2011年10月6日木曜日

IAEA to help decontaminate Japan nuke plant area

TOKYO – A team of experts from the International Atomic Energy Agency will visit Japan this week to help with the massive cleanup of areas contaminated by a radiation-leaking nuclear power plant, officials said Tuesday.

Chief Cabinet Secretary Osamu Fujimura said the 12-member team will help plan and conduct the decontamination during its nine-day visit starting Friday. It will also visit the crippled Fukushima Dai-ichi nuclear power plant, meet with Japanese nuclear officials and compile a report, he said.

A massive March 11 earthquake and tsunami damaged cooling systems at the plant, causing three reactor cores to melt and releasing large amounts of radiation. Tens of thousands of people fled their homes.

"We hope that we can move ahead with decontamination more promptly and effectively by bringing together wisdom from around the world," Fujimura said.

The team is the second major IAEA mission to Japan since the nuclear crisis began. An IAEA accident investigation team visited the tsunami-hit plant in late May and early June.

The upcoming mission will also inspect the plant and monitor decontamination experiments in farmland and other areas near the plant.

Japan lifted some evacuation advisories around the plant last week, in a move largely aimed at reassuring tens of thousands of evacuees that it is safe to return home. But the area must still be decontaminated, especially schools, playgrounds and other areas where children gather.

A 12-mile (20-kilometer) no-go zone remains in place around the plant. But the government lifted the advisories in five municipalities just outside the ring, saying the plant had been restored to a relatively stable condition, with radiation levels reaching safety standards.

Towns around the plant have begun massive efforts to decontaminate buildings and restore public services so residents can return. Tens of thousands remain in voluntary exile, and local officials say they don't expect residents to rush back because of radiation fears.

Experts say it could take decades for some of the areas nearest the plant to be safe for habitation after the worst nuclear disaster since Chernobyl in 1986.

The plant's operator, Tokyo Electric Power Co., is struggling to keep the plant under control. It said last week it recently made significant progress in controlling reactor temperatures, key to achieving shutdowns.

TEPCO faces billions of dollars in compensation claims from people and businesses affected by the nuclear crisis.

A government panel said in a report Monday that TEPCO could face a capital deficit of up to 8.6 trillion yen ($112 billion) in a worst-case scenario if it is unable to restart halted nuclear reactors or raise utility fees. The panel said the utility is likely to face about 4.5 trillion yen ($60 billion) in compensation claims and will need 1.2 trillion yen ($15.8 billion) to decommission crippled reactors.

The panel recommended that TEPCO save about 2.5 trillion yen over the next 10 years by eliminating 7,400 employees or 14 percent of its work force, selling off affiliates and taking other steps.

The panel's recommendation will be incorporated into a new restructuring plan for TEPCO as it seeks public funds.


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Japan companies on shopping spree with strong yen (AP)

TOKYO – Rakuten is not just the top shopping website in Japan. These days the company is doing some serious shopping of its own as it turns the strong yen — usually seen as a huge negative for Japanese companies — into a plus.

The online shopping mall operator has bought several overseas businesses in the last year and is not the only Japanese company on an acquisition spree. Businesses from pharmaceutical companies to toy makers have been emboldened by the increased purchasing power that the rising yen gives them.

A strong yen has long been characterized as potentially fatal for Japan Inc. by making the country's cars, consumer electronics and other goods more expensive abroad, eating into the earnings of giant exporters like Toyota Motor Corp., Sony Corp. and Nintendo Co.

But for a service company such as Rakuten Inc., the yen at post World War II highs is a boon it hopes will help it catch up to giants in the global e-commerce hierarchy such Amazon and eBay. The yen is up nearly 8 percent against the U.S. dollar over the past year.

"I like it," Rakuten Chief Executive Hiroshi Mikitani said with a grin when asked about the yen's gains. "We can buy more companies."

Mikitani also thinks Japan's traditional export-focused manufacturers should be taking advantage of the yen's rise by buying rivals in emerging markets. But he said some may be reticent as they lack the management expertise to know what to buy or how to make it work.

