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In a bold move to position Japan as a leader in the global asset management industry, Prime Minister Fumio Kishida is considering the establishment of special business zones in four key locations: Tokyo, Osaka, Fukuoka Prefecture, and Sapporo City. This initiative aims to entice foreign asset management companies to set up operations in Japan.
Prime Minister Kishida discussed this vision during a speech to investors at the Economic Club of New York in late September, highlighting the importance of creating an environment conducive to foreign investment. These proposed special business zones will be de-regulated and have simplified administrative procedures, streamlining the process for foreign financial companies to establish offices.
One notable element of these zones is the emphasis on conducting administrative procedures in English, marking a departure from traditional business practices in Japan. This move is expected to remove some of the prior language barriers, making it more attractive and accessible for international firms to consider Japan for their operations.
The importance of English proficiency is further underscored by the intention to ensure that medical facilities within these special business zones have English-speaking staff. This holistic approach facilitates the ease of doing business and ensures that the living and working experience for foreign professionals in these zones is as seamless as possible.
The commitment to creating a foreigner-friendly environment extends beyond administrative procedures. The municipalities in consideration, including Fukuoka, have already taken proactive steps by appointing individuals with expertise in overseas financial institutions as advisors. This approach demonstrates a genuine desire to become a special business zone and exemplifies the municipalities’ existing history in this regard.
While the specific criteria for these zones will be finalized at a later date, the announcement signals a significant step toward making Japan a more attractive destination for foreign investment. The call for applications from potential candidates is expected to generate interest from international financial institutions looking to capitalize on the envisioned benefits of these special business zones. Already, administrative procedures in English have been successfully implemented at the Financial Market Entry Office in Tokyo. Over 20 foreign financial institutions have decided to enter the Japanese market as a result, with expectations that this number will grow substantially with the introduction of these new business zones.
Japan’s ambitious bid to become a global asset management hub through the creation of special business zones reflects a commitment to economic openness and competitiveness on the global stage. If successfully implemented, these zones have the potential to transform Japan into a magnet for international financial institutions, bolstering its position as a key player in the dynamic landscape of global finance.
Whether within one of these zones or at another location of interest, Tractus’ Japan office is ready to help companies enter the Japanese market. We can support a variety of requests ranging from providing organizations with the resources and research they need, organizing and facilitating trade and FDI missions within Japan, and connecting companies and organizations with targeted meetings and partner-matching. Regardless of where you are at in this process, the Tractus team is prepared to work with you to achieving your business goals.
About the Author
Kaitlin Smith is a Research Analyst based in Japan.
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