Celebrating 70 years of trade with Japan
This year marks 70 years since the establishment of New Zealand-Japan diplomatic relations. Economically, Japan is New Zealand’s 4th largest trade partner, and both countries are forerunners of free trade, leading agreements like CPTPP and RCEP. World Class New Zealander Jacky Scanlan-Dyas is an M&A lawyer who has 25 years of cross-border transaction experience between New Zealand and Japan. She advises major Japanese corporates and trading houses investing outside of Japan and many international corporates investing and doing deals in Japan. She spoke to Kea about the importance of the 70 year milestone and the opportunities she sees for Kiwi companies interested in trading with Japan.
Jacky was born and raised in Gisborne, and had what she describes as a fairly transient childhood, moving all over the region. When she was 16 she won a scholarship to study in Japan for a year and fell in love with the country and its people.
“I finished high school and went on to study Law and Japanese at Canterbury University, where I graduated with an LLB (Hons) and BA in Japanese. I joined Russell McVeagh as a summer clerk and then as a graduate which provided a wonderful start to my legal career. It was clear from the outset that I wanted to do M&A and that this would somehow be connected to Japan. I just wasn’t sure how to piece it all together. Then I was offered a secondment to Nagashima Ohno Tsunematsu, the largest law firm in Japan. It was incredible to be involved in complex cross-border transactions and I started to see how my skillset would be useful on the international stage.”
After heading to London on her OE, Jacky met and married a British man and joined what is now Hogan-Lovells, one of the world’s largest international law firms. In 2009 she was asked to come back to Japan and help launch the firm’s Tokyo M&A team, now one of the largest M&A teams in the region.
“I am so proud of the work I have done around the world, and especially of my career in Japan building the Corporate & Finance practice here, which has expanded four-fold during my tenure. I am currently a Partner, Regional Lead for Corporate and Finance in Japan, co-Global Lead for our Manufacturing and Industrials sector, a member of the firm’s global M&A leadership committee, and Chair of the Tokyo office’s Responsible Business Committee. I also have the privilege of leading a multilingual, multicultural team of diverse lawyers, with different voices and perspectives.”
Jacky says the 70 year milestone of diplomatic relations speaks volumes to the relationship between New Zealand and Japan and the two countries political and economic views enable strategic cooperation in the areas of security and defence, and each country’s economy, as well as on a wide range of regional and global issues.
“The relationship between Japan and New Zealand was initially built on trade of agricultural products, it has since expanded to include technology, film, manufacturing, etc., as well as educational and cultural exchanges. Currently, Japan is New Zealand’s fourth largest trading partner at over NZ$8 billion in trade value per year and fourth largest source of foreign investment at over NZ$5 billion. New Zealand and Japan are both members of the Regional Comprehensive Economic Partnership and have Free Trade Agreements under the Comprehensive and Progressive Trans Pacific Partnership (CPTPP), contributing to greater value and volume of trade.”
“In addition, this anniversary is significant because it reflects the achievements of Japan-New Zealand cooperation thus far and a further commitment and coordination in maintaining peace and security, free trade, climate change countermeasures, and sustainable growth. In fact, Prime Ministers Ardern and Kishida both recently reinforced their respective country’s commitment to continued cooperation in food and agriculture, renewable energy, technology, as well as space development, cybersecurity, and global health, among many other areas.”
Jacky says Japan is an excellent option for Kiwi businesses seeking to attract offshore investors and her biggest piece of advice to those looking to go down that route would be to make sure you have a solid business plan which outlines your company’s strategy.
“It is important to remember that investors are risking their funds, so a strong business plan can create a greater incentive to invest. Additionally, I would recommend that businesses make sure all legal documents are in order because properly prepared and organised legal documentation makes due diligence easier for investors and highlights a business’s legitimacy and reliability. An experienced legal advisor will also be able to help you identify any missing information and anticipate and resolve issues at an early stage. Investors are taking a risk with their funds and the more certainty and visibility they have the better. Another recent component is to demonstrate supply chain continuity. Businesses should be able to prove that their operations are robust, can continue well into the future and generate sustainable profits.”
Japan already has one of the largest economies in the world, and its global reach plays a significant role in the international trade system. Jacky says with New Zealand being an increasingly important player in the agriculture, technology, and energy resources markets, there are good opportunities to create more room for business growth and expansion between the two countries.
“The key areas where I anticipate growth and business opportunities are in renewable energy, fintech, aerospace, and agritech. New Zealand has a long history of being an innovator in energy and is recognised as a leader in renewable energy. I believe the country’s renewable energy resources and environmentally friendly energy supplies offer future business opportunities with Japan, especially in light of Japan’s commitment to renewable energy at COP26 and goal of achieving carbon neutrality by 2050. This increasing focus on Environmental, Social, and Governance (ESG) initiatives, particularly decarbonisation, has led to the popularity of the renewable energy sector as destinations for investments.”
“Japan’s fintech market is currently valued at NZ$15 billion and expected to grow even more because of recent governmental support in the industry. The pandemic pushed Japan in a new direction with increased interest in digitalisation and e-commerce, and many businesses are looking to streamline operations while ensuring data security, creating opportunities for Japanese and New Zealand businesses.”
“The Japanese government identified the space sector as one of the areas of focus under the Growth Strategy Action Plan of June 2021. It intends to strongly promote space development and utilisation from the viewpoint that space is a growth industry and is indispensable for security, disaster prevention, and the achievement of sustainability goals. This industry is estimated to reach NZ$57 billion by 2050.”
Jacky says Japan is a geographically small nation limited in resources and is dependent on trade for agriculture, food, energy supplies, and natural resources. She feels there are an increasing number of business opportunities in the agritech, horticulture, and food industries as a result of Japan’s ageing population and labour shortages, concerns for national food security (Japan currently imports around 60% of its food), and accommodative government policies.
“This increase in demand for agritech provides business opportunities for New Zealand, which is smaller in market size, but a net exporter of agricultural products, suggesting that there is still room for business growth and expansion between the two countries. One such example is the partnership between Robotics Plus and Yamaha Ventures. Yamaha Motor invested in the New Zealand agricultural automation and robotics company, Robotics Plus, to develop agricultural technology. As New Zealand and Japan look ahead to further years of strong diplomatic relations, the future of business opportunities between the two companies is looking very bright indeed.”