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In Japan's Nagasaki, some glimmers of economic revival

Leika Kihara and Takahiko Wada
·2-min read
FILE PHOTO: A general view shows Nagasaki port amid the coronavirus disease (COVID-19) outbreak in Nagasaki

In Japan's Nagasaki, some glimmers of economic revival

FILE PHOTO: A general view shows Nagasaki port amid the coronavirus disease (COVID-19) outbreak in Nagasaki

By Leika Kihara and Takahiko Wada

NAGASAKI, Japan (Reuters) - On Japan's southern tip, some initiatives to revitalise local businesses are making small but steady success, offering a silver lining for a region that has long suffered from an ageing population and declining economy.

Nagasaki, which has seen its once-dominant shipbuilding industry wane due to global competition, is today symbolic of Japan's demographic challenge. It has one of the fastest shrinking populations, as younger people head for bigger cities in search of work.

But it is trying to reinvent itself as an IT hub and has created data science programmes at local universities. That has helped lure big tech firms like Kyocera Corp <6971.T> and Fujifilm Holdings Corp <4901.T>, which have both set up research and development centres.

"We need to create new industries and attract companies that offer promising jobs for young people," said Ryutaro Kaichi, head of Nagasaki Bank. "That's the only way Nagasaki, and we regional banks, can survive."

The prefecture offers subsidies to firms that bring in jobs and investment. Last year alone, it signed contracts with a record 13 companies, mainly in IT and finance.

Electronic parts production made up 33% of the prefecture's gross domestic product (GDP) as of 2017, according to the latest available data. That was up from 14% in 2010 and exceeded 18% for shipbuilding.

Local lender Juhachi-Shinwa Bank wants to help revive a fishing industry hit by falling prices. Bank officials are working with the local government on a subscription system to connect local fishermen with consumers in Tokyo.

Under the scheme, consumers who pay a monthly fee will have fresh fish shipped to them directly.

"Nagasaki is an exemplar of the challenges Japan faces," said Kousei Kuwasaki, of Juhachi-Shinwa Bank.

"That's why it can serve as a sandbox for companies that want to try out something new."

(Reporting by Leika Kihara and Takahiko Wada; Editing by David Dolan and Michael Perry)