific region to gain the latest market insights. This helps them successfully fill difficult searches that require unique resources and expertise.
Such searches can arise as Japanese companies look to expand their diversity, equity, and inclusion (DEI) as well as remain competitive in areas evolving beyond traditional approaches to management.
Sipus recalls one such case.
“We scanned the market many times over and found that what our client was looking for simply didn’t exist in Japan; or, if it did, it was untouchable,” he explained. “There were no more than a handful of candidates, and even then, they had only 20–30 percent of what the client required. What that meant for us is that we had to be very creative. We had to do a lot of coaching with the client, and we had to look outside Japan. Through this rigorous process, we were able to identify Japanese talent located overseas, and the client was supportive of relocating them back to Japan.”
Nick Scheele (left) and Andrew Sipus
Robert Half has also helped companies factor DEI into their Executive Search process and consider non-traditional candidates.
“In the case of Japanese companies, we’ve shown them what other organizations are doing and how those organizations are benefiting from more inclusive practices,” explained Sipus. “This could mean highlighting impacts on engagement, creativity, employer branding, and how that leads to gains in productivity and overall business health. We can use tools such as market maps, which give a more accurate sense of the distribution of talent, to counter or confirm the assumption that there are no solutions in the market. This helps our clients identify opportunities where they can make strategic hires using DEI and relevant data sets as a consideration.”
Robert Half itself is awash in diversity. The nearly 100 employees in the Japan office represent 22 nationalities. And globally, Robert Half and Protiviti have been named by the Human Rights Campaign Foundation for five consecutive years as one of the best places to work for LGBTQ+ equality. They have also earned a perfect score on the foundation’s Corporate Equality Index, a national benchmark for US businesses’ dedication to LGBTQ+ equality in the workplace. They have also been selected for the Bloomberg Gender-Equality Index for the fourth consecutive year, for their commitment to promoting equality, creating opportunities for women to succeed, and providing a culture that supports diversity.
Is Robert Half’s Executive Search division the right choice for you?
Scheele encourages those considering hiring leadership talent to think about the level of engagement they’d like, the level of services required, and what it is going to take to deliver the talent sought. “If you need a bespoke, dedicated project team that won’t simply present you with profiles but will manage the entire process and fully represent your interests as an extension of your talent acquisition and employer branding, then Robert Half’s Executive Search division is an ideal fit.
Home-Grown Unicorns
There are 488 unicorns in the United States and 170 in China. Japan is home to just 11. The Ministry of Economy, Trade and Industry (METI) is on a mission to narrow this gap. In June, Japan’s Cabinet Office approved the Grand Design and Action Plan for a New Form of Capitalism: Investing in People, Technology, and Startups. The plan includes the formulation of a five-year roadmap for nurturing Japan’s startup ecosystem.
Japanese startup investment poised to accelerate
Japanese Prime Minister Fumio Kishida (center) alongside award-winning startup founders.
There are 488 unicorns in the United States and 170 in China. Japan is home to just 11. The Ministry of Economy, Trade and Industry (METI) is on a mission to narrow this gap.
The first step is identifying the barriers to global success for Japanese startups.
A combination of factors is hindering the development of Japan’s startup ecosystem, explained Shinpei Ago, deputy director-general for startup policy in the agency’s Minister’s Secretariat. Firstly, the entrepreneur population is relatively small. Rather than starting or joining startups, a lot of Japan’s top talent is being scooped up straight from university by big companies. Secondly, venture capital (VC) funds operating in Japan are small compared with those in many countries. And Japanese startups are often too focused on the domestic market and lack a global mindset.
Shinpei Ago, deputy director-general for startup policy in the Minister’s Secretariat of METI shares the latest on the startup environment in Japan.
All these issues are intertwined, so a piecemeal approach that tackles each one by one will not be effective. Instead, Ago concludes, a cross-ministry initiative featuring a comprehensive set of policy measures addressing all the challenges at once is needed.
In June, Japan’s Cabinet Office approved the Grand Design and Action Plan for a New Form of Capitalism: Investing in People, Technology, and Startups. The plan includes the formulation of a five-year roadmap for nurturing Japan’s startup ecosystem.
Agencies will also explore how to free up entrepreneurs from systems which discourage them from taking risks—specifically, the practice of requiring entrepreneurs to extend personal guarantees for loans from financial institutions, thus making them liable to repay debt. While the government-backed Japan Finance Corporation already provides loans to some startups without personal guarantees, this type of financing is set to be expanded.
