Japan Echo Web

Can Japan Export Its Water Business?

Late last year the news that a Korean-led consortium had won a major order for a nuclear power project in Abu Dhabi brought further gloom to an already downbeat Japan. The Japanese media noted that South Korea’s President Lee Myung-bak had visited Abu Dhabi repeatedly in support of the Korean bid and suggested that the Japanese government did not have an adequate setup to back Japan’s bid. A senior official at the Ministry for Economy, Trade, and Industry offered this postmortem: “This is a defeat for the Japanese business model. Japan was trying to sell Abu Dhabi nuclear power plants. But Korea was offering to provide a steady supply of electricity for sixty years. The Koreans were selling electricity.”

The South Korean government and the company leading the bid shared the same objective and conducted repeated top-level sales in order to achieve it. They also shared a strategy of not insisting on using just Korean firms or Korean technology. Their goal was to secure leadership in the provision of electric power infrastructure, and they promised to supply Abu Dhabi electricity by drawing on the world’s top technologies and the companies able to provide it—not just Korean companies. For example, one of the companies supplying technology as a member of the Korean-led consortium is Westinghouse, an American company that is a subsidiary of Japan’s Toshiba.

Next, the Russians won a nuclear power plant order in Vietnam, beating out both Japan and France, the two countries that supposedly have the world’s most advanced nuclear power technology.

The days of being able to sell a stand-alone technology are over. This is because the customers are no longer in the developed countries but rather the emerging countries, which do not have the ability to manage and operate stand-alone technologies or plants by themselves.