Summary

The change, complexity and uncertainty of the external environment in a developed country like
Japan have posed great challenges for Kajima Corp in terms of adaptability to innovate and
pursue development long term. Part 1 of the report below if up to 6 impacts (PESTEL) of Japan
on one of the largest construction companies in Japan. These impacts require Kajima Corp to
take measures to adapt and develop for mutual benefit.

Part two of the report deals with the ethics and responsibility to society and stakeholders of
Kajima. This issue is mentioned because of its importance for a developed country like Japan.
An enterprise not only races for profit, but the Japanese government also wants businesses to
contribute to society to build many benefits with stakeholders. This helps to build a sustainable
development and supply chain.

Kajima was founded in 1840 by Iwakichi Kajima, an innovative carpenter and designer. The
Kajima Corporation is one of the oldest and largest construction companies in Japan. The firm's
services include design, engineering, construction, and real estate development. Kajima builds
high-rise structures, railways, power plants, dams, and bridges. Its subsidiaries are located
throughout Asia, Europe, and North America (. kajima.co.jp, 2021).
Question 1:

P -Political

The overview shows that Japan is a country with a stable political environment. This is a free and
democratic country. Japan has now established itself as a stable democracy with the second
largest economy in the Free World, accounting for about 10% of the Free World's gross national
product. Japan is a member of G7, G20, APEC and ASEAN+3, and is a strong supporter of the
current rules-based international system. Therefore, one of the key industries of Japan is the
construction industry, which is promoted by the government not only domestically but also
abroad. Indeed, during more than 180 years of construction and development in the domestic
market, today more than 100 Kajima subsidiaries are located in North America, Asia, Europe
and Oceania and are engaged in building projects. Moreover, the Government and the
construction industry have a close relationship with each other. The new Liberal Democratic
Party (LDP) government under Prime Minister Abe has made economic recovery a top priority.
What Prime Minister Abe introduced is structural reform in the construction industry. Japanese
construction companies have had to cut government spending on public works. Stricter building
regulations, introduced by the government after 2005 to materialize fake data techniques for
apartment complexes, have caused housing numbers to begin to decline and also dent business
builder becomes more difficult. This forced Kajima Corp to cut construction costs and cut office
costs. The company says it has become more selective in accepting contracts to avoid losing
projects. However, Kajima was forced to record a net loss of 4.47 billion yen.

E -Economic

Japan's economy is the third largest in the world after the US and China. Gross domestic product
(GDP) in 2016 was estimated at US$4.7 trillion, a population of 126.9 million people had a high
standard of living. Although gross domestic product per is high, Japan's GDP per capita is low.
Japan's GDP per capita in 2019 was $40,113, or 66.4% of the US ($63,143). This makes it
difficult for housing demand in Japan because house prices in Japan are quite high. Most young
people in Japan cannot afford to buy a house, but mainly rent a house. Faced with the hardships
of expensive housing, Kajima realized that in order to help young employees, the corporation
had to provide some form of housing assistance. The company has built a number of
condominiums that it rents out to employees for a very low price, as little as $77 a month, but
these apartments are old fashioned and very small, and young employees aren't too comfortable
living here. So Kajima is in the process of building more spacious and modern apartments for
their residents and has set aside $77,000,000, excluding land costs, to do so. These apartments
range in size from just 645 to 753 square feet, but by Japanese standards, these rental units are
more than enough.

S -Social

The rate of population decline and rapid aging in Japan continues unabated. These factors have
led to a labor shortage affecting some industries, especially construction. Therefore, to solve this
situation, the Government proposes measures to allow more migrant workers to enter the
construction industry. Companies in Japan allow interns or temporary foreign workers to work at
manufacturing, agricultural or construction sites. The construction industry is experiencing a
chronic labor shortage, so the Kajima Corporation is accelerating its efforts to train foreign
welders. The company creates opportunities for experienced welders from other countries to
come to Japan, creates opportunities for interns to learn and practice welding skills, and learn
Japanese before coming to Japan. The preliminary course is designed to prepare trainees who are
ready to start learning practical skills on the job and start working full-time as soon as they arrive
in Japan

