Japan Must Aim to Be a Major Tourism Nation

Seiji Fuji

Obama’s visit to Hiroshima was regarded as a joke

  The front page of the Nihon Keizai Shimbun had an article on April 12 entitled “Human Suffering Caused by the Atomic Bombings.” It read:

The Group of Seven (G7) Foreign Ministers’ Meeting came to an end on April 11. This meeting included the adoption of the Hiroshima Declaration, which calls for nuclear disarmament and non-proliferation. It points out that Hiroshima and Nagasaki, the targets of the atomic bombs, “experienced immense devastation and human suffering.” It also calls for global-scale efforts to reduce nuclear weapons. This joint declaration, which discusses a broad range of subjects, also includes settling a concrete plan for cooperative anti-terrorist efforts at the G7 Summit (Ise-Shima Summit) in May.
The United States government has begun preparations for President Barack Obama to visit Hiroshima, one of the cities that was bombed, after the Ise-Shima Summit in May. An advance group, mainly composed of presidential bodyguards, will go to Hiroshima in April to investigate the route and places where Obama will visit. After viewing the domestic response to U.S. Secretary of State John Kerry’s visit to Hiroshima, a final decision will be made on the presidential visit. Obama, who is aiming for a “world without nuclear weapons,” has indicated his desire to visit the bomb-struck areas since his inauguration in 2009, and specific actions are being started to that end.

 Obama assumed the office of 44th president of the U.S. on January 20, 2009. He gave a speech in April in Prague, the Czech Republic calling for a “world without nuclear weapons” and advocating for the Nuclear Security Summit. This speech earned him the Nobel Peace Prize. The first Nuclear Security Summit was held in April 2010 in Washington, D.C., followed by the second in March 2012 in Seoul, South Korea. Obama won the election in 2012 and started his second term in January 2013, but has taken no further steps toward the total abolition of nuclear weapons. This course of events has convinced me that the only thing Obama – who won the Nobel Peace Prize for calling for a world without nuclear weapons – can do is to become the first incumbent president to visit Hiroshima.
 When a large-scale development project in front of Hiroshima Station was brought to my attention in October 2013, I immediately decided to buy. Past data also shows that, among the foreign tourists visiting Japanese provincial cities, American travelers comprise the largest number in Hiroshima. I thought that Obama’s visit to Hiroshima would increase the number of American and European tourists all at once. I decided to build APA Hotel Hiroshima-Ekimae-Ohashi, a 14-story hotel with 727 guest rooms, on this plot of land. The groundbreaking ceremony was held on February 18, 2015. At that time I held a press conference in which a reporter asked me if there was actually demand for building such a large hotel – of the biggest scale in Chugoku and Shikoku – in Hiroshima. I responded, “Obama, who won the Nobel Peace Prize for advocating for the total abolition of nuclear weapons, will visit Hiroshima next year. If he does, the number of American and European tourists will increase suddenly.” The audience laughed, perhaps because they thought I was joking about Obama coming to Hiroshima, yet it is looking like this visit will become a reality.

Considering Japan’s appealing features, it only makes sense to upwardly revise the target number of foreign tourists

