Israel Japan | Business Guide | 2023

Challenges have increased also in the cyber sphere, with cyber-attacks gainingmomentum, affecting not only financial institutions but also the supply chain of Japan’s robust manufacturing industry. Notable examples fromMarch 2022 in the automotive segment served as wake up call. Cyber​ awareness is increasing and new government agencies have been established. Many Japanese companies have increased their activities in Israel in this area, scouting for technologies to deploy, distribute or invest in, as well as training and research. Cooperation agreements in the cyber field, signed by both governments in recent years, create a favorable ground for collaborations. Automotive and Smart Mobility: Japan is a global leader in the automotive industry, thanks to OEMgiants such as Toyota, Mitsubishi, Honda, Mazda, Nissan, Suzuki and Subaru, as well as an entire ecosystemof suppliers, such as Denso and Aisin. Faced with the era of digitalization and transformation from hardware to software; autonomous; connecting; electrical and sharedmobility, the Japanese industry is looking for ways to remain on top of the game. Perhaps one of the most active fields in recent years for bilateral collaborations, Japanese corporations have been actively seeking strategic partnerships in Israel. Information Technology and Communication (ITC): Japan’s ITC market is amongst the worlds’ biggest, boasting global telecomoperators and ITproviders. Israeli companies havebeen leading innovations in this field for a fewdecades, pioneering technologies such as VOIP and instant messaging, and continue to growand innovate. In addition to the 2014 acquisition of Viber by Rakuten, NEC’s active R&D center in Israel andmany bilateral transactions completed in this segment over the last decade, Japan's largest operator and one of its top 3 corporates - NTT - established an innovation laboratory in Israel. This field is expected to continue to generate partnerships, especially in quantumcomputing, artificial intelligence and Internet of Things. Israel-Japan > Business Guide > 2023 16 > General Information > Trade Figures How to strengthen mutual cooperation? Here are some points to consider for a successful partnership: 1 . Decisions in Japan take time, but once decided and everyone is on board, thingsmove forward. Israelis need to be extra patient and learn how the process-oriented, consensus- based systemworks in Japan. At the same time, Japanese companiesmaywant to understand the shorter time cycles Israeli start-ups are faced with and attempt to increase agility and flexibility, as well as reflect to their Israeli partners the internal processes and expected timelines. 2 . In Japan there is a preference for a finished product with proven success in other markets, preferably in the US. Japan is generally not the ideal first-market for Israeli start-ups, so it is advisable to choose the right timing to enter the Japanese market, as this requires time and resources. 3 . While Israelis value directness and bluntness, Japan’s high-context culture requires attention to the non-verbal communication. It is often difficult for Israelis to ‘read the air’ as is expected in Japan. Japanese business personswould dowell to know that their Israeli counterparts are likely not to understand their non-verbal messages as they haven’t been trained to do so. 4 . Whereas successful negotiations may lead to a deal, it doesn’t necessarily lead to successful partnership, which will need to be nurtured over time, keeping in mind the Japanese high expectations for service quality and commitment. Mistakes are less likely to be tolerated and when they happen, an investigated is expected, as well as a formal and sincere apology. 5 . There is great importance for a local presence in Japan/Israel, with priority for a combination of Japanese and Israelis, to be able to overcome the substantial cultural differences.