T – Technology

Currently, more than a quarter of Japan's population is over the age of 65, and this number is
expected to increase to 40% within the next 40 years. Japanese companies are facing the problem
of workforce automation. Instead, companies need to build robots to replace the number of
Japanese workers approaching retirement age. That's bad news for industries that will need to
replace workers nearing retirement, especially for industries like construction where automation
hasn't caught up quickly. Several companies are working to develop new robots to assist in the
construction of tall buildings. To solve this problem in the construction industry, Kajima Corp
has partnered with 16 construction companies in Japan to develop technology in the fields of
robotics and the Internet of Things. Kajima Corp will collaborate on basic research and
technology development to reduce costs and labor while allocating their management resources
to areas where they can demonstrate unique competence. In early 2021, Kajima Corp announced
a robot prototype during a press conference. The robot, which has been in development since
2018, can level concrete floors after the concrete is poured, among other things. Kajima expects
the robot to be in use by 2024 and hopes it will increase efficiency and reduce the burden on
workers.

E - Environment

Japan is famous as a country that regularly experiences earthquakes and tsunamis, because the
island nation is located along the Pacific Ring of Fire. Earthquakes are extremely dangerous and
it is also a cause of tsunamis. There was a double disaster in Japan in 2011. Every year, there are
many earthquakes in Japan. This entails much damage to buildings and factories in Japan. Many
cement plants in Japan have been affected by the earthquake and are announcing shutdowns due
to direct damage caused by the earthquake or subsequent power shortages. This causes the
Kajima company to strictly comply with the best possible earthquake resistance of the buildings,
according to the Building Standards Act. For that reason, Japanese buildings can be divided into
different "generations", depending on when they were built. Besides, according to Keybank
Capital Markets Inc., construction companies in Japan are likely to benefit from the earthquake.
Shares of Kajima Corp have surged 30% recently, and other companies are positioned to
appreciate. In addition, Kajima has developed an originally tuned 1,800-ton mass dampers
(D³SKY®) for roof mounting to resist ground movement for long periods of time. The unique
D'SKY® system tackles these challenges and dramatically enhances the value of the building. It
has received much appreciation as a superior approach to seismic upgrading technology for
existing high-rise buildings.

L – Legal

Even after the promulgation of the Industrial Health and Safety Law in 1972, work-related
accidents still frequently occur at construction sites in Japan every year. Dangerous working
conditions plus 17% longer than average annual working hours have resulted in a drop in the
number of new workers in the construction industry. Construction business associations
including major general contractors in Japan consider it important to improve working
conditions. As a result, the Japan Construction Occupational Safety and Health Association
(JCOSHA), founded in 1964, actively promotes voluntary occupational health and safety
activities in the industry. In all of Kajima Corp's projects both inside and outside of Japan,
Kajima works closely with their business partners, especially on safety. Guided by the Basic
Health and Safety Policy, Kajima is pursuing a series of measures designed to ensure a safe work
environment with the goal of being free from serious accidents and deaths. Prevent human-error
injuries and accidents by following Kajima's three accident prevention principles of arriving at
the site, directly observing, and determining the facts, and by pointing out and pointing out the
actions and hazards during operation consistently.

The analysis of external factors plays an important role as it provides stakeholders with a view of
Kajima's environment from all important angles that can affect the company's work. Not only
understanding the market, analysis of external factors is the backbone that not only defines what
a company should or should not do, but also holds Kajima accountable to their goals and values.

Question 2:

In Japan, ethics is considered the core of society. Ethics plays an important role in all aspects of
Japanese life. Above all, ethics is the behavior of business, it plays an important role in the
development of any company. Ethics is also very closely related to corporate social
responsibility. Kajima Corp is recognized for its great contributions to the construction process
and to the industry. However, Kajima not only contributes to the industry, but the group also
strives to support social and individual activities in the long run. Kajima wants to gain a new
appreciation of the importance of putting his trust in construction companies.

