INVEST KANSAI

KYOTO

HYOGOOSAKA

NARAWAKAYAMA

SHIGA

Introduction of KANSAI, JAPAN

Introduction

Compare to Capital economic zone (Tokyo)

(Comparison of Manufacturing)

Domestic Comparison International Comparison

Source: Institute of Geographical Survey, Ministry of Internal Affair “Population Projection” “World Statistics 2012”, Cabinet Office“Country Economic Statistics”, IMF WORLD Economic Outlook Database Apr 2012, Ministry of Economy Trade and Industry “Industrial Survey” “Factory Site Selection Trend Survey” *) Number of new factory setup: company that acquire more than 1,000m2 of land for the purpose of setup new factory or research institute Note) Definition of region: Kansai (Osaka, Kyoto, Hyogo, Nara, Shiga, Wakayama), Capital zone (Tokyo, Kanagawa, Chiba, Saitama) Year of comparison: Area: 2013, Population: 2012, Economy scale: 2010, Manufacturing output and Employment: 2012, New factory setup: 2012, International Comparison: Kansai 2010 Gross regional products(GRP), economy zone 2010 Gross domestic products (GDP) Exchange rate: 2010: US$1=87.78Yen, 2012:US$1=80.82Yen

Area (km2)

Population (1,000)

27,095 7.2% 13,370 3.5%

16.3%

15.6%

With a population exceeding 20 million and an economy of $800 billion, the Kansai region plays a leading role in western Japan. Osaka is center of the region, a vast metropolitan area second only to Tokyo in scale.

Three metropolises, located close to one another 30 minutes by train from Osaka to Kyoto, and to Kobe.

Gross Product ofregion (GPR) (US$billion)

Kansai(as percentage of Japan)

Tokyo(as percentage of Japan)

Kansai(as percentage of Japan)

Tokyo(as percentage of Japan)

Manufacturingoutput (US$billion)

Employment inmanufacturing (1,000)

Number of new factory setup (*) 181 87 7.1%

Number of manufacturers in Kansai is equivalent to Tokyo which is twice its economic size.

Comparison of economic scale (Asia Pacific Region)

Economy scale of Kansai is comparable to economies in Asia Pacific Region.

Australia

Korea

Kansai

Indonesia

Taiwan

Thailand

Singapore

Hong Kong

New Zealand

0 500 1000 1500

Kansai area

Kyoto

Hyogo

Tottori

Tokushima

Mie

Fukui

Shiga

Nara

Wakayama

Osaka

Osaka Kyoto

Kobe

©Osaka Convention & Tourism Bureau

INVEST KANSAI

(Unit: US$ billion)

Tokyo

Kansai

Profile of KANSAI, JAPAN

20,845 35,704 28.0%

879 1,823 32.3%

568 15.9% 621 17.4%

1,196 16.1% 1,231 16.6%

14.8%

Kansai's Unique Growth Strategies Will Generate Premium Value

INVEST KANSAI

Kansai’s Economy TodayAt APIR we monitor movement of the Japanese and world economies, and ana-lyze and report trends on a weekly basis. For Kansai’s economy we use high freq-uency model forecast to reveal economic trends and issue very short-range to medium- and long-range forecasts based on Japan’s quarterly GDP data. Kansai’s economy currently accounts for 16% of Japan’s GDP, but it has become less competitive in areas where it was tradition-ally strong, such as in exports of audiovisual equipment, and the focus is now on innovative growth strategies and industries with the potential to stimulate future growth.

Kansai’s Future Growth StrategiesThere are four aspects to Kansai’s growth strategies: (1) branding to achieve high added value; (2) leveraging ICT to speed up the decision-making process; (3) investing in human capital to build a workforce that can spearhead corporate expansion over-seas; and (4) finding ways to ride the Asian growth wave. As far as human capital, I believe that foreign students studying in Kansai are potentially a core source of the people we need. A poll of foreign students studying in Kansai revealed that 73% like our region and want to work here. There is, in fact, an initiative in place that seeks to match foreign students with Kansai busi-nesses through internships.Efforts to strengthen the Kansai brand inc-lude establishment of the Kansai Innovation International Strategic Comprehensive Spe-cial Zone. This zone provides a solid foun-dation for pursuing sustainable innovation in the lifestyle and green sectors. In part-icular, Kansai is emerging as a global leader in drug discovery, regenerative medicine,

and medical equipment.

Benefits Offered by KansaiEach prefecture in Kansai offers distinct advantages: Osaka is an economic power that accounts for half of the Kansai region’s economic activity; Kyoto is a premium tourist destination; Hyogo boasts thriving metalworking and machinery industries; and Nara, Shiga and Wakayama are strong in other areas. Given that Kansai is home to so many highly developed urban centers, naturally it is well connected by an efficient transport network.But Kansai is not only a rich hub of industry, academia and research. It is also blessed with countless cultural treasures, a rich natural environment, and delicious cuisine. Little wonder, then, that Kansai is a popular posting for international businesspeople and their families.

Kansai’s Strategic AdvantagesKansai is a region of great diversity where collaboration among industry, government, and academia are broadly encouraged, and there is a distinctly organic connection between its unique cities. Kansai boasts the flexibility and hospitality to satisfy the varied interests and needs of people from around the world.The Great Hanshin Earthquake of 1995 devastated a large swath of Kansai, but the lessons learned have led to many innovatio-ns in disaster readiness. Business continuity plans are now much more common among local businesses, and Kansai businesses are much more aware of the need to protect supply chains against such risks. These behind-the-scenes aspects also help give the region true premium value, making Kansai a highly attractive proposition.

