H.E. Kanji Fujiki – Ambassador Extraordinary and Plenipotentiary of Japan, Embassy of Japan in UAE, Abu Dhabi
Japanese Ambassador to the UAE, H.E. Kanji Fujiki, discusses the longstanding relationship between the two countries, his top priority of safeguarding energy security for Japan and his embassy’s strategy for ensuring that bilateral relations evolve along with the UAE’s program of economic diversification.
What does the business relationship between the UAE and Japan entail?
The genesis of Japan-UAE relationship lies in oil and gas, having begun in the 1960s before the UAE was founded in 1971. This shows how long and dense bilateral relations are between the two countries, and petroleum has been a core aspect of this relationship. Most notably, Japan is currently the largest importer of crude oil from the UAE.
However, from the onset, founding president H.H. Sheikh Zayed bin Sultan Al Nahyan has emphasized the importance of human resource development and education and that esteemed tradition continues today, with fruitful results, for instance, in terms of investment in transport and infrastructure, and more broadly, the diversification of economy away from oil and gas. For instance, most of the economy in Dubai is non-petroleum, and even in Abu Dhabi, about 50 percent of GDP comes from non-oil industries, and the government has a target of reaching a 60 percent non-oil economy.
Japan needs to respond to the evolution of the UAE’s economy. This is why we are focusing on a parallel diversification of the UAE-Japan relationship, most notably in the areas of space science, nuclear technology, medical advancements, environment issues and education.
Given the importance of UAE-Japan relations, how is the Embassy playing a role specifically in ensuring that Japanese interests remain at the forefront for the UAE and the region?
Given how complex and multi-faceted UAE-Japan relations are, to prioritize Japanese interests is not easy but energy security is at the top of our national agenda, as it is in every country. Japan imports over 25 percent of its oil from the UAE, so my first priority is to maintain good relations with the UAE in terms of energy supply. Oil and gas is a strategic industry, involving not just economic but also political calculations, and sometimes delicate government intervention and involvement are required, particularly during critical periods.
What I am grateful for is that as mentioned, we have a long history of cooperation in petroleum issues, and as such, we have built up a good network of relationships in this region. My embassy’s role is more simply to build on this existing network and support the private sector’s activities in this country. For instance, in April 2015, Inpex/Jodco became the first Japanese oil development company to acquire a stake of the Abu Dhabi Onshore Petroleum Company (ADCO) Onshore Concession; although only 5 percent, this is a historic achievement.
Looking ahead, many existing Japanese offshore oil concessions will expire in 2018. This is a major challenge for the Japanese oil industry and hence the Japanese government. My embassy is playing a role in conveying Japan’s strong desire and commitment to remaining partners of choice to the UAE government in terms of participation in these concessions.
How do you differentiate yourself from other Asian powerhouses?
Compared to 30 or 40 years ago, we are facing very tough competition because of the entrance of new emerging powers like China and South Korea, and even India, not only in the oil and gas industry but other sectors as well. These countries are now our main competitors. For instance, in the area of nuclear energy, South Korea recently won a contract to construct four huge nuclear power plants in the southwestern part of the UAE due to the strength of their bids and this was a blow to the Japanese companies that had been competing for the same project.
Nevertheless, I believe we are well positioned to compete with them. Firstly, we are technologically very advanced and this is something we can offer to the UAE. Secondly, the impeccable quality of our education system and therefore our human capital gives us an important edge. Finally, the success of collaboration also rests on the presence of long-term trust and reliability, which is also something we can offer because of our longstanding history with the UAE. For instance, in 2014, Mitsubishi supplied the launching system for one of the Dubai government’s observation satellites, KhalifaSat, which is one of the most reliable launching systems in the world, with 22 consecutive successful launches since 2005. This marks an important stage in our relationship with the UAE in terms of space technology.
In October 2015, you said that your biggest mission is to make Japan-UAE relations “the best-ever bilateral relationship: a deepened, diversified and multi-layered one”. How do you envision the ideal relationship between the two countries?
As mentioned, aside from the top priority of ensuring Japanese energy security, Japan’s current strategy is to evolve bilateral relations according to the program of diversification the UAE is undertaking. A very specific example is the trade relationship. We have a significant trade relationship with the UAE but we have a significant trade deficit of USD 30 billion, due to the heavy oil and gas imports we rely on from the UAE. I hope to be able to remedy this by creating new avenues of collaboration not just in oil and gas. For instance, we could enlarge our existing relationship in the automobile industry and forge new ties in other high-technology niche areas like space science and medical science.
Tourism is another sector with important potential. Japan is in the process of formulating a National Tourism Plan to double the number of foreign tourists from 10 million to 20 million over the next few years. Emirati tourists to Japan number only around 3000 at the moment, so there is definite room for a healthy increase.
Of course, considering the recent situation of the Japanese economy, it may not be possible to expect huge investment opportunities in the short term, but I am confident that the growth trajectory of the UAE-Japan relationship in general is very positive. This is why Japan would like to invest further in this relationship and react to the new opportunities to the diversification of the Emirati economy. The UAE is changing very rapidly and the bilateral relations between Japan and the UAE should take care to keep up with the pace of development in this country.