NZ business needs to look to Japan for opportunities - business adviser

More New Zealanders are expected to travel to Japan in 2023. Photo / All Nippon Airways

New Zealand businesses need to wake up to the trade possibilities in Japan in order to lessen their dependence on China, Annette Azuma, a business adviser with accounting firm Baker Tilly Staples Rodway says.

Azuma specialises in international business and deals with a number of listed and unlisted corporates and high-net-worth individuals, and serves as a vice chair of the Japan New Zealand Business Council.

She told the Herald there were big two-way trading and partnership opportunities between New Zealand and Japan.

The fluent Japanese speaker, who has been with Baker Tilly for 27 years, was seconded to Japan 15 years ago.

“Fast forward 15 years and we now have six native Japanese speakers and myself,” she says.

Many of the team’s clients are listed and unlisted corporates, and a number of high-net-worth individuals who have have emigrated to New Zealand .

The PRC is by far New Zealand’s biggest trading partner while Japan is its fourth-largest.

“There has probably been an over-dependence on China over the last 10 years,” Azuma said.

New Zealand and Japan have had diplomatic relations for 70 years.

The countries have had an active two-way trade relationship that has predated the rise of China as the country’s number one export destination.

Azuma said Japan, with its population of 125 million, is a sophisticated market

“A lot of people say that if you can succeed in Japan you can succeed anywhere,” she says.

“So for an exporter, there are high standards and they will sometimes need to adjust their product,” she said.

NZ Trade and Enterprise arranged New Zealand as the first non-Asian country to be featured on Japan’s Rakuten platform - a domestic version of Amazon.

Today there are 500 New Zealand products on sale on the platform, she says.

Tourism has in the past been 75/25 per cent in New Zealand’s favour, but it is heading towards 50/50 by 2023 as more Kiwis seek an experience in Japan.

Air New Zealand will be running daily flights to Japan again from January.

Azuma noted that former president , the late Shinzo Abe, was a proponent of opening Japan up to the world, forging relations with the west, and clearing a path for Western companies to invest in Japan.

Japan has a declining population and an ageing demographic.

“They realise that they need to get more immigration and to get more business people,” she said.

There was also a push to make Tokyo more like Singapore or Zurich as a financial centre.

She said Japan’s business ethos went along the lines of “relationships, trust and a long-term view”.

Azuma sees opportunities in clean energy as Japan increases its focus on hydro and geothermal generation in order to reduce its carbon emissions.

Japan views New Zealand as a leader in clean energy and Obayashi Corp - which helped built the Waterview Tunnel - is working with iwi in Taupo around geothermal energy generation.

New Zealand’s two-way trade with Japan was $8.8 billion for the year ended June, 2019.

That year, New Zealand imported goods worth $4.247b from Japan, and exported goods worth $4.594b.

Fruit was New Zealand’s second-largest export to Japan, worth $617 million.

Of this, kiwifruit made up over 95 per cent, worth $590m, making Japan New Zealand’s largest export market for kiwifruit.

Other top exports to Japan were aluminium and aluminium articles ($607m); and milk powder, butter, and cheese ($563m).