Attracting Japanese companies

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Attracting Japanese companies

The president of Japan’s top automaker, Toyota Motors, visited Korea last weekend to “encourage dealers and explain the post-earthquake recovery process in Japan.” But industry analysts view his visit differently. They see his visit as part of a tour to secure parts suppliers outside Japan, which is prone to earthquakes and other natural disasters.

Even before a monstrous earthquake and tsunami in March caused production disruptions, Toyota had suffered a slump in sales due to repeated recalls and a strong yen. Its production lines were shut down because of a shortage of electricity and parts. As a result, Toyota may be actively looking for new supply lines in Korea, a geographically close neighbor as well as a provider of high-quality auto parts to companies around the world.

Korea has benefited from its geographic proximity to disaster-hit Japan. Softbank recently joined up with Korea Telecommunications to establish a global data center in Gimhae, South Gyeongsang. The move, of course, came amid growing fears of more aftershocks and more natural disasters.

In the wake of the traumatic earthquake and tsunami, Japanese companies will forced to endure a 15-percent cut in electricity consumption starting in July. Many are preparing to shift their production bases to the southern region of Korea.

According to the government, about 100 Japanese firms are showing interest in the southern coastal area, which is close to Japan and possesses advanced port, road and electricity infrastructure.

It is too great an opportunity to miss. Rather than seeking short-term gains, Korea should be able to take advantage of this opportunity by upgrading our industrial capabilities to meet the demanding taste of Japanese companies.

Korea’s free trade agreement with the European Union is set to go into effect in July, and a deal with the United States is expected to be ratified soon, making the Korean market even more alluring to Japanese companies.

Against this backdrop, we should ride the current to make a new leap forward. We should present attractive land and infrastructure deals to lure more Japanese corporate investments to our country.

The task should not be left to local governments alone.

The central government should also hurry and organize a task force to attract Japanese companies.
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