KANSAI Insight & Foresight

Kansai's economy has an influence extending beyond the region’s borders, and its trends are felt throughout Japan and the rest of Asia. What is its potential for future growth? What predictions can foreign investors make based on existing analyses and indicators? We asked Dr. Yoshihisa Inada, Director of Research at Asia Pacific Institute of Research (APIR).

Asia Pacific Institute of Research(APIR)

Ph.D. in EconomicsDirector for Research

Yoshihisa INADA

Grand Front Osaka Knowledge CapitalTower C7, 3-1 Ofuka-cho, Kita-kuOsaka 530-0011, JapanTEL +81-6-6485-7690

E-MAILcontact@apir.or.jp

(February 2014)

5 8

4

1

6

9

3

7

30km

60km

2

100km

1

2

3

48

9

6 5

7 2 Tokushima Plant

3 Kasai Plant 4 Suminoe Plant

6 Ritto Plant 7 Kusatsu Plant

Lithium Energy Japan

Hitachi Maxell, Ltd.

8 Kyoto Plant

5 Kyoto Plant

Blue Energy Co., Ltd

9 Fukuchiyama Plant

1NO.Share in Japan

KANSAI

Company websites, DiamondWeekly

INVEST KANSAI

Concentration of Solar Cell and Li-ion Battery Manufacturing Sites in KansaiSuccess in Green Technologies

Photovoltaic modules

Kansai’s Overwhelming Battery ShareLithium-ion Battery

Source: Kansai Bureau of Economy, Trade and Industry,Ministry of Economy, Trade and Industry

1

Sharp Corporation

Panasonic Corporation Eco Solutions Company

Katsuragi Plant 2 Sakai Plant

3 Nishikinohama Plant 4 Shiga Plant

KYOCERA Corporation

6 Shiga Yasu Plant 7 Mie Ise Plant

5 Shiga Youkaichi Plant

Mitsubishi Electric Corporation

8 Kyoto Plant

Kaneka Solartech Corporation

9 Toyooka Plant

1 Sankyo Energy Nandan

Panasonic CorporationAIS Company

Source: Application for The Kansai Innovation International Strategic Comprehensive Special Zone

<Leading Projects>Effort / Activity to Enhance Industrial Competitiveness

Creation of world’s leading Battery Cluster New Generation Energy System / Laboratory Zone Knowledge Capital

Special Zones in Kansai Region Future Outlook of Solar Cell andLi-ion Battery Industry Output by 2025

Lithium-ion battery

230Billion yen

2010

Solar Cell

1,130Billion yen

4.5 times

2025

3,850Billion yen16.7 times

2025

250Billion yen

2010

Kansai InternationalAirport

Hanshin Port

---

Experimental Projects

Urban open innovation center for New business networkingFacility: Salon, Lab and Theater

-

-

Osaka Bay area ,Yumeshima andSakishima

Kansai Science (Keihanna) City Osaka Station area (Grand Front Osaka)

KNOWLEDGE CAPITAL

Objective- Innovation - Spreading culture- International exchange- Nurturing talent More than 110 research, university, and cultural facilities

Photo: Urban Renaissance Agency

Battery Strategy Research CenterSmart Community projects forstandardization and overseas businessInvite environmental and energy industriesProjects in development (Mega solar power plants, Waste power generation, and Superconducting power transmission, etc.)

--

-

-

YumeshimaYumeshima

SakishimaSakishima

World’s leading research institutions and enterprises are located within 1 hour travel distance.(Membership ) 204 organizations including universities, research institutions, companies, economic groups, local governments, etc.. (As of March 2014 )

-Future projects

Next generation energysystem of CommunityEnergy ManagementSystem

-Open Innovation Center

Promotion ofindustry-academia andinternational exchanges

A community entirely covered by PV power generationBiogas/Waste power generationModal shift ,etc.

Photo: The Kansai Electric Power Co., Inc

Green-TechLife science

E Osaka Bay area, Yumeshima and Sakishima

F Kyoto area

G Kansai Science City

A Harima Science Garden City (SPring8)

B Kobe Biomedical Innovation Cluster

C Northern Osaka area

D Osaka Station area

A

B

E

C

D

F

G

(Total Production in Japan)

Total Production in Japan:13.8 Million pcs

Other Than Kansai5.57 Million pcs

40%

in 2012

No.1in Japan

Total Production in Japan:2.1 Billion AH

No.1in Japan

Kansai8.23 Million pcs

Other Than Kansai0.8 Billion AH

39% Kansai1.3 Billion AH

61%in 2012 60%

The Role of BSRC"Kansai Innovation International Strategic Comprehensive Special Zone” is targeted at the field of life sciences and new energy. This organization is particularly committed to the development and industrial cooperation among those involved in three types of batteries (storage battery, fuel cells, and solar cells) as well as smart community. In particular, we believe there will be huge market for electric vehicles (EV) and fixed storage batteries in the future.

Our ActivitiesThere are three important activities at BSRC. First is to "create new demands”. Take electric vehicle as an example, EV use much more batteries compared to electrical gadgets such as personal computers, the increase in demand of electric vehicles will have direct impact on the level of industrial activity within the Kansai region. Combining different technologies to create new application is also important, such as combining storage battery and medical devices. We believe there is demand for batteries in medical application such as dialysis equipment which should maintain functionality even in emergency situations.

Second is to "promote certification". Although quality of Japanese battery is superb, it is hard to be recognized internationally without third-party certification and assessment of its performance. In addition, energy equipment cannot avoid PL (Product Liability). Therefore, we work together with the certification body to promote awareness of certification as well as provide advices on certifying the batteries.

