TT-697 -- Containing China with Arms Exports. Ebiz news from Japan.

* * * * * * * * * T E R R I E 'S T A K E * * * * * * *
A weekly roundup of news & information from Terrie Lloyd.

General Edition Sunday, Feb 10, 2013, Issue No. 697


- What's New -- Containing China with Arms Exports
- News -- Recruit's Hiromasa Ezoe dies
- Upcoming Events
- Corrections/Feedback
- Travel Picks -- Kagawa castle town, Yokohama train museum
- News Credits

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In the last week, there have been two major press announcements by the government that make us think that Japan is about to take part in an arms race in South East Asia, as a likely containment policy to China and its increasingly belligerent posturing. On February 4th, the government announced that it would reverse a long-standing arms export policy, first put in place in 1967, and allow F-35 parts made in Japan to be exported to third countries. Then on February 11th, the government said that it would use overseas development funds to allow the Philippines to buy ten 40-meter patrol boats for JPY10bn.

We imagine that it's only a matter of time before there will be similar announcements of initiatives with Vietnam and Indonesia. Mitsubishi ATD-X Shinshin fifth-generation jet fighters perhaps? Although they'll have to wait a few years for delivery...

The Senkaku Islands spat has woken up a lot of powerful people in both government and industry about Japan's vulnerability in having China as its biggest trading partner. Given China's predilection for confrontation and even armed conflict with its neighbors, Japan will be caught with a difficult decision should China decide to invade the Senkakus. That decision will be whether to give up a major portion of about JPY13trn of exports to China, or to give up the Senkakus, which currently allow Japan to control vast oil and gas fields with as much as 100bn barrels of oil and the fourth largest gas reserves in the world.

[Continued below...]

------------- Job Vacancy, American Embassy -------------

Position: Commercial Assistant, Foreign Commercial Service, Japan
Experience: Either fully experienced or trainee
Timeframe: Urgent hire, applications close Feb 19th, 2013.
1. If experienced: professional service manager, analyst, and adviser to U.S. client firms. Provide advice and assistance in all aspects of facilitating the export of U.S. goods and services to Japan, and of attracting Japanese investment to the United States. Assist U.S. firms, conduct market research. Plan/organize trade-related programs and events for business and government.
2. If trainee: assist U.S. client firms in facilitating the export of U.S. goods and services to Japan and attracting Japanese investment to the United States. Market research, market trends analysis. Plan and organize programs and events to promote U.S. commercial interests.

For more details, see: (click Commercial Assistant opening), then submit your application to Human Resources Office, U.S. Embassy Tokyo. By post: 1-10-5, Akasaka, Minato-ku, Tokyo 107-8420 and by fax: 03-3224-5818.

[...Article continues]

Already we can see Japanese industry starting to reduce its exposure to China. Yes, the retailers are still rushing in, but the hard-core product makers are increasingly announcing new factories (autos, for example) in Thailand and elsewhere. And now that the yen is falling, we expect more production will return at least temporarily to Japan as well. Although the China domestic market itself is important for Japanese companies looking for new revenues, since many of the Japan->China exports are for materials, tools, and parts, which get re-manufactured and re-exported, one wonders if a confrontation would actually cause as much economic damage as feared? Obviously a war right now would be harmful, but with every year that goes by, Japan is diversifying itself to markets that are much less dangerous.

Indeed, proof of this can already be found in the recent realignment of Japan's exports. In 2012, Japanese firms sold US$129.8bn to ASEAN countries, up 5.8% from 2011, and just 7% less than all the exports to China, which fell 10.4% in 2011 to US$144.7bn. This is an appropriate move not only strategically but also because ASEAN is growing much faster than either China or Japan. ASEAN countries apparently now account for 10% of the world's GDP, as much as China, and the Asian Development Bank expects that by 2050, the region will account for 52% of global GDP.

