2024 New Year’s Remarks by Chairman KOKUBU Fumiya

January 4, 2024

I humbly express greetings of the new year.

On January 1, the 2024 Noto Peninsula Earthquake with a maximum intensity of 7 on the Japanese scale occurred. I would like to express my deepest condolences for the people who lost their lives and my heartfelt sympathies for all those affected by the earthquake.

Last year, splits in the international community, which have been apparent for some years, became even more complex. In regional conflicts, Russia’s invasion of Ukraine entered its second winter, with no path to ending the war in sight. In October, Hamas raided Israeli territory and incurred large-scale retaliation. These events threw Israeli-Arab relations into disarray, shattering hopes of reconciliation. The invasion of Ukraine and the conflict in Gaza both involve the sacrifice of many civilians. I am deeply concerned about the current situation and sincerely hope that the fighting will end as soon as possible so that citizens in these two regions can live in peace.

In addition to such regional conflicts, rising geopolitical risks including cooling US-China relations manifested themselves in the form of supply chain instability, which heightened countries’ awareness of economic security. In addition to the issue of supply chain resilience, some developed countries, including European nations and the US, are strengthening their industrial policies against the backdrop of transition to a green economy.

Japan held the G7 presidency and hosted a G7 Summit in Hiroshima in May. The summit demonstrated that participating countries agreed that the universal values of freedom, democracy, human rights, and the rule of law remain paramount. The participants also affirmed the importance of inclusive economic development in forms that position the countries of the Global South as partners.

However, I feel that international organizations have unfortunately become even more dysfunctional. Vetoes by permanent members of the UN Security Council have become the norm, and effective solutions to interstate conflicts and humanitarian crises have not been reached. The WTO governs multilateral trade rules, yet prolonged vacancies in its Appellate Body, which makes final rulings, have stalled resolution of many disputes.

Under these circumstances, much progress has been made on economic partnerships as a mechanism to complement multilateral trade rules. The Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) entered into force in Chile in February and Brunei in July, and all 11 original member countries have now signed the agreement and put it into effect. The UK has also signed a Protocol of Accession to the CPTPP, and further expansion is expected. The Japanese government’s persistent negotiations were credited with the success of the UK’s accession efforts. Following two Indo-Pacific Economic Framework for Prosperity (IPEF) Ministerial Meetings, the IPEF Supply Chain Agreement was signed to bolster supply chain restructuring and resilience.

While pursuing the principle of maintaining and expanding systems for free trade and investment, considering the current complexity of international relations, the JFTC will aim for inclusive and high-level economic relations through a framework that takes into account the diversity of participating countries.

Measures to address climate change were boosted by the historic agreement to transition away from fossil fuels reached at the recent COP 28 meeting with the approval of oil-producing countries. Last year, the JFTC established a special study group to explore the theme of “Shosha and carbon neutrality.” This initiative shares information on member companies’ specific efforts to achieve carbon neutrality and examines how the Shosha industry can contribute to carbon neutrality. While enhancing policies and systems is of course important, specific measures to reduce greenhouse gas emissions are equally vital. For Japan, with its high level of dependence on energy imports, an extremely challenging situation lies ahead. However, in the Shosha industry we will tackle these issues head-on and play a significant role.

A host of factors could transform the world in 2024. On the international scene, national elections and other political events are scheduled in many politically and economically influential countries. The most important of these is the US presidential election, the result of which could substantially change the country’s involvement in the international community.

The international situation is becoming even more uncertain, and corporate executives will face increasing difficulties in charting a course for their companies. The JFTC upholds the aim of “LEAPING AHEAD INTO A SUSTAINABLE WORLD” and we will strive to resolve a range of issues and promote business activities through proactive partnerships between the public and private sectors. I hope we can continue to count on your understanding and support.

Let me conclude this new year message with my very best wishes that 2024 will be an even more productive year for us all.