Having been established in 1992, the Budapest office of the Japan External Trade Organization (JETRO), the principal organization for promoting trade and investment relations between Japan and foreign countries, celebrates its 30th anniversary this year.
As to what he considers the greatest achievements of the Budapest presence of JETRO over these three decades, the General Director of the office, Toru Suehiro starts with a short summary of the two countries’ cooperation. “Hungary and Japan have a long way of historic relations. Japan and the Austro-Hungarian Empire signed a treaty of friendship, trade and navigation in 1869. Since then, the island nation and Hungary have maintained excellent relations in the fields of trade, business, science, culture and sports, among others. After the change of regime in Hungary in 1989, relations between the two countries began to develop rapidly.”
Supporting with information
The Japan External Trade Organization is a government-related organization that works to promote mutual trade and investment between Japan and the rest of the world. Originally established in 1958 (headquartered in Tokyo and Osaka) to promote Japanese exports abroad, JETRO's core focus in the 21st century has shifted toward promoting foreign direct investment into Japan and helping small to medium size Japanese firms maximize their global export potential. JETRO has 76 overseas offices in 56 countries and 48 regional offices in Japan.
“Ever since the foundation of JETRO’s Budapest office in 1992, we have been continuously supporting Japanese companies with information. We, here at JETRO Budapest try to be a bridge between Hungary and Japan. In the early stage of the Budapest office, the presence of Magyar Suzuki Corporation (founded in 1991) served a good example for attracting Japanese manufacturing companies to set up their factories as greenfield investors in Hungary,” the General Director explains.
Many Japanese manufacturing companies came and set up their factories in Hungary and sought to establish good relationships with local suppliers. Therefore, JETRO organized a ‘Reverse exhibition’ in the year 2000 together with ITDH (the predecessor of HIPA, the Hungarian Investment Promotion Agency). The first such event in the central European region was attended by 50 Japanese companies, he adds.
There are currently 184 Japanese companies in Hungary (as of July, 2021), employing more than 30,000 people. Japan is the largest Asian greenfield investor in Hungary and the largest Asian market for Hungarian food products. Japanese companies represent an outstanding added value for the Hungarian economy, especially in the industries most affected by the transformation known as the Fourth Industrial Revolution.
“Also, we promote the importance of Japan’s market to the Hungarian business society. Providing the experts’ consultation, Hungarian IT companies could access to the Japanese market. JETRO Budapest promotes the so-called ‘Invest Japan’ program to Hungarian IT and biotech firms wishing to do business in Japan. At the end of the process, they can open their own entities in Japan in the form of representation office, joint venture, etc. So far, three Hungarian companies have already established their office in Japan and there will be more to follow hopefully this year and also in 2023 when travel restrictions in Japan are lifted. It is essential for Hungarian companies to meet face to face with Japanese clients in order to do business in Japan,” the General Director highlights.
The main partners of JETRO Budapest in all these activities include the Hungarian Investment Promotion Agency (HIPA) and Ministry of Foreign Affairs and Trade, the Association of Hungarian Automotive Industry (MAGE) and Chamber of Commerce and Industry of Hungary (MKIK). “Besides that, the Hungarian Embassy in Tokyo is always our reliable partner when JETRO Budapest promotes the Hungarian business opportunities to Japanese firms in Japan and also assisting Hungarian business delegations or businessmen to open doors for new businesses in different sectors,” he points out.
Defying the pandemic
Despite the past two years plagued by the new coronavirus epidemic, JETRO’s Budapest office has successfully cooperated with businesses here. As Toru Suehiro puts it, “the coronavirus reminds us of the importance of resilience.” Since many Japanese companies focus again on the CEE region, JETRO Budapest made efforts even during these pandemic years to provide basic business information such as incentives, subsidies and legal regulations to the Japanese business society. For example, Seiren, a Japanese company specializing in the production of automotive interior materials and textiles, decided to establish their first factory in Europe in Pécs, southern Hungary with an investment amount HUF 15.2 billion.
A fine example of people-to-people relations was when – in May 2020 – a young Japanese chef in Budapest, wishing to highlight the work of healthcare professionals fighting in the frontline against the new coronavirus and untiringly defying the danger, decided to donate Japanese food to the workers of the Péterfy Sándor Street Hospital-Clinic and Trauma Center in Budapest’s District 7. In organizing and coordinating this support, the WAFU Bar was assisted by JETRO’s Budapest office.
“Also, we introduced the EU-Japan EPA (Economic Partnership Agreement), which has been in force since February 2019, to the Hungarian business society together with the Hungarian Chamber of Commerce and Industry (MKIK). This can create many business opportunities to Hungarian exporters to Japan in the upcoming years by lowering tariff rates.”
The pandemic forced some activities go online. The General Director stresses that after the emergence of the pandemic, most of the real business activities “evaporated.” As a result, JETRO shifted most of the activities into a digital format such as collaboration with Alibaba and opening a special Japanese corner named ‘Japan Mall’, establishing the business-to-business site ‘Japan Street’.
Introducing authentic sake
One important task of JETRO is promoting the export of Japanese goods to Hungary, making Hungarian businesses and the public aware of Japanese products. Regarding this aspect of its activities, the Budapest office is currently promoting Japanese sakes and liqueurs in Hungary.
“At the moment, most of the sake sold in Hungary are not from Japan. So, we will try to introduce very sophisticated sakes made in Japan to the Hungarian market. You may be surprised with its difference in their flavor and taste. We are now preparing such an event in cooperation with the Japanese Embassy in March this year,” the General Director concludes.
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