(MENAFN- Muscat Daily) In an interview with Muscat Daily
, H E George Hisaeda, Japan's Ambassador to Oman, offered an overview of bilateral trade and economic ties. He stressed that Oman's economy can benefit from Japan's cutting-edge technology, including robotics. Excerpts:
Could you give an overview of trade relations between Japan and Oman?
In 2013, the volume of exports from Oman to Japan was around US$5.63bn. Japan is one of largest importers of oil and gas, aluminum and fishery products from Oman. Imports from Japan to Oman were at around US$3.13bn, the second highest after the UAE; more than 90 per cent comprised automobile and auto parts. Japan's world-class machinery and electronics products are also in demand.
The bilateral tax agreement was signed in January and substantial agreement has also been reached on bilateral investment agreement negotiations.
Which are the areas that are expected to receive a boost following PM Abe's recent visit?
The priority points in the joint communique are:
a) Cooperation in maritime security, including counter-piracy, and the maritime order based upon such fundamental principles as the rule of law.
b) PM Abe welcomed Oman's continuous endeavor to supply oil and LNG to Japan. Strengthening cooperation in the energy sector was reaffirmed, utilising Japan's advanced technologies.
c) Cooperation in Oman's electricity and water infrastructure development by encouraging the private sector to invest in Independent Power and Water Projects (IPP, IWPP, IWP).
d) Discussions regarding the Japan International Cooperation Agency's (JICA) cost-sharing technical cooperation with Oman for HR development.
e) Cooperation in the education and cultural fields.
Also mentioned was cooperation in tourism, urban transportation and the medical sector. Japanese companies mainly invest in IPPs and IWPs or oil and gas projects and large construction plants. However, as Oman's economy develops, Japan can offer a wider range of cutting-edge technology.
How do you intend to implement the concept of Al Taish (co-existence and co-prosperity) in economic ties with Oman?
Japan is revitalising. We are developing our overseas market. Japan depends on energy from Oman, but can offer some of the best renewable technologies and medical technology, and experience of an aging society and modern lifestyle diseases. The region's large youth demographic is the future elderly generation. The Japanese preventive health care system can be applied.
Energy is the foremost cooperation sector. Could you throw some light on the existing levels of engagement, and future initiatives between Japan and Oman?
Japan entered into a long-term partnership with Oman LNG and Qalhat LNG, which have subsequently merged. Japan's leading business houses - Mitsubishi, Mitsui and Itochu and Osaka Gas - have shares.
Mitsui has been operating a successful joint venture project in oil and gas exploration and production in northern Oman. Mitsui E&P Middle East (MEPME) is investing in upstream projects. Japanese oil & gas companies have close ties with their Omani counterparts and the Ministry of Oil and Gas, including in technical training programs. Japan welcomes increased private investment in upstream projects.
There are 13 Japanese companies in Oman, undertaking various infrastructure projects. Could you provide an overview?
Oman is developing infrastructure in an effort to depart from its resource-centric economy, and diversify its industry. Japan seeks to export infrastructure, a product of Japan's high-end technologies.
Six of the 13 Japanese companies are major business houses and play a central role in bilateral cooperation, including general trading, shipping and investment.
In recognition of Japan's excellence in engineering technology and work schedule management, a number of Japanese companies were awarded contracts of major industrial and infrastructure projects, including LNG trains in Sur, a refinery and chemical fertiliser plant in Sohar, and desalination plants in Ghubrah and Barka.
One example is the iron direct reduction plant in Sohar, built by a leading steel company from Japan with advanced environmental engineering technology. It boasts a cost-effective and eco-friendly production facility. The production of Japanese thermal barrier paint was also introduced by an Omani company in 2011. This high-tech insulating paint conserves energy by reducing air-conditioning requirements. An engineering company is also temporarily operating in a large industrial project in Sohar.
Six Japanese companies import oil and gas from Oman and invest in IPPs and IWPs. Sojitz Corp, with Shikoku Electric Power Corp, was awarded the Barka 3 and Sohar 2 IPP. In 2011, Marubeni & Chubu Electric Power Company won the Sur IPP contract, which accounts for around 30 per cent of Oman's electricity, with a US$1.6bn investment. Sumitomo Corp was awarded the Al Ghubrah IWP, which will significantly contribute to Muscat's water demand using Japanese reverse osmosis technology. MEPME are also investing in Oman's upstream projects.
Are there other Japanese companies showing interest in projects? What potential is there for Japanese investment in infrastructure and other projects?
With its growth and political stability, Oman is attractive to investors. The Japanese private sector, with its wealth of experience, is interested in investment opportunities, especially utilities. Water and power production projects continue to be desirable. As Oman develops, new infrastructure markets will follow. For example, an urban transportation system may be required. Japan has a state-of-the-art, safe operating system.
Oman may experience similar growth issues as Japan, like environmental degradation, energy conservation needs, and modern lifestyle diseases. Japan developed technologies to resolve them, such as plant waste heat reuse, and diabetes check-up schemes, and can share this experience.
Which other sectors are both countries focusing on in terms of trade, investment and collaborations?
Japan and Oman are maritime nations and cooperate in the shipping sector. Reputed for advanced shipbuilding technologies, Japanese shipyards build a number of vessels for Oman Shipping Company (OSC). These include LNG tankers and very large crude carriers (VLCCs) and Japanese companies have substantial shares in the fleet. Mitsui OSK Line has played an active role in OSC, including management, fleet operation, and crew training.
Around 90 per cent of Japanese oil imports are from the Middle East. The region's stability is indispensable to Japan's energy security. Oman is a important country for international maritime transportation. It's vital for us to cooperate in maintaining the safety of shipping routes.
Japan is the world leader in robotics and hi-tech engineering. Is Oman showing any interest in importing robotics technology?
The Embassy held a robot contest here in 2011. In Japan, industrial robot technology has been used in areas such as iron and steel plants and assembly lines, including welding, painting, pick and place (packaging, palletising and SMT), product inspection and testing - all accomplished with high endurance, speed, precision and decreased industrial accidents. This technology could be imported by Oman's growing industrial sector.
We also have robots to care for the elderly, and therapeutic robots, such as Paro.