The Japan Times PUBDATE: 11/6/20010 PAGE: 5 C M Y K OUTPUT TIME: 18:42:8

11/6/1910 / / PT SUP/PG 5/ED 1

(3) THE JAPAN TIMES SATURDAY, NOVEMBER 6, 2010 5

Kyoto APEC finance minister’s meeting

Former capital lends its history to key finance meetingJunichi MurataCHAIRMAN OF THE KYOTO PROMOTION COUNCIL FOR THE APEC

JAPAN 2010 FINANCE MINISTERS’ MEETING

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Kyoto boasts a longhistory since the time itwas Japan’s capitalmore than 1,200 yearsago. Kyoto flourishedas Japan’s political andcultural center then,and as proof of itsprosperity, it is home tonumerous historicbuildings and culturalassets that symbolizethe respective ages ofJapan, some of themdesignated as UNESCO World Heritage sites orJapanese national treasures. Kyoto is such anattractive area that every year it draws manytourists, not only from the other regions of Japanbut also from foreign countries.

In such a historical atmosphere, Kyoto’s uniqueculture and art have been fostered by its affluentnature and the people who have lived there overthe years, and they have come to symbolizetoday’s Japan.

In recent years, Kyoto is also developing as anew hub city that accommodates facilities forenvironment-related and cutting-edgetechnologies as well as those for academicstudies and research and development.

It is also well-known that Kyoto has drawnglobal attention as a theater for many internationalconferences. Thirteen years ago, Kyoto hostedthe third Conference of the Parties (COP3) to theUnited Nations Framework Convention onClimate Change. The meeting took place at theKyoto International Conference Center, producingthe internationally known Kyoto Protocol, and thecenter will this time be the venue of the APECFinance Ministers’ Meeting.

The world economy aims for sustainabledevelopment, while at the same time, countries inthe world have undergone unprecedentedeconomic upheavals. These were triggered by thesubprime mortgage issue in the United States andaggravated by Lehman Brothers’ downfall in 2008and fiscal crises that occurred in some Europeancountries. The series of incidents has seriouslyaffected the economic situation in each countryand these memories are still fresh.

The incidents show us it is difficult for a singlecountry to solve financial, fiscal, foreign exchangeand other economic issues alone, at a time whenthe world economy is becoming even moreglobalized and interconnected. They also tell usthat countries and areas concerned need to workclosely together to find a solution under the nameof international cooperation.

APEC groups 21 major economies in theAsia-Pacific region and the finance ministers whoare responsible for steering their economies willget together in Kyoto. I do hope that they will havefruitful dialogues at the meeting.

Tradition, innovation go hand-in-hand in KyotoKyoto, the venue of The 17thAPEC Finance Ministers’Meeting, is the historic andcultural heart of Japan as itserved as the nation’s capitalfrom 794 to 1867.

At the same time, Kyoto hasbeen the center of an industri-al region for the past 1,200years. Today, the region hous-es numerous industry-leadingcompanies with global opera-tions, including KyoceraCorp., Omron Corp., NintendoCo., Murata Machinery, Ltd.,Murata Manufacturing Co.,Shimadzu Corp., Rohm Co.and Wacoal Corp.

Observers say the charac-teristic that is reflected incompanies from Kyoto stemsfrom the following factors:

B Unparalleled high quali-ty: In Kyoto, there are scoresof large and small companiesthat have the largest share intheir respective industries.

B Active cooperation be-tween industry and acade-mia: Neighboring universitiesand companies in Kyoto havecooperated actively and thiscollaboration has proven to beeffective in developing out-standing technologies andproducts.

B Original managementphilosophy: Kyoto is a ‘‘spe-cial city’’ in Japan due to itstrait of treasuring originality.Moreover, companies in Kyo-to have been successful bymaking ‘‘originality’’ theirmanagement philosophy.

B Creativity: In Kyoto, theimportance of preserving andhanding down traditions has

been deeply understood,which has created an enter-prising spirit that new andoriginal development shouldbe rooted in traditions.

B Blending of tradition andinnovation: There are asmany as 1,636 companies,which have been active at theforefront of their markets formore than 100 years, and theselong-established businesseshave supported the develop-ment of new venture compa-nies.

When it comes to the blend-ing of tradition and innova-tion, the centuries-old ‘‘Kyo-yaki’’ or ‘‘Kiyomizu-yaki’’technique of making ceramicware has developed into theproduction of ceramic con-densers.

The traditional technique ofprinting images on kimonotextile has developed into thetechnology for the manufac-ture of printed wiring boardsand screen printing, which areessential for the informationtechnology industry today.