Third is “coordination” in the new energy field, which involves companies, universities, and research institutions located in the Kansai region. It is our task to provide business matching and consulting services as well as promote concentration of battery related industry to the Special Zone.

Can you give us details about BSRCs activity?In order to attract more companies to join EV related industries, we held a seminar on battery related components in March 2013, where we decomposed an actual EV. In other cases, field trials have begun based on our business matching efforts. I will use my experience as a researcher, and organize more projects that are beneficial to business community.

Message to companies interested in Special ZoneSpecial Zone in Osaka has unique policy of “zero local tax” which is unmatched by any local governments in Japan. Osaka is part of the Kansai region with huge market and is also an attractive business location with sophisticated transportation network, good logistics infrastructure such as Port of Osaka, Kansai International Airport. Our task is to support bridging your company and the central government as well as with other relevant agencies, match your business with other business entities in Kansai. We look forward to your investment and business activities in Osaka.

INVEST KANSAI

Battery Strategic Research Center(BSRC)

Head of BSRC(Assistant Director General Department of Commerce,Industry and Labor,Osaka PrefecturalGovernment)

Masayuki TOHDA

Case of Activities(Electric Vehicle StructureResearch Society)

1-14-16, Nankokita, Suminoe-ku, OsakaJAPAN 559-8555FL 25, Sakishima Hall, Osaka PrefectureTEL +81-6-6210-9269

E-MAILshinenesangyo@sbox.pref.osaka.lg.jp

Aiming to become the world’s top battery R&D and manufacturing baseBattery Strategic Research Center(Department of Commerce, Industry and Labor, Osaka Prefectural Government)

Battery Strategic Research Center (hereinafter referred to as BSRC) was established in Osaka Prefecture in July 2012, as part of efforts of “Kansai Innovation International Strategic Comprehensive Special Zone”.The purpose of BSRC is to take advantage of the concentration of battery related manufacturers and research institutions to support the development of industry concerned and to strengthen its international competitiveness. We interviewed Head of BSRC, a former Sony Corporation engineer, Mr. Masayuki TOHDA regarding policies and future outlook of BSRC. (April 2013)

30km

60km

100km

21

3

47

6

5

1NO.Share in Japan

KANSAI

No.1in Japan

INVEST KANSAI

10%8%

Tokai 151 Billion Yen

World’s leading research institutions and enterprises are located within 1 hour travel distance.(Membership ) 204 organizations including universities, research institutions, companies, economic groups, local governments, etc.. (As of April 2014 )

1 Kyoto BioCity Conception (Kyoto)

2 Osaka Bio Strategy (Northern Osaka)

3 Creation of Biotechnology IndustriesBased on Photo Science Technology (Harima)

4 Kobe Biomedical Innovation Cluster (Kobe)

5 Health and Preventive Care Industry Promotion Project (Osaka)

7 Photo-Medical Valley Project (Keihanna)

6 A Biotechnology Industry Creation Project Based onthe Biotechnology of the Nagahama Science Park (Shiga)

Biotechnology-relatedprojects

Source: Kansai Bureau of Economy, Trade and Industry, Japan Bioindustry Association

Leading pharmaceutical companiesin Kansai

Over 200universities/research institutes

About 100 bio ventures

Medical–drug-related-production Medical–device-related-production

Kansai's Share of Medicinal Drug and Medical Device

in 2010 in 2010

Others1,853 Billion Yen

28%

6 Trillion 600 Billion Yen

Tokai1,193 Billion Yen

18%Tokyo Area

1,669 Billion Yen25%

Kansai1,887 Billion Yen

29%

In Japan

1 Trillion 500 Billion Yen

In Japan

17%

Others254 Billion Yen

Tokyo Area729 Billion Yen

47%Kansai

280 Billion Yen

18%

Kyusyu 123 Billion Yen

Alliance with overseas organizations

Source: Application for The Kansai Innovation International Strategic Comprehensive Special Zone

Special Zones in Kansai Region Future Outlook of Medical IndustriesOutput by 2025

Export of medicaldevices

66Billion yen

2010

Export of medicaldrugs

780Billion yen

Approx. 4 times

2025

280Billion yen

Approx. 4 times

2025

189Billion yen

2010

Kansai InternationalAirport

Hanshin Port

<Leading Projects>Effort / Activity to Enhance Industrial Competitiveness

Combination of Companies and Institutions technologies Fundamentals for boosting innovationSpeed-up of R&D-to-product process

Use of clinical study data as clinical trial dataIntegrated screening management regardless of clinical study or clinical trial

-

-

Establishment of thescreening system

PMDA*-WEST (Investigation/Consulting desk)Clinical Trial Center (Virtual network)*PMDA: Pharmaceuticals and Medical Devices Agency

Establishment of specialized organizations

R&D for medicine and medical devicesAccelerated establishment of advanced medical technologies and preemptive medical care

--

Project target

- World's leading cold chains- Inauguration of Mega cargo carrier hubKIX Medica: Constant temperature storage

Osaka Station area

Kansai International Airport

Projects

Photo: New Kansai International Airport Company ,Ltd

Bio Business Alliance of Minnesota (BBAM), since 2010

-

Universitiesin KansaiKYOTO,OSAKA,KOBE...

