Weekly Japanese Industry and Policy News (October 13-October 19, 2023)

The EU-Japan Centre is pleased to start a new weekly service by publishing brief summary of the latest information from the Japanese governmental organizations & private companies/organizations. A couple of minutes reading to be informed about what is happening in Japan's policy, economy, EU-Japan relations, and innovation.

*Information is deemed correct at the time of release. 

2.18 million foreigners visited Japan in September, approaching the pre-COVID-19
The Japan National Tourism Organization (JNTO) and Japan Tourism Agency (JTA) announced on October 18 that the number of foreign visitors to Japan in September was 2,184,300 (estimated). It was down 3.9% compared to the same month in 2019, and has recovered to a level approaching the performance before the outbreak of the COVID-19. In addition, the amount of money spent domestically by foreigners who visited Japan in the three months up to September this year was approximately JP¥ 1.39 trillion, the highest amount on record for three months, exceeding the amount before the coronavirus outbreak. have become.

This is thought to be due to the rapid recovery in the number of foreigners visiting Japan and the recent depreciation of the yen, with the average consumption per person being JP¥ 211,000. By country and region, the consumption amount increased by 2.18 times compared to the same period in 2019 is the Philippines, 2.09 times is South Korea, and 2 times is Singapore. On the other hand, although the ban on group travel in China was lifted in August this year, the number is 40% lower than the same period in 2019, and the slow recovery is noticeable. The consumption amount by foreigners from January to September this year was approximately JP¥ 3.6 trillion, and the focus will be on whether this will exceed the government's annual target of JP¥ 5 trillion.

Japan National Tourism Organization website (in Japanese):
https://www.jnto.go.jp/news/20231018_1500_monthly.pdf

Japan Tourism Agency website (in Japanese):
https://www.mlit.go.jp/kankocho/siryou/toukei/content/001634982.pdf

Primetals Techno provides FS support for rebuilding Ukrainian steel
Primetals Technologies (Hiroshima Prefecture) announced on October 12 that it will support a feasibility study (FS) scheduled to be completed in 2024 as part of its support for rebuilding the steel industry in Ukraine. In the future, it will focus on the entire green value chain, from raw material supply to agglomeration, pig iron production, and steel production. The reconstruction project aims to establish an environmentally friendly steel value chain in the country. Investment targets include clean power generation, hydrogen production, green pig iron and iron making equipment, iron ore beneficiation and pelletizing (a processing method that grinds poor ore and fine ore into powder and hardens them with a binder into spheres), and related infrastructure projects. Establishing the value chain is expected to require an investment of approximately $ 20 billion to $ 40 billion.

In addition to the company, major companies from various countries are participating, and once the project is completed, Ukraine will become a global base for green pig iron and steel manufacturing, supplying raw materials and steel products with low carbon emissions to the entire world. The company is a Mitsubishi Heavy Industries group company headquartered in London, UK. Technologies and products include electrical machinery, automation, digitalization, and comprehensive environmental solutions. It provides a complete set of services and covers all areas of steel, from raw materials to finished products.

Primetals Technologies website:
https://www.primetals.com/press-media/news/primetals-technologies-to-support-the-recovery-of-the-ukrainian-steel-industry-with-green-production-solutions?setLang=1&cHash=4558261501e8eb846a46751abbcb473d

THE JAPAN WOOL TEXTILE introduces automatic foreign matter removal equipment from used clothes, increasing production capacity by 10 times
THE JAPAN WOOL TEXTILE (Osaka Prefecture), a comprehensive wool manufacturer, announced on October 13 that it will install new equipment at Fujiko, a group company, that can automatically remove foreign objects such as buttons and zippers from used clothing. Full-scale operation is scheduled for February to March 2025, and the production volume of recycled fibers is expected to be 300 tons/month, which is 10 times the current production capacity. Fujiko has been recycling used clothing into raw materials at its Ichinoseki factory (Iwate Prefecture), but the removal of buttons and zippers had to be done manually. As a result, processing capacity is limited, which is also a factor in high costs.

Approximately 40% of Japan's used clothing is discarded in the Kanto region, but the company aims to use its Ishioka factory as a base for recycling and recycling used clothing, contributing to the maintenance and strengthening of the textile resource recycling system in Japan. .According to a survey by the Ministry of the Environment in fiscal 2022, of the 798,000 tons of new domestic supply of clothing, 731,000 tons were discarded after use, and 470,000 tons, or 64.5%, were disposed.