 I have visited 81 countries across the world and held debates with important figures in each nation. They all talked about how wonderful Japan is. However, in Japan the schools and mass media insist on censuring the Japanese Army for cruel acts in the past that are fabricated stories. For instance, they talk about the “Nanking Massacre,” saying the Japanese Army killed 300,000 unarmed citizens, women, children, and other civilians, even though there is not one photograph that proves these claims. They also say the Japanese Army forcibly transported 200,000 young women on the Korean Peninsula into sexual slavery, despite the fact that newspapers from that time did not report once on protests made by the family members of the captives or other parties. The cause for this is the atomic bombs dropped by the U.S.
 In the end stage of World War II, Japan used various channels such as the Soviet Union, Switzerland, Sweden, and the Vatican to cease hostilities, for which the only condition was the maintenance of the national polity. The U.S. knew this, but it ensured that Japan could not surrender easily by purposefully removing the protection of the national polity from the Potsdam Declaration. In that way, it had to buy time to finish the nearly complete atomic bombs and drop them on Japan.
 The U.S. provided extensive military assistance to the Soviet Union and also built war plants to help it win against Nazi Germany. As a result, it expanded the Sovet Union into a military monster with the world’s greatest military strength. If the war with Japan were to end in that way, the U.S. feared that the Soviet Union would communize not only Eastern Europe, but also the entire area bordering Europe including Asia and Africa. It therefore had to implement an offset strategy by using the atomic bombs to restrain the Soviet Union.
 The Battle of Iwo Jima took place from February 19 to March 26, 1945. The Japanese Army, which had already lost control of both the seas and air, had turned the entire island into a fort where it was taking shelter. The U.S. should have detoured around Iwo Jima, but instead it forced the Marine Corps to land on the island. There, the U.S. suffered more casualties than the Japanese Army. The number of soldiers killed or wounded in action was 28,686 – one tenth of the American soldiers killed or wounded in action in the entire Pacific War (280,000) and one third that of the overall Marine Corps casualties (86,940). Based on this, the U.S. made a conjecture that around one million U.S. soldiers would likely be killed or wounded if a decisive battle were to occur on the Japanese mainland. It had to persuade the American people that the atomic bombings were necessary to prevent such circumstances, even though the military authorities were saying the atomic bombs were not needed to make Japan surrender. On March 10 – right in the middle of the fierce fighting on Iwo Jima – firebombs were dropped during the Great Tokyo Air Raid to show that atomic bombs were not the only inhumane weapon. A total of 100,000 Tokyo citizens were burned to death in just one night.
 The U.S. laid the groundwork in this way by taking measures so it would not be censured for dropping the atomic bombs. Its purpose was not victory in the war with Japan. Rather, we can say the true goal was to prevent the outbreak of World War III in the future, a fierce battle over Soviet communization of the world in which it was highly probable that 10 million soldiers would perish. But even after using this inhumane weapon, the U.S. had to portray Japan, the victim, as a bad country so that it would be continually seen as a righteous country. That is why the U.S. has not negated the fictitious Nanking Massacre and comfort women stories. It also used the Press Code to regulate the media, purged 200,000 public officials in important offices, gathered and burned 7,769 types of disadvantageous books, forced the holding of the Tokyo Trials, and brainwashed the Japanese people until the historical viewpoint compelled by the U.S. has become accepted as general knowledge. More than 70 years have passed since the atomic bombings, and the American public opinion is changing. In the past 80% of Americans said the U.S. had no choice but to drop the bombs, but today this has declined to around 60%.

A Trump presidency would be a major opportunity for Japan’s independence

 Many people felt great hope when Obama was inaugurated in 2009, yet he has caused chaos across the globe by declaring that the U.S. is no longer the policeman of the world. Russia intervened in Ukraine and annexed the Crimean Peninsula, and IS dominates Iraq and Syria. China is reclaiming reefs in the South China Sea to build military runways. It is also dispatching warships, constructing military bases, obstructing free navigation in international waters and flight, and hastening its efforts toward making its hegemony a fait accompli during the tenure of the weak Obama. This was also mentioned at the recent G7 Summit.
 Famous strategy researcher Edward Luttwak said that weak presidents are followed by strong ones. Republican presidential hopeful Donald Trump is taking advantage of this trend. He asserts that the unilateral Japan-U.S. Security Treaty should be changed and that Japan and South Korea should have nuclear arms to protect themselves. However, Trump lacks sufficient understanding that this unilateral treaty was originally intended as a yoke to prevent Japan from becoming a major military power, and was determined by the U.S. as a set with the Constitution of Japan. Still, a Trump presidency would be in a sense an ideal opportunity for Japan to become a truly independent nation. Japan should revise the constitution, enter into the nuclear sharing agreement already concluded between the U.S. and four NATO countries (Belgium, Germany, Italy, and the Netherlands), restrain the expansion of China, regain a balance of power in East Asia, and achieve peace and prosperity. I think the Ise-Shima Summit in May is an important preparatory step to that end.
 Three years ago, my analyses led me to conclude that Obama would someday visit Hiroshima. The ability to make accurate future predictions is essential for business success. Another recent prediction of mine that was right on the mark was the target number of foreign tourists to Japan. Based on my travels to 81 countries across the globe, I believe that no other country is as wonderful as Japan. Japan has good public order and women can walk the streets alone at night. Japan has delicious food and the high-level culture of Washoku. Japanese people keep their promises, are kind to other people, and are brimming with a spirit of hospitality. Public transportation is also always on time.
 APA Group began the Summit 5 project on April 1, 2010. With this first five-year, medium-term plan, our goal was to become number one in central Tokyo. Just before that point, the number of foreign visitors to Japan in 2009 was 6.79 million, but I thought there was still room for growth. The Great East Japan Earthquake occurred during Summit 5 and the number of tourists was stagnant for some time, but Shinzo Abe became prime minister for a second time in 2012 and took decisive action aimed at a cheaper yen and higher stock prices. Therefore, the number exceeded 10 million in 2013. At that time, I declared that it would not be unthinkable for 40 or 50 million foreign tourists to visit the fantastic country of Japan. In March of this year the Japanese government doubled its goal, announcing that the target number of foreign tourists would be 40 million by 2020 and 60 million by 2030. In this way, efforts are afoot to make Japan into a major tourism-focused nation, which is exactly in line with my predictions.