Promotion of R&D activities for innovative medicinesMedical Innovation Center (Kyoto area)

-

Robotech-bed(Panosonic)

Development of Robots and Devices for surgical, diagnostic, nursingNational Cerebral and Cardiovascular Center (Northern Osaka area)Innovative R&D of medical devices for digestion treatment (Kobe Biomedical Innovation Cluster )

-

-

Green-TechLife science

E Osaka Bay area, Yumeshima and Sakishima

F Kyoto area

G Kansai Science City

A Harima Science Garden City (SPring8)

B Kobe Biomedical Innovation Cluster

C Northern Osaka area

D Osaka Station area

A

B

E

C

D

F

G

Excellence of Life Science IndustriesThe Kansai-based life science industry supporting high level of longevity

Source: Ministry of Economy, Trade and Industry

In 2008, Nippon Boehringer Ingelheim Co., Ltd. has set up a new research and development base – The Kobe PharmaResearch Institute, within the Kobe Biomedical Innovation Cluster (hereinafter referred to as KBIC).Since its establishment, Kobe Pharma Research Institute has been conducting research and development activities in collaborationwith number of nearby research institutes and taking advantage of the infrastructure. We interviewed Head of the Institute,Mr. Koichi WADA to better understand the advantages of KBIC as The Kansai Innovation International Strategic Comprehensive Special Zone.

Role of the Kobe Pharma Research InstituteBoehringer Ingelheim GmbH has set up research institutes in five countries around the world including Germany and Kobe, and is working in cooperation with each other in carrying out international research and development activities. Among our institutes, Kobe is focused not only on non-clinical research and development but also contribute to enhance customer satisfaction by adapting to specific needs of the Japanese market. Furthermore, it is our important task to enhance collaboration between our international research and development activity with extraordinary advanced technologies of Japanese academia.

Reasons for Selecting Kobe Japanese universities and research institutes have remarkable research and development capabilities. KBIC seemed suitable for us as a place where we can establish relationship with the brightest researchers and medical experts in the Kansai region, which will lead us to perform high level research and development through joint projects and sharing know-hows.KBIC is a cluster of enterprises and research institutes which makes us easy to socialize with other researchers and carry out joint research projects. You can make use of infrastructures such as laboratory facilities and conference rooms within KBIC. Close proximity to Shinkansen Station (Shin-Kobe) and Airports (Kobe, Itami, Kansai international) makes it convenient for us to collaborate with Headquarter in Tokyo and overseas laboratories, and invite personnel for joint projects involving academia, government, and the industry concerned.I also think the living environment in Kobe is favorable for foreign researchers.

What are your thoughts about taking hold in Kobe after five years?It has been stimulating experience for our researchers to be involved with cutting edge research themes, know-how and technology of the RIKEN Center for Life Science Technologies (CLST). Actually, we carry out joint research project with CLST. We also receive technical proposals from neighboring ventures and enjoy the privilege of utilizing the world’s largest synchrotron radiation facility “SPring-8”. In addition, the simplified import-export procedure for pharmaceuticals that we use for research is of great help in speeding up the procurement of necessary materials.It is important for us, not only to contribute to international pharma-ceutical research and development but also to develop pharmaceuticals that are suited to Japanese market.In order to achieve such objectives, we have to take a long-term perspective and nurture our researchers to be able to lead our research and development activities with understanding of the Japanese market, while accumulating practical experience on a global basis. Kobe is the right place to nurture such researcher who can act both globally and locally.

Messages for future entrant to KBICThere are many universities, research institutes, and enterprises in KBIC focused on iPS cell and other advanced life science research. One can expect collaboration such as joint research among cluster members. For a global company, I think Kobe is the best place where you can understand the Japanese market as well as maximize R&D results.

INVEST KANSAI

Nippon Boehringer Ingelheim Co., Ltd. Kobe Pharma Research Institute

Devotion to Pharmaceutical Development Meeting the Needs of theJapanese Market and Cultivation of International Talents

Nippon Boehringer Ingelheim Co., Ltd.Kobe Pharma Research Institute

Operating OfficerHead of Kobe Pharma Research Institute

Koichi WADA, Ph.D. in Pharmaceuticals

6-7-5, Minatojima-Minamimachi,Chuo-ku,KobeHyogo, JAPAN 650-0047 TEL +81-3-6417-2200 (main switchboard)E-MAILwebmaster@kaw.boehringer-ingelheim.com

(May 2013)

Source: Application for The Kansai Innovation International Strategic Comprehensive Special Zone (Kyoto Prefecture, Osaka Prefecture, Hyogo Prefecture, City of Kyoto, City of Osaka, City of Kobe)Website of Kansai Economic Federation, Brochure :The Kansai Innovation International Strategic Comprehensive Special Zone

Projects in KansaiProject sites

KansaiInt'l

AirportHanshin

portA

1 Establishment of the screening system and clinical trial function utilizingregional institutions

Establishment of a screening and evaluation committee of advanced andpreemptive medical technologies

Innovative drug discovery and development utilizing synchrotronradiation and simulation technologies

Improvement of efficiency in drug discovery utilizing MRI, PET and CTtechnologies

Use of Hyogo beamline in SPring-8 develop and evaluate nextgeneration energy saving raw material

Establishment of Battery Strategy Research Center

Establishment of Smart Community Open Innovation Center

Promotion of R&D activities for innovative medicines

Development of Robots and Devices for surgical, diagnostic, nursing

Accelerate establishment of regenerative medicine, cell therapy, etc.

R&D and promotion for establishment of preemptive medicine

Innovation creation project in Osaka Station area

Training programs for foreign medical experts in Northern Osaka area

Exchange programs for international medical experts in Osaka Stationarea

Training programs for foreign medical experts in Kobe BiomedicalInnovation Cluster

Battery Strategy Research Center for industrial promotion

Smart Community for standardization and promoting in Osaka Bay area.