Kajima always strives to strictly comply with and respect the laws and regulations, and
encourages each of its employees to work towards realizing a company that respects corporate
ethics to the highest degree. First, it can be said that Kajima adheres to social standards. The
Kajima Group Code of Conduct provides that the Group must comply with all laws and
regulations, including foreign and international ones, as well as their fundamental spirit.
Accordingly, the Group declares tax in accordance with relevant laws. In line with these
principles, the Group has developed a tax compliance policy that outlines what needs to be
followed and complies with applicable tax laws and regulations in the country. In line with the
Kajima Group's Global Tax Compliance Policy, the Group will continue to strive for transparent
and appropriate tax payment. The Group will make tax declarations and payments in accordance
with the laws and regulations of Japan.
Not only considering ethical issues outside of society, but Kajima Corp also focuses on ethical
issues within the company. The Company has placed the Kajima Group Code of Conduct as the
foundation of its compliance program. In 2007, Kajima created the Code of Conduct Practice
Manual and distributed it to all directors, officers, auditors and employees. During the financial
year 2008, the company started an e-learning training course for all employees to help better
understand and accept the Kajima Corporation Code of Conduct. Additionally, Kajima has
established a corporate ethics whistleblower system with a hotline to allow team employees to
report criminal or unethical behavior they know or suspect.

Kajima's Corporate Philosophy is to "contribute to society through the development of the

company's business operations." The company's CSR was adopted on the basis of this
philosophy and guides the CSR activities of the entire Kajima Group, which strives to be an
enterprise of good faith, imbued with a spirit of corporate ethics and social mission, and trusted
by society for those reasons. Employing CSR, Kajima aims to contribute to both society and
customers through business that provides high social value. Following the ethical issue, Kajima
Corp focuses more on social and environmental responsibility to the community and society.
This is all the more so with increasing sensitivity to social and environmental issues, as well as
requests from various stakeholders for corporations to do more for society. Kajima's CSR
programs help the company bring benefits to the community & society, and can develop its
brand at the same time.

Environmental responsibility is the top priority of Kajima Corp. Because the construction
industry consumes a large number of resources and is involved in changing the physical
environment in many ways. This is why Kajima always strives to reduce the impact of its
business activities on the environment and seeks to contribute to society by constructing eco-
friendly buildings and structures. than. Kajima actively contributes to society's transition to low
carbon emissions by reducing CO emissions during construction, by developing energy-saving
technologies, renewable energy facilities, etc. creating, green buildings, and by managing energy
efficiently.

In the fiscal year 2008, Kajima reduced CO2 emissions by 11.7% per unit of construction sales
compared to fiscal 1990 levels, slightly below the 12% target for that year. The company has cut
its total emissions by 39%, also compared with 1990, mainly due to improvements in
construction methods, including more efficient adoption of heavy machinery and vehicles
(saving fuel when driving, using fuel-efficient heavy machinery and vehicles, and properly
maintaining heavy machinery) and vehicles), as well as reduce the volume of soil taken from
construction sites.

Kajima Contributing to Local Communities as a Responsible Citizen Kajima Company aims to

grow in sync with the local communities in which it operates and recognizes the importance of
communicating with the people locality when carrying out construction activities. To fulfill her
responsibilities as a corporate citizen, Kajima also contributes to society through the foundation's
non-profit activities. For many years, Kajima has contributed to society through the Kajima
International Peace Institute, which aims to help the community by making donations. A good
example mentioned here is the help in recovering from the 2008 Iwate-Miyagi Nairiku
earthquake disaster. After the earthquake, the company joined the effort to clean up fallen trees
as well as rocks and soil to restore the area and prevent any further damage or casualties.
Following this event, the Kajima company was awarded an award by the Tohoku Regional
Office of the Ministry of Land, Infrastructure, Transport, and Tourism in recognition of the
company's outstanding contributions to the recovery efforts. local disaster. In addition, Kajima
organizes an annual voluntary blood donation to help hospitals, and 2008 marks the 20th
anniversary of the company's efforts. This dedicated effort received a highly appreciated official
statement from the Minister of Health, Labor, and Welfare.

