In the first session of “ASEAN-Japan Business Week”, powerful and encouraging messages were delivered by the leaders of the public and private sectors of both ASEAN and Japan toward establishing new partnership between Japan and Southeast Asia.

In the beginning of the session, Minister Kajiyama stressed that there are new business opportunities for Japanese companies in ASEAN region where they can contribute to sustainable business growth while solving the social problems through innovation in the region.

He also mentioned the importance of promoting co-creation of innovation through collaboration between ASEAN and Japan while learning from local dynamism, such as the rapid progress of digitalization in ASEAN. In addition, he emphasized on "Green Growth" for ASEAN-Japan cooperation, and announced the launch of "Asia Energy Transition Initiative (AETI)", targeted to achieve sustainable economic growth and carbon neutrality in Asia, with concrete support measures based on five pillars.

Finally, he reiterated the need for Japanese companies’ management to understand that ASEAN is at a major turning point and that companies need to take the challenges - as an opportunity to build their new business models. He hoped this ASEAN-Japan Business Week would be a drive for Japanese companies to consider next steps for their ASEAN expansion plans.

Secretary-General of ASEAN Dato Lim highlighted the significance of digitalization and sustainability that are critical to ASEAN recovery efforts along with the recent launch of the Mid-Term Review (MTR) Report of the ASEAN Economic Community Blueprint 2025. He added that he expected Japanese business community to continue maximizing cross-border manufacturing and production activities within the ASEAN region, restoring the supply chain by the use of digital technologies such as e-commerce as well as focusing on sustainable investment towards carbon neutrality.

Next, from the Japanese industry, Mr. Sasaki, Chairman of the Japan External Trade Organization (JETRO), Mr. Mimura, Chairman of the Japan Chamber of Commerce and Industry (JCCI), and Mr. Hara, Chairman of Committee on Asia and Oceania, Keidanren, gave their speeches on the theme of "new business opportunities expanding to Southeast Asia”.

Chairman Sasaki underscored the ASEAN-Japan partnership in industrial development and reiterated ASEAN region as a hub of supply chain and increasing digital solutions. He also introduced the J-Bridge, which was launched as a platform for encouraging collaboration between ASEAN and Japan startups/businesses and further shared his enthusiasm for such collaboration.

Chairman Mimura gave emphasis on the importance of business transformation through digitalization amid COVID-19 pandemic, and underscored the SME’s key focus on overseas business development in SEA as emerging business opportunities. Furthermore, he introduced a new project called "Overseas Business Development Initiative" collaborated with JETRO, JICA and local JCCIs throughout Japan to actively support overseas business operations especially SMEs.

Mr. Hara highlighted the importance of digitalization amid pandemic, DX promotion and global economic recovery in post pandemic era in solving global agenda and creating a sustainable society. With this awareness, he further introduced “. The NEW Growth Strategy” which Keidanren published last November, emphasizing the importance for business sector to jointly work and create value co-creation with international community, especially ASEAN, in solving social problems and achieve economic growth. He also stressed the necessity for promoting the co-creation with ASEAN in three fields: 1) strengthening ASEAN connectivity which Japanese companies have long been engaged especially in terms of both hardware and software infrastructure, 2) digital technology for social development through cooperation with ASEAN startups, and 3) sustainable growth.

To conclude this session, Mr. Tamura, Deputy Director-General of the Ministry of Economy, Trade and Industry, gave a keynote speech titled "Deepening Japanese Engagement with ASEAN Region in the Post-COVID Era". In recognition of ASEAN-Japan longstanding relation, he therefore addressed three core pillars for future ASEAN-Japan cooperation, 1) strengthening cooperation towards the early recovery from COVID-19 pandemic 2) transformation to lucrative business model by co-creating businesses with ASEAN’s local partners with use of open innovation, and 3) enhancing energy transition and partnership on green growth, adding that the Ministry of Economy, Trade and Industry is promoting policies based on these core pillars.

Kajiyama Hiroshi (Minister of Economy, Trade and Industry)

The economic relation which ASEAN and Japan built over a half century, has constantly been evolving and forming the win-win relations. Currently, Japan’s business in ASEAN region is at a great turning point due to the changing needs of ASEAN countries and intensifying competition with other countries. While ASEAN continues to perform remarkable economic growth, there is an urgent need to deal with social challenges such as traffic congestion in urban areas and economic disparities among regions. It means there are new business opportunities for Japanese companies in ASEAN region where they can contribute to sustainable business growth while solving these social challenges through innovation.

Economic cooperation between Japan and ASEAN is also moving forward to a new stage. Last year, despite the worldwide pandemic, active discussions among economic ministers were carried out resulting in the endorsement of “ASEAN-Japan Economic Resilience Action Plan” containing over 50 cooperation projects.

One of the most symbolic projects is "Asia DX Project”. In ASEAN region, digital innovation is developed and implemented faster than in Japan, and this trend is further accelerated by COVID-19 crisis. I believe Japanese enterprises learn a lot from this regional dynamism and contribute to solve the social issues with technologies and know-hows. The public and private sectors in Japan and ASEAN should thus work together to promote the co-creation of innovation.

Another important focus for ASEAN-Japan cooperation in post-COVID-19 period is "the implementation of green growth”. Namely, countries around the world are required to further increase or advance their greenhouse gas reduction targets toward COP26, by the end of this year. Moreover, in the international financial industry, divestment movements, especially from fossil fuel projects, are moving rapidly. However, the conditions of industrial and social structure in individual country are different, and there is no single optimal solution for achieving carbon neutrality. It is absolutely essential to achieve diverse and realistic energy transitions that utilize all energy sources and technologies, especially in Asia, where energy demand is rapidly increasing.