Japan offers a diverse range of destinations for foreign travelers in rural areas beyond Tokyo

 First-time travelers to Japan start by going to Tokyo, but in their second or third visit many range father afield to rural areas such as Kyoto, Hokkaido, and Hokuriku. In Summit 5, our project aimed at being number one in Tokyo, we built hotels with 13,801 guest rooms (including those being designed or constructed) in central Tokyo, mainly in Chuo, Minato, and Chiyoda Cities. The theme of the second project, named “Summit 5-II” and begun in 2015, is full-scale developments following the first project that was targeted at the single area of central Tokyo. In Summit 5, we built hotels located within three minutes by foot from train stations in a square spanning from Ikebukuro in the north to Shinjuku/Shibuya in the west, Shinagawa in the south, and Asakusa in the east. This bore fruit, and all completed hotels in Tokyo have monthly occupancy rates of 100% or greater. Together with more overseas tourists, increased business travel to Tokyo due to economic recovery also contributes to our high occupancy rates. The hotel shortage in Japan is rapidly becoming a problem as the government is aiming to increase the number of foreign tourists, and measures to resolve this issue are definitely behind schedule.
 To deal with the past issue of insufficient housing, there were some cities where housing had to be built together with office or hotel buildings. In these regions, one is still obligated to build housing when constructing buildings, such as hotels, that meet certain conditions. A condominium’s hallways, lobbies, and other common areas are not included in the floor space ratio calculation, but that is not the case with hotels. Just abolishing these rules would make it easier to build hotels and also increase the number of guest rooms. There are also regulations that prevent the construction of hotels in school zones, perhaps because they are seen as dubious facilities. I feel this rule is out of tune with the present era of globalization, in which people are being asked to interact more proactively with foreign nationals.
Some say that vacation rentals could be a key to resolving the accommodation shortage, but it is inevitable that problems will occur with other residents when travelers stay at condominiums and houses that were not originally meant as lodging facilities. It is also likely that too many people would end up staying in one room. More smartphone apps are providing agency services, and it is thought that the usage of vacation rentals will increase in Japan like it has in Europe and the U.S. However, the hotel shortage should be handled by increasing the range of genuine accommodation facilities. To that end, we should not only increase the floor space ratio but also abolish the attached housing regulations that are placed on the construction of hotels at or above a prescribed scale in locations such as Chiyoda and Minato Cities. I think rules such as the “oblique line” and “sun shadow” regulations should also be relaxed in central Tokyo. I proposed this to National Diet members attending my Shoheijuku school, which showed me that many Diet members are not fully cognizant of this issue. However, news reports in April said the hotel floor area ratio will be relaxed by the Ministry of Land, Infrastructure, Transport and Tourism, and it looks like my recommendation may be realized to some extent.
 In the future incomes will rise not only in China but also other countries with large populations near Japan, including India, Indonesia, Vietnam, and Thailand. We will enter an era of more people vacationing abroad, and it is expected that even more foreign tourists will come to Japan, the closest advanced nation that has great appeal. The development of low-cost carriers (LCC) will also probably increase direct flights to Japanese rural airports from Asian cities. After Tokyo, people will visit rural areas. The next step in Summit 5-II, our second project, is development in such areas. I believe we can provide support for reconstruction after the Great East Japan Earthquake by building hotels, which is why I decided to construct the largest hotel in Fukushima City near Fukushima Station. Many other development plans are also underway in locations such as Nagoya and Kyoto, including a 32-story tower hotel in Midosuji, Osaka with more than 900 guest rooms, the largest number for an APA Hotel in Osaka. This is because I believe that developing more hotels across Japan is the best way to contribute to national policy.