In addition to its responsibility to the community and the environment, Kajima's CSR programs
are tailored to meet the specific needs of shareholders and stakeholders. For shareholders and
investors, Kajima's central tenets are profit maximization, cost reduction, and risk reduction.
Kajima's basic policy is to strive for a dividend payout ratio of 30%, as well as to contribute
flexibly to shareholders' profits by repurchasing its own shares and other means with
consideration of business performance, financial condition, and business environment. In
addition to providing information in a transparent and unambiguous manner to shareholders and
investors, all management and financial information is appropriately disclosed on Kajima's
corporate website. Through investors relationship briefing sessions and communication with
shareholders and investors, Kajima also strives to reflect their opinions in its management and
business.

Kajima suggests value to many of the company's other stakeholders is more important than
generating profits. CSR creates value and the interdependence of stakeholders makes Kajima's
responsibilities unified.

For suppliers, Kajima builds a sustainable supply chain based on mutual understanding and
trusting relationships with business partners. Kajima has established its own “Code of Conduct
for Business Partners” to comply with regulations, quality assurance and safety regulations.
Collaboration with suppliers is of interest to improve the work environment throughout the
supply chain. Kajima's partner companies have established an association of Kajima partners,
which participates in the supply of Kajima projects such as Rokueikai in the spirit of support and
sharing. By working with suppliers through this organization, Kajima has built a strong
partnership that helps to ensure quality and safety as well as provide other benefits.

For customers, Kajima always focuses on communicating with customers to invest ideas in
construction projects. To realize the best works possible, Kajima strives to maintain a close
relationship with the client, while respecting their unique ideas for the works. Kajima Corp uses
modern technologies in construction to continuously attract and retain customers. Instead of
focusing on profit, the Company accompanies and develops with its customers to earn their trust
through solid proposals and excellent work. Kajima enhances systems that can provide value to
customers in all phases of construction and development. Therefore, customers highly appreciate
Kajima's design and construction system, so the proportion of the company's design-build
contract awards in the total number of construction contract awards has increased in recent years.

For the Japanese government, Kajima shows its social responsibility to the government by
strictly following the regulations. Compliance with government policies to facilitate business
operations does not cause harm or risk to society and the environment. In 2020, the business
environment is extreme as a result of restrictions on onsite operations due to the impact of covid-
19. Kajima strictly abides by the measures taken by the Japanese government to improve safety
and ensure the future resilience of the economy. In April 2020, Kajima Corp plans to halt
construction nationwide until early May in response to the state of emergency. The
announcement comes a day after Prime Minister Shinzo Abe extended the epidemic status to
Tokyo, Osaka and five other prefectures across the country. Kajima will first seek approval from
contract recipients and their business partners as the company has about 700 construction sites
across the country at the time.

Social responsibility makes Kajima Corp involved with other stakeholders in the group's
decision-making process. The growth of Kajima's social responsibility has fostered participation
and encouraged other stakeholders to assist the company in making decisions, especially those
that affect social welfare of society in general. Kajima is working to make stakeholders aware of
their decisions and how they can affect society and the environment.

Kajima has been doing a great job in compliance with ethics and social responsibility. Kajima
being in the top 4 largest contractors in Japan has shown that this group has built a really strong
brand value for their stakeholders. However, the negatives are inevitable for a large corporation
like Kajima because of the large number of employees and workers, plus the fact that their
construction sites are littered all over Japan. This can make it difficult to control employee
behavior. In fact, in mid-2021, a former manager of Kajima's Tohoku branch evaded around 220
million yen in taxes without filing a tax return, including a bonus received from a subcontractor,
for demolition work Damaged buildings in Tomioka town, Fukushima prefecture. This employee
prosecuted without arrest for violation of the Income Tax Act but he was suspended from the list
of designated contractors. Kajima Company fired this employee and apologized to the media and
related parties. Although this is an undesirable matter, it shows that Kajima Corp needs more
firm guidance on professional ethics for employees. Not only stopping at issuing a code of
conduct in the company, Kajima needs to take more practical measures. Kajima's management
needs to work more often with outside directors who oversee and manage construction sites.
Communicate regularly to check and ensure the transparency of the manager. Moreover, the
appointment of branch managers needs to be more careful and strict, this is to select employees
who have enough experience and ethics to complete the job well without falling into scandals
similar. From these incidents it is clear that compliance and enforcement responsibilities are
important. Kajima should realize that compliance is a prerequisite for the company's survival and
sustainable development. This should be embedded in the culture and accompanied by employee
behavior.
Ethics and CSR