"They should think about that, and utilize the strength of the currency as a weapon," Mikitani told reporters. "I think we should favor the stronger yen."

Embracing a strong yen is an uncommon attitude among Japanese CEOs, and officials. Rakuten is different in other ways too. Nearly three quarters of the hires joining the company this month were foreigners and Mikitani's pep talk at a welcoming ceremony this week was in English, the standard language at Rakuten — both rarities for usually insular Japanese companies.

The jump in overseas acquisitions by Japanese companies this year has come even though the global economy faces extremely uncertain times and Japan's own economy has reeled from the March 11 earthquake and tsunami disasters.

Data compiled by Tokyo-based Recof Corp., which advises on acquisitions, found overseas takeovers and acquisitions by Japanese companies gained by 30 percent in number of deals in the first eight months of this year.

The jump was most pronounced in Asia, where the number of deals increased 50 percent year-on-year to 143, a record for the region, although the purchase prices were bigger for deals in the U.S., according to Recof.

Data from Dealogic shows that the value of overseas takeovers and acquisitions by Japanese companies in January through August more than doubled from a year earlier to $46.7 billion.

Among the biggest Japanese takeovers announced in recent months was Takeda Pharmaceutical Co.'s deal to buy Switzerland's Nycomed for $13.6 billion, giving Japan's biggest drugmaker coveted access to emerging markets.

Another was Tomy Corp.'s purchase of RC2, the U.S. maker of Chuggington and Thomas & Friends toys in an all-cash deal valued at about $640 million.

Online securities company Monex Group Inc. bought TradeStation Group, based in Florida, in a deal valued at up to $411 million. Brewers such as Kirin and Asahi have also been busy acquirers.

The yen's gains can also tip the scales in favor of manufacturing investments overseas.

Last month, Honda Motor Co. announced a $50 million investment to boost transmission production in the U.S., bringing the automaker's capital investment in Ohio to more than $400 million for this year.

Matt McCollister, a vice president at central Ohio's economic development panel, Columbus2020, said the strong yen came up often in meetings with Japanese executives as a solid incentive for overseas investment. He visited Japan recently to woo more investment to the state.

"I don't know that it's the primary catalyst, but it can definitely be a tipping point for a project, especially if there's one that has been under consideration," he said. "When you start to apply the currency differential, it may make more financial sense than it did a year ago."

Still, there is no doubt that the yen's unrelenting strength is the source of plenty of woe for many of the Japanese corporations that are global household names. It has also added to worries in Japan that more manufacturing could be shifted overseas, hollowing out industry and jobs.

Like other Japanese automakers, Honda has been hit hard. It says the yen erased 22.5 billion yen ($288 million) from its April-June operating profit. The Tokyo-based maker of the Odyssey minivan and Accord sedan had initially counted on the dollar trading at 80 yen this fiscal year through March 2012. The dollar is now hovering between 76 yen to 77 yen.

The automaker has been moving production to the markets where vehicles are sold. For the more specialized cars still being exported from Japan, pressure is on to cut costs to make the business worthwhile, sometimes delaying model launches until such cuts are achieved, Honda officials say.

Squeezing positives out of a strong yen is a change of pace for Japan which has been, up to now, obsessed with trying to prop up the dollar to protect its exporting giants.

Such efforts have proved largely futile in recent years against larger global developments that nowadays include the debt crisis in Europe and fears of another recession in the U.S.

Japan's finance ministry most recently tried to weaken the yen in August, by buying dollars. That did send the yen lower but the effect lasted only days.

For Rakuten, a robust yen is key to its ambitions to one day become the world's No. 1 e-commerce company.

In September, Rakuten announced an agreement to buy British e-commerce site Play.com for 25 million pounds (3.3 billion yen, $43 million), following the acquisition of PriceMinister of France and German online shopping mall Tradoria.

The moves add to an empire that now sprawls across 10 countries, including Japan, raking in 90.7 billion yen ($1.2 billion) in April-June sales, a quarterly record for Rakuten. Its business also includes Buy.com of the U.S. and a partnership with Baidu Inc. in China as well as ventures in Thailand, Russia, Taiwan and Indonesia.

