Wednesday, September 12, 2007

Day Three -- Visit to Aisin Seiki

Last night we attended a "Friends of Indiana" reception on the top of the Imperial Hotel. It was a very formal and well attended event with over 100 dignitaries and business professionals in attendance. The feedback we are receiving is quite positive -- there is a lot of incredible momentum and excitement and many of the Japanese executives and companies are very open to learning more about Indiana and the economic opportunities. The time and effort the Governor has spent developing relationships is really paying off.

We took the bullet train to Nagoya this morning. It is the third largest city in Japan and one of the fastest growing. The infrastructure, and mass transit, is fast and efficient not to mention neat and clean. The train crosses the country and travels approximately 200 mph. There is a vast contrast between the big city of Tokyo and the rural areas we saw on the train.

Once we arrived in Nagoya we took a bus ride to Aisin Seiki, a large Japanese manufacturer. There are 153 companies under the Aisin umbrella with approximately 20 billion in sales and 3,300 employees. They have a presence in Rushville, Seymour, and Terre Haute. The facility we visited makes brakes for automobiles and manufactures about 360,000 pieces a month.

There are very formal "executive" office suites, or corner offices, but rather long conference room tables with laptops so the employees and staff have very little privacy. Overall the Japanese workplace culture is very organized and methodical. Even the nine different trash containers we saw were organized by type of refuse.

During the plant tour, I was surprised to see few employees in the assembly line, rather everything is robotic and sensor driven. Safety, as you can imagine, is a top priority, especially since a fire broke out in the facility several decades ago. Before you enter the factory, for example, you must go through an air shower, similar to those in airports.

Tuesday, September 11, 2007

Day 2: Continued Participation in the U.S. Midwest Japan Association Conference

Today the delegation continued our participation in the U.S. Midwest Japan Conference. The conference featured a special program called, "Invest in Indiana Agriculture." The three hour presentation addressed the state's agriculture initiatives and featured remarks by Governor Daniels and Nate Feltman, of the Indiana Economic Development Corporation. Mike Beard, a pork farmer, and Kip Tom, of Tom Farms, also offered their personal perspectives.

During the event, I participated on a luncheon panel with Jeff Knight, General Counsel of Old National, and Kyle Hupfer, General Counsel of ProLiance Energy. We spoke about the funding opportunities available in Indiana and emphasized that Indiana is pro-investment, pro-trade and pro-business. I was able to offer information about our Firm's work in the agriculture industry and the legal services involved in agriculture including: intellectual property, financing strategies, employee relations and employment and labor law.

The panel also discussed why agriculture is a key driver in global trade and politics. Food and agriculture are seen as necessary goods and many countries spend a large percentage of their disposable income on food. In the United States, agriculture contributes $1.3 trillion to the GDP and employs 17 percent of the US workforce. Other trends in the agriculture industry include a move to consolidation and improved efficiency. In the US, for example, seven percent of farmers produce 60 percent of output.

Indiana is seen as a leading agriculture state in many ways, so our participation in today's event and the perspective from the panelists, was particularly valuable. Indiana is home to approximately 59,000 farms and ranks #4 in soybean production, #1 in duck production and #5 in corn, pork and chicken production.

Indiana has also emerged as a national leader in alternative energy. We now have 12 ethanol plants under construction and we have gained national and international acclaim with BioTown, USA. Indiana is also strategically located with a strong infrastructure. You can travel to 2/3rds of the US population in less than 24 hours. Finally, Indiana is home to Purdue University, one the world's leading agriculture institutions. All of these combined are seen as competitive advantages for our state and part of our "sales pitch" to Japanese companies.

A small group of the delegates, including the Governor, Nate Feltman and I, met with Nobuyuki Idei, Chairman of the Sony advisory board. Sony has been number one in their industry in the last 7 years, which is an incredible accomplishment. It was a fascinating meeting which featured a great deal of discussion about technology, specifically blue chip, and the state's film and entertainment industry. We encouraged Mr. Idei to consider Indiana for film production and emphasized our state's abundant labor force. He was very gracious and friendly and interested in learning more about our state.

In the evening, we participated in a gala dinner and "Friends of Indiana" reception with about 500-600 in attendance. It was a very formal dinner in a beautiful ballroom with fine china. A group of 70-80 year old men and women were dressed in authentic Japanese dragon costumes and were followed by a drumming and acrobatic corps.

I continue to be impressed with Japan, and Tokyo in particular. The city is beautiful at night with skyscrapers that light up the sky. Surprisingly, there is a lot of green space, and parks, that are interspersed throughout the city. It's quite hot and humid which contributes to a very lush landscape.

Monday, September 10, 2007

Day 1: U.S. Midwest Japan Association Conference

Unlike some of the other trade missions, this one included attending the annual conference of the U.S. Midwest Japan Association. The Association first met in 1967 in Chicago, IL. The membership is comprised of 10 member U.S. states. Those states include Illinois, Indiana, Iowa, Kansas, Michigan, Minnesota, Missouri, Nebraska, Ohio and Wisconsin. The meeting in 2006 was held in Indianapolis and was attended by the governors of five Midwestern states and the Chairmen/CEOs from such companies as Eli Lilly, FedEx, Duke Nuclear, Lear Corporation, Northwest Airlines, Tokyo Stock Exchange and Toyota Motor North America.

Over 500 people attended the conference in Tokyo this year. All the states in the Association have a delegation such as ours from Indiana. We are in attendance to hear a variety of speakers from both the U.S. and Japan and to meet other business people who trade with Japan.

While attending the conference I became more convinced that Japan is truly a partner of ours and that partnership is integral to our future success. The U.S. and Japan are the two largest economies in the world. Indiana has the 4th highest investment in Japan of all U.S. states. Ahead of us on the list are Kentucky, Ohio, and California. Eighty-eight percent of our investment is in motor vehicle parts. Additionally, 50% of all patents in the world are registered by either Japan or the U.S.

One of the concerns currently in Japan is their farming community and its workforce. The average age of a farmer in Japan is 70 years old. This means that they are more and more reliant upon countries like the U.S. to provide imported agricultural products. However, they are somewhat leery about the food safety standards of the U.S. Because of the size of the U.S. market they feel that the standards may not be enforced as rigidly as the standards are in Japan. They are also very skeptical of genetically altered products and do not believe they are the same from a nutritional standpoint.

The Japanese culture is one of tradition and ritual. We went to a Sumo match and I was fascinated to learn about the meaning of the rituals that occur before the match begins. Sumo is believed to be as much a mental sport as one of balance and strength. To begin the match, each wrestler claps his hands to get the attention of the audience. Then the hands are lifted up to show they have no weapons. The legs are lifted and the feet stomped to rid the arena of bad spirits. Each wrestler rinses his mouth with water and wipes the inside of his mouth with a towel. This is done to symbolically represent the clearing of the mind and the body. And lastly before the match begins, salt is spread in the area to purify the ring.

As with my previous visit to Japan I continue to be struck by the similarities we share and also the marked differences. We share interests and values in supporting democracy, research for disease cures and technological advances, and protecting and conserving natural resources. Our differences seem to be driven by our heritage and culture. Our manners and customs are different, but as we continue to embrace diversity across our own country and the world such differences become less significant and more of who and what we are as a global economy.