Kajima's Corporate Philosophy is to "contribute to society through the development of the

company's business operations." The company's CSR was adopted on the basis of this
philosophy, and guides the CSR activities of the entire Kajima Group, which strives to be an
enterprise of good faith, imbued with a spirit of corporate ethics and social mission, and trusted
by society for those reasons. Employing the CSR, Kajima aims to contribute to both society and
customers through business that provides high social value.

Kajima's CSR programs help the company bring benefits to the community & society, and can
develop their brand at the same time. Kajima's CSR activities also help promote work spirit and
cohesion among departments and employees in the company. Activities create a better culture
and working environment, creating success for Kajima.

Kajima Contributes to Local Communities as a Citizen Responsible Corporate Kajima aims to

grow in sync with the local communities in which it operates and recognizes the importance of
communication with local residents when carrying out construction activities. Working to gain
trust and cooperation in the community, Kajima organizes construction site tours, participates in
neighborhood cleanup campaigns and provides educational programs for children. To fulfill her
responsibilities as a corporate citizen, Kajima also contributes to society through the foundation's
non-profit activities. Over the years, Kajima has contributed to society through the Kajima
Foundation for the Arts and established several foundations that pursue academic and cultural
activities. As a responsible corporate citizen, the company will always be ready to contribute to
society in as many ways as possible.

Kajima organizes blood drives—Yokohama Branch in Kanagawa Prefecture: Kajima's

Yokohama Branch organizes a voluntary blood drive every year, and fiscal 2008 marked the
20th anniversary of its efforts, for which it received an official statement of appreciation from the
Minister of Health, Labor and Welfare. Blood drives are also held by the Kajima Head Office
and its other branches.

The construction industry consumes vast amounts of resources and is involved in altering the
physical environment in many ways. As a member of the construction industry, Kajima
recognizes that it can play a leading role in building a more sustainable society. To deliver on
this basic environmental commitment, Kajima has formulated Triple Zero 2050, a new
environmental vision that sets out how Kajima will help build a more sustainable world.
Spanning the years through 2050, the vision focuses on three activities that are essential for
increasing sustainability: reducing carbon emissions, recycling resources, and coexisting
harmoniously with nature—or in other words, the "zero carbon," "zero waste," and "zero impact"
of Triple Zero 2050.

Kajima has placed utmost importance on establishing various training systems to ensure that
Kajima employees pass on their knowledge and the Kajima spirit to younger co-workers through
daily activities and operations. Kajima provides a systematic education program that combines
group training with hands-on learning onsite to ensure that younger employees understand the
company's onsite construction processes and develop a "Kajima mindset," defined as the fusion
of knowledge and experience. Kajima's civil engineering and building construction divisions
stress basic technical training during employees' first five years with the company. Today,
strengthening construction capabilities is a major area of focus for Kajima. As such, Kajima
provides different training programs specifically tailored to foster the skills of both mid- and
entry-level engineers.

However, the disadvantage of CSR affecting Kajima must be the cost of these activities. Kajima
spent 2% of the company's net income on social, environmental and human activities.
The work of a construction firm is highly visible to the public eye, both during and after the
construction process. A construction firm co-exists with society and customers, and bears a
burden of responsibility to the next generation and beyond. In this light, Kajima approaches CSR
with a social mission to continually research and improve its techniques so that its high-quality
infrastructure, buildings, and services will contribute to society and provide customers with
convenience, comfort, and peace of mind.

