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One of Japan’s best cities broadens its appeal

Interview - March 16, 2016

Already one of Japan’s most desirable cities to live in, Yokohama is also aiming to be its easiest and most rewarding to work. It is pioneering special support programs for women entrepreneurs, offers substantial benefits and incentives for businesses, and even has signs in three languages, including English, to help foreigners settle in. Mayor Fumiko Hayashi details the city’s advantages and explains why, from individuals to start-ups to blue-chip multinationals prefer Yokohama. 


Can you take us through some of the competitive advantages that City of Yokohama can offer both to companies and people alike?

Yokohama is now one of Japan’s finest, most appealing cities. 157 years ago, it was nothing more than a remote village with less than 100 households, but after Commodore Perry arrived in Yokohama to conclude the Japan-US Treaty of Amity and Commerce, its port opened in 1859 as the gateway to Japan. Since then, Yokohama has had a strong relationship and deep bond with the US. The port was perpetually a source of growth for the city. Today, there are around 150 luxury cruises a year that call at Osanbashi, Yokohama’s foremost passenger terminal.

Urban development in Yokohama is based on “urban design” thinking and is carried out in a systematic, logical, planned manner. We’ve established very high standards for constructing buildings and structures so that no matter who comes to visit, they have no problems and are instead in constant admiration of the city itself and the beauty of the cityscape.

Another part of Yokohama’s appeal is its urban agriculture. The city has 18 administrative wards and is enthusiastic about agriculture in its suburban areas. 40% of the products grown in Yokohama are consumed by its residents, forming a sustainable cycle of local production for local consumption. It is very unique for a city as large as Yokohama to be home to agriculture, livestock-raising and dairy farming.

With its beautiful waterfront, rich food culture and creative activities such as art and design as well as the opportunity to live amid abundant nature, Yokohama consistently takes top positions in domestic Japanese surveys of where people want to or are glad they live.

It also has 30 universities, including graduate schools, and educational and research activities are vibrant. So-called industry-academic-government cooperation, in which universities and other education and research organizations cooperate with private companies and the government to research and develop new technologies and create new industries, is also prevalent. This is a pillar of Yokohama’s sustainable growth strategy.

In recent years, Yokohama has continued to take on new challenges, giving rise to successive business opportunities. The national government, seeking future economic growth, has designated it a special zone and pilot city for various projects, and as such it bears the growth of the country.

Our efforts to counter global warming through environmental measures and green conservation activities have been praised. Furthermore, we have hosted a number of international conferences, such as the APEC Economic Leaders’ Meeting, and we are constantly developing tourism promotion. We are also endeavoring to promote arts and culture, and the number of special events held in the city is almost too high to count. These events support and introduce the city and are enjoyed by the numerous visitors we receive each year.

Continuing low-birthrate and aging-population trends give rise to expectations that the working-age population will shrink and that demand for welfare and medical services will increase. Therefore, it is essential that we not only create an environment in which it is easy to have and raise children, but also, beginning with the education of these children and youth who bear our future, empower all kinds of people, including women and senior citizens.

Aiming to be Japan’s easiest and most rewarding city to work in, Yokohama is striving to promote and establish an environment that supports the participation of women in the workforce. As you know, women fill a mere 10% or so of positions of responsibility in Japan. In light of this, Yokohama set a target of reducing the number of children on nursery school waiting lists to zero and achieved this target three years ago. We have kept this number near zero since then. Prime Minister Abe, calling this the “Yokohama method,” extended it across Japan, successfully implementing it not only at the individual city level but also at the national level.

Moreover, I support entrepreneurship by women and believe that we must train more women entrepreneurs in the region. I’m convinced that entrepreneurship is a way of increasing the number of women in executive positions.

Capitalizing on the sensibility and diverse and flexible points of view of women in product and service development can create new markets and realize a more flexible way of working for women. In Japan, Yokohama is pioneering a special support program for women entrepreneurs. It has established shared offices for incubation purposes and offers a wide range of support, including consulting with a team of experts, lending with favorable interest rates, startup/business management seminars and more. It also offers precise support at the embryonic stage, for example by establishing trial spaces to set up shop on a trial basis while receiving expert consultation prior to launching the actual business.

The government says it will provide several funds to well-located municipalities with excellent or even outstanding plans for economic stimulation. In Japan, there are 20 municipalities with over 700,000 people. These large cities must drive national growth by offering and implementing solutions with a sense of urgency to the problems of a low birthrate, aging population and population decline.


What initiatives and incentives are in plan to attract more businesses to Yokohama?

For example, there’s a company called Euglena that uses the organism Euglena to refine bio-jet fuel. Euglena is planning to build a pilot plant for manufacturing bio-jet diesel fuel in Yokohama. It chose Yokohama because it can locate the plant less than 25 minutes from Haneda Airport. The city is home to a large number of companies and a big reason for that is the excellent access to a massive market. Around 43 million people, a third of Japan’s population, live in the metropolitan area encompassing Tokyo and Yokohama, making up a market of considerable size. Tokyo can be accessed in under 30 minutes.

Yokohama also offers excellent access to airports – it takes as little as 24 minutes to get to Haneda Airport, which offers direct flights to and from major cities around the world. It also has a bullet train stop, making for easy access to Japan’s main cities. Companies from overseas value how convenient Yokohama is.