Brewing techniques are an-other asset. The Fushimi areaof Kyoto is blessed with goodwater, which is essential forgood-quality sake, and thereare many sake breweries inthis region. The brewing tech-niques that have long been cul-tivated here have developedinto advanced technologies,such as in biotechnology, ge-netic engineering enzymesand biological reagents.

Meanwhile, many localcompanies have evolved thetechnique for decorating Bud-

dhist altar fittings into thetechnology of manufacturingadvanced precision molds forflexible print circuits and elec-tronic components.

It’s possible that the devel-opment of these techniquescould only happen in Kyoto.New forms of science, technol-ogy, skill and design have de-veloped from the foundationsof the traditional industries.When traditional elementsand new ‘‘wisdom’’ are com-bined, new lifestyle productsare created.

In today’s Kyoto, there aremany high-technology indus-tries, which developed fromthe precision techniques andunique management methodsof the many traditional indus-tries. A long history of innova-tive business approaches hasled to the successful founda-tion of many new businesses.

Cutting-edge industries andtraditional industries existside by side in Kyoto. WhenKyoto’s ‘‘wisdom’’ is added toKyoto’s unique industry struc-ture, new business models aredeveloped. Often, these busi-ness models focus on small-lotproduction of a variety ofproducts characterized byhigh added value. These cut-ting-edge industries competeon a global level and are thecenter of Kyoto’s economy.

As mentioned earlier, theclose collaboration betweenindustry and academia is anoutstanding strength of Kyoto.

Kyoto is home to around 40universities and most of themhave research institutes that

are in active cooperation withresearch and development de-partments at various compa-nies. These centers of learninghave produced original tech-nological development meth-ods and high-value-addedproducts or services for soci-ety.

One of these is Kyoto Uni-versity, which has producedseveral Nobel laureates. Theuniversity aims to expand itscapacity for making contribu-tions to the world with signifi-cant results from researchand innovation. In addition tothe extension of its educationand research centers, a newbase, called Katsura Campus,will be developed in the west-ern part of Kyoto. The univer-sity’s Graduate School of En-gineering, Graduate School ofInformation and InternationalInnovation Center will be relo-cated to the Katsura Campus.The neighboring zone will alsobe developed into the KatsuraInnovation Park, where aTechno-Science Hill will be lo-cated. Also, in Keihanna in thesouthern part of Kyoto, theprefectural government ispromoting the Kansai ScienceCity as an active incubationbusiness center and R&D basein cooperation with interna-tional partners.

These areas will be essen-tial integration centers oftechnology and science in Ja-pan. The ultimate strategicgoal of this plan is to enhancethe local potential by promot-ing collaboration among in-dustry, academia and govern-

ment.The local governments of

Kyoto are playing an impor-tant role in such collabora-tions. For instance, the KyotoMunicipal Government is pro-moting a project to create acarbon-free city by introduc-ing next-generation electricvehicles and the infrastruc-ture to sustain it. Nissan Mo-tor, Mitsubishi Motors andHoriba, a Kyoto-based leadingmaker of measuring equip-ment, are participants in thisventure.

As Kyoto is also internation-ally known for hosting theThird Conference of Parties tothe U.N. Framework Conven-tion on Climate Change(COP3) in 1997, when the Kyo-to Protocol was adopted, thereare a number of businessesthat are globally active in theenvironmental sector. Allkinds of ‘‘wisdom’’ accumulat-ed in Kyoto have resulted inthe creation of a ‘‘model cityfor a sustainable society,’’

which is environmentally ad-vanced, and where the envi-ronment and the economy ex-ist in harmony.

APEC finance ministers search for growthAs host, Japan likely to seek discussions on exchange rates, free trade agreementsKazuaki NagataSTAFF WRITER

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Finance ministers from the 21APEC member economiescame to Kyoto on Nov. 5 for atwo-day meeting ahead of theleaders’ session of the Asia-Pacific Economic Coopera-tion forum, to be held in Yoko-hama later this month.

The participants in Kyotoare expected to draft a reporton the efforts of the bloc inachieving growth in the Asia-Pacific region as well as com-ment on recent hot topics,such as currency rates.

In the history of the APECforum, the Kyoto meet, whichends Nov. 6, will be the firsttime APEC finance ministerswill come up with a concretereport on specific issues.

It was decided in last year’sAPEC leaders’ session in Sin-gapore that the finance minis-ters will be in charge of put-ting together a progress re-port on APEC economies’efforts to achieve the region’sgrowth.

One major agenda for thisyear’s APEC forum is to for-mulate a comprehensive mid-to long-term strategy for theregion that puts an emphasison balanced, inclusive, sus-tainable and knowledge-basedgrowth.

