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12/09/2021

Strategy for water business in overseas market

METI promotes Japan’s water business overseas

Water is a precious resource essential for daily living and industrial activities. Helping other countries improve their water infrastructure and develop an environment where it can be steadily supplied will lead to solutions for the issues they face.

In the global water business market, companies from France, China and the United States boast large sales. Japanese companies are increasingly making their presence felt by pushing their technological advantages and know-how. This article looks into the Japanese government’s efforts to help domestic businesses enter water infrastructure markets overseas, including its strategies and support programs.

In terms of sales, Japan’s Kubota Corp., Kurita Water Industries Ltd. and Toray Industries, Inc. have a strong presence globally. Companies such as these are addressing the demand for clean water, which is increasing with the growth of public awareness of the U.N. sustainable development goals (SDGs).

How important is the water business?

Water is essential for a sustainable future. © KAZUYUKI OKAMOTO
Water is essential for a sustainable future. © KAZUYUKI OKAMOTO

Water is required by nearly all industries, but there are still many people for whom access to safe drinking water and flush toilets is not readily available. Even in advanced economies, there have been times when industrial water for semiconductor production ran short due to the impact of climate change, including droughts. Damage and economic losses from increasingly severe water disasters, including earthquake-induced disruptions and floods, have become issues around the world. Developing and improving water infrastructure helps mitigate such situations and can be said to increase the significance of businesses’ role in society. One could say the development of the water business is contributing significantly to achieving a sustainable society.

What then is the Japanese government proposing in order to help Japanese companies enter water infrastructure markets overseas?

Ways of promoting Japan’s infrastructure systems overseas have been discussed by the Ministerial Meeting on Strategy relating Infrastructure Export and Economic Cooperation chaired by the chief cabinet secretary. The agenda of this meeting has included issues specific to certain countries or regions, as well as issues specific to or encompassing certain fields. In December 2020, the meeting formulated the “2025 Policy Program for Promotion of Overseas Infrastructure Systems,” which lays out new goals for the five-year period starting in 2021. The three key aims of the program are to achieve economic growth through carbon neutrality and digital transformation; contribute to achieving the SDGs in partner countries; and realize Free and Open Indo-Pacific (FOIP).

In response to the program, the Ministry of Economy, Trade and Industry published the “Survey Report on the Overseas Development of the Water Business: 10-Year Review of Overseas Development Measures and Future Direction of Development” in March. In this report, the ministry, which has been promoting Japanese water companies overseas since 2009, outlined anew the current situation of the global water business and suggested vision for the future in client countries and a policy direction that will allow for the promotion of both domestic companies and Japanese know-how overseas.

Amid calls for strategic development under a collaborative framework between the government and the private sector, the document laid out five scenarios for overseas promotion ranging from discovering water projects in target countries and completing them, to continuing such projects after completion.

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