For this reason, Japan newly proposes "Asia Energy Transition Initiative (AETI)" with a package of concrete support measures based on five pillars including; 1) Support drawing roadmaps for energy transitions in Asia, 2) Presentation and dissemination of Asian version of transition finance, 3) USD 10 billion financial support for projects such as renewable energy/energy saving and LNG, 4) Technology development and deployment through 2 trillion yen fund support, 5) human resource development related to decarbonization technologies and knowledge sharing through Asian CCUS network. Japan also continues to hold further discussions with ASEAN and broaden ideas of need for practical transitions to the international community including other Asian countries, the United States, Canada, Australia and the Middle East.

ASEAN is going through a major turning point which is a great transformation opportunity for Japanese companies to establish new business models, and win the competitions while assimilating various changes surrounding ASEAN. In this connection, sharing Japanese awareness in management of Japanese businesses would also be of importance along with the support from Japanese government to fully back up and tackle with the challenges of those companies. We hope that ASEAN-Japan Business Week would be a drive for Japanese companies to consider next steps for their ASEAN expansion plans.

Sasaki Nobuhiko (Chairman, Japan External Trade Organization)

Japanese companies have contributed to Southeast Asia through job creations, technology transfers and human resource developments more than half a century, especially in the manufacturing industry. Meanwhile, the governments of Southeast Asian countries - also heard of business voices to further improve business environment. We both have deepened mutual trust, developed and maintained great relationships.

ASEAN has been actively proceeding with trade liberalization, and as a result, finally signed a Regional Comprehensive Economic Partnership Agreement (RCEP) last year. This contributed the region to be highly recognized as a global supply chain base, and I would like to express my respect for the efforts toward economic integration. The value of foreign investments into Southeast Asia increased 5 times in the 20 years from various industries, not only manufacturing but also finance, retail, real estate, etc. The shift in the industrial structure to the non-manufacturing industry has led to a discovery of new demands in each country. The service industry is about solving the problem and realizing wish in our daily life. Due to the COVID-19 crisis, digital tools hugely play an active role to satisfy demands across the national borders. Particularly the young generation in Southeast Asia is adapting and boosting this trend.

A lot of startups in Southeast Asia, such as Grab, have grown their business rapidly. They are tackling numerous social challenges, and Japan has a lot to learn from their quick actions and flexible adaptability. In Southeast Asia, digital technologies are utilized not only in manufacturing, R&D, inventory management, logistics but also in medical treatment, education, blockchain, and payment. Besides, there is new business opportunities to bring digitalization into traditional industries such as agriculture and fisheries.

JETRO launched J-Bridge as a new platform to increase foreign business opportunities for Japanese companies which is one project of the "ASEAN-Japan Economic Resilience Action Plan" endorsed between Minister Kajiyama and ASEAN Economic Ministers last July. Through this new platform, JETRO would put our effort to promote collaboration between Japanese companies and ASEAN start-ups, to give a new perspective on business in ASEAN region to Japanese companies, to contribute to economic recovery from COVID-19, and to develop further win-win relationships.

Tamura Akihiko (Director-General for Trade Policy, Ministry of Economy, Trade and Industry)

Historically Japan and ASEAN have evolved together for over half a century by deepening economic relations. In the 1990s, Japan positioned ASEAN as an important production base and provided various support for carrying out "flying geese model". Then, in the 2000s, in response to the movement toward ASEAN regional economic integration, the EPA (Economic Partnership Agreement) negotiations were promoted, and the construction and expansion of production network throughout the region took place.

ASEAN is becoming more attractive as a market with its remarkable economic growth, but at the same time, it is going through various changes. The responses to the COVID-19 outbreak and early full-scale economic recovery would be the urgent tasks for ASEAN. With the rapid economic development, new social issues such as regional disparities, social infrastructure and institutional development have also become apparent. When we talk about the changes in ASEAN, global trends such as economic digitization and responses to climate change issues cannot be ignored either. In particular, the progress of digitalization in the region, described as "leapfrogging" and the growing presence of foreign companies are notable events. Moreover, in regard to climate change issue, as the world is being steered toward a greener trend, ASEAN will be expected to take actions toward the going green strategies/plans like every other country.

Focusing on deepening of ASEAN-Japan cooperation, there are three key points to be considered. The first is to strengthen cooperation towards the early recovery from COVID-19 pandemic. The second is the transformation to lucrative business model by co-creating businesses with ASEAN’s local partners with use of open innovation. Namely, "Monozukuri" represented by the Japanese manufacturing industry so far is based on the projects of Japanese companies or affiliated companies, investing and developing infrastructure overseas, and expanding the production network to reduce overall costs and improve productivity. However, a shift to a new business models such as business development that meets local needs, the combination of goods and services, or the provision of solutions to problems are also required. To move forward, it is vital to co-create businesses with ASEAN’s local companies as partners and exploit open innovation. The last but not least, the third is enhancing energy transition and partnership on green growth with ASEAN. Achieving economic growth and responding to climate change would therefore be essential for the future of ASEAN. In this context, Japan is prepared to tackle these issues together with ASEAN.

With these three key points in mind, the Ministry of Economy, Trade and Industry (METI) would encourage further achievements on the ASEAN-Japan Economic Resilience Action Plan, Asia DX Projects, Dialogue for Innovative & Sustainable Growth (DISG), Supply Chain Resilience Forum as well as the Asia Energy Transition Initiative (AETI) in collaborative efforts with ASEAN.