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The Japanese connection.

Adviser Helping AIDC Build Trade and Improve on $187 Million in Goods Exported in 1991


For centuries, marriages were arranged by a broker, a nakoudo.

The tradition of the nakoudo is being carried on these days, in a corporate fashion, by the Arkansas Industrial Development Commission.

Rather than coordinating the union of a man and a woman, the AIDC is concentrating on wedding Arkansas manufacturers with Japanese distributors.

Amid increasing speculation of economic collapse in the Land of the Rising Sun and the eventual demise of the country's long-standing ban on rice imports, the AIDC is constantly looking for state companies with the potential for exporting their products. In particular, to Japan.

Japan is the No. 2 destination for Arkansas exports, second only to Canada, according to Department of Commerce figures. Arkansas products worth $187 million were shipped to Japan in 1991, more than twice as much as the next largest export target, Mexico.

That included almost $58 million in food products, $82 million in chemical and allied products, $1.6 million worth of lumber and wood products and $1.1 million in measuring, analyzing and controlling instruments.

Among the members of the Southern United States Trade Association, Arkansas ranks first in exporting both rice and poultry and second in catfish.

Those products, commonly associated with the state, are actively exported worldwide. Japan, though, imports some products that may surprise some Arkansans.

Fishing rods and reels, persimmon golf club heads, loudspeakers, greeting cards, collapsible containers, grandfather clocks and even laser instruments make up just a few of the products exported by the nearly 190 Arkansas companies that trade with Japanese distributors.

In an attempt to increase that number, the AIDC recruited its version of a nakoudo in 1990.

Yutaka Kajita, one of 18 senior trade advisers employed by the Japan External Trade Organization (JETRO), joined the state agency's marketing division two years ago. Kajita, whose contract with the AIDC expires in 1993, spent roughly a year and a half traveling the far corners of Arkansas to spread the word about the Japanese market.

Kajita's efforts began to show fruition early this year, as several Arkansas firms began shipping their products abroad for the very first time.

Cedar products, shavings, aromatic blocks, etc., produced by American Cedar of Hot Springs are now being marketed in Japan, as are jewelry bags produced by Classy Creation of Monticello.

Potlatch Corp. of Stuttgart recently shipped 20,000 SF of flooring and paneling to a Japanese firm, Nippon Win Industries Inc. of Gifu, following a trade show in October in which Potlatch displayed its wares.

And, in one of the more unique examples of Kajita's prospective labors, Unified Sound of Booneville began shipping roughly 90 percent of the handcrafted electric guitars it produces to Japan in June.

The lone producer of the Mosrite solid-body electric guitar, made famous in the 1960s by the instrumental group the Ventures, Unified Sound produces 70 guitars a month but expects to double its volume within a year. The most expensive model sells for as much as $2,500 in the U.S., according to a company spokesman, but retails for up to $6,000 in Japan.

"My mission is to find new companies that are not export-minded," says Kajita, a salaried employee of JETRO, a government agency much like the Department of Commerce. "Since I came here, I have already contacted 200 companies in Arkansas, visited more than a hundred, and introduced their products to Japan."

Japanese corporate executives place a high priority on trust, a factor emphasized by Kajita as he spent his early months trying to encourage relationships between Arkansas manufacturers and their Japanese counterparts.

"Introducing a new product there just takes time," says Charles Sloan, the AIDC's marketing director. "It's a very involved decision process."

The exposure gained through the international press' coverage of President-elect Bill Clinton's campaign will aid the state's tourism trade most immediately, Sloan says, while the industrial sector will have to wait and see what effect it will feel.

"The product almost has to be a niche product, something has to make it special," Sloan says. "You can't just pick up any item and make it successful. You have to have a good product."

"What it will do is open doors that previously weren't open, and we're already seeing that in the investment side," says Gray Swoope, international project manager for the AIDC, pointing to the larger number of inquiries his office has received from foreign corporations into possibly locating operations in Arkansas.

Newfound Families

The theme of building lasting relationships is extended not only on the statewide level but on the community level as well.

Both Hot Springs and Pine Bluff have sister cities in Japan, with agreements between the four civic areas designed to promote cultural and, perhaps, business exchanges.

An agreement between Hot Springs and Hanamaki City received preliminary approval during a December visit to Japan by a delegation of Hot Springs officials. It will be signed into effect in January.

"In other words, we got engaged in December. We're going to get married in Japan," says Hot Springs Mayor Melinda Baran, one of 15 members of the delegation.

"We have been clearly taught that the best way to establish greater foreign trade is to establish relationships with people over there ... To be perfectly honest, anybody who thinks there are boundaries is foolish. We are truly an international community now."

Pine Bluff's relationship with Iwai, 40 miles north of Tokyo, was established in 1986. The purpose of it was "to build cultural and economic relationships with Japan," says Larry Bates, a former president of Pine Bluff Sister Cities, a nonprofit organization.

Bates and several other Pine Bluff residents were in Iwai in early November to help the city's residents celebrate their 20th anniversary of incorporation.

The relationship between the two cities has led to the opening of an offshoot office of the Jefferson County Industrial Foundation in Osaka, near Iwai, along with the establishment of a high school student exchange.

"I think that the student exchange helps to build a better understanding," Bates says. "They stay with families here in Pine Bluff, so there's an immediate understanding of things here in the U.S. It's a way to exchange and understand each other's cultures."
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Title Annotation:Arkansas to export in Japan; Arkansas Industrial Development Commission
Author:Taylor, Tim
Publication:Arkansas Business
Date:Dec 21, 1992
Previous Article:News from the Northwest.
Next Article:We're on the map.

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