Kevin M. Carroll, who runs EA International, an environmental engineering and consultancy company in Tokyo, says the shrinking Japanese population and the high labor costs as well as corporate taxes in Japan are making overseas growth even more crucial for Japanese companies.

The days when a big Japanese corporation could prosper just by catering to customers in Japan are long over, said Carroll.

"The strength of the yen in most foreign markets works for Japanese companies as it places them in the envious position of acquiring foreign firms or technologies at a discount," he said.

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Follow Yuri Kageyama on Twitter at http://twitter.com/yurikageyama


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Japan to hold whale hunts despite activist threats (AP)

TOKYO – Japan will go ahead with its whaling program in the Antarctic later this year under heightened security to fend off activists who have vowed to disrupt the annual hunt, the country's fisheries minister said.

Japan's whale hunts have become increasingly tense in recent years because of clashes with the Sea Shepherd Conservation Society. The most recent expedition was cut short after several high-seas confrontations, and it was unclear whether the hunt would be held at all this year.

But fisheries minister Michihiko Kano said Tuesday that measures would be taken to ensure the whalers' safety, and that the hunt would go ahead. It is expected to begin in December.

"We intend to carry out the research after enhancing measures to assure that it is not obstructed," he said.

Commercial whaling has been banned since 1986, but Japan conducts whale hunts in the Antarctic and the northwestern Pacific under an exception that allows limited kills for research purposes.

Japan's government claims the research is needed to provide data on whale populations so that the international ban on commercial whaling can be re-examined — and, Japan hopes, lifted — based on scientific studies.

Opponents say the program is a guise for keeping Japan's dwindling whaling industry alive. The Sea Shepherd group, which is already rallying to block the upcoming hunt, has been particularly dogged in its efforts to stop the kills.

Last year's season was marred by repeated incidents with Sea Shepherd vessels, one of which sank after colliding with a Japanese ship. The boat's captain, New Zealander Peter Bethune, was later arrested when he boarded a whaling ship from a Jet Ski, and brought back to Japan for trial.

He was convicted of assault, vandalism and three other charges and given a suspended prison term. Bethune has since returned to New Zealand.

Sea Shepherd recently announced that it is calling its effort to obstruct the December expedition "Operation Divine Wind" — a reference to the "kamikaze" suicide missions carried out by the Japanese military in World War II.

Though vilified by anti-whaling organizations around the world, the government's strong pro-whaling position has the support of the Japanese public, according to an Associated Press-GfK poll conducted among 1,000 people in July and August.

Fifty-two percent favor it, 35 percent are neutral and 13 percent are opposed, the poll found. It has a margin of error of 3.8 percentage points.

Once a common item on school lunch menus, whale meat can be found in stores and restaurants in Japan. But, because of its relatively high price, it is generally regarded as a gourmet food by the public.


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Japan to toughen security for Antarctic whaling fleet - Reuters

TOKYO | Tue Oct 4, 2011 7:38am EDT

TOKYO Oct 4 (Reuters) - Japan will toughen security around its whaling fleet in the Antarctic Ocean this winter, Fisheries Minister Michihiko Kano said on Tuesday, in response to anti-whaling protests at sea.

Last season, Japan cut short its annual whale hunt in the Antarctic after it was obstructed on the water by the Sea Shepherd Conservation Society.

This year, Japan plans to send the Fisheries Agency's patrol ship to protect whaling crews, and other measures are also being considered, Kano told reporters. Whaling ships normally set sail from Japan around November and December.

"There is a premise that Japan aims to restart commercial whaling in the future and the nation needs to continue research whaling to achieve that," Kano said.

Australia immediately condemned Japan's decision to continue whaling, especially as the hunt will take place in the Southern Ocean Whale Sanctuary established by the International Whaling Commission, Foreign Minister Kevin Rudd said in a statement.

Japan -- which along with Iceland and Norway is one of one three countries that hunt whales -- introduced scientific whaling to skirt the commercial whaling ban under a 1986 moratorium. It argues it has a right to monitor the whales' impact on its fishing industry.