To grow the talent pool for startups, METI is considering expanding its Exploratory IT Human Resources Project, also known as the MITOU Program, which aims to discover and nurture top IT talent. More than 2,000 people have completed the program since its launch in FY2000, and more than 300 have successfully started a business or brought a product to market. Well-known alumni include Miku Hirano, chief executive officer and founder of Cinnamon Inc., an artificial intelligence development company, and Ken Suzuki, chairman and CEO of Smart News Inc., developer of Japan’s leading news curation app.
The government’s new approach to working with international VC funds is sure to draw attention. Beyond capital, VC funds also bring valuable expertise on how to grow businesses, manage talent, and build rich networks. Partnering with international VC funds helps Japan expand opportunities to nurture fledgling domestic startups.
Japan has experienced a quiet renaissance as startup investments increased nine-fold between 2013 and 2021. That trend may be set to continue with the emergence of even more globally minded entrepreneurs.
One Japanese startup looking beyond Japan is Astroscale.
CEO Nobu Okada (third from left) and the management of Astroscale pose with a satellite designed to test core technologies necessary for cleaning up space debris. Photo: Astroscale
In the nine years since its founding, the on-orbit servicing company has leveraged its prowess in the deep tech sector to global acclaim. Time magazine named Astroscale to its TIME100 Most Influential Companies list in 2022.
Space debris is a truly global issue. More than 35,000 objects orbit Earth, including defunct satellites and upper bodies of rockets. A collision with these objects traveling at eight kilometers per second could greatly damage working satellites, potentially affecting national security, telecommunications, television broadcasts, and much more. Major disruptions could put us back 70 years.
The secret to Astroscale’s success lies in founder and CEO Nobu Okada’s pioneering of a completely new market—so new that some said it didn’t exist even on a global stage. From the start, he had a firm commitment to global business development. While many startups launch in Japan and aim to go global after achieving domestic success, working globally from the start primes a business for success and helps it avoid competing over the smaller domestic pool of funding, Okada said.
METI hopes that the success of new homegrown ventures such as Astroscale, combined with greater government support, will inspire and encourage more entrepreneurs to be bold enough to shoot for the stars.
Deepening Africa–Japan Business Ties
While the number of Japanese companies active in Africa has doubled over the past decade to more than 900, Japan continues to lag the European Union, the United States, China, and India. The Ministry of Economy Trade and Industry (METI) is focused on encouraging Japanese businesses to support sustainable growth in Africa through projects that address vital social needs, leverage digital transformation, provide technical skills training, and boost renewable power generation.
Investment in people, innovation, and sustainable energy to play a key role at the TICAD 8 conference
Dots for’s Carlos Oba (third from left) and Emmanuel Agossou (far left) in a village close to Zagnanado, Benin.
On August 27 and 28, the Republic of Tunisia will host an international conference dedicated to deepening the economic ties between Japan and the 54 nations that make up the continent of Africa. Japan has taken the lead in the Tokyo International Conference on African Development, otherwise known as TICAD, since 1993, when TICAD 1 was held in Tokyo. Meetings take place every three years, and the Tunisian gathering—TICAD 8—is only the second to be held in Africa.
While the number of Japanese companies active in Africa has doubled over the past decade to more than 900, Japan continues to lag the European Union, the United States, China, and India. The Ministry of Economy Trade and Industry (METI) is focused on encouraging Japanese businesses to support sustainable growth in Africa through projects that address vital social needs, leverage digital transformation, provide technical skills training, and boost renewable power generation.
TICAD 8 comes as foreign direct investment in Africa more than doubled between 2020 and 2021 to about $83 billion, according to a report by the United Nations Conference on Trade and Development. This underscores the vital and timely role of Japan–Africa relations ahead of the upcoming gathering of African leaders, development partners, and international and regional organizations, along with representatives of the private sector.
As former METI Minister Koichi Hagiuda told attendees of a TICAD 8 preview event, “Japan sees three key catalysts for partnership opportunities with Africa.” He went on to highlight how compelling demographics mean one in four people will be African by 2050 and noted that a digital revolution is driving a thriving startup scene. He added that, as Africans seek alternative ways to grow their economies, the opportunities for green growth projects will increase.
Digital Revolution
Carlos Oba is a good example of how Japanese expertise is helping fuel digital startups in Africa. He is co-founder of Dots for Inc., a tech startup launched in October 2021 with a mission to provide internet access to 200 million people living in rural areas of West Africa by 2030.
While it was a trip through Tanzania in East Africa that opened Oba’s eyes to how people living in rural areas are being left behind as the digitalization wave sweeps through larger towns and cities, Dots for’s initial projects have been in West Africa, beginning with Benin in December 2021 and Senegal the following year.