While exporting clothes, cars, and home electronics has been the main focus of Japan's exports to SE Asia over recent years, now that China and South Korea have the ability to make more and better products, Japan has no option but to move up the food chain. The USA, France, and UK have provided ample proof that this means among other things, weapons exports. Japan already has the relationships in SE Asia, it has the technologies, and the funding. Further, the region is ripe for such exports, because according to an Economist 2012 article, there is a mini arms race already underway there.

The article says that SE Asian countries together spent US$24.5bn on defense in 2011, up 13.5% from 2010. This is still modest compared to China's US$143bn and Japan's US$59.3bn in 2012, but with soaring GDP growth and resulting tax income, we see much greater spending by SE Asian nations in coming years. This is only going to be reinforced by China's saber rattling over the Spratlys (also supposedly over oil and gas reserves) in the South China Sea, which directly affects Vietnam and the Philippines.

These are all factors that will prove too difficult for Tokyo's right-wingers to pass by. We're not saying this is a desirable turn of events, but given the increasing chance of confrontation between Japan and China, it's easy to see how the Japanese government will plow a pile of cash into this new regional strategy. Therefore, we think it's probably time to invest in Mitsubishi and other military hardware stocks...

...The information janitors/


--------------------- DELTA AIR LINES ---------------------


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・ Agoda
・ Ctrip
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・ SkyMiles Dining Japan
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**This offer is also eligible for package tours stated in DeltaVacations (Japan) brochure.

+++ NEWS

- Recruit's Hiromasa Ezoe dies
- Yes, consumers want pharmaceutical online
- Japanese families moving to Malaysia
- Japanese otaku Riddler finally caught

=> Recruit's Hiromasa Ezoe dies

The battle-scarred founder of Recruit and later of local property management firm Space Design, Hiromasa Ezoe, died on Friday of pneumonia in Tokyo. He was 76. Ezoe became embroiled in a bribery scandal in the 1980's and was eventually forced out of the media giant he'd built, Recruit. Ezoe-san fought the bribery charges all the way, but finally lost after the courts decided that giving shares in his unlisted company did constitute bribery. Among the recipients was Takao Fujinami, who was the chief cabinet secretary in the Nakasone government. ***Ed: One wonders what will happen to Ezoe's Space Design office and apartment management company? A great little firm.** (Source: TT commentary from, Feb 9, 2013)

=> Yes, consumers want pharmaceuticals online

In a resounding confirmation of the folly of banning the sale of Over-The-Counter (OTC) drugs online, in the four weeks since the Supreme Court ruled that a Health Ministry ban on the sale of OTC drugs was unfair, there are apparently more than 120 companies already selling OTC pharmaceuticals online. One of the Supreme Court plaintiffs,, has said that its OTC product sales have jumped to JPY5m a day from nothing previously. ***Ed: Apparently the Health Ministry is now scrambling to introduce new regulations, to require the many resellers to stick to Class 2 drugs such as cold medicines, and to give adequate explanations on the website about how to use those products. (Source: TT commentary from, Feb 9, 2013)

=> Japanese families moving to Malaysia

Interesting article in the Asahi several weeks ago, about young Japanese families moving to Malaysia on that country's MM2H visa. The visa allows people with regular overseas income and the required financial deposit, to live in Malaysia and travel freely to and from the country as the resident wishes. According to the article a small but increasing number of people under the age of 40 are moving to Malaysia to live. There were apparently 423 Japanese admitted under this visa category in 2011, and almost 50 of them were young family members. The availability of AirAsia flights from Kuala Lumpur to Tokyo for just JPY20,000 means that the MM2H visa is now a very viable alternative for Japanese wanting to live abroad and yet hop over to Tokyo for sushi when the mood takes them. (Source: TT commentary from, Jan 27, 2013)

=> Japanese otaku Riddler finally caught

It took the police to force confessions from four innocent suspects before they caught him, but finally they did. Last week they took into custody pudgy, 30-year old Yusuke Katayama, after solving a series of riddles that Katayama had challenged them with and which led them to a digital memory card he'd strapped to a cat living on an island near Tokyo. Katayama had sent threats against schools and kindergartens from rented PCs around the country, in what appears to be a case of boredom and otaku weirdness. ***Ed: Only in Japan?** (Source: TT commentary from, Feb 10, 2013)

NOTE: Broken links
Some online news sources remove their articles after just a few days of posting them, thus breaking our links -- we apologize for the inconvenience.



