Serious Relationship


Hiroe Shimabukuro, first came to Ethiopia almost 10 years ago as a Japanese International Cooperation Agency (JICA) volunteer, assigned to the catering and tourism training institute, one of the governmental tourism schools in Ethiopia. She was assigned as a tourism teacher and taught for two years about the hotel service, restaurants and in general tourism issues. Recently she founded an organization called Access Ethiopia dedicated to bridging the gap between Japanese and Ethiopian businesses. Capital’s Elias Gebreselassie talked to Hiroe about her new organization.

Capital: How did you get the idea to introduce your new organization Access Ethiopia?
I also worked for the Japanese External Trade Organization (JETRO). Five years ago a trade crisis between Japan and Ethiopia regarding coffee imports occurred because of pesticide residue occurred and Japan stopped importing coffee from Ethiopia. At the time I was assisting in the discussions between the Japanese side and the Ethiopian Ministry of Agriculture about how to resolve this issue. This came hot on the heels of the problem with Sesame which arose from residues of the controversial anti-pesticide DDT, which we had to negotiate to resolve the problem. I was also doing the local consultancy work for JICA for the project called “one village, one product” as well as being the local coordinator for the Japanese work competency training program called KAIZEN, which has been implemented on various Ethiopian factories. Recently my experience and network in Ethiopia as well as requests from Tanzania led me to open up my business called Access Ethiopia, this is a business to link between Japan and Ethiopia, and so far I’m engaged in coffee, sesame, leather, shoes, flowers and some other things.
Capital: What projects is Access Ethiopia currently working on?
As you know the major import of Japan from Ethiopia is coffee followed by flower, sesame and leather, while some companies are buying shoes. As a company I have to provide the proper information to the Japanese side because you don’t have much business information in Ethiopia. In a way, it’s very difficult to get accurate updated information, even though you have the Ethiopian Commodity Exchange (ECX) and so on. If you’re staying in Japan it’s very difficult to know what’s going on like for example the coffee bulk issue last year. People are asking me about what’s going on in Ethiopia and I’m the one providing the proper information to the Japanese and explaining to them the facts on the ground. So one of my major tasks is giving accurate information, like business matching, if the Japanese company wants to buy a certain item from Ethiopia, I try to introduce them to Ethiopian firms. I am also trying to create positive images of Ethiopia for Japanese people. I just introduced “Ethiopian Idol” to a famous Japanese TV program.
Capital: With regards to work ethics and cultural differences, what concrete steps have you done to solve impending problems?
First of all, in a one to one company relationship there still are many problems, even those companies that have already started importing some materials from Ethiopia, they’re always complaining on the Japanese side. They are asking me to become the middle person, we have a huge gap in communication, with Japanese preferring a quick response to whatever is asked of them;  say by e-mails, Ethiopian responses take a long time; regardless of company size. In many companies in Ethiopia the boss is the one doing everything; the company owner. So, if a company owner is out of Ethiopia for some business trip they don’t reply to  e-mails, and not only that, sometimes the factories suddenly stop production, which means the Japanese have to wait two or three weeks just to get this e-mail information. We’ve been telling Ethiopian owners please delegate your work, but this is a problem that has yet to be tackled by the Ethiopian side, which I think emanates from the problem of trusting your employees. This problem kills the time of the Japanese companies, and Ethiopian companies have to take this seriously, that’s to deal with the very fast paced and efficient information flow of Japanese companies. The Japanese companies, be it importers and retailers demand detailed information to which the Ethiopian sides are surprised, reluctant or unable to respond. Other problems such as export permit regulations or policy hinders conducting business smoothly in Ethiopia which discourages the Japanese side.
Capital: What about organizing workshops, seminars or exchange programs to solve the business relationship difficulties?
Since the business I started is only about four or five months old, we haven’t started these programs yet, but in the future I’m planning to start a coffee seminar, or tourism seminar, corroborating with the Ethiopian Embassy in Japan and I expect the ambassador to be very active.  He wants to bring more Japanese investors to Ethiopia and is planning jointly with us. Also since I have the background of tourism, I want to change the image of Ethiopia in Japanese eyes, especially the branding of Ethiopia. If you go to Japan people do not even know about Ethiopia. Although the older generation may know about Ethiopia, the younger generation, like me they don’t. So, we need to have good Ethiopian brands, like for example the beautiful Ethiopian roses, your good coffee, other quality products and as well tourism also. So this is one of the shorter goals of my organization.
Capital: In terms of Japanese companies, do you know of any that are currently engaged in big business investment activities in Ethiopia?
Unfortunately, although there are companies researching investments in Ethiopia, so far I haven’t seen any concrete plans. As you know Chinese, Indians and others are all investing in Ethiopia, however from Japan it is almost zero. Japanese are very careful people, we don’t want to take a risk, we ask so many questions, we want to know every step, and how it’s going to pan out. Finally when we decide, we plan for a long term relationship, but problems with information have led to scarcity of Japanese firms in Ethiopia. Although the Ethiopian government is enticing them with brochures, and others, it isn’t enough information for Japanese companies, because the companies have a lot of other options; Asian or other African countries. In this regard promotion works, and telling the competitive aspect of Ethiopia, is where I come in.