Not only does it offer excellent access and business, its office rent is about 20% cheaper than that of Tokyo’s business districts. This means that for the same cost as Tokyo, one gets a building with better specifications and higher cost-performance in Yokohama. It is these factors that help explain the 180 foreign companies located in Yokohama, the second highest figure in Japan after the capital.

Another factor is its wealth of human resources. Yokohama has a large number of schools of science and technology, an extremely popular field for students these days. One of these is its prestigious medical university.

Yokohama does everything it can to support companies considering expanding here. First, our subsidy system offers tax breaks and locational subsidies in line with investment for five years if they build or acquire an office or factory. If they invest more than a certain amount, their property tax and city planning tax rates are cut in half. Not only that, but in addition to these tax breaks, we offer subsidies of up to 15% or 3 billion yen if a global company invests at least 5 billion yen. Furthermore, companies that become tenants of buildings within the city can receive subsidies in line with the number of relocating personnel and floor area. Global companies making a large-scale relocation of 100 or more employees are eligible to receive up to 400 million yen.

Many companies have used this subsidy system and have gathered in Minato Mirai 21, Yokohama’s beautiful waterfront business area. Nissan Motor, Fuji Xerox, Lenovo, Accenture, and many other global firms have headquarters and research bases there. Not merely for business, Minato Mirai is also a concentration of tourism, shopping and MICE facilities and is the new center of Yokohama. With its diverse array of functions, much more innovation is expected.

This is not the only support we provide. We operate the Yokohama World Business Support Center (WBC) to assist foreign companies in expanding to Japan for the first time. Its support includes key money/deposit-free incubation offices specifically for foreign companies as well as services that arrange meetings with legal and tax experts and business consultants.

We also work hard to make sure the employees and their families can live comfortably with peace of mind. There are currently 10 international or foreign schools in the city, and we provide introductions to foreign-language medical institutions, dispatch interpreters for medical examinations, foreign-language versions of the City of Yokohama website and radio programs giving general information. Signs in three languages – English being one of them – in the city center and at train stations help create an environment in which it is easy for foreigners to live. Our incredibly international citizenry and our city officials look forward to welcoming you or your business to the city.

Another thing we take pride in is our four professional sports teams. In baseball, we have the Yokohama DeNA BAYSTARS; in soccer, Yokohama F. Marinos and Yokohama FC; in basketball, the Yokohama B-CORSAIRS. This is something to pay attention to – in other words, it’s also a fun city to live in.

Previously, when Fuji Xerox was giving a presentation for a client in Singapore, apparently their R&D base was located in a remote place in the mountains for reasons of confidentiality. Over time, however, thinking concerning company location has changed dramatically. Companies nowadays must be sensitive to client needs, able to respond immediately and not take up clients’ time in transit. They need to be able to meet with clients somewhere that is easy for the client to get to. An R&D base is a place where companies can advertise themselves, so the location needs to be social and attractive, which is why Fuji Xerox established itself in Minato Mirai. Nissan Motor has its global headquarters with a showroom there and Apple is preparing to open a base there as well.


In 2015 Apple had announced that it was going to build a R&D facility in Yokohama. How does this aid in attracting more and more international companies in this environment?

This type of news has significant influence, and competition between cities to attract well-known companies doing large-scale, international business is extremely fierce. Apple is one such company, but another company that decided to make a large-scale R&D base relocation to Minato Mirai is Shiseido. Euglena, which I mentioned before, is another example. Yokohama is appealing to venture startups with the same zeal as to international firms.

Another reason foreign companies choose Yokohama is its status as a National Strategic Special Zone. Yokohama has been selected for a number of governmental projects and enjoys a number of regulation relaxations as a special zone. In the city center, the scheme relaxes floor area ratio restrictions significantly, allowing the construction of high-rise buildings. Some of the top floors of these buildings will be used as residences for foreign entrepreneurs. Several such buildings will be built in the so-called Tsuruya district around Yokohama Station. These are some of the ways in which Yokohama endeavors to attract many global firms to the city.


Can you take us through Yokohama’s international relations, and how is the city working to spread its example and develop enhanced cooperation at global level?

Yokohama is developing direct and active partnerships with cities overseas. We discuss how to make use of knowledge and skills that lead to the eradication of issues the cities face. On the mayor of Frankfurt’s recent visit to Yokohama, we discussed the issues our cities face. We plan to hold clear and organized discussions on how we can identify the various issues we face. Between cities, we are accelerating and streamlining discussions between two countries. In solving city issues, ultimately it is the actions of cities rather than governments that are important.

Yokohama, overcoming earthquakes, war, rapid population increase and other difficulties, has grown into a major city of 3.72 million people. We are helping address issues faced by cities in emerging nations based on infrastructure technology and expertise cultivated over this growth.

In May 2015, we established an organization called the Y-PORT Center and it is accelerating cooperative public-private initiatives. We have signed MoUs with Cebu City in the Philippines and three other Asian cities, encouraging Yokohama companies to carry out specific technical support projects concerning water treatment, waste processing and more. Through activities such as these, we hope to expand the business of city companies overseas and make an effective international contribution.

We are happy to provide a variety of proposals and presentations to anyone interested in knowing more about Yokohama’s technologies.