INTERVIEW OF THE WEEK Frank Boyland

By Colin Donald

So, JAPAN is not immune to the global slowdown. The fact was made clear last week by figures showing that the world's second-largest economy - which has been on a long but shallow recovery since 2001 - had slowed down by 0.6% in the second quarter. Against this background a steadily rising yen is hurting the country's exporters.

As Japan is our fifth-biggest export market, the destination of a chunky 5% of our manufactured exports - the value of which has shot up by 20% since 1983 - this amounts to a mild negative for Scotland, right?

Wrong, says Frank Boyland, since 2002 Scottish Development International's man in Tokyo, and the trade and investment body's newly appointed director of Asia-Pacific.

Boyland, 42, a former semiconductor designer and champion boxer, sees nothing but positives in Japan's shifting fortunes, and makes a compelling case for looking beyond the headlines in the expectation of further growth in the long economic amity between Japan and Scotland.

"There has, in fact, been an increase in M&A mergers and acquisitions activity from Japanese companies, as in the last five years of apparent slow growth you have seen corporate profits that are actually higher in cash terms than they were at the peak of the 1980s bubble. People don't believe me when I say that," Boyland said.

"The difference is that this time, instead of going out and investing in golf courses, shopping malls and landmark buildings in New York - which they then had to sell for 10 cents in the dollar - Japanese companies have been building up large stores of cash and selectively going out and buying companies.

"The rise in the value of the currency is a good news/bad news thing. The good news is that where they previously had a billion dollars in the bank, this year they have $1.2bn. So if they were thinking about acquiring something in Europe last year, they are definitely thinking about it now." His job is to point them in Scotland's direction.

SDI is not in the business of selling off Scottish companies, but it can cite very successful Japanese-Scottish collaborations to prospective investors that highlight Scotland's strengths in access to the European markets, innovation and manufacturing capability.

These collaborations are the basis of the solid economic relationship that lies below such colourful crossing-points as Shunsuke Nakamura of Celtic and a Scottish-style Hokkaido distillery's award as 2008 best whisky in the world.

No less than 65 Japanese-owned companies are currently based in Scotland - which makes the world's second-largest economy our fifth-biggest inward investor. Some, such as JVC, have called it a day as commoditisation has driven down margins but others, like OKI and Mitsubishi, are showing the long-term loyalty and commitment that makes Japanese companies ideal inward investors. These companies have transformed their businesses to suit the new economic realites. OKI, for example, which once made faxes and copiers, now makes high-margin toners and inks.

Obviously the 1970s and 1980s era of big new Japanese greenfield developments is over. The good news promoted by Boyland, whose determination was honed in a Port Glasgow boxing gym, is that a new era of higher-value collaboration and investment is opening up.

"I wake up every day hoping to find a 5000-job plant but the reality is that it's about high value-add jobs, it's about R&D, it's about turning our brains to the good of the economy. Jobs like that come in clusters of 10 or 50, or 100 and with an R&D centre; in drug research they come in fives. Of course, we won't walk past other opportunities but it's at the higher end, where the jobs pay more than 10% over the average Scottish salary, this is the place where inward investment can help Scotland most."

Boyland contends that, flush with these enhanced-value yen, smart, long-termist Japanese companies are looking to enhance their European operations, and are ready to be persuaded about Scotland's sell of world-beating R&D capability.

SDI, whose mixture of technocratic smarts and glad-handing sales and marketing instincts are well represented in the figure of Boyland himself, is confident that its technique of "consultative selling" can enhance an already impressive list of gains.

Boyland describes what he means by that term with characteristic clarity. Scotland's message in foreign markets now goes something like this: "You don't know why you need this facility yet but you do, and let's tell you why. We have done the analysis of your company that shows you have 16 mom-and-pop shops, and someone doing back office invoicing and technical support, but did you know that the trend now is in looking at technical support supercentres, and guess what, Scotland is a great place to do that for your European operation."

In Japan, as in other markets across Asia and beyond, SDI has got its selling technique down to a fine art, though this is an area that is constantly developing.

A typical example of an SDI campaign, as he describes it, would be to identify a medical field in which Scottish universities excel, bring out the most distinguished academics in that field to a seminar at the British Embassy - one of the grandest addresses in Tokyo - and invite the leaders of 40 of Japan's biggest pharmaceutical companies to a room festooned with Saltires. Boyland will then say his piece about how "Scotland is the bees knees in life sciences, but don't just take my word for it".

"It's a very technical sell, in a Scottish context. We are saying that Scotland has bright companies that can help you, and contract research organisations that can help your business to progress to the next level."

This stealthy blurring of the lines between the academic conference and the sales rally is one that is well suited to Boyland, the son of a marine plumber from Scott Lithgow's Port Glasgow yard. He joined SDI after being invited to join Globalscot, the successful international network of Scots and Scots-friendly invividuals. He is the first SDI official to be recruited via the Globalscot network.

At the time he was based in Singapore, where he was working for Chartered semiconductors, having been lured to the east by headhunters.

Boyland's focus and dynamism impresses colleagues in a public sector not always marked by those qualities. Ironically, in Japan and elsewhere in the east, public sector-ness is a vital component in Boyland's toolkit for helping Scottish businesses establish themselves, as those hoping to enter the market need the stamp of credibility that only officialdom can confer.

Boyland will need focus and dynamism in his new role, which involves almost-constant travel between SDI's east Asian outposts, though the first appearance in his new role at a set-piece event will be Globalscot's inaugural Asia conference in Hong Kong next month, where Cabinet secretary for finance John Swinney will talk up the new government's economic priorities to the eastern business diaspora.

It is all in the service of turning Scotland into the lean, mean, business-growth machine that Boyland is proud to represent.