Establishment of next generation energy system experimental projects

Accelerate current new energy test projects to practical application

Smart Community for standardization and promoting in NorthernOsaka area

Support R&D activities through establishment of high speed ICT network

Utilization of MICE functions in Osaka Bay area

Developing human resources through innovative R&D projects

Promote consolidation and commercialization of medical devices

Promotion of manufacturing SMEs' entry into the medical devices andnew energy market

Digitalization and simplification of import and export procedures formedicines and devices

Enhance cold chain services

Enhance Asian hub function by inauguration of internationalMega cargo carrier hub

Establish dryports to enhance domestic container-cargo network

Reduction of port and harbor costs

Privatization of port services

Increase Cargo demand through promoting Hanshin port

2

3

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B C D E F G

Speed-up ofR&D-to-productprocess

Combination ofCompanies andInstitutionstechnologies

Fundamentalsfor boostinginnovation

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Special Zones in Kansai Region- Matrix of Projects -

Kansai InternationalAirport

Hanshin Port

Guide to the symbols: = Main district for project = Collaborating district for project

For further information, please visit the websiteof The Kansai Innovation International StrategicComprehensive Special Zone Council at: http://kansai-tokku.jp/

Green-TechLife science

E Osaka Bay area, Yumeshima and Sakishima

F Kyoto area

G Kansai Science City

A Harima Science Garden City (SPring8)

B Kobe Biomedical Innovation Cluster

C Northern Osaka area

D Osaka Station area

INVEST KANSAI

A

B

E

C

D

F

G

ATR’s Areas of StrengthAt ATR we seek to make a genuine contribution to the inter-national community through advanced, creative research. Speci-fically, we foster high-quality basic research and nurture a large pool of talented researchers by providing a forum for industry-government-academia research partnerships. We also actively explore practical applications of research outcomes by deve-loping them into products and business ventures.One example is research into auditory and visual perception, one of our initial areas of focus. Today we are doing some of the world’s most advanced research into decoding and transmitting neural activity, earning us the attention of medical institutions and businesses worldwide. Our goal is to parlay such breakthroughs into research and innovations of practical use to society in a wide range of fields.

Examples of Successful Commercialization Our research into smart communication systems before the widespread advent of mobile phones has evolved into research into 3D and other “tele-immersion” technologies. One of our most celebrated founding projects was automated translation, now offered as a translation application service in partnership with a mobile phone carrier. In the future we expect our research into neuroinformatics and robotics to lead to innovations that improve people’s lives, such as in the area of assisted living.

Advantages of Pursuing Research at Kansai Science CityKansai Science City provides a spacious environment with natural greenery. It is a setting that researchers from overseas are always pleased to work in. What’s more, the fact that we are located in Kyoto Prefecture ensures that ATR constantly attracts the interest of VIPs from abroad. This place is home to a vast array of partnerships involving various universities and research institutions, making it attractive to research and development type businesses.Discovery research at Kansai Science City continues to spark many offshoot joint research projects in a variety of fields, including agriculture and healthcare. These are very much future-oriented undertakings and have yet to reach maturity, but they serve as clear illustrations of Kansai Science City’s solid growth as a center for innovation.

Future ProspectsThere is a palpable feeling that the long years of groundwork at Kansai Science City are beginning to bear fruit. Many ATR alumni are making great strides around the world and are expanding ATR’s network across the globe. Significantly, all ATR subsidiaries established to commercialize research outcomes have reached or exceeded the financial break-even point. Moreover, the opening of Grand Front Osaka in the heart of the city has greatly increased opportunities to spread the word about ATR’s research achievements among the general public.Looking to the future, our goal is to achieve innovations that can change society. To that end, we will further pursue local and global partnerships with universities, research institutions, and businesses that will cross-stimulate participants.

Advanced Telecommunications Research InstituteInternational (ATR)

President of AdvancedTelecommunicationsResearch InstituteInternational

Yasuo HIRATADoctor of Engineering

2-2-2 Hikaridai, Seika-cho, Soraku-gun, Kyoto 619-0288, Japan

INVEST KANSAI

Advanced Telecommunications Research Institute International

Pioneering Research into Basic Technologies and Giving Birth to Promising Partnerships

Advanced Telecommunications Research Institute International (ATR) was established in 1986 and opened in 1989 in Kansai ScienceCity, one of the Kansai Innovation International Strategic Comprehensive Special Zones. ATR was Kansai Science City’s first majortenant and played a central role in getting the zone concept off the ground. Since then, ATR has followed a philosophy ofcontributing to the international community by offering a forum for basic technology research and research partnerships amongindustry, government and academia, with many promising results that have made it one of the world’s premier research institutes.We asked President Yasuo Hirata about the present and future of this pioneering research facility in Kansai. (March 2014)

ATR develops robot-basedservices aimed at assistingthose in need.

TEL +81-774-95-1111 E-MAIL info@atr.jp

´Nestle Japan Ltd.

AIG Fuji Insurance Services KK

Haier Japan Holdings Co., Ltd.EVATECH Co.,Ltd

DATA

2012 2012

3.1%3.1%

31.6%

14.2%6.7%

U.K.U.K.4.0%4.0%3.1%3.1%

ItalyItaly5.3%5.3%

10.3%10.3%

8.9%8.9%

6.7%6.7%

5.7%5.7%

3.1%3.1%

14.1%

9.8%9.8%

10.7%

3.6%3.6%

4.0%4.0%

21.3%

6.2%6.2%4.0%4.0%4.0%4.0%

10.7%10.7%

4.0%4.0%

0.4%

43.6%

21.3%32.0%

7.6%7.6%

25.3%39.1%

35.6%

INVEST KANSAI

Investment by Global Companies Kansai’s Advantage:

Kansai becomes one of the most attractive places as to its economic fundamentals, therefore a number of foreign companies has set up operations in Kansai region.