=> BiOS, a Division of the LINC Media group, is actively marketing the following positions for customers setting up or expanding in Japan, as well as other employers of bilinguals.


BiOS is urgently looking for a Staffing Consultant who can support our IT Outsourcing team in the Minato-ku area by working closely with IT engineers for both internal hire and direct placement recruitment. The candidate will search for and scout candidates to be submitted to clients, match job openings with candidates with appropriate level of skill, language, salary, etc., as well as meeting with candidates and coordinating with internal managers for interviews and screening. You will also be responsible for formatting resumes for submission, translating some job descriptions, and occasionally attending networking events.

Due to the technical nature and demanding work environment, this position is suitable for someone with a basic understanding of IT terminology who is comfortable multitasking. In addition, since this role requires direct coordination with both regional and global IT teams, fluent Japanese and native English will be required.

Remuneration is JPY2.5m - JPY3m depending on your experience and skill level.


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----------------- ICA Event February 21 ------------------

Speaker: Gen Utsumi, Head of Sales & Business Development APAC for smartTrade Technologies.

Title: "The Reality of Electronic FX Trading" Details: Complete event details at

Date: Thursday, February 21, 2013
Time: 6:30 Doors open, Buffet Dinner included and cash bar
Cost: 4,000 yen (members), 6,000 yen (non-members) Open to all. No sign ups at the door!!!!!!!
RSVP: RSVP by 5pm on Friday, February 15th
Venue is The Foreign Correspondents' Club of Japan

-------------------- Tohoku Fundraiser --------------------
David Stetson Valentine’s Photography Fundraiser for Tohoku

Studio portrait sessions for couples on Saturday 23rd & Sunday 24th February anytime between 10am and 10pm at a private studio in Meguro. Create a Valentine’s memory that will last a lifetime while supporting the recovery effort in Tohoku. Special price: JPY68,000. One third of all proceeds going to support projects on the Oshika peninsula.
Reservations: email with your preferred time.

David’s photography - and
Caroline’s activities in Tohoku -



In this section we run comments and corrections submitted by readers. We encourage you to spot our mistakes and amplify our points, by email, to

=> No corrections this week.



=> Honjima, Kagawa-ken
The Island Where Time Stood Still.

Many travelers head to Kyoto to catch a glimpse of Old Japan, but a simpler, quieter, more rare and realistic experience can be found in Kasashima on Honjima, a small island in the Seto Inland Sea, and part of the Shiwaku Island group.

The former castle town’s well preserved houses and local scenery have been designated an Important Historic Structure Group Preservation Zone of some 13.1 hectares. Although the hilltop castle overlooking Kasashima no longer exists, below it, over 100 beautiful old houses built by the Edo and Meiji period Shiwaku carpenters line the narrow streets, providing a rare glimpse into old Japan

=> Old Shimbashi Station, Kanagawa-ken
Foreign Footsteps in Yokohama 13 - Morel’s contribution

In 1854, during Commodore Perry’s second trip to Japan, Perry had amazed the Japanese with a live demonstration of a model steam locomotive in Yokohama. In 1872 (a long 18 years later) Japan’s first two train stations began service at Shimbashi and Yokohama, with a direct train connecting both stations (a distance of 23.8 km) in 53 minutes. Before then, the same journey had taken one day on foot, or seven hours by palanquin.

The original Shimbashi Station building (designed by American architect Richard P. Bridgens) was destroyed by fire in the Great Kanto Earthquake of 1923. But in 2003 it was restored for use as a nice little memorial museum. The station’s original platform was also replicated; it is 35 meters long.

The Railway History Exhibition Hall displays nails, plates, rails, and old tools and materials from the original railway on the first floor. Special exhibitions and a video corner are up on the second floor. The videos are quite interesting and include photos of Old Shimbashi Station when it was first opened, and bridge, rail and embankment construction site photos, as well.



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