Osaka - Sunday, February 27, 2011
Nikkei, Japan’s leading newspaper specialized in business and economy, reported on February 25 that Japan (public and private sectors) will invest total of 110 billion yen in rare earth metals in order to shed its excessive dependence on China.
The objective of the investment is to change the supply structure of rare earth metals that is highly dependent on China. This is urgent because China has been drastically limiting rare earth metal export, as mentioned in the previous article Risk Management and Interdependence in Today’s Global Economy.
The initiative will involve 160 businesses from 110 companies and the government will give financial assistance of equipment investment.
1. What is the background and objective of rare earth metal investment?
1) Shed its excessive dependence on China to reduce risk
The investment would decrease risk for Japan. In the latter half of 2010 import of rare earth metals from China once terminated. The Chinese authorities have also reduced allocation of rare earth metal export. Currently 90% of rare earth metals used in Japan are those imported from China and excessive dependence on China is a very high risk for Japan.
2) Decrease outflow of technology
The financial assistance from the government would help globally competitive manufacturing sites remain in Japan, which means decrease in outflow of technology. Chinese government has been promoting investment of Japanese component manufacturers in their country using stable supply of rare earth metals as its reason. It is because high tech components made from rare earth metals are extremely globally competitive. By providing financial assistance to Japanese component manufacturers that utilize rare earth metals, the Japanese government would like to retain such globally competitive manufacturing sites in Japan.
2. What is the overview of the initiative?
The initiative is led by METI (Ministry of Economy, Trade and Industry), which selected 160 businesses from 110 companies that align with the government’s financial assistance policy. It is decided to that total of 33.1 billion yen will be provided. 9 billion yen will be invested to seek additional businesses.
The companies are to start the investment from 2011, aiming to reduce import of rare earth metals from China by approximately 30%. Currently as much as 30,000 ton of rare earth metals from China are used in Japan, and 10,000 ton of them will be reduced in mid/long term.
3. How will rare earth metal import from China reduced?
1) Reduction in use of volume and recycling
An affiliate of Konica Minolta will implement new equipment that efficiently uses cerium oxide as glass abrasive.
Mitsubishi Trading and Dido Steel make alliance with a venture company specialized in this realm to start a new business with the objective of reducing use of dysprosium by 40% in neodymium magnets production that are used in motors of EV cars.
Hitachi Metals plans to recycle refuse of manufacturing process of neodymium magnet.
2) Diversification of supply
Rare earth metals imported from the U.S. and Australia will be used and initiatives to drive such diversification of rare earth metal supply are driven by companies.
Rare earth metals from China are usually processed as alloys before imported to Japan but the U.S. and Australia are still behind in alloy process equipment. For this reason, Mitsui Mining and Smelting and Japan Metals & Chemicals will import rare earth metals in the form of raw stone and then process as alloys in Japan. Leveraging the knowhow, the two companies also plans to implement a new equipment to extract rare earth metals Nickel-metal-hydride batteries collected from around the globe.
Rare metal import from other countries such as Vietnam and Brazil is being studied as well.
3) Examination of new components
Reduction of rare earth metals and use of rare earth metals that are different from previous ones (i.e. those imported from countries other than China) means change in constituent. This means it is quite possible that performance of motors and catalysts change.
For this reason, leading automobiles companies including Toyota, Honda and Nissan will implement equipment to examine use of such new components for EV cars as a part of their development of motors and catalysts of EV cars.
Kureha Corporate will implement testing and evaluation equipment as apart of their load material development of lithium-ion battery.
2011年2月13日日曜日
The First Chinese Accounting Firm Enters Japan
Osaka - Sunday, February 13, 2011
Nikkei, Japan’s leading newspaper specialized in business and economy reported in its evening newspaper on February 12 that a leading Chinese Accounting Firm is to establish its first office in Japan. This is the first Chinese Accounting Firm to start business in Japan.
The firm is to support from accounting perspective Chinese companies starting business in Japan such as establishing affiliates or joint ventures in Japan. It is quite possible that the entry triggers global accounting network originating in China to expand worldwide.
