Japan PM’s visit set to boost cooperation, says JETRO MD

Hideki Sho, MD of Japan External Trade Organization (JETRO) in his Riyadh office. (Rashid Hassan)
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Updated 12 January 2020

Japan PM’s visit set to boost cooperation, says JETRO MD

  • Abe's trip will promote bilateral ties and begin a new era of partnership between the two countries, Hideki Sho says
  • Saudi-Japan Vision 2030 covers trade, investment, energy, industry, infrastructure, finance and several other areas

RIYADH: Japanese Prime Minister Shinzo Abe’s ongoing visit to Saudi Arabia is timely and important, will boost cooperation between the two countries and promote bilateral ties, according to Hideki Sho, managing director of the Riyadh offices of the Japan External Trade Organization (JETRO) and Saudi-Japan Vision 2030.

In an exclusive interview with Arab News, Sho said: “It is the right time for our top leadership to visit. The Kingdom is the leader of the Arab world. The prime minister's decision to put Saudi Arabia at the top of his foreign countries to visit in 2020, reflects the very good relations between Japan and the Kingdom, and how much he values Saudi Arabia as a partner in this global economy.”

Saudi-Japan Vision 2030 was first suggested in September 2016 during Crown Prince Mohammed bin Salman’s visit to Japan. The Crown Prince and Prime Minister Abe agreed to bolster the two countries’ strategic partnership through the creation of the Joint Group for Saudi-Japan Vision 2030, “heralding a new era of partnership between the two countries,” according to Sho.

“Six months later, King Salman visited Tokyo and Saudi-Japan Vision 2030 was launched in March 2017,” said Sho. “Japan was the very first major economic partner who officially announced its support for Saudi Vision 2030.”

Sho said the Kingdom is expected to open its own Saudi-Japan Vision 2030 office in Tokyo in the first quarter of this year, in reciprocation of the Riyadh office that Sho heads, which was opened in 2018.

The joint initiative covers trade, investment, energy, industry, infrastructure, finance, SMEs, sports, culture, entertainment and several other areas. “It’s a much broader concept for Japan-Saudi collaboration,” he said.

“Before this, Japan’s relationship with Saudi was mainly oil-based — Saudi exported oil and Japan exported automobiles. That was very much a monoculture relationship. However, since this joint vision initiative our collaboration area has diversified (greatly).”

Both parties have so far identified 64 projects to work on together as part of the initiative.

Some of the key projects include the dispatch of a Japanese business mission to special economic zones in the Kingdom; cooperation on intellectual property and academic research (King Abdullah University of Science and Technology, or KAUST, has signed a five years agreement with the University of Tokyo); and cooperation in the transport sector (the Saudi Transport Ministry and the Ministry of Land, Infrastructure, Transport and Tourism in Japan has been conducting a study on the transport sector in the Kingdom).

In other deals, the Japanese Ministry of Internal Affairs and Communication and the Saudi Ministry of Communication and Information Technology have signed an agreement to strengthen cooperation in ICT; and the Japan Cooperation Center for the Middle East (JCCME) and the General Commission for Audiovisual Media (GCAM) have also been conducting joint activities to promote the development of human resources in the entertainment sector, including games, animation and graphic design.

On Saudi National Day this year, the Japanese entertainment conglomerate Avex produced the fireworks show “Star Island” in Jeddah. And in the health sector, the Saudi Ministry of Health and the Ministry of Health, Labor, and Welfare in Japan are conducting a one-year endoscopic treatment training program for Saudi doctors in Japan.

“Now our economic, political, social and cultural relationship is much more diversified, and deeper, with more people-to-people contact,” said Sho.

He said that the deepening of that relationship will be reflected in an increased number of Japanese tourists visiting the Kingdom, particularly since Saudi Arabia changed its tourism visa rules in October.

“The response is good,” he said. “Individual tourists have started visiting the Kingdom already, and major Japanese tourist companies and agents have started organizing Saudi tours. And you can see many Saudi tourism promotions on Yahoo! Japan nowadays.”

Sho said he hopes to see Saudi companies increase their presence in Japan in the near future. Giants like Saudi Aramco and SABIC already have offices in Tokyo, “but what we are trying to do at JETRO is to mobilize more Saudi companies (to do the same).”

He also stressed the potential of the Middle East market — particularly Saudi Arabia — for Japanese companies, adding that population growth, plus the fact that the average age of the population in the Gulf is so young, means more consumption and more economic activity, with higher spending on food, entertainment and cars. “So for Japanese companies, this area is a growing market,” Sho said.