Globalization (measurements, drivers, barriers)

Measurements: indicators of globalization

Globalization means the speedup of movements and exchanges (of human beings, goods, and
services, capital, technologies or cultural practices) all over the planet. One of the effects of
globalization is that it promotes and increases interactions between different regions and
populations around the globe. Globalization changes the way nations, businesses and people
interact. Specifically, it changes the nature of economic activity among nations, expanding trade,
opening global supply chains and providing access to natural resources and labor markets. Jason
Fernando, 2020

International Trade in Goods and Services

In recent years, Japan has been active in negotiating and signing free trade agreements with key
trading partners, including the US, the EU and Asian countries. The current government regards
free trade agreements as extremely important to stimulate Japan's economic growth. Japan is one
of the 23 members of the WTO that are currently negotiating the TiSA to deepen the
liberalization of cross-border trade in services among them. Kajima's overseas operations, which
began in the late 19th century with the construction of railway infrastructure in Taiwan, have a
history of more than 120 years. Today, more than 100 subsidiaries are located in North America,
Asia, Europe and Oceania and are engaged in construction and development projects. The
company's local team members and multifaceted and intertwined network support its growing
overseas operations.

For building and construction materials imports, Japan depends on neighboring Asian countries
for short delivery times and very competitive prices for American products. Typical imported
building and construction materials from Europe are stones, blocks, tiles, roofing materials,
exterior wall cladding materials, insulation materials, construction hardware. Kajima is one of
the construction enterprises in Japan with internal procurement departments abroad, very open to
importing building and construction materials directly for larger projects managed by them.

The rate of population decline and rapid aging in Japan continues unabated. These factors have
led to a labor shortage affecting some industries, especially construction. Therefore, to solve this
situation, the Government proposes measures to allow more migrant workers to enter the
construction industry. Companies in Japan allow interns or temporary foreign workers to work at
manufacturing, agricultural or construction sites. The construction industry is experiencing a
chronic labor shortage, so the Kajima Corporation is accelerating its efforts to train foreign
welders. The company creates opportunities for experienced welders from other countries to
come to Japan, creates opportunities for interns to learn and practice welding skills, and learn
Japanese before coming to Japan. The preliminary course is designed to prepare trainees who are
ready to start learning practical skills on the job and start working full-time as soon as they arrive
in Japan.

Divers

Kajima has established overseas subsidiaries in many regions to provide a wide range of
construction related services to meet the construction needs of clients expanding their business
globally. In North America, Asia and Europe, the company established operations ahead of its
competitors, Kajima U.S.A. (KUSA), Kajima Asia Pacific Holdings (KAP) and Kajima Europe
(KE) are regional headquarters managing subsidiaries in each country. The company has also
established subsidiaries in China and Taiwan and with the establishment of Kajima Australia
(KA) as its regional headquarters in 2015, Kajima entered the market in Oceania. Kajima was
easily accessible when they decided to expand their business overseas.

The competition within the construction market in Japan has become severe because of the
internationalization. Because of the full-blown entry of the foreign corporations after the WTO
Government Procurement Agreement took effect, the competition in the construction market has
become much severer. In 2014 company also established an Engineering Division in Singapore.
For many years now, Kajima have leveraged the combined strengths of all nine divisions of
Kajima, including the Real Estate Development, Civil Engineering and Interior Design
Divisions, which also operate businesses in this region.
As a member of the Asia-Pacific region, Japan is in a relatively quiet growth phase of the
construction industry today: growth is forecast at around 4% per year. Japan has been mapping
out the technologies needed to make the country smart and sustainable for the future, and that
means smart cities are where smart buildings are located. Kajima Corporation built GEAR as a
business hub for the Asia-Pacific region and will act as an innovation hub to drive technological
innovations globally. The company builds as a testbed to develop cutting-edge solutions
including robotics, digitization and automation of construction processes in line with the Kajima
Intelligent Future Vision. The company is focused on implementing an integrated digital delivery
(IDD) process, and with the Covid-19 pandemic, the focus on digitalization has increased even
further.

Barrier

Despite the fact that globalization offers Kajima many advantages, it also poses a major
challenge, that is, increased international opportunities also lead to increased competition. Due to
greater access to international markets, globalization creates more businesses that want to
capture a piece of these emerging markets. This means that Kajima will have to set himself apart
from the competition.

