More Capital Injection Will Drive Sapporo’s GX and Asset Management Zone Status [8 Images]
~ Thursday, December 19, 2024 Blog Post ~
Last Monday, December 16, and Tuesday, December 17, 2024, I took part in the Global GX/Finance Conference: New Frontiers in Green Transformation and Sustainable Finance held in Sapporo, Japan. The forum Nikkei Asia organized was attended in person and virtually by government officials and green energy (GX) enthusiasts from Japan, the United States, and Denmark, as well as interested participants worldwide.
Among the speakers were Sapporo City Mayor Katsuhiro Akimoto, Hokkaido Governor Naomichi Suzuki, and United States Ambassador to Japan Rahm Emanuel. Also present to speak at the Global GX/Finance Conference were Denmark’s Ambassador-Designate to Japan Jarl Frijs-Madsen, US Embassy Japan’s Economic Minister Counselor Evan Felsing, Climate Bonds Initiative CEO Sean Kidney, the Danish Energy Agency’s Japan Program Leader William Lin, and US Senior Advisor to the President for International Climate Policy Mr. John Podesta.
Clean energy advocates and offshore wind energy executives such as Copenhagen Offshore Partners Japan CEO Clement Helbig de Balzac, Export and Investment Fund of Denmark Associate Director of Wind Origination Team Mr. Lars Ulrich Jensen, and F&P Insurance and Pension Denmark Deputy Director Tom Vile Jensen enlightened the attendees about Japan and Denmark’s GX and finance partnerships.
As for the finance and asset management speakers, present at the Global GX/Finance Conference were BlackRock Japan President and CEO Hiroyuki Arita, Hokkaido Bank President Yuji Kanema, Sparx Group President Shuhei Abe, and Development Bank of Japan Managing Executive Officer Fumiyo Harada, among many others.
Furthermore, Mizuho Bank’s Managing Executive Officer Nobuo Sakuragi, MUFG Bank’s Managing Executive Officer Koichiro Oshima, Sumitomo Mitsui Financial Group Chief Sustainability Officer Masayuki Takanashi, and Mitsubishi UFJ Trust and Banking General Manager and Sustainable Investment Unit Head Yasuko Watabe represented Japan’s three mega-banks at the forum.
Japan is among the top 10 countries leading the world’s energy transition movement. I felt impressed by the East Asian country’s numerous initiatives promoting GX or renewable energy and decarbonization in partnership with the public and private sectors. Furthermore, I find the measures taken by the Japanese authorities and financial institutions practicable when it comes to fostering the city of Sapporo as a special zone for finance and asset management.
With my participation in the two-day Global GX/Finance Conference, I find it worthy to further analyze and write my viewpoints about this forum here in my blog for my readers’ enlightenment.
Why Should Investors Consider Sapporo?
Sapporo is the capital of Japan’s northernmost island of Hokkaido. It is the latter’s primary business center and a popular tourist destination, famed for its freezing winter and the nearby Niseko ski resort. I learned from the Global GX/Finance Conference that the Japanese people elected Sapporo as Japan’s most livable city for delivering a sound equilibrium between its abundant natural surroundings and an industrialized urbanity.
In 2023, the Japanese Government designated Sapporo as one of the country’s four international financial centers. Hokkaido’s capital is a special zone for finance and asset management, making these two industries important growth areas there and complementing other hubs like Tokyo, Osaka, and Fukuoka.
Moreover, Sapporo’s assignment as a special district for green energy transformation and finance and asset management is a component of the Japanese Government’s 10-year, ¥150-trillion GX strategy. I gathered that securing decarbonized power sources will ensure Japan’s competitiveness on the world stage.
The conference speakers made it clear that investing in Sapporo in the long term will generate substantial investment returns for capitalists from Japan and worldwide. After all, the world is responding to climate change by having more expanded investments in the decarbonization sector.
Additionally, as countries become greatly digitalized and with artificial intelligence or AI expected to make further advancements in various industries, electricity will continue to be in high demand until 2050. In light of these developments, renewable energy is getting more preference in this climate-conscious world. I agree that the demand for green, renewable energy like offshore wind power will surge in the coming years.
Hokkaido is rich in renewable energy sources, including its spiking investments in offshore wind energy. This second-largest island of Japan possesses massive potential for clean power sources and is gradually breaking away from its reliance on fossil fuels.
For instance, Aizawa Concrete is a local enterprise in Hokkaido. CEO Yoshihiro Aizawa pointed out that energy is Japan’s security and sovereignty. He proposed his firm’s floating wind power units which can simulate the idea of the Japanese energy infrastructure. Aizawa Concrete’s head relayed that the Mikasa-style concrete floater can produce electricity and fuel and is capable of being transformed into a fish reef and a security mechanism. Mr. Aizawa also remarked that the 4,000 floating structures can modify Japan’s security posture. He cited that, if the country has the necessary clean energy infrastructure, it can succeed in becoming energy-independent.
I also gathered that Hokkaido’s government has continued to provide capital investment in GX supply chain support projects. It is eager to achieve carbon neutrality and decarbonized power sources in the next decade. I believe these initiatives will be successful, thanks to the great support and cooperation of Hokkaido residents.
More Investor Capital Will Propel Sapporo’s Green Transformation and Finance and Asset Management Position
Money motivates everyone and everything. I believe Sapporo’s targets of a carbon-neutral society and metamorphosing into a thriving finance and asset management hub will be realized in the next decade if investors from local and overseas pour their funds into the Hokkaido capital.
Indeed, the rocket has left the base and it will not stop. In Japan, offshore wind energy development, companies’ wind and solar power energies involvements, and wind farm investments will carry on at a steady pace. Thus, businesses like banking and financial institutions must take the initiative of investing for the cash-oriented Hokkaido GX project to take off.
Investing in Sapporo will certainly entice more AI, semiconductors, and data centers to set up shop there. With businesses established in the Hokkaido region, more financial institutions and firms abroad will consequently be attracted to the area. Sapporo’s opening up to the world as a business, tourism, and food culture hub will deliver value to developers, investors, and local communities.
I learned from one of the forum speakers that people in Hokkaido are really modest and hardworking. Nonetheless, these residents can create mechanisms to establish and solicit more funds and capital from abroad by collaborating with the private and public sectors.
Furthermore, through advertising, Sapporo and Hokkaido locals can excite investors and make them willing to pour their investment funds into the area. Japan’s northernmost island and its capital’s fervent intent of promoting renewable energy and making the site a clean and green energy center will be a success, with the Japanese mega-banks partnering with offshore wind energy firms and supporting the construction of offshore wind farms.
With the help of investors, I believe social and economic values will come to Sapporo and Hokkaido. Locals will relish these advantages which will be sustainable through continued support from local and foreign capitalists.
Climate change is a very critical environmental concern. With Sapporo’s impact investment initiative, I am certain the return on investment or financial return will be the highest in the long run, which will be simultaneous with the environmental and social benefits. Investing in GX or renewable energy can result in a virtuous cycle, with everyone winning, not just companies which is capitalism’s grand design. The future is quite bright in terms of opportunities and there is so much more prosperity in the future in Sapporo.
References:
https://www.aizawa-group.co.jp/
https://www.aizawa-group.co.jp/news2024091701/
https://www.climatebonds.net/about/team/sean-kidney
https://energydigital.com/top10/top-10-countries-leading-the-energy-transition
https://www.iea.org/reports/world-energy-investment-2024/overview-and-key-findings