Sho cited Japanese multinational Canon as a good example, saying it has started to invest in Saudi Arabia and aims to hire 300 Saudis as sales executives to expand its business in the Kingdom.

Sho said there are currently 95 joint projects — mostly in the industrial sector — underway between the Kingdom and Japan, worth $15 billion.

Saudi Arabia is Japan’s third-largest trading partner and second-largest source of foreign capital, and provides 40 percent of the country’s oil requirements, he said.

“Saudi Arabia has a huge trade surplus with Japan,” Sho said, adding that Japanese investments have so far created 6,500 jobs for Saudis.

He also praised the Kingdom’s preparations for its hosting of the G20 Summit (hosted by Japan last year), adding that the Saudi Arabian General Investment Authority (SAGIA) had already impressed him by reducing the time required for customs clearance from one week to within 24 hours.

He also welcomed the introduction of separate immigration counters at Riyadh airport for G20 delegates.

“The world is recognizing that Saudi is moving in a good (direction),” Sho said, pointing to the Kingdom’s ranking in the World Bank’s most-recent “Ease of Doing Business” report.

In the study, Saudi Arabia showed the biggest improvement, leaping 30 places up the rankings to number 62 out of 190 countries.

“Prime Minister Abe’s visit is kind of a commitment from the top leadership,” he said. “It is a very good sign from a foreign investment point of view.”

S&P 500 inches closer to record high

Updated 12 August 2020

S&P 500 inches closer to record high

  • US stock market index returns to levels last seen before the onset of coronavirus crisis

NEW YORK: The S&P 500 on Tuesday closed in on its February record high, returning to levels last seen before the onset of the coronavirus crisis that caused one of Wall Street’s most dramatic crashes in history.

The benchmark index was about half a percent below its peak hit on Feb. 19, when investors started dumping shares in anticipation of what proved to be the biggest slump in the US economy since the Great Depression.

Ultra-low interest rates, trillions of dollars in stimulus and, more recently, a better-than-feared second quarter earnings season have allowed all three of Wall Street’s main indexes to recover.

The tech-heavy Nasdaq has led the charge, boosted by “stay-at-home winners” Amazon.com Inc., Netflix Inc. and Apple Inc. The index was down about 0.4 percent.

The blue chip Dow surged 1.2 percent, coming within 5 percent of its February peak.

“You’ve got to admit that this is a market that wants to go up, despite tensions between US-China, despite news of the coronavirus not being particularly encouraging,” said Andrea Cicione, a strategist at TS Lombard.

“We’re facing an emergency from the health, economy and employment point of view — the outlook is a lot less rosy. There’s a disconnect between valuation and the actual outlook even though lower rates to some degree justify high valuation.”

Aiding sentiment, President Vladimir Putin claimed Russia had become the first country in the world to grant regulatory approval to a COVID-19 vaccine. But the approval’s speed has concerned some experts as the vaccine still must complete final trials.

Investors are now hoping Republicans and Democrats will resolve their differences and agree on another relief program to support about 30 million unemployed Americans, as the battle with the virus outbreak was far from over with US cases surpassing 5 million last week.

Also in focus are Sino-US tensions ahead of high-stakes trade talks in the coming weekend.

“Certainly the rhetoric from Washington has been negative with regards to China ... there’s plenty of things to worry about, but markets are really focused more on the very easy fiscal and monetary policies at this point,” said Paul Nolte, portfolio manager at Kingsview Asset Management in Chicago.

Financials, energy and industrial sectors, that have lagged the benchmark index this year, provided the biggest boost to the S&P 500 on Tuesday.

The S&P 500 was set to rise for the eighth straight session, its longest streak of gains since April 2019.

The S&P 500 was up 15.39 points, or 0.46 percent, at 3,375.86, about 18 points shy of its high of 3,393.52. The Dow Jones Industrial Average was up 341.41 points, or 1.23 percent, at 28,132.85, and the Nasdaq Composite was down 48.37 points, or 0.44 percent, at 10,919.99.

Royal Caribbean Group jumped 4.6 percent after it hinted at new safety measures aimed at getting sailing going again after months of cancellations. Peers Norwegian Cruise Line Holdings Ltd. and Carnival Corp. also rose.

US mall owner Simon Property Group Inc. gained 4.1 percent despite posting a disappointing second quarter profit, as its CEO expressed some hope over a recovery in retail as lockdown measures in some regions eased.

Advancing issues outnumbered decliners 3.44-to-1 on the NYSE and 1.44-to-1 on the Nasdaq.

The S&P index recorded 35 new 52-week highs and no new low, while the Nasdaq recorded 50 new highs and four new lows.