Many hotels across the world will some day conform to the New Urban Style Hotel concept

 After the bankruptcy of Lehman Brothers in 2008, all financial institutions naturally stopped offering new loans and also started collecting on existing debts. Emergent developers had no choice but to repay their loans by tearfully selling the land they had bought as condominium sites at prices lower than the purchase prices. All of APA Group’s sites were bought with cash, and the hotels built there now have high occupancy rates. In the forecast for APA Group’s consolidated business results in November of this year, sales are 106.9 billion yen and current profit is 33 billion yen. We expect an increase in both income and profit compared to last year’s sales of 91.1 billion yen and current profit of 28.1 billion yen. I suspect there are no other hotel groups in the world with a current profit rate exceeding 30%. This business model is gaining prominence across the world, and we have received many inquiries from other countries. APA Hotel Woodbridge was soft opened in November 2015 in New Jersey, the U.S. It is our first advance into overseas markets and was at the request of the most influential real estate owner in New Jersey. The grand opening will be on June 20. All rooms feature washlet toilets, and the hotel also has a Japanese restaurant.
 The growth of the Internet has brought about an era in which one party stands out as the strongest, and the rest are weak, for all sorts of services. People can search online according to price, so the cheapest and best services in a category are chosen over all others. Hotel categories include urban, business, and resort hotels, but APA Hotel has created a new category of New Urban Style Hotels that offer high functionality, high quality, and environmental friendliness. In this way, we have avoided price competition to dominate throughout Japan and are also beginning to expand across the world.
 Up until now, urban hotels have offered services like those provided by a servant to a master. In contrast, New Urban Style Hotels are based on the concepts of welcoming guests with pride, allowing guests to stay with pride, and equality between guests and staff members. The basic concept is offering a full range of services with no unnecessary ones. When I started the hotel business, I carefully thought about how to boost the occupancy rate. Five days of each week are weekdays. Therefore, hotels where many people stay on weekdays will have higher operating rates. That is why I concluded that we should target businesspeople and started by building business hotels targeted at that demographic. I created a membership system with rebates that was made available from our first hotel, and I was the first member. I have worked to construct hotels that are close to train stations in all regions – within three minutes by foot if possible – in order to make them user-friendly to businesspeople. Business travelers participate in meetings, eat, drink, and then return to their rooms where they take a bath and watch TV. Considering these actions, I thought they would mainly spend their time in the room in bed, so we installed a large 50-inch TV where it is easily viewed from the bed. We also put the lighting and air conditioning switches near the pillow. The high-grade Cloud fit beds of our own design are very wide at 1,420 millimeters, even in the single rooms. People often say that APA Hotel rooms are small, but I respond that we made them small on purpose for the sake of the environment. Compact items are becoming mainstream throughout the world. The full-size Cadillac has given way to the Prius, and jumbo jets with four engines are being replaced by two-engine 787s. Accordingly, hotel rooms must also be made smaller. APA Hotel is evolving based on my belief that it should sell satisfaction, not space.
 As for environmental friendliness, the rooms have water-saving showers that maintain water pressure while mixing air into the water, oval-shaped bathtubs that feel spacious yet use just 80% of the water of regular bathtubs, volume-regulating faucets with thermostats that turn off automatically when a fixed quantity of water is reached, heat-insulating curtains, and other features. As a result, the carbon dioxide emissions are just one third that of regular urban hotels. Because the rooms are small, we can build more rooms in the same area, which keeps initial and running costs low. This upholds our business model with the highest profit margin in the world. At my speech in Manhattan on our American expansion in November of last year, I shared my view that many hotels in the world will someday conform to the New Urban Style Hotel concept.
 APA Hotel has been successful because of my foresight cultivated by reading newspapers from when I was in elementary school, when I looked up all unfamiliar words in the The Encyclopedia of Contemporary Words. The ability to predict the future is essential for conducting business successfully. My predictions have turned all recent economic cataclysms into fantastic opportunities, including the collapse of the bubble economy in the 1990s and the fund bubble burst and bankruptcy of Lehman Brothers in the 2000s. As a result, we have never had a deficit in 45 years since the company was established and have not fired even one employee for restructuring. We pay taxes of more than 100 billion yen, and have achieved good business results in our latest settlement of accounts as well. I am proud that I have been able to create demand and jobs in this way, based on which I have expressed myself in Apple Town, the Shoheijuku, and other arenas.

April 21, 2016 (Thursday) 11:00 a.m.