Japan braces for Brexit disruption


Japanese people are skilled at collaborating and the prime minister and business leaders are working together closely to face a serious problem in the UK at the moment: the Brexit.

Japanese companies which have invested in Britain – including Hitachi, Honda, Toyota and Nissan – expected to use the UK as a gateway to Europe’s single market.

They are therefore distraught by Britain’s plan to leave the EU and are especially concerned about the prospect of a so-called “no deal Brexit” which could cause massive disruption to their international operations.

Abe’s visit

Prime Minister Shinzo Abe lobbied on behalf of Japanese companies when he met his British counterpart Theresa May in London. He said he was was “in total support of the draft withdrawal agreement” which Mrs May reached with the EU and which was put to a vote in Parliament on January 15th.

It was rejected by a huge majority of MPs.

That leaves everyone – including Japanese businesses – wondering what happens next. If no agreement is in place by the time Brexit happens on March 29, then there will be severe restrictions on the movement of goods between the UK and EU.

Mr Abe said: “We truly hope that a no-deal Brexit will be avoided. And in fact, that is the whole wish of the whole world.”

Honda’s shutdown

The Japanese carmaker Honda has announced it will halt production in the UK for six days in April due to Brexit.

The company said in a statement: “Honda has been assessing how best to prepare for any disruption caused by logistics and border issues following the UK leaving the EU. To ensure Honda is well paced to adjust to all possible outcomes, we are planing six non-production days in April 2019.”

Hitachi’s nuclear problem

Meanwhile, the Nikkei Asian Review reports that Hitachi is about to suspend plans to for a new power station in North Wales.

Hitachi has strived to win foreign contracts since the Fukushima disaster, which has led to a suspension of new reactors within Japan.

According to the BBC, it has spent two billion pounds to develop the Welsh site but the investment will now have to be written off as a loss.

Hitachi is worried about the price the British government will pay for the electricity generated by the plant upon its completion.

Nick Butler from King’s College, London told the BBC: “Hitachi are exhausted that they can’t get a decision from the UK government and this is one of the secondary consequences of Brexit. The government is entirely tied up with one issue and unable to cope with others.”

Free trade hope

The nuclear power project is by no means Hitachi’s only investment in the UK. It is also involved in many other businesses related to transport and science.

Prime Minister Theresa May told Hitachi’s chairman Hiroaki Nakanishi last year that Britain would seek a free trade agreement with Japan following Brexit, although the time scale is unclear.

Handcuffed business hero protests his innocence from the dock

There’s been massive media coverage around the world this week of the court appearance by the former Nissan chairman Carlos Ghosn in Tokyo.

More than 1,100 people – some of them Nissan shareholders – queued for 14 seats in the public gallery.

Places for reporters were assigned by a lottery and no filming or photographs were allowed in court. However, artists were allowed to draw pictures of the accused and they provided the press with sketches of Mr Ghosn looking gaunt and stressed.

Detention without trial

Those images were beamed around the world, with a reminder that Mr Ghosn has been held in detention for fifty days without trial. He was led into the court in handcuffs and with a restraint around his waist.

Mr Ghosn was arrested out of the blue in November and accused of not disclosing his full compensation and of using company money for personal gain.

The court appearance itself was short – only ten minutes – during which he read from a prepared statement protesting his innocence.

He challenged allegations made by his former colleague, Nissan CEO Hiroto Saikawa, who has suggested that his former boss had “remained in charge too long and had come to treat Nissan as his personal fiefdom and was driven increasing by greed,” according to the Financial Times.

In response, Mr Ghosn said that he had dedicated two decades of his life to reviving Nissan and building its alliance with Renault. “I worked towards these goals day and night on earth and in the air, standing shoulder to shoulder with hard-working Nissan employees around the globe to create value,” he said.

Defence tactics

The BBC turned to an old friend, Seijiro Takeshita of Shizuoka University for analysis. He said: “Mr Ghosn wanted his voice heard. His tactic is to say that the top management of Nissan were aware of all his actions, so if Nissan knew about this, the focus will be on Nissan’s approach to corporate governance, rather than just Mr Ghosn personally,” said Professor Takeshita.

The FT’s Tokyo correspondent Leo Lewis discussed the case with Jesper Koll of Wisdom Tree Japan, a robust critic of Japanese business and government, who loves the media limelight. Mr Koll suggests that the arrest of Mr Ghosn is a national embarrassment which shows corporate reform in Japan has been an illusion.

According to that way of thinking, writes Leo Lewis, “Whether Mr Ghosn has been felled by a corporate coup or some other design, he has fallen victim to an insiders’ club he could never hope to join. These are the rules of Japan Inc – love them or leave them.”

Back to prison

Mr Ghosn has now returned to his cell. The next step is for the court to decide whether to release him. However, prosecutors could arrest him for a fourth time if they have fresh allegations against him – meaning he’ll be locked up for even longer.

The media’s appetite for information about the case is far from satisfied and the story’s likely to stay in the headlines for many months to come.

 

Whale hunters ride another wave of criticism

I have been writing about Japan for many years but I always try to avoid the subject of whales.

Whaling generates a great deal of emotion and leads to criticism of Japan in the media, with the strong implication that other countries treat animals much better than the Japanese.

I can remember taking a few phone calls on this topic when I was working at the BBC’s office in Tokyo. When asked by colleagues in London to write about whales, I am afraid that I made an excuse that I was “busy on other topics”.

I am not a person who spends much time thinking about animal welfare or hunting. Perhaps I should.

Headline news

The international press keeps the issue high on the agenda.

Last week, Japan withdrew from the International Whaling Commission and said it would restart commercial hunting.

This issue became the lead story for the BBC on both its domestic and international outlets. “It means Japan will be able to freely hunt species currently protected by the IWC, like minke whales. Conservation groups warn the move will have serious consequences,” said the BBC website.

Shock reaction

The Times newspaper picked up on the issue in an editorial on December 27th. It said: “Japan’s decision further undermines the principle of a rules- based system of international conservation. In a free for all of hunting, it is entirely feasible that, like the great auk in the 19th century, the whale could eventually vanish. No one knows the wide effect that would have on the ecosystems. The disaster must be prevented.”

The New York Times struck a similar tone: “There is no commercial, cultural or scientific justification for killing these magnificent creatures. Japan: Stop Slaughtering Whales!”

So, it is abundantly clear that Japan’s position on whaling brings a torrent of bad publicity with some unpleasant diplomatic implications.

And yet very few people actually eat whales. According to Japan’s Asahi newspaper, whale meat makes up only 0.1% of all meat sold in Japan.

Why do it?

The Financial Times reporter Robin Harding explained that most whale meat ends up in government stockpiles. But he says “the issue is totemic for nationalists and crucial to certain fishing villages represented by members of the ruling Liberal Democratic Party.”

I gained further insight into the rationale behind whaling by watching a documentary on Netflix which aims to present the issue from a Japanese perspective.

The film is called Behind The Cove: The Quiet Japanese Speak Out!

It claims that the traditional approach to whaling ensures the preservation of species and brings great social benefits to some coastal communities.

The film also shows the “quiet Japanese” loudly shouting at foreign eco-warriors from a group called Sea Shepherd, which stages protests against whaling in the fishing villages, without understanding much about Japanese culture.

The film also raises a question which was absent from this week’s media reports on whales.

Why do people in other countries – including Australia, the EU and the US – make such a distinction between the precious lives of whales and the lives other animals, such as cows, sheep and pigs – or even fish?

My new year’s resolution is to keep an open mind on this topic as I am sure whales are going to hit the headlines again soon.