THE JAPAN WOOL TEXTILE website (in Japanese):
https://www.nikke.co.jp/admin/wp-content/uploads/2023/10/65248587c9da58759867f2bd1094319f.pdf

AESC to procure battery materials for 1 million EVs per year from Umicore

AESC, a major automotive battery company, announced on October 17 that it will procure cathode materials used in batteries for electric vehicles (EVs) produced in the United States from Umicore, a major Belgian materials company. Starting in 2026, the company will procure approximately 1 million EVs annually. The company will establish a supply network in North America to guarantee battery supply and meet the demands of automakers aiming to increase EV production.

The cathode material contains rare metals and is the most important component of batteries, determining capacity and output. Umicore will supply up to 50 gigawatt-hours (giga is 1 billion) of watt-hours per year from its factory in Cheonan, central South Korea, and its plant in eastern Ontario, Canada. AESC will procure cathode materials and assemble batteries at its three U.S. locations, including those under construction, and supply them to companies such as BMW of Germany.
AESC has in mind the US Inflation Control Act (IRA). The law, which includes measures to promote the spread of EVs, allows buyers to receive a tax deduction of up to $7,500. To be eligible for the deduction, 40% of the important minerals used in car batteries must be sourced from the United States or countries with which the US has free trade agreements (FTAs), and 50% of battery components must be manufactured in North America.

AESC website:
https://www.aesc-group.com/en/news.html

"Japan-U.S.-EU Industrial Control System Cybersecurity Week for the Indo-Pacific Region" was held
The Ministry of Economy, Trade and Industry (METI) and the Information-technology Promotion Agency (IPA) Industrial Cyber Security Center (ICSCoE) held an in-person event on cybersecurity for control systems in Tokyo for the first time in four years in corroboration with the US and EU governments from October 9 to 13.

Efforts by one company or one country are not sufficient for cybersecurity measures and measures need to be taken throughout the entire supply chain. For this reason, Japan, which shares a supply chain with the Indo-Pacific region, launched this event in collaboration with the US in 2018 to improve cybersecurity capabilities across the region and strengthen cooperation with other countries. Recognizing its value, the EU has officially participated as a host since 2021. It is expected that this event would help foster a common understanding of cybersecurity for industrial control systems, and the strengthening of ties between the Indo-Pacific region and Japan, the US, and the EU.

METI website:
https://www.meti.go.jp/english/press/2023/1016_001.html

Honda and GM to launch driverless taxis in Japan in 2026
On October 19, Honda announced that it will start an unmanned taxi service in Japan with General Motors (GM). The two companies and GM's subsidiary, which handles self-driving services, will launch a joint venture in the first half of 2024, with plans to expand mainly in Tokyo from 2026. Compatible with Level 4, which fully automates driving under certain conditions, it will be the first vehicle in Japan to be put into practical use on public roads in central Tokyo. The new company will be established in Japan by Honda, GM, GM's self-driving technology development company, and GM Cruise Holdings, with Honda taking a majority stake.

The company will start with a few dozen driverless taxis, with plans to expand to around 500. The 500 units represent 1.7% of the total number of corporate taxis in Tokyo. After that, they aim to gradually increase the number of machines and expand the service area. The vehicle will be a self-driving vehicle called “Cruise Origin,” jointly developed by Honda, GM, and others. It features a spacious interior as no space is required for the driver's seat. Level 4 public road driving was lifted in Japan in April. Honda also has an investment in GM Cruise. Test driving has already been carried out in the United States, and driving demonstrations using test vehicles are underway in Tochigi Prefecture.

Honda website:
https://global.honda/en/newsroom/news/2023/c231019aeng.html

Mitsubishi Heavy Industries begins CO2 liquefaction demonstration, aiming to popularize CCUS
Mitsubishi Heavy Industries, Mitsubishi Heavy Industries Engine & Turbocharger, and Mitsubishi Heavy Industries Refrigeration announced on October 16 that they have begun a joint demonstration test to liquefy CO2 recovered from gas engine equipment. The aim is to promote the spread of CCUS by reducing the volume through liquefaction and making transportation easier. In addition to conventional CO2 recovery from exhaust gas, they will accelerate efforts toward carbon neutrality through the introduction of liquefaction equipment and technology. Liquefied CO2 has a smaller volume than gas and is easier to transport, and it can contribute to the spread of CCUS.

In this demonstration test, CO2 is recovered from the gas engine equipment in the in-house power generation facility at MHIET's Sagamihara Factory using a compact CO2 capture device called “CO2MPAC” and is liquefied using a compact CO2 liquefaction device manufactured by Mitsubishi Heavy Industries Refrigeration. By leveraging the knowledge as a comprehensive research institute responsible for research and development in the Mitsubishi Heavy Industries Group, they will conduct verification aimed at early commercialization. 

MITSUBISHI HEAVY INDUSTRIES website:
https://www.mhi.com/news/231016.html