Japanese construction companies have responded to the global competition by seeking new
business opportunities in the international market in addition to the traditional domestic market.
However, technological challenges are still a barrier to the success of Japanese general
contractors in the international market. For Kajima Company, its biggest challenge is achieving
its Smart Future Vision. The vision outlines super front-end loading in which company simulate
the completion of all work before the start of construction, with half of the work performed by
robots, half of project management done remotely, and digitalization of all processes.

Both the benefits and challenges of globalization change the way Kajima operates in different
ways. When companies decide to go global, they must be ready and willing to change internal
processes. This helps adapt to new markets and makes their global workforce feel comfortable
and accepted at work. Kajima sees many aspects of their business changing as they enter the
global marketplace.

Foreign Direct Investment (FDI)

Foreign direct investment (FDI) is an investment from a party in one country into a business or
corporation in another country with the intention of establishing a lasting interest. Lasting
interest differentiates FDI from foreign portfolio investments, where investors passively hold
securities from a foreign country. A foreign direct investment can be made by obtaining a lasting
interest or by expanding one’s business into a foreign country. (Somer Anderson, 2018)

The Japanese government actively welcomes and calls for foreign investment and has set
ambitious targets for increasing inward FDI. Despite Japan's wealth, high level of development,
and general acceptance of foreign investment, FDI inflows, as a share of GDP. FDI inflows into
Japan remain low compared to most other developed countries in the world and are relatively
unstable. According to UNCTAD's World Investment Report 2021, FDI falls 30% to $10 billion
in 2020, reflecting a 25% drop in FDI from MNEs in the United States. Japan is actively opening
its doors to foreign businesses, as they are aiming to create the best possible environment for
foreign investors. Direct investment in Japan by foreign investors has been open and free since
the Foreign Exchange and Foreign Trade Act (Foreign Exchange Act) was amended in 1998.
The Japanese government explicitly encourages encourage FDI in and have established official
programs to attract.

The low level of inward FDI is a cause for concern because inward FDI offers a number of
benefits to the host country. The country's main strength is its leadership in advanced technology
and R&D. Potential barriers to investment are primarily demographic, linguistic and cultural.

However, in 2020, foreign direct investments in the Japanese construction industry amounted to
approximately minus seven million U.S. dollars, indicating a net outflow. In the previous year,
FDI in the Japanese construction business stood at about 187 million dollars.

Indochina Capital, one of Vietnam's leading real estate and financial services companies, last
week partnered with Japan's Kajima Group to form ICC-Kajima Development Company - with
the aim of actively developing real estate development. Indochina Capital and Kajima
Corporation are equal partners in this joint venture, with total investment estimated at $1 billion
over the next decade. The goal of this new venture, according to Peter Ryder, founder and CEO
of Indochina Capital, is to build on the success and impressive track record of the two
companies, by developing quality real estate projects. quantity and creativity.
Kajima is looking for opportunities to support foreign companies: those who want to enter the
Japanese market and those already present in Japan. Local experience and knowledge are
indispensable tools for foreign companies to become successful investors in Japan. Kajima has
established a nationwide network during its 160 years of operation and its track record makes it
possible for foreign companies to enter the viable Japanese market.

Kajima participates in domestic and foreign engineering development and construction projects
and has the flexibility to support the company's feasible and effective investment in Japan by:
location, equipment Design and engineering according to the concept and implementation of
construction. Kajima's operations span the globe and the company has many bilingual specialists
providing services to foreign companies in Japan.

Foreign direct investment is vital to the Japanese economy, where companies need funding and
expertise to expand their international business. Private investment in infrastructure, energy and
water is an important driver of the economy, helping to increase employment and wages.
However, at present, there are still many language or cultural barriers that make direct
investment in Japan still low.

Kajima was founded in 1840 by Iwakichi Kajima, an innovative carpenter and designer. The
Kajima Corporation is one of the oldest and largest construction companies in Japan. The firm's
services include design, engineering, construction, and real estate development. Kajima builds
high-rise structures, railways, power plants, dams, and bridges. Its subsidiaries are located
throughout Asia, Europe, and North America (. kajima.co.jp, 2021).