The Internationalization of Corporate R&D

THE INTERNATIONALIZATION OF CORPORATE R&Dby the head-office function. Again, the main barriers to doing business in Japan aredifferences in business culture and low levels of English proficiency. Since overcomingthose obstacles is a long-term process, the near-term outlook for heightened foreign R&Dactivities in Japan looks rather pessimistic.9.4.3 Implications for SwedenThe increasing interest of Japanese companies in establishing more overseas R&Dactivities can be an opportunity for Sweden to attract Japanese technology-monitoringand innovative R&D. Due to its small consumer market, Sweden has little likelihood ofattracting Japanese adaptive R&D. The exception could be when Japanese companiescan use the Swedish market as an entry-point to the European market.With 130 million people, Japan is a very large, homogenous and attractive consumermarket. It can be more forcefully targeted by Swedish companies for adaptive R&Dactivities, especially following the latest Japanese effort to increase foreign direct investmentin Japan. In 2002, the Swedish export to Japan was only 0.6 percent of thetotal Japanese import (the Swedish import from Japan was 0.34 percent of the totalJapanese export) (MOFA 2004).To meet the increasing interest of Japanese companies to establish more overseas R&Dactivities, the Swedish government should consider the following policy measures topromote the Swedish science and technology:• Intensify the exchange of individual researchers, both from industry and academia,between Sweden and Japan. (Swedish researchers should be encouraged to use already-existingfunds for conducing research in Japan.)• Promote research collaboration between Sweden and Japan by providing financialmeans for running common scientific projects. (There are already some verygood practices established by VINNOVA, SSF and the Japan Science and TechnologyAgency.)• Encourage new collaboration agreements between Swedish and Japanese universities(including the exchange of individual students).To promote new, direct corporate R&D investments (both Swedish investments inJapan and vice-versa), policies should include:• Support for small Swedish private companies to approach the Japanese market;• Intensified efforts to convince Japanese companies that Sweden is a good hostcountryfor their R&D investments; and,• Encouragement to work toward better understanding of Swedish and Japanesecorporate cultures.224