Last year, Australia filed a complaint against Japan at the world court in the Hague to stop Southern Ocean scientific whaling. The decision is expected to come in 2013 or later. (Reporting by Kaori Kaneko; Editing by Daniel Magnowski)


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Noda seeks TPP policy by November summit

Prime Minister Yoshihiko Noda will try to come up with a policy on joining negotiations for a trans-Pacific free-trade pact before he leaves for the Asia-Pacific Economic Cooperation summit in Hawaii in November, sources said.

Noda will soon convene a meeting of his key Cabinet ministers to resume the coordination process for the talks, the sources said. The work on the Trans-Pacific Partnership Agreement, as the U.S.-led pact is called, was meant to be finished by last June but was suspended by the March 11 earthquake and tsunami.

Noda's crew is apparently divided over the matter. Noda is apparently in favor of joining the talks, but Agriculture, Forestry and Fisheries Minister Michihiko Kano is reluctant because the pact is certain to put pressure on Japan to open up its protected and politically sensitive agriculture market.

Among other key ministers, trade chief Yukio Edano, speaking to reporters during a visit to Singapore last month, supported joining the talks.

Singapore is one of nine countries engaged in the talks. Those countries have set a goal of achieving a broad accord for the TPP agreement when APEC's leaders gather for an annual summit starting Nov. 12.

Noda, who met with U.S. President Barack Obama last month in New York, is expected to clarify his government's stance on the U.S.-led trade initiative when he meets Obama again on the sidelines of APEC, the sources said.

KYODO

Business leaders in Kyoto on Sunday urged the government to make all-out efforts to lessen the severity of the disaster reconstruction tax it is planning.

"Honestly speaking, I cannot see how the government can impose heavier taxes on corporations while the economy is in such bad shape," Yoshio Tateishi, chairman of the Kyoto Chamber of Commerce and Industry, said at a meeting with economic and fiscal policy minister Motohisa Furukawa and members of local business groups.

The comment came as the government last week announced a plan to raise income, corporate and other taxes for a limited period to finance the reconstruction of disaster-hit areas and businesses in eastern Japan.

Tateishi said the government should reduce the rate of the tax hikes as much as possible by selling off assets and other means.

Furukawa said he would try.

"The government will do its best to reduce the rate of tax hikes," he said.

But "Japan is in the worst fiscal condition of all the developed countries, and we cannot achieve stable economic growth without addressing the problem," he added.


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Citizen fund investments

More and more people are investing their money in citizens' funds. People can invest a small amount of money to help organizations that are tackling issues close to people, such as community building, nursing care support for the elderly and care of children after school classes are over.

Especially since the March 11 earthquake and tsunami, citizens' funds have helped to prop up enterprises and to promote green energy development in the disaster-hit areas.

In the public sector, even when budgets are passed by the Diet or local assemblies, it is difficult for the central and local governments to act quickly. They have to clear legal provisions, and a lot of administrative documents must be prepared.

For example, the work to remove debris from the devastated areas has not gone smoothly. Even the Japan Red Cross Society is slow in delivering support money contributed by people to local residents who have suffered from the disasters and the Fukushima nuclear crisis.

In contrast, citizens' funds can effect prompt action. It does not take a lot of time to set up such funds, collect money from citizens and begin operations. Those interested in helping enterprises struck by the disasters can request explanations from them about their history, activities, determination and how funds will be operated. They can also get such information through the Internet.

Enterprises such as restaurants, fish stores, fish cake makers and soy sauce makers have established their own funds to collect investments from citizens so that they can reconstruct themselves financially and resume business operations.

Such funds first started in and around Kesennuma, Miyagi Prefecture, and spread to Iwate Prefecture. They were able to start collecting investments within a month after they were established. Investors put up money ranging from several tens thousands of yen to around ¥100,000.

Even if only several thousand people take part, the amount invested can become surprisingly large.

If enterprises helped by such funds make profits, the invested money will be returned. Investors may also be able to get some perks. But if enterprises cannot make profits, the invested money will not be returned.

Citizens' funds can play a meaningful role. But investors must watch whether funds are operated properly. It is hoped that such funds will help strengthen civil society.