・The size of the Kansai market・Well-developed rail and flight networks・Good transportation access to major cities・Concentration of related businesses and R&D institutes・Presence of business partners ・Availability of well-qualified human resources・Cheaper office rent compared to the Tokyo area・Favorable living environment (educational institutions, natural environment)

Major Determining Factors

Medical Industry

Retail Industry

Service Industry

Distribution / Transportation Industry

Manufacturing Industry

Chemical Industry

Foods Industry

Finance and Insurance Industry

AstraZeneca K.K.

Nippon Boehringer Ingelheim Co., Ltd.Bayer Yakuhin,Ltd.

Eli Lilly Japan K.K.Hospira Japan K.K.

IKEA Japn K.K.

Chelsea Japan Co., Ltd.Costco Wholesale Japan

Emirates Airline, Japan BranchHilton Osaka

ProLogis

Eurocopter Japan Co., Ltd.

Tata Consultancy Services Japan Limited

USJ. Co., Ltd.

ALSTOM K.K.

Corning Japan Inc.

Samsung Japan Corp.

Air Liquide Japan Ltd. Japan Air Gases

Procter & Gamble Japan K.K.

Beauty & Health Innovation Co., Ltd.

RECARO Japan Co., Ltd.HBC-radiomatic Japan K. K.

Source: “Welcome to Kansai” issued by Kansai Bureau of Economy, Trade and Industry The Foreign Investor CD-ROM 2012, Toyo keizai Inc. Note: Listed are companies that have head offices, sales offices or research institutes in Kansai. Major determining factors are based on interview surveys of some companies listed above.

Countries’ share of foreign companies in Kansai Industries’ share of foreign companies in Kansai

Total number:225

Total number:225

Source: The Foreign Investor 2012, Toyo Keizai Inc. Firms* Foreign-affiliated firms: With foreign capital of 20% or over (including branch offices)

Source: The Foreign Investor 2012, Toyo Keizai Inc. Firms* Foreign-affiliated firms: With foreign capital of 20% or over (including branch offices)

Manufacturingrelated

companies’ share

Manufacturingrelated

companies’ share74.7%74.7%

OtherOther

North America

Europe

Asia

OtherOther

U.S.

GermanyFrance

SwitzerlandSwitzerland

Europe otherEurope other

ChinaChina

KoreaKorea

Asia otherAsia other

Canada

OtherManufacturing

Machinery andEquipments

Machinery andEquipments

MachineryWholesale

ElectricAppliances

ElectricAppliances

PharmaceuticalsPharmaceuticalsOtherNon-manufacturing

Electric AppliancesWholesale

Electric AppliancesWholesaleChemical

WholesaleChemicalWholesale

PrecisionMachine

Wholesale

PrecisionMachine

Wholesale

OtherWholesale

Related withManufacturing

OtherWholesale

Related withManufacturing

Information& Software

Sevices

Information& Software

Sevices

ChemicalProductsChemicalProducts

OtherManufacturing

WholesaleRelated with

Manufacturing

Preferential policies forsetup business in KansaiSubsidies - No limit on the upper limit 1)

- Subsidy for foreign affiliated company 2) etc.Taxation and Loan- Additional preferential treatment in Special Zones 3)

3268

3565

2575

6931

1783

5248

6238

INVEST KANSAI

Excellence of business and living environmentKansai’s Advantage:

Lower business costs than Tokyo

Safe and comfortable housing area with expatriates from 170 countries 8)

[Rental Fee] 2012

Office 4)

Osaka/Kansai’s Cost Advantages

Tokyo: 100Osaka

House 5)

Warehouse 4)

[Land Price] 2012

Commercial 6)

Tokyo: 100Osaka

[Labor cost] 2012AverageSalary 7)

Tokyo: 100Osaka

Residential 6)

Industrial 6)

Sources: 1) Hyogo-Kobe investment Support Center 2) Osaka Prefectural Government 3) each local government website 4) CBRE in JAPAN 5) Ministry of Internal Affairs and Communications “Annual report on rental price survey” 6) Ministry of Internal Affairs and Communications “ Statistical Handbook of Japan 7) Ministry of Health, Labor and Welfare “ Monthly Labor Survey 2012”

Comparative indicators(Tokyo used as the base score of 100) Cost advantage ratio

Note: Data of Osaka is used as a representative of Kansai region.

Sources:8) Immigration Bureau, Ministry of Justice 9) Economist Intelligence Unit, 2009 10) Mercer Quality of Living Survey, 2010 11) Wanderlust, TripAdvisor, 2009 12) Economist Intelligence Unit, 2010 Global Peace Index 13) Local governments in Kansai ,Osaka International House Foundation 14) Local governments in Kansai 15)19) The Foundation for Kansai Region Promotion (Kansai Window) 16) Ministry of Foreign Affairs 17) Survey by Kobe Shinbun Jigyosha 18) National Federation of UNESCO Association in Japan (Buddhist Monuments in the Horyu-ji Area, Himeji-jo [caslte] , Historic Monuments of Ancient Kyoto, Historic Monuments of Ancient Nara,and Sacred Sites and Pilgrimage Routes in the Kii Mountains Range)

18 Consulates 16)

Hospital/Clinics correspondence to foreign languages 14)

5 World Heritagesites in Kansai 18)

Restaurants serving cuisines ofover 30 countries 17)

Birthplace of varioustraditional cultures 19)

