Thank you very much for the kind introduction.
My name is Nozomu Takaoka, new Consul General of Japan in Edinburgh.
Thank you very much for inviting me to participate in this Explore Trade with Japan meeting. I am truly honoured to be here in this magnificent Orkney Council Chambers.
This is the first time for me and my wife Yumi to visit these beautiful islands of Orkney. I thank Ms. Yuka Johnston and Ms. Ruta Noreika for arranging perfect and comprehensive itinerary for us to recognize and appreciate various aspects of social activities and life in Orkney, rugby, business, whisky and establishment of Orkney Japan Association.
I am particularly honoured to attend this meeting with the presence of Mr. Liam McArthur MSP and Convener Harvey Johnston from Orkney Islands Council because trade and investment are very important vehicles to promote bilateral relations between Japan and Orkney.
Therefore, I would like to take this opportunity to explain four reasons why it is good for Orkney to develop relations with Japan now.
The first reason is our similarity. Both of us are honest and modest, yet determined and hardworking people. Both of us are open to the world and respect the rule of law, which has been carefully established over the years in the international community.
You might think these are all too normal virtues, but in fact, I know from my experience as a diplomat, that you cannot take them as granted in today’s world. I have spent five years in the Middle East, both in secular Sunni and theocratic Shiite states, almost five years in the United States, both in the Republican leaning Texas and Democratic leaning New York, and nine years in three countries in Europe, from Viking descendants’ land in Scandinavia to the Roman Empire epicenter.
Based upon those experiences, I see clearly now that this is indeed a very appropriate timing for Scotland to focus upon Japan. Because unlike some of these states, we are similar. I don’t intend to dwell upon the changing nature of the current world political scene, but in no other times in the recent history, cooperation and solidary among countries like the two of us are very precious and urgently needed.
The second reason is the economic reality of the world where we live. Especially in this turbulent situation surrounding Brexit, we must grasp the key realities and hard facts.
Sometimes, people tend to forget that Japanese GDP has been considerably larger than that of West Germany and later of unified Germany for the past five decades. This means Japan-UK, Japan-Scotland and Japan-Orkney economic relations have a great potential to grow.
Actually, it is not just a potential, but already a reality. Everybody knows that technological alliances and Foreign Direct Investment (FDI) represent more substantial and enduring modality of collaboration between any two economies than mere transaction of goods and trade, since the former involve longer term commitment.
I am glad to note that between Japan and Orkney, such a long term and promising collaborative project is promoted by European Marine Energy Centre and Aquatera Ltd. to share innovative Scottish technology regarding renewable marine energy with industrial-academic complex in Nagasaki Prefecture.
Regarding Foreign Direct Investment, the newest figure shows that UK’s FDI stocks as a whole increased by 12.6% to 1trillion and 337 billion pounds in 2017, the highest ever level despite Brexit.
And I would like to stress that when the average increase was 12.6% as I said, Japanese FDI increased by 71%, by far the highest rate among the all international investors, accounting for 61% of Asian total stocks, of course much more than China.
As results of this, there are as many as1000 Japanese companies invested in UK nowadays, creating 150,000 jobs. There are around 50 Japanese companies based in Scotland employing 10,000 people.
I just want to very quickly name several important Japanese investments made in Scotland last year and this year, ranging from renewable energy, IT, advertising to the offshore oil industry.
- The Japan Bank for International Cooperation, provided a £743 million loan for the Moray East Offshore Windfarm. Mitsubishi Heavy Industries, Mitsubishi UFJ and Kansei Electric are working with other partners to develop this major renewable energy project.
- Kawasaki Heavy Industries is developing a plant in Aberdeen to construct sub-sea vehicles for the oil industry.
- Mitsubishi bought 20% of the energy supplier Ovo who own the Selkirk-based company Spark Energy which employs around 400 people in the Scottish Borders.
- Pharmaceutical giant Takeda will be working with Dundee University to produce treatments to combat dementia.
- Heriot-Watt University spin out company Optoscribe, which is based in Livingston, will be working with Sumitomo Electric to develop multicore fiber components for the data and telecommunications sectors.
The third reason is the recent diplomatic achievements by Japan. In the past two months, Japan has taken a leadership role to realize the entry into force of TPP11, Trans Pacific Partnership and Japan-EU EPA, Economic Partnership Agreement.
Because of the EPA, now there is no tariff on EU’s export of wines, whiskies and processed cheese to Japan and in due course, no tariff on Aberdeen Angus beef as well.
More importantly after the Brexit, Prime Minister Abe has repeatedly indicated to PM May that Japan will welcome UK toTPP11, now officially termed as CPTTP, with open arms.
This means that UK can be incorporated into the most advanced free trade area in the world. Currently, half of TPP11’s GDP is accounted by Japan, followed by Canada, Australia, Mexico and developing South-east Asia. If the US ever decides to come back and re-join, revived TPP12, it will be much bigger economic entity than the whole of EU.
The forth reason will be the inevitable focus upon Japan in 2019 because of its hosting of the Rugby World Cup and in 2020 because of its hosting again this time the Tokyo Olympics and Paralympics.
Today, I had the privilege to enjoy ‘Peedie Isles Rugby Festival’ at Pickaquoy Center. Perhaps those boys and girls are still too young to compete in this year’s Rugby World Cup in Japan. But I think that some of them might in the future join the Scottish national team.
Because both Rugby and Paralympics originated in UK, somebody told me the other day that the Olympics itself also originated in UK, the forthcoming two years will be ideal years to draw public attention to Japan-UK cultural events both in UK and Japan.
Therefore, Prime Minister Abe and Prime Minister May agreed to launch “the Japan Season of Culture 2019-20”.
Those are the four reasons why now is the time to strengthen Japan-UK, Japan-Scotland and Japan-Orkney relations.
Therefore, I am very glad that the Cross Party Group on Japan has been established this year in the Scottish Parliament with the kind participation of Liam McArthur MSP as its important founding member.
I am even happier to witness here today that Japan Orkney Association is established seizing upon these momentums that J have explained.
Historically, Scotland led the way for UK in forging and developing relations with Japan. It was a Scot, James VI, who initiated the first diplomatic contacts between the British Isles and Japan in the early 17th century.
And it was the eighth Earl of Elgin who led the delegation and signed the Treaty of Amity and Commerce in 1858, 150 years ago, which laid the foundation for the two countries exchanges in modern times.
I am sure that the distinguished ladies and gentlemen in this chamber are going to follow the footsteps of James VI and the eighth Earl of Elgin. I am looking forward to working with all of you during my tenure in Scotland.
Thank you very much.
Address from Consul General Takaoka: Orkney Council Chambers meeting
April 12, 2019