1. What is the background of the first Chinese accounting firm entering Japan?
It is the fact that Chinese companies are extremely proactive in investing in Japan, especially M&A, as mentioned in the previous article Japanese Companies Leverage China / Asia Capital for Survival.
In fact, the number of M&A in Japan (acquisition of Japanese companies) by Chinese and Hong Kong companies has been increasing since 2000 and the pace has speeded up in the last year.
The number of M&A was around 10 in 2000 and has remained below 15 until 2005 but increased to above 20 in 2007. And, in 2010 the number jumped from around 25 in 2009 to over 35 in 2010.
2. Which Chinese accounting firm enters Japan?
It is Shinewing Certified Public Accountants, based in Beijing, China, that enters Japan. They have already completed registration. Japanese accounting professionals operating in China are the certified accountants.
3. What is the plan?
The company plans to officially start their business in Japan this spring, and increase the staff to approximately 10 by the end of this year.
Their core business is to support accounting and audit of affiliates and joint ventures of Chinese companies and to support M&A in Japan of Chinese companies. The company also would like to support Japanese companies investing in China.
The country manager of the Japan office commented that Japanese products are of high quality and globally competitive even though the price might be high. He also commented that Chinese companies are extremely interested in market, technology and know-how of business administration of Japan.
4. Positioning of Shinewing Certified Public Accountants
Revenue of Shinewing Certified Public Accountants is third in China, excluding western accounting firms such as PricewaterhouseCoopers. It has been supporting approximately 300 Japanese companies operating in China. It already has offices in other countries such as Australia and Singapore.
Chinese government is currently strengthening education of accountants. For this reason, they would like to expand accounting network of Chinese accounting firms by initiatives such as encouraging M&A of accounting firms/offices. The first office of in Japan is part of their initiative.
Nikkei, Japan’s leading newspaper specialized in business and economy reported in its evening newspaper on February 12 that a leading Chinese Accounting Firm is to establish its first office in Japan. This is the first Chinese Accounting Firm to start business in Japan.
The firm is to support from accounting perspective Chinese companies starting business in Japan such as establishing affiliates or joint ventures in Japan. It is quite possible that the entry triggers global accounting network originating in China to expand worldwide.
1. What is the background of the first Chinese accounting firm entering Japan?
It is the fact that Chinese companies are extremely proactive in investing in Japan, especially M&A, as mentioned in the previous article Japanese Companies Leverage China / Asia Capital for Survival.
In fact, the number of M&A in Japan (acquisition of Japanese companies) by Chinese and Hong Kong companies has been increasing since 2000 and the pace has speeded up in the last year.
The number of M&A was around 10 in 2000 and has remained below 15 until 2005 but increased to above 20 in 2007. And, in 2010 the number jumped from around 25 in 2009 to over 35 in 2010.
2. Which Chinese accounting firm enters Japan?
It is Shinewing Certified Public Accountants, based in Beijing, China, that enters Japan. They have already completed registration. Japanese accounting professionals operating in China are the certified accountants.
3. What is the plan?
The company plans to officially start their business in Japan this spring, and increase the staff to approximately 10 by the end of this year.
Their core business is to support accounting and audit of affiliates and joint ventures of Chinese companies and to support M&A in Japan of Chinese companies. The company also would like to support Japanese companies investing in China.
The country manager of the Japan office commented that Japanese products are of high quality and globally competitive even though the price might be high. He also commented that Chinese companies are extremely interested in market, technology and know-how of business administration of Japan.
4. Positioning of Shinewing Certified Public Accountants
Revenue of Shinewing Certified Public Accountants is third in China, excluding western accounting firms such as PricewaterhouseCoopers. It has been supporting approximately 300 Japanese companies operating in China. It already has offices in other countries such as Australia and Singapore.
Chinese government is currently strengthening education of accountants. For this reason, they would like to expand accounting network of Chinese accounting firms by initiatives such as encouraging M&A of accounting firms/offices. The first office of in Japan is part of their initiative.
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