Capital: How can you get Japanese companies to invest in Ethiopia?
Japan to Ethiopia, yes we have high technology and then there are a lot of things, we can introduce in Ethiopia, but some nation’s products are much cheaper than Japanese products. That’s the problem, and the Japanese Yen is very high, people are buying the Japanese Yen more than the US dollar or UK pound or the Euro. So, it’s very expensive to buy Japanese items, it’s one of the reasons that the Ethiopian companies also prefer to buy Indian or Chinese machines. Japanese may sell some things at  cheaper prices to people with lower incomes, so I’m actually looking for second hand machines to export them from Japan to Ethiopia. But my focus remains on Japanese companies buying from Ethiopian businesses, meaning coffee etc.
Capital: What about Japan investing here?
As I said before investment from Japan to Ethiopia is almost zero, there are no concrete undertakings so far in making factories or purchasing farms, although there are companies that come and take a look. But when they come they say the Ethiopian government or the Ethiopian Investment Agency says something very good, showing only the positive side but in actuality after they finished visiting here they get a delay in obtaining information from government officials. The reality sometimes was different than what they were saying. Japanese don’t like contradiction, we like only facts, we don’t want something big, and I can see from the government and the companies from Ethiopia that when we ask questions on plausibility of projects and such related items the answer is an inevitable yes, even though it may not be possible or panctual at that time. So far the Japanese response has been let us wait and see even though Chinese, Indian and Turkish companies are involved in it because government policy changes sometimes very quickly, in contrast to Japanese companies who like stable and predictable policies. But of course you have the opportunities like the cheap labor force, the land and coffee, sesame, leather. But first investment promoters need to have better capacity in implementation otherwise you won’t have the Japanese investors fast.
Capital: What’s your relationship with JETRO and JICA?
Since I was working with JETRO I would like to work with them again, but the thing is the JETRO office in Kenya is the one overseeing Ethiopia. They don’t have offices in Ethiopia, but I hope that it the future they will increase their budget and then they will pay more attention to Ethiopia, but what I’m doing right now is almost similar to JETRO’s work because I’m providing information and then helping Japanese businesses, so I consider myself like a private JETRO and people like it because my service is faster. With JICA also since they’re doing KAIZEN for example, I would like to collaborate with KAIZEN companies, but at this time they’ve just started, once they’re able to have a company that implemented KAIZEN properly, then the company can do the import-export with the Japanese. So I’m waiting for the maturation of JICA’s projects. But JICA is a developmental agency it’s not assisting the private firms or other businesses, it’s about making infrastructures or agriculture or so on. But I’m working on collaboration with JICA on such things as when the pesticide residue issue arose, JICA is financing Ethiopian government to test the pesticide for the coffee. These are the ways I’m collaborating with JICA people and of course the Japanese embassy in Ethiopia.
Capital: Do you have plans for a Japanese business delegation to come with JETRO to Ethiopia?
Actually, a business delegation is good but big numbers mean sometimes you can’t have full information because if there are too many people you are not as mobile. At this time, I brought one Japanese flower company to Ethiopia they have already started the business. We want to expend the Japanese market in flowers and that means more direct sales for Ethiopia.  I’m also helping with promoting the Ethiopian flower in Japan as part of Ethiopian branding efforts. Recently there were Japanese business delegations in Ethiopia with me but rather than have a big delegation it’s better to pinpoint one or two companies, and let them come here and then we make the tailored business. Japanese companies will ask many questions.
Capital: Japanese products are well known in Ethiopia. Could we see Japanese products being manufactured here?
I can’t specify, but I’m actually working with the factories that want to assemble something in Ethiopia. But the thing is, since this is a factory you have to bring Japanese people here, we don’t send people easily, we the Japanese are careful of even sending the people and then we want to know what kind of lifestyle they will have. And since you have a huge market, you can also export to the other African countries definitely there are companies interested in the manufacturing sector in Ethiopia, but it’s just that we need to work harder to assure that investment in here is good because these policy changes and other numerous risks we consider have to be taken out. But you have to understand that Japanese   firms want to make an almost perfect product, therefore they could take a longer time to do their research which could be frustrating because of various obstacles in the Ethiopian bureaucracy.
Capital: What about Japan’s technology?
One of the things is of course KAIZEN which Prime Minister Meles Zenawi wants to be implemented nationwide, and I also believe the KAIZEN way of thinking is something which can improve the entire business climate of Ethiopia not only manufacturing but others also. But technology wise, sometimes Japanese firms want to keep the technology by themselves, so unless there’s a big potential opportunity, they’re not going to share it. When the Japanese come here, I assure that these Japanese experts will really train Ethiopian workers up to the level of the Japanese. So it really will be good for the company also, the tendency of Japanese businesses is we give the skills or knowledge also, it’s not that we’re hiring people and not giving them the an upgrading. We want to upgrade together, that’s the way Japanese think so I’m also wanting to bring Japanese company that can also invest in technology transfer or the manufacturing sector and together build up the Ethiopian economy.