M a r k e t N e w s
Japan looks to boost trade with Africa
Posted on : Monday, 29th August 2016
”They’re being driven out by the Chinese,” said Caroline Mwazapi, a resident of Tanzania’s commercial capital. “The Chinese bikes are often less than half the price but people don’t mind if they don’t last as long. They’ll just buy another and still save money”, FT reported.
Such trends are largely the result of Beijing’s aggressive approach to capturing African markets as it has flooded the continent with affordable goods. But Shinzo Abe, Japan’s prime minister, is hoping that Japanese corporates will shake up Africa’s trade dynamics as Tokyo embarks on a new charm offensive with the continent.
Abe arrived in Nairobi this week accompanied by 75 business leaders to launch the sixth Tokyo International Conference on African Development (Ticad), Japan’s premier African investment initiative that is being held on the continent for the first time.
“Japan will work hand in hand with Africa to realize the African dream,” Abe said. “This is exactly what Ticad is all about”.
Japanese officials acknowledge that emerging economies such as India and Turkey, as well as China, have been more proactive in building business ties with Africa, which is rich in natural resources but underdeveloped.
Tokyo’s engagement with the continent has traditionally been aid-led, and health and peacekeeping will be on Ticad’s agenda. But its investment has been relatively limited, focusing on infrastructure and consumer goods.
Japanese investment into Africa declined from $17 billion in 2014 to $14 billion in 2015, according to the African Development Bank.
But Tomohiko Taniguchi, a special adviser to the Japanese government, said the number of top Japanese executives joining the Africa conference was “testament that finally otherwise risk-averse Japanese companies have finally come to be aware that Africa can provide them with real growth opportunities”.
He added: “For a long time Africa meant little for Japan economically, but a lot for Tokyo to showcase its commitment in universally shared value”.
Dating from 1993, the Ticad conferences were held every five years in Japan. In contrast, China — Africa’s biggest trading partner — holds its equivalent event every three years and rotates it between China and Africa.
The fact that this Ticad is in Africa and comes only three years after the last one speaks volumes about Abe’s heightened interest in the continent — and a willingness to take on Beijing at its own game.
There is also a richer diversity of Japanese companies attending than usual. In addition to groups such as Toyota and Fuji, producers of cosmetics, noodles, sweets, artificial hair and medicines have also made the trip to Nairobi.
The conference comes at a time when many African nations are enduring their toughest economic challenges in years. The International Monetary Fund forecasts that sub-Saharan Africa’s growth will dip to 1.6 percent this year, from 3.5 percent in 2015.
As a result, much attention will be paid to the amount of money Japan pledges at its conference.
At the last one in 2013, Tokyo committed $32 billion. This compares with $60 billion Beijing promised at its Africa conference in December.
Japanese officials insist they are not competing with other Asian economies or western nations for African pre-eminence.
Source : iran-daily.com