- Noh plays - Tea ceremony- Kabuki theater - Flower Arrangement

Osaka : Asia’s No1 livable city 9)Kobe : Asia’s No1 Eco-City 10)Kyoto : Asia’s most famous tourist destination 11)

Japan: the most peaceful countryin Asia, and the third in the world 12)

Excellent educational facilitiesfor expatriates (Osaka, Kobe, Kyoto) 13)

International business communities,Clubs and Associates for expatriates 15)

17.9%27.5%

5.8%5.8%

4.9%4.9%

4.6%4.6%

1.9%1.9%

1.9%1.9%

23.0%12.6%

16.1% 17.9%

23.5%

20.1%

10.0%

5.5%5.5%

1.6%1.6%

2.0%2.0%

26.5% 34.1%

11.9%8.3%

7.1%7.1%

8.4%3.8%3.8%

7.6%7.6%

3.3%3.3%

25.9%

13.8%

23.6%

7.6%

9.2%

12.3%

INVEST KANSAI

Kansai’s Advantages: Gateway to AsiaCurrent Trade Scale in Kansai

Source: Asia Pacific Institute of Research “Whitepaper of Kansai Economy 2013”, Japan Customs, Osaka Customs “Trade Statistics” (US$1=80.82yen)

Value of Exports by Commodity (Kansai)

Value of Exports by Commodity (Japan)

Total value of exports

$168 billion

Total value of exports

$788 billion

Value of Imports by Commodity (Japan)

Value of Exports by Country (Kansai)

Value of Exports by Country (Japan)

Value of Imports by Country (Kansai)

Value of Imports by Country (Japan)

Electronic equipment including semiconductors and general machinery accounts for more than 50%.Also, export rate to Asia countries is high. Trade base that targets for Asia countries holds important position.Export

Value of Imports by Commodity (Kansai)

Total value of imports

$167 billion

Total value of imports

$867 billion

20%of Japan'stotal scale

Import 20%of Japan'stotal scale

Reflects the status of manufacturing industry cluster, high proportion of mineral fuels and electronic appliances.Import from Asia countries (including China) accounts for more than 50% of all imported commodities.

Other Electricappliances

SteelSteel

Transportationequipment

Transportationequipment

Scientific andoptical instrumentsScientific and

optical instruments

Metal productsMetal products

Nonferrous metalNonferrous metal

MachineryChemicalproducts

OtherElectric

appliances

Transportationequipment

Machinery

Chemicalproducts

SteelSteel

Metal productsMetal products

Nonferrous metalNonferrous metal

Scientific andoptical instrumentsScientific and

optical instruments

Other Mineral fuels

Electric appliancesFoodstuffs

MachineryMachinery

Chemicalproducts

Clothing andaccessories

Clothing andaccessories

Clothing andaccessories

Clothing andaccessories

Other

Electric appliances

Mineral fuels

Machinery

FoodstuffsChemicalproducts

Other10.6%

U.S.11.6%

EU10.0% China

23.5%

Asia44.3%

Other17.6%

U.S.17.6%

EU10.2% China

18.1%

Asia36.6%

Other27.6%

U.S.6.7%

EU10.1% China

31.7%

Asia23.9%

Other37.7%

U.S.8.6%

EU9.4% China

21.3%

Asia23.0%

INVEST KANSAI

Sophisticated Traffic and Logistic InfrastructureKansai’s Advantage:

KANSAI/KIX

KOBE PORT

Access to the world

Sophisticated air route networkfrom Kansai to the world

Source:Kansai Bureau of Economy, Trade and Industry New Kansai International Airport Co., Ltd, Ministry of Land, Infrastructure, Transport and Tourism

Sophisticated Internationalseaway infrastructure

Osaka International Airport

Kobe Airport

Kansai International Airport

Kansai International Airport isthe only 24-hour OperatingInternational Logistics Hub inJapan.

Vast network to and from ChinaRapidly emerging as major LCCnetwork hub.

-

--

Flight ScheduleAirline companiesFlight to overseas citiesThe weekly number of flights

6273

850

Maizuru Port

Serving as North Gate of Kansaiwith regular service to China,South Korea, Russia.

The port can accept 50,000-toncontainer ships.

-

-

Hanshin Port(Port of Osaka, Port of Kobe etc)

Japan's deepest earthquake-resistantcontainer berth (with a water depthof 16m) allows the harbor to accept100,000-ton class container ships.

Hanshin Port was designated asinternational strategic ports inJapan(Aug. 2010).

Improving the cargo integratingfunctions by reinforcing thedistribution network incorporatingthe coastal shipping feeder,railroadsand trucks

Reducing port costs by privatizingthe port management company

Service improvement for shippersby promoting 24-hour operation ofterminal gates

Securing a large-scale terminal withdepth of 18 m, etc.

-

-

The comparative volume of domestic cargo2011

(Unit: million Freight-ton)

KOBE/UKB

ITAMI/ITM

OSAKA PORT

SAKAI-SEMBOKUPORT

Hanshin

Nagoya

Tokyo area(*)

131

165

57

HighwayShinkansenAir

Domestic AccessKansai has a well-developed transportation network in terms of flight, train and motorway systems.

