International Business Development
Business Development Keeping Sights on Overseas Markets: In order to succeed in business, it is increasingly important to ride the crest of globalization and stay at its forefront. Recognizing this reality, many Japanese firms are actively engaging in trade and international investment activities. By setting up new production bases outside Japan in a move to increase production overseas, they are going beyond the mature domestic market for a broader business horizon overseas where there are more opportunities for business development.
However, in developing overseas business, Japanese firms have to face various risks that reflect the political and economic conditions of the localities and countries where they operate. There are also a number of cases where infrastructure crucial for business operations such as power and transport networks are yet to be well-developed, hampering business operations of Japanese firms.
Under these circumstances, JBIC has been providing financial support for trade and direct investment activities in developing countries since the days of its predecessor, the Export-Import Bank of Japan (JEXIM). In its unique capacity as an official financial institution, JBIC is supporting overseas business operations of Japanese firms, while utilizing knowhow it has accumulated over the years.
Even if Japanese firms seek to expand business into foreign countries, their business projects will not succeed without a sound business environment. The most important factor is infrastructure at the national and/or local level. It is essential to develop such basic physical infrastructure as roads, telecommunications networks, power, water supply and port facilities. As JBIC supports the efforts of Japanese firms to develop international business operations, it is active in financing this sector. The objective of infrastructure development is not simply to draw in investments. Infrastructure will also serve as the underpinnings of economic development. Thus infrastructure projects have to proceed as joint public-private undertaking based on mutual trust between JBIC, host country governments and local firms.
For example, since Japan relies on the Middle Eastern countries for about 70% of its total crude oil imports, their stable political and economic development and stronger ties with them are an increasingly important issue to Japan. The following are a number of projects in the Middle East where JBIC is involved to address this issue.
Japanese SMEs have a high reputation in the world for their technology. However, when they set out to explore overseas business development, they find in many cases inadequate information regarding investment climates in foreign countries, and what funding is available to their ventures. This section describes how JBIC supports Japanese SMEs expanding into overseas markets, and showcases an SME which is successfully conducting international operations with financial support from JBIC.