The report from the financeministers’ meeting is likely tocontribute to that agenda.

Meanwhile, issues such ascurrency rates and fiscal re-construction, which havebrought some impact on theglobal economy this year, willprobably be touched on at theKyoto meeting.

Currency rates have espe-cially been a pressing issue inJapan, as the yen has hit 15-year highs against the dollar,impacting Japan’s export-driven economy.

Although the Japanese gov-ernment intervened in the for-

eign exchange market for thefirst time in six years on Sept.15, the yen’s value versus thedollar continues to rise.

Dow Jones Newswires re-ported last month that Thai Fi-nance Minister Korn Chatika-vanij said the participants atthe APEC Finance Ministers’Meeting will discuss the effectof U.S. ‘‘easy money’’ policieson the regional economy.

The 21 APEC member econ-omies are Australia, Brunei,Canada, Chile, China, HongKong, Indonesia, Japan, Ma-laysia, Mexico, New Zealand,Papua New Guinea, Peru, thePhilippines, Russia, Singa-pore, South Korea, Taiwan,Thailand, the United Statesand Vietnam.

At the G-20 finance minis-ters and central bank gover-nors’ meeting held Oct. 22 to23 in South Korea, partici-pants agreed to ‘‘refrain fromcompetitive devaluation ofcurrencies.’’

‘‘Advanced economies, in-cluding those with reservecurrencies, will be vigilantagainst excess volatility anddisorderly movements in ex-change rates,’’ according tothe joint statement issued af-ter the meeting.

It is possible that the Kyotomeeting will reconfirm theG-20 stance, though manyeconomies in APEC are notmembers of the G-20.

Satoru Ogasawara, an econ-omist at Credit Suisse in To-kyo, said the Kyoto meetingwill probably touch on topicsfrom the G-20 meeting, espe-cially the currency issue andthe reduction of the globaltrade imbalance.

He also said Japan mayface difficulties in adjustingand putting voices of othereconomies together to draft ajoint statement.

‘‘Before, the global tenden-cy was expansion of fiscalspending and monetary eas-

ing,’’ Ogasawara said, ‘‘butsome economies started tight-ening their spending. As for fi-nance policy, while advancedeconomies are taking an easymoney policy, emerging econ-omies are tightening.

‘‘This difference can be adifficult factor to put togethera joint statement,’’ Ogasawa-ra added.

The government, as host na-tion, feels an obligation to pro-duce something from themeeting.

‘‘As the chair economy, wewill listen to various opinionsfrom participating economiesand draft a firm statement,’’Finance Minister Yoshiko No-da said.

Other than drafting agrowth plan, this year’s majoragenda at the APEC forum in-cludes seeking agreement onhow to explore possible path-ways to a regionwide freetrade bloc called the FreeTrade Area of the Asia-Pacific

(FTAAP) and checking on theprogress that advanced econo-mies have achieved regardingthe Bogor Goals of liberalizingtrade and investment in the re-gion by 2010.

The goals were adopted in1994 in Bogor, Indonesia, inwhich open, free trade and in-vestment were to be realizedfor industrialized economiesby 2010 and for developing na-tions by 2020.

APEC, which was formed in1989, accounts for 53 percent ofthe world’s gross domesticproduct (GDP) and 43 percentof the world’s trade.

While APEC is a nonbindingand relatively loose interna-tional framework comparedto other international bodies,such as the Association ofSoutheast Asian Nations(ASEAN) and the WorldTrade Organization (WTO),this year’s APEC forum canbe a chance for Japan to in-crease its global presence as

the host country, especially asits economic standing in theworld has declined.

For instance, the govern-ment appears to be taking ad-vantage of this year’s APECevents to speed up the discus-sion of Japan’s free trade part-nership strategy with a spe-cial focus on the Trans-PacificPartnership (TPP) agree-ment. The U.S., Australia,Malaysia, Peru and Vietnamare negotiating to join thefour-nation framework involv-ing Brunei, Chile, New Zea-land and Singapore.

Prime Minister Naoto Kanhas shown an interest in join-ing the TPP and is expected toannounce Japan’s stance atthe APEC summit meeting inYokohama.

The series of APEC 2010ministerial meetings lead upto the main event, the APECEconomic Leaders’ Meeting,scheduled for Nov. 13 and 14 inYokohama.

The Kyoto International Conference Center is the main site ofThe 17th APEC Finance Ministers’ Meeting.

(Publicity)

The technique of making‘‘Kiyomizu-yaki,’’ Kyoto’straditional ceramic ware,helped lead to the productionof ceramic condensers.

The Kansai Science City in the Keihanna area of Kyoto hasadvanced research facilities, contributing to scientificdevelopment in Japan.