1hr

1hr

1hr50min

2hr30min

6hr

2hr50min

2hr30min

4hr

7hr30min

Osaka Osaka OsakaFukuoka Fukuoka

TokyoTokyo

Sapporo

Nagoya

Fukuoka

TokyoNagoyaHiroshima

(*)Tokyo area (Tokyo, Yokohama, Kawasaki, Chiba)

Japan External Trade Organization (JETRO) provides comprehensive consulting services and directassistance for foreign companies seeking to invest in the Kansai region

JETRO IBSC Support

(Osaka, Kyoto, Nara, Shiga, Wakayama)

Invest Japan Business Support Center (IBSC)29F Osaka Kokusai BLDG., 3-13 Azuchimachi 2-Chome,Chuo-ku, Osaka 541-0052 Japan

FAX: +81-6-4705-8650 E-Mail: IBSCOSAKA@jetro.go.jpWebsite: http://www.jetro.go.jp/jetro/japan/osaka/

TEL: +81-6-4705-8660

Service Menu

(Hyogo)

Invest Japan Business Support Center (IBSC)Kobe C.I.T. Center Bldg. 4F, 5-1-14 Hamabe-dori,Chuo-ku, Kobe, Hyogo 651-6591 Japan

FAX: +81-78-232-3439 E-Mail: KOB@jetro.go.jpWebsite: http://www.jetro.go.jp/jetro/japan/kobe/

TEL: +81-78-252-7505

ForInquiries

INVEST Promotion Activities in Kansai

*IBSC: Invest Japan Business Support Center

INVEST KANSAI

JETRO Osaka/Kobe(KANSAI ONE WINDOW)

Wide-range of Network

Chambers of Commerce and Industry

- Local Network with small and medium companies, schools and related research institutions members

Kansai EconomicFederation

- Network with local companies, universities, and related

research institutions

Kansai Bureau ofMETI

- Regulation related matters

Local Governments

- Incentive information - Industrial area information

- Recruiting assistance service

- Assistance in finding appropriate office property

- Provision of concierge support by expertsTemporaryOffice Space

HumanResources Networking

OfficeProperties

Consulting

INVEST KANSAI

Foreigncompanies

Temporary office space offered free of chargeOffice space (Free for 50 business days)Desk, chair, telephone, fax and internet connection available.Ideally located for business in the center of metropolitan Osaka.Meeting room (Free)The conference rooms can be used for business meetings, negotiations, etc.Business library in Osaka (Free) The adjoining business library can be used to view information on investing in Japan or to collect information on business in the online database.

FacilitiesFree individual consultation for your companyA vast network of experienced experts in both public/private sectors can provide a wide range of support including advice on entering markets, analyses of startup costs, assistance on procedures for new businesses, finding office space and staffing.

JETRO can also put you in contact with public authorities (Invest Japan office) and local governments for matters concerning laws on market entry, regulations or permit procedures.

Consulting

- Free of charge (up to 50 business days)- Convenient location

Success Stories of JETRO, in supporting foreign companies to setup business in Kansai

INVEST KANSAI

Successful Story

Global leader in patient recruitment for clinical trials

BBK Worldwide - Osaka, G.K.

Established in: February, 2009Business in Japan: Marketing consultancy in patient recruitment for clinical trials

1.Active industry-university joint research in pharmaceutical development2.Most suitable base for business in Asia-Pacific region3.Accumulation of head offices of medical device manufacturers

Free temporary office spaceAssistance with company registration and visa preparationArrangement of business meetingsHelp with press releases

--

--

Free temporary office spaceCompany registration supported by an introduced specialist Support for establishing an office, such as introduction to a human resources consulting firm and help with finding office space

--

-

Profile

Why Kansai?

JETRO Support

A developer and manufacturer of radio control systems for industrial cranes with products available in more than 60 countries worldwide.

HBC-radiomatic Japan K.K.

Established in: February , 2009Business in Japan: Sales of radio control systems for industrial cranes

1. Attracted to the Kansai market as it provides large-scale potential customers2. Lower costs compared with those in Tokyo

Profile

Why Kansai?

JETRO Support

Fast growing Chinese automated cutting machine manufacturer,set-up production base in Japan for global penetration

YIN JAPAN Co.,LTD (current AGMS Corporation)

A core organization of India's largest conglomerate, the Tata GroupOne of the largest IT consulting companies in Asia

Tata Consultancy Services Japan Limited, Osaka Office

Sells approximately 200 varieties of English rosesin over 45 countries

David Austin Roses K.K.

Established in: November, 2007Business in Japan: Import and distribution of English roses

1. Had distribution channel in Kansai via former agent2. Strong support by the local government

Consultation on registration, tax, and visa preparationCooperation on English-style garden establishment plan along with Osaka Prefectural Government

-

-

Profile

Why Kansai?

JETRO Support

Established in: Factory (current Technical Center), May, 2012Business in Japan: Manufacturing automated cutting machine, sales to domestic and international market

Free temporary office spaceInformation on office spaces and lifestyles in KansaiAssistance in holding press conference

--

-

Profile

1. Potential customers 2. Excellent environment for production (current Technical Center)3. Pool of experienced human resources

Information on real estate (factory and office) cooperating with local government agencyBusiness consulting for developing oversea businessInformation on subsidies in Kansai from local governments

-

-

-

Why Kansai?

JETRO Support

Established in: June, 2010Business in Japan: IT consulting, systems-development and maintenance

1.Presence of numerous manufacturing and pharmaceutical companies2.Accumulation of globally operating enterprises

Profile

Why Kansai?

JETRO Support

Large Korean renewable energy companies,from manufacturing to business development

KP JAPAN Co.,LTD

Company registration supported by an introduced specialistInformation on real estate (office location) and on-site guidance Help open bank account Accompany to handle various Consulate General issues

-

-

--

Established in : Jan, 2013Business in Japan: Solar power and other related business

1. Headquarter in West Japan where is well fit for solar power generation 2. Potential customers

Profile

Why Kansai?

JETRO Support

Nara factory (current Technical Center)

KyotoHyogo

Tottori

Tokushima

Mie

Fukui

Shiga

Nara

Wakayama

Osaka