UKTI October 2013

Eye on Expansion

Japan chosen for second wave of UK export programme

The BCCJ has been invited to join wave two of the UK government’s new Strengthening Overseas Business Networks programme. Sue Kinoshita, director of UK Trade & Investment (UKTI) Japan, describes the background and opportunities this presents for the BCCJ.

The economists tell us that at a time of government cutbacks and tentative consumer spending, the only way for the UK to achieve growth is through trade and investment. Sounds like a job for the eponymous UKTI!

Jointly “owned” by the Foreign & Commonwealth Office and the Department for Business, Innovation and Skills, UKTI’s mission is to help UK exporters succeed globally and assist overseas firms to bring high-quality investment to the UK.

Last year my team of 50-plus in Tokyo and Osaka helped some 2,250 UK firms develop their business in Japan, and we played a significant role in securing 110 investments into the UK by Japanese firms, thereby creating or safeguarding over 7,400 jobs.

For the third straight year we achieved record performance levels, despite a shrinking staff complement.

But we need to do more. Ministers have set UKTI the challenge of doubling the number of UK firms it helps by 2015. The government also has fixed 2020 targets of getting 100,000 more firms to export, and doubling exports to £1trn.

With resources static at best, the only way for UKTI to achieve that is by working more smartly, particularly by delivering services digitally, and by forging partnerships with others whose networks and expertise can complement and augment our own.

British chambers of commerce in the UK and overseas have always been among UKTI’s most important partners. But in line with this new national challenge, UKTI is now exploring options for even closer collaboration with chambers.

Inspired by German, French, US and Japanese models, where chambers of commerce play a more prominent role in delivering export services, Prime Minister David Cameron in November 2012 launched a programme to enhance overseas business networks.

The programme aims to build the capacity of the UK’s overseas business networks, mostly chambers of commerce, to provide a wider range of high quality business-to-business (B2B) support to UK small and medium enterprises.

Success will be a simple, seamless customer journey connecting firms locally, nationally and internationally and offering practical business support at least on a par with that on offer to competitors from other nations.

The first wave of the programme was backed by £8mn in seed funding, and focused on 20 emerging and high-growth markets.

Sadly, Japan doesn’t quite fit that description at the moment, despite Prime Minister Shinzo Abe’s best efforts! The size and capacity of the respective chambers varied hugely, from nothing in Qatar to the highly sophisticated, well-staffed operation in Singapore.

Each chamber is now taking its own approach to developing services for exporters, from simple networking opportunities, as the BCCJ does, to full-blown business centres, like the one opened last month in Gurgaon, India.

The programme is still in its infancy. But early feedback is positive, and that has emboldened the government to bring into the programme 21 more markets—including Japan.

We have some interesting bedfellows in this second wave, including Kazakhstan and Angola. But Minister for Trade and Investment Lord Green was keen to see how the B2B model might work in a sophisticated developed market, and Japan is the place he has chosen to pilot the approach.

I received news of Japan’s inclusion just as everyone was departing for summer holidays.

Intrigued by the challenge, the BCCJ Executive Committee nevertheless began putting together a taskforce to start considering the implications, opportunities and risks.

In the BCCJ’s 65th year, this is a chance to review its role and the value it can add for members and firms seeking to enter the market for both the first time.

Newcomers need legal, financial, marketing, logistical and HR support and, therefore, represent a new potential client base for many member firms.

And the experience that chamber members have in doing business in Japan, in turn, represents a hugely valuable resource for first-time exporters.

The new Export to Japan digital platform developed by UKTI in partnership with the BCCJ, British Airways, Business Link Japan and many other BCCJ members is a first step towards harnessing members’ services and knowhow for the benefit of firms new to the market (more details in the next edition of BCCJ ACUMEN).

However, taking on a whole new role has potentially far-reaching implications for the BCCJ’s membership, staffing and resources.

The BCCJ has, therefore, elected first to bid to UKTI for funding for a scoping study to understand the nature of the market and the demand for export services, and to compare possible business models and the impact they might have on the chamber’s tax status, constitution and member services.

At the time of writing, we are waiting to hear whether this bid has been accepted. If it has, you can expect to hear more soon about how you can be involved, including how to feed into the consultation with members.

In the meantime, UKTI continues to offer its own full range of services to all UK firms. Do get in touch with us if you think we can help.