Emmanuel Agossou, the Dots for country manager in Benin, said the challenges are daunting. “Most of our clients are farmers, often with just primary-level education and small incomes from farms and fisheries—though we also have a few university students, graduates, and teachers,” he explained. “They live in villages where there is almost no electricity and no—or very weak—mobile network coverage and internet.”
That lack of universal online access is fueling a rapidly widening disparity between rural and urban areas of Africa, and Oba was prompted to action when he realized major digital players would be reluctant to invest based on low foreseeable profits.
Dots for was awarded just over $300,000 in seed money from two projects initiated by METI: AfDX and J-Partnership. The funding has enabled Oba and his co-founder, Sho Nakata, to develop d.CONNECT, a distributed wireless network communication infrastructure that brings the internet to African villages at extremely low cost. This is accomplished through Wi-Fi routers equipped with mesh network technology, which cuts out dead zones and can provide uninterrupted Wi-Fi.
Residents connected to the village wireless network can use their smartphones to access services and digital content stored on a server also installed in the village. Oba envisions a “smart village,” where users can use online platforms for distance learning, telemedicine, and crowd work. Not only is this meant to improve overall convenience, but the ability to access government and corporate digital services may also boost income and quality of life.
Residents of a village close to Zagnanado, trying out smartphones
“As the Dots for services expand, villagers will get strong internet connectivity and digital platforms to boost their business, education, and work opportunities,” Agossou said. “Young people may be able to work remotely from their village homes, without the need to trek to the big cities, where they would be forced to live apart from their families.”
The system is operated on a subscription basis, targeting users who can see the prospective advantages and are prepared to commit to making ongoing payments. According to Agossou, Dots for employs local agents in or near villages who promote the services either face-to-face with farmers or in village meetings that include young people and village heads. The emphasis is on explaining the advantages of the service to the community as well as to those looking to run businesses, he added.
The service has been successful in helping men and women aged 23 to 45 find steady jobs, Agossou said. But the reality of life in an African village remains harsh, and he notes that payment challenges exist for villagers with small incomes as well as university students and new graduates who have yet to find employment. As a result, Dots for is testing a lower-fee business model to boost client interest.
Based on forecast population increases, and the rising desire to be connected, the need for the company’s offerings is likely to extend to other African nations.
“Dots for services have a huge potential market, and I can see the model expanding from Benin to many other French- and English-speaking African countries, such as Côte d’Ivoire, Ghana, and Nigeria, to name just a few,” Agossou noted.
Sharing Skills
Japan is also committed to providing high-quality technical training to 5,000 young Africans over the next three years.
In Kenya, METI is cooperating with the Kenyan Association of Manufacturers (KAM) to promote training for human capital in the Kenyan manufacturing industry. METI seeks not only to raise technical levels throughout the entire Kenyan manufacturing industry, but to enhance the Japanese presence in the former British colony.
In February, METI dispatched a specialist team to Kenya, which conducted a 10-day guidance program. A further eight-day program was directed by similar specialists in June.
In May, representatives of the Kenyan Ministry of Industrialization, Trade and Enterprise Development, together with KAM, were sent to Thailand, where they took part in third-party training conducted by Japanese experts.
Among KAM’s client companies is Nairobi-based Plast Packaging Industries Ltd., a family-run business involved in the manufacture of environmentally friendly plastic bottling, packaging, and printing products. The company participated in a technical guidance program during which Japanese experts installed sensors on factory equipment and instructed program participants on how to apply the gathered data.
“Japanese technology has helped us monitor our production capacity on a real-time basis,” said Group Chief Executive Officer Mary Ngechu.
The sensors were installed at the Plast Packaging production line without disrupting operations. As a result, production efficiency has improved. This should also have a knock-on impact on sales, she added.
Ngechu has been impressed with the devotion of the Japanese engineers. “The Japanese team are committed to ensuring any project they spearhead goes to completion and that the companies benefit,” she said. “They have offered immeasurable support to me and my family in our business, and we look forward to partnering with them in different areas.”
Mary Ngechu
A METI team visited Plast Packaging in May 2022.
Future Power
At the Second Japan–Africa Public-Private Economic Forum, held on May 3 in Nairobi, participating countries reaffirmed their commitment to green energy. Given the number of African states, and the different issues they face, there is no one-size-fits-all solution to green-energy requirements. METI’s stance is that the most realistic approach is for each nation to select the path that best suits its needs.
To solve the challenges of limited supply and higher costs for electricity, due to power generation through heavy fossil fuel use and power importation from neighboring countries, Toyota Tsusho Corporation has conducted studies financed by METI on the feasibility of solar power generation with battery storage in several countries, including Zambia, Angola, Eritrea, and Benin. One possible approach using this method is to store power generated during the day in batteries and discharge this energy at night.
