A Happy New Year?
Tokyo-based Hawaii executives see challenges, opportunities in 2004
TOKYO - Last year, Japan began to show signs of a pickup, and many economists see a modest recovery continuing in 2004. But what do people actually doing business in Japan expect in the new year? To answer that question, and to find out what it all means for Hawaii's economy and businesses, I turned to three executives from the state who are currently based in Tokyo. Aaron Medina is the representative director for Hertz Asia Pacific (Japan) Ltd., Allan Takahashi is vice president of the hospitality division for Capital Realty Inc., the asset management arm of Lehman Brothers Japan Inc. and Ray Tsuchiyama is the director of business development in the Asia-Pacific region for AOL Mobile, a division of AOL Online Inc. Their bottom-line verdict: Japan isn't in the clear yet. "My feeling, as far as the Japanese economy goes, is that there's not a real trend here," Medina says. "We've had a little blip in the economic numbers, but the overall fundamentals haven't changed a lot. We're still going to see deflationary pressure on consumer prices." "We feel there are still going to be a lot more things that are going to shake out," says Takahashi. Specifically, he says banks' nonperforming loans, one factor behind Japan's prolonged stagnation, remain significant, in spite of efforts to tackle the problem. A cloudy political situation is another concern, says Tsuchiyama. Prime Minister Junichiro Koizumi's coalition government retained power after elections in November, but with a slimmer parliamentary majority. "There's uncertainty, because there's not a clear mandate for Koizumi to do things. This means that a lot of reforms in the banking industry and so on may not happen as quickly," he says.
Clearly, problems like these could affect Hawaii by dampening consumers' willingness to travel and to spend. However, the three executives say business opportunities exist. The key, they believe, is to focus on niche markets. Consider, for example, the growth in women travelers in their 50s and older. "They are more skittish when it comes to global problems - they tend to stay at home if things aren't safe. Having said that, when they go, they have more time and money to spend," says Medina. That's potentially good news for retailers of high-end goods and small- and midsize businesses, especially those selling things like children's toys and clothing. "The people they're shopping for is themselves, as well as their grandchildren," he explains. Health services, especially for seniors, also deserve attention. "Is there a market in Hawaii for wellness tours? Is there a market in health and revival, and culture for older people? I think yes, and that's a niche Hawaii should look at," says Tsuchiyama. He and Medina believe that mental health is another field with potential.
As for businesses opportunities in Japan, one industry that is ripe for the taking is hotel management, says Takahashi, whose work entails buying up Japanese hotel properties. "The Japanese hotel industry, as far as management goes, is so far behind the times," he says. "[Hawaiian] hotel operating companies could probably come here and expand their business." The final word? As with any venture, fully understanding the market is critical to succeeding in business with the Japanese. "A lot more targeted research should be done by anybody who's investing in this market," advises Medina. n |
Do you like what you read? Subscribe to Hawaii Business Magazine »
Hawaii Business magazine invites you to comment on our articles and the issues they raise. Comments are moderated for offensive language, commercial messages and off-topic posts and may be deleted. Some comments may be chosen for inclusion in the magazine on the Feedback page.