Japanese government actively seeking overseas talent to promote “internal internationalization”

The one-two punch of low birthrates and an aging population are prominent concerns in most modern nations, but none more so than Japan. Here, the rapid trend towards a shortage of workers is inevitable, and the bureaucracy and tradition of legacy systems continues to be a factor hindering economic development, especially in a startup-oriented world. As one policy to overcome this domestic situation and achieve sustainable growth, the Japanese government is promoting “internal internationalization.”

‘Internal internationalization’ refers to the active adoption of international perspectives and activities by companies and organizations within Japan, and the internal permeation of diverse cultures and values. In other words, the aim is to improve international competitiveness by attracting foreign human resources to Japan with a concerted effort to their widespread integration in Japanese companies.

Internationalization has also been directly linked to an uptick in sales. By incorporating international perspective to the core of the corporate culture and management strategy of organizations that have so far focused on the domestic market, it will be possible to respond to global market trends and adapt their products and services, leading to the development of new customer segments and the expansion of sales channels.

Against this background, internal internationalization is being pushed as a way of capturing foreign demand while dealing with the shrinking domestic market. This is essential if Japan is to make the most of its advanced technological capabilities and economic base to achieve sustainable growth in the competitive environment of the international market.

History provides proof

There are many examples of prosperity based on internationalization.

The Tang Dynasty in China is known as a period when urbanization was achieved through trade, religious and cultural exchange. Peter the Great of Russia promoted Westernization in his country’s military, education, and administration. In modern times, Singapore implementing policies that encourage free trade and foreign direct investment, as well as tax incentives and deregulation, and it has attracted both multinational corporations and foreign investors as a result, turning it into an Asian financial hub. The fact that there is no tax on capital gains from investments in stocks, real estate, and cryptocurrency has led to the establishment of a unique economic zone in Singapore, with many companies active in the Web 3.0 domain as well as traditional investment-related companies and investors choosing to register their businesses in Singapore.

Following this history, it is clear that in order to succeed in internal internationalization, it is essential for the whole country to work together based on bold collaboration in all areas, including law, education and government.

The appeal of working in Japan

In a globalized society, it is absolutely essential to be able to meet local demand.

The positioning of the Japanese market in the global context is quite strange, because Japan is home to many companies that are active in the global market, particularly in the automotive industry, and its GDP is one of the highest in the world. On the other hand, it is quite difficult for foreign companies to be active in the Japanese market. There are linguistic restrictions of course,  with Japanese not being a common second language outside Japan and many Japanese people unable to handle English in business situations, but there are also many unwritten rules in Japan — for business more than anywhere else. For overseas companies and foreign entrepreneurs, getting used to this Japanese culture can be a major hurdle.

Even with these initial barriers, however, building a career in the Japanese market can be an attractive step for overseas talent.

Japan is proud of its high technology, safety, and social stability. It has advanced technology and an excellent research and development environment, and boasts world-class technology and facilities in fields such as automobiles, robotics, electronics and biotechnology. Working in Japan provides many opportunities to come into contact with the latest technology and knowledge and to improve your specialist skills. In addition, Japanese companies invest heavily in research and development, and there is an environment in which overseas personnel can participate in advanced technology projects and make rapid career progress.

In terms of quality of life, Japan is one of the most attractive countries in the world. The crime rate is very low, and you can live with peace of mind anywhere in the country. Men and women alike think nothing of walking alone late at night.

The healthcare system is accessible and extremely high-quality, allowing great peace of mind when moving to Japan — especially for those with families.

The level of development of public transport is one of the best in the world. Whether in urban or rural areas, trains are almost never delayed. There is an absolute belief in punctuality, to the extent that even a delay of a few minutes is considered a failure on the part of the operator.

But it's not just about business and social welfare. Japan is home to beautiful scenery, and culture and tradition prescribes a calm, harmonious lifestyle.

What about starting a business from scratch in Japan?

The Japanese government offers various programs to support startups and foreign companies entering the market, such as JETRO (Japan External Trade Organization), which provides business matching and legal and tax advice to foreign companies entering the Japanese market. Local governments also have their own support systems in place, with start-up visas, financial assistance, mentor programs, and office space all on offer depending on the region. Many Japanese research institutions and universities also take part in government schemes to make it easy to carry out joint research and technological development with the private sector.

However, the biggest hurdle is the language barrier. English is fairly widely spoken in Japan, but usually not to a high level. Japanese — especially the formal Japanese used for in business meetings, negotiations, and when drawing up contracts — takes a long time and a lot of effort to become fluent in. Japanese business culture and customs are also (rightfully) famed as being byzantine and insular.

The regulatory and legal environment in Japan can also complex for foreign companies to navigate. In addition to a relatively-high corporate tax rate, certain industries and businesses may require special permits and licenses to comply with Japan's unique labour, tax, and commercial laws.

For these reasons, the key to success in Japanese business is to develop with a long-term perspective and aim for sustainable growth.

As the number of foreign entrepreneurs and foreigners choosing Japanese companies increases, the support available to them will become more substantial and more optimized, but a lot of the groundwork is there already. What might seem like a bit of a challenge now might, in fact, be you getting on at the ground floor of tomorrow’s more international Japan.

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