Against the backdrop of a rapidly growing population, the Egyptian government is targeting the supply of 20 percent of electricity from renewable sources by 2022 via initiatives that include onshore wind power created with support from Japan.
Toyota Tsusho and its subsidiary, the renewable-energy company Eurus Energy Holdings Corporation, in partnership with France’s Engie and Egypt’s Orascom Construction PLC, have developed the 262.5-megawatt Ras Ghareb Wind Energy project. The wind farm is located on the west coast of Gulf of Suez, 260 kilometers southeast of Cairo. This project raised $320 million of limited recourse financing, of which the Japan Bank for International Cooperation (JBIC) provided $192 million as overseas investment loans. The remaining $128 million came from commercial lenders Sumitomo Mitsui Banking Corporation and Societe Generale as loans covered by Nippon Export and Investment Insurance (NEXI) Overseas Untied Loan Insurance.
The Ras Ghareb Wind Energy project is the first independent wind-power production project in the country. After reaching financial close in December 2017, it began commercial operation in October 2019—two months ahead of schedule. With 125 wind turbines, it continues to generate enough electricity to power 500,000 Egyptian households.
In December 2019, a €110 million project-financing loan agreement for the Taza onshore wind farm in Morocco—led by Parc Eolien de Taza, the shareholders of which are EDF Renewable and Mitsui & Co., Ltd.—was signed by JBIC, the Bank of Africa, Sumitomo Mitsui Banking Corporation, and MUFG Bank, Ltd. The funds provided by the latter two commercial banks were insured by the state-owned export credit agency NEXI. The electricity generated by the project will be bought by Office National de L’Électricité et de l’Eau Potable, Morocco’s public electricity and water company.
Wind power is beginning to play a key role in the energy mix of nations such as Egypt and Morocco.
Kenya has committed to the realization of a green, hydrogen-based society as it looks to reduce its reliance on fossil fuels and has established a working group led by the Ministry of Energy. A strategy and roadmap are currently being drawn up, and institutional design and development of pilot projects will follow.
Japan’s public and private sectors are expected to work together to lead the development of greener energy resources. For the 2022 fiscal year, Toyota Tsusho and METI have decided to implement a feasibility study on green-hydrogen value chain development in Kenya. This study aims to pursue the formation and commercialization of pilot projects which lead to a green economy. The goals of such projects include unlocking the potential of green hydrogen as a new energy source through various industries, such as freight and passenger transportation, port cargo handling, steelmaking, fertilizer manufacturing, and alternative fuel and electricity storage solutions.
Financial Foundation
Project finance is risky in some respects. The special-purpose vehicle set up to run the project has limited underlying capital, and repayment of loans is funded only from project proceeds, which can take years to come to fruition. Such long-term finance risk is higher in developing countries.
One way to mitigate risk is to have loans insured by organizations such as NEXI, which provides coverage for loans made by private-sector Japanese banks to overseas businesses in which Japanese companies participate. NEXI was founded in 1993 and, according to a NEXI International Relations Group spokesperson, a high-level African focus has been in place since TICAD 1, which was held the same year in Tokyo.
In December 2020, NEXI insured a $520 million loan made to the African Export-Import Bank (Afreximbank) by Mitsubishi UFJ Bank, Ltd. and Mitsubishi UFJ Trust and Banking Co., Ltd. as support for the Pandemic Trade Impact Mitigation Facility (PATIMFA) for African countries affected by the Covid-19 pandemic. Through the PATIMFA program, the money is being widely used to support medical care, hygiene, environmental, and educational projects in Africa.
The spokesperson also revealed that NEXI has decided to participate in a telecommunications project in Ethiopia—jointly conducted by Sumitomo Corporation and Vodafone Group Plc of the United Kingdom—which began in May. The project will be reinsured by the African Trade Insurance Organization (ATI) based on a memorandum of cooperation concluded in 2019 at TICAD 7 in Yokohama.
Leading up to TICAD 8, NEXI is planning to host joint webinars with Afreximbank and ATI as side events to introduce these projects in more depth, the spokesperson said.
Tunisia is in an optimal position to host TICAD 8 given its unique geographical advantage as the gateway to the continent, as well as being an important partner for Japan in the Middle East and Africa. The conference has won the broad support of the African states, and Japanese Prime Minister Fumio Kishida is scheduled to attend. Tunisian President Kais Saied will chair the conference—a role which he is scheduled to share with Macky Sall, president of the Republic of Senegal and chairperson of the African Union.
Backed by more stable funding sources for clean energy projects, high-level training facilities, and the rapid uptake of digital services across the continent, TICAD 8 is on its way to securing a firmer and more deeply founded relationship between Japan and Africa as we move toward 2050.