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Japan's rivals look to lure away yen-harried firms

As the economy staggers under the weight of the strong yen, businesses in Japan are receiving much-needed offers of help, with a chance to reduce rent, pay fewer taxes and cut utility costs.

News photoSimple math: Employees monitor currency rates at a foreign-exchange office in Tokyo on Aug. 4. Strained by the rising yen, businesses are relocating to overseas markets out of necessity. AP PHOTO

The problem is that these offers are coming from Japan's neighbors, particularly China. Delegations from across Asia have spent recent months hosting seminars in Tokyo's upscale hotels and conference rooms, hoping to pluck away Japanese business by offering incentives that companies find increasingly difficult to resist.

Since June, recruiters from at least seven Chinese provinces have hosted events in Japan. Vietnam came with a 20-member mission. Myanmar sent more than 300 representatives. One official from Zheziang Province in China described it as a "rare opportunity" to lure Japanese businesses that are strained by the rising yen, high corporate taxes and a shrinking domestic market.

The prospect that companies big and small will relocate amplifies concerns about the world's third-largest economy as it tries to break a two-decade run of stagnation and rebuild its disaster-hit northeastern coastline.

Politicians and business leaders fear a scenario in which major manufacturers, though maintaining a baseline presence in Japan, will build factories overseas and depend increasingly on local suppliers in their new countries; then, the smaller Japanese companies that once depended on those manufacturers will cut costs to compete or move overseas themselves.

In his first major speech, Prime Minister Yoshihiko Noda said last month that the soaring yen and the rise of emerging economies had created "an unprecedented industrial hollowing-out crisis" that could lead to lost jobs and weakened Japanese competitiveness.

"Japan is on the verge of suffering a major loss of national credibility due to the hollowing-out of its industries," Noda said.

Many companies say they have been approached with offers to begin operations overseas. The invitations, according to government data, come mainly from China and several Southeast Asian countries — especially Thailand and Singapore.

Firms have also received offers from provinces in South Korea, even though Seoul tried this summer to curb the recruitment of Japanese companies, thinking it inconsiderate in the aftermath of the March 11 disaster.

Attempts to poach Japanese companies is hardly new. Neither is Japanese interest in Asia's developing markets, with many export-reliant giants — Toyota, Panasonic and Sony — building regional networks. What was once a business opportunity, though, has turned into a business necessity; firms now relocate to China and Southeast Asia not merely to reach new markets but to offset the pain in Japan.

That pain comes largely from the yen, which has soared in value this year amid concern about the U.S. and European economies. Investors see the yen as a safe bet, and they have managed in a short time to transform its worth.

In April, the yen was valued at about 85 against the dollar. On Sept. 19, it was 75.94 against the dollar, a post-World War II high, and Japanese policymakers have been helpless to stem the rise. The strong yen makes Japanese exports more expensive overseas, and it pinches foreign-made profits when they are repatriated.

In a recent government poll of major manufacturers, one-third said they would face "serious profit decline" if the exchange rate held steady for the next six months.

The poll, conducted by the industry ministry, suggested Japanese companies will flee — quickly — if the Noda administration can't soon provide help. Of the 61 manufacturers surveyed, 28 said they would transfer production plants and research centers overseas if the yen held its value. One in five smaller businesses reported that they were already seeing a decline in demand because trading partners had moved overseas.

"The worst case is, a greater percentage of business will be done overseas," said Koichiro Otake, deputy director of the macroeconomic affairs division at the Ministry of Economy, Trade and Industry. "And that will lead to big, big problems for small and medium-size companies. They have two options. Either they follow suit and move overseas, or they go out of business."

Many economists in Tokyo say the hollowing-out process is already under way — and gaining momentum. They say a growing number of companies are finalizing plans not just to outsource their production, but to open new factories in foreign countries.

This summer, some of the biggest Japanese companies signaled their intention to bulk up beyond Japan, with Panasonic announcing a new procurement center in Singapore and telecommunications giant Softbank launching a data center in South Korea, citing the country's lower electricity costs.

But the woes go beyond the yen. Japan's corporate tax far exceeds levels in China and South Korea. So do its energy costs.


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