ABU DHABI, 31st July, 2019 (WAM) -- Japanese companies are making a strong presence in the UAE, with their number increasing 23.44 percent in the past six years, according to a top Japanese diplomat.
"The number of Japanese corporations in the UAE has slowly but steadily been increasing; from 273 in 2013 to 337 in 2018," Akihiko Nakajima, the Japanese Ambassador to the UAE, told the Emirates News Agency, WAM, in an exclusive interview.
Around two thirds of them are working in manufacturing and retail/wholesale business. Most of the new Japanese businesses are established in free zones that offer many incentives to private entities, he said.
"Generally speaking, Japanese companies are not quick to seize the trend but once settled, they tend to work rigorously and contribute to the economy in a long term," Nakajima explained.
Although bilateral trade witnessed a slight decline in the first quarter of 2019, compared to the same period last year, "our economic relationship is rapidly expanding and diversifying," he said.
Bilateral trade between Japan and the UAE stood at US$7.46 billion (AED 27.4bn) in the first quarter of 2019, the envoy said.
Total exports from the UAE to Japan were worth US$5.68 billion (AED20.87bn), of which oil and gas comprised 96 percent and valued at around US$5.46 billion (AED20.06bn).
Total imports from Japan to the UAE were pegged at US$1.78 billion (AED 6.53bn), of which automobile and machinery made up 74 percent that amounted to around US$1.32 billion (AED4.84bn) in the first quarter of 2019, he said.
About the value of trade, the ambassador explained that the exports from the UAE heavily depended on the fluctuating oil price, while imports from the UAE have been rather stable during past four years.
The bilateral investment protection treaty signed in April 2018 to boost investment flows between the two countries is an example for the growth trajectory, he said.
"With this trend in mind, it is highly expected that our economic relations will further expand in the near future," the envoy said.
Japanese oil and gas companies are actively involved in the UAE economy. Likewise, there are some remarkable non-oil Japanese direct investments that have become successful businesses in the UAE, Nakajima said.
Al Gharbia Pipe Company LLC in Khalifa Industrial Zone, KIZAD in Abu Dhabi, which manufactures large diameter steel pipes for domestic oil plants, is an ideal example for Japan-UAE Joint Venture, he pointed out.
Marubeni Group, a Japanese corporation, is operating the Noor Abu Dhabi, one of the world’s largest independent solar power plants with a production capacity of 1,177 megawatt, he said.
Japanese small and medium enterprises, SMEs, also play an active role and make their contributions to the UAE economy. For example, Nihon Mesh Kogyo UAE FZC that manufactures steel mesh for various plants, and Takenaka Middle East LLC that manufactures anticorrosion bolts and nuts, are the pioneers of Japanese SMEs operating in Ras Al Khaimah, the envoy explained.
Asked about any unexplored areas in bilateral economic relations, he said Japan has advanced unique technologies in renewable energy sector, such as Fuel Cell Vehicle (FCV) and energy efficient urban development, which the UAE has not yet fully utilised.
"I believe such technologies will contribute to developing a sustainable society here, in accordance with UAE Vision 2021 and especially Environment Vision 2021," Nakajima said.
Similarly, the ambassador said, the developments in Japanese food industry, especially water-efficient greenhouse horticulture, health food, and authentic Japanese food services could also be utilised in the UAE.