For so long as the needs arise and charitable funds through grants and donations are available, Kizuna Foundation intends to continue to provide assistance to our Regional Focus Area (as defined below) for economic development, and needs-based funding. To this end, we will work closely with our Key Personnel (see below) to assess economic needs and with our vast corporate, financial and charity networks, to provide charitable funding. We will continue to focus on our stated Objectives above and on projects that have long lived impact, not one-off financing opportunities.
We believe, however, that the economic future of Iwate prefecture and the Tohoku region lies in attracting new industries and businesses. Once the historic economy is restored, new businesses and industries must be considered. To this end, we are in the initial stages of creating an Economic Recovery Fund, focused on investing in the impact zone. Our initiatives will include projects to develop renewable energy resources, expand the heavily isolated regions logistics network, advocate on behalf of the prefecture for capital investment from large-scale multinational and domestic corporations, and create economic incentives to attract new business and manufacturing. Without a strong, well-educated work force, however, these industries will not be long for the region, so we are also working to organize scholarships and government stipends to supplement the Program and to incentivize repopulation and encourage return of the diaspora and disenfranchised. Moreover, we believe emigration and stemming of population flight goes hand-in-hand with building a firm tax base and a stronger economic future for the region.
Ryori Port Rehabilitation Project
Major damage occurred over a wide area along the Pacific coast of Japan due to the Events, primarily in the seven prefectures that account for 50% of Japan’s fisheries production (Hokkaido, Aomori, Iwate, Miyagi, Fukushima, Ibaraki, and Chiba). The Sanriku region of Iwate, Japan’s leading fishing region, suffered particularly severe damage from the Events. Ryori is in the southernmost district of the Sanriku region in Ofunato and supports one of its largest fishing communities. The Cooperative oversees all fishing related activities and operates the Facility. The Cooperative members engage in many coastal fishing activities, including, fixed net, fishing boat (squid, drag net, gill net, longline fishing, etc.), aquaculture (wakame, scallops, seasquirt), and shellfish/seaweed gathering.
2010 Cooperative Fishing Activities (Revenue in ‘000)
Ryori, like other parts of Japan, faces an aging demographic profile with over half its population over the age of fifty. Any delay in returning the region to economic prosperity risks the further aging of the population with the younger residents using the Events as a reason to move to more economically diverse urban areas, lured by the chance of a new start. Any decrease in the tax base will have a knock-on effect on the economic future of the region. Further, while the Cooperative has 453 members (each member represents an economic interest such as a family or group of fishermen), only 300 are active in fishing activities. The remaining members are widows and retired fishermen, who still receive financial assistance and share in the profits of the Cooperative. As such, the Cooperative serves as a critical social welfare institution and its economic health has a significant effect on the well-being of the older residents.
The Affect of the Events on Ryori Harbor
The tsunami that was generated by the Earthquake heavily damaged the Facility, completely washing away the walls and shutters, leaving only the roof, and rendering the facility useless as a product storage warehouse. Water damaged the electrical utilities and water pump system, such that the Facility employees cannot clean properly the work area, a very important maintenance step for sanitation and hygiene for food safety and preparation safety measures. Refrigeration and warehousing facilities are also not operational, so storage is a major problem. In fact, although boiled wakame production has resumed, the product must be shipped immediately to other area fishing cooperatives for processing and packaging, which results in empty truck space, thus losing significant economic margin.
The geological effects of the Earthquake resulted in land subsidence at the pier creating a gap of ca. 60 cm from the boat landing apron to the Facility, with an additional ca. 100 cm gap forming between the Facility to the approach road. The local government plans to fill these gaps as part of the government rebuilding program; however, the nearly 5-¼ foot difference means that the clearance at the current building height would be too low to allow trucks and forklifts entering and operating properly in the Facility, to say nothing of its structural soundness.
Finally, prior to the Events, the Ryori Harbor was home to a 610 strong fishing fleet of ships, of which only 206 survived or were classified as salvageable. Further, all the aquaculture lines were completely swept off their moorings and washed ashore or out to sea. Taking advantage of the government subsidy for the revitalization of the fisheries in Iwate, the fleet is back to ca. 80% of its pre-Events size with the addition of 300 boats, bringing the fleet size to 500. The local and central government provide a subsidy for the recovery of related equipment up to 8/9th of the cost, and the Cooperative has secured financing or received donations from other fisheries to replace the aquaculture lines. Kizuna Foundation, through its government advisors and in cooperation with the Cooperative, successfully received approval from the Japanese government for the 8/9th subsidy to rebuild the Facility, and is seeking grants to fill the remaining 1/9th financing need.
- Economic efficiency: Although fishing equipment and infrastructure, including fishing boats and aquaculture lines, have been restored in large part, without processing and storage facilities, the business is not able to operate competitively, having to outsource processing/packaging, and shipping partially filled containers
- Sanitation and hygiene: Without a sanitary and hygienic environment for seafood processing, including warehousing, sterilized sea water pumps and ice manufacturing, the Cooperative cannot properly guarantee its product safety, and thus may not receive the highest possible market price
- Population control: Speedy reconstruction of the Facility will encourage the current population of fishermen and their families to stay and prevent further flight of citizens
- Social impact: As many members of the Cooperative are retired fishermen and widows, the fishing industry is a critical social welfare institution, supporting the elderly who rely upon this income
- Economic base: As the largest of the ports in the Cooperative, the rehabilitation of the Facility is an economic symbol of recovery to the region. In November, Kizuna Foundation successfully broke ground on the Koishihama Harbor, one of 6 ports in the Cooperative. Together, the successful reconstruction of these two landmark ports in Ryori will provide a strong economic base for the Sanriku region
- Model fishing cooperative: Ryori intends to be a model of reconstruction to the fishing industry in Tohoku, and in cooperation with Kizuna Foundation, will advise other fishing cooperatives on the use of government subsidies to rebuild the primary economic driver in the region. We are also working with the Cooperative to explore the use of renewable energy as another source of income and cost reduction method to build self-reliance for further infrastructure development and capital investments
- Financial leverage: The Japanese government subsidy means that grants made to this important project benefit from significant financial leverage of nine-times the grant amount. The economic impact is, therefore, amplified providing the grantor considerable degree of efficacy in the application of valuable resources
Overview of Facility and Construction Plan
Location： Ryori Harbor
134 Tate, Aza, Ryori, Sanriku-cho, Ofunato, Iwate
Previous Construction Date： 1985
Structural Classification: Large-scale, single-story, steel-frame building
Total floor space: 900.0m2
Project Completion Date (tentative): May 2013
Kizuna Foundation believes that the economic future of Iwate prefecture and the Tohoku region lies in attracting new industries and businesses; however, the immediate focus must be on a speedy recovery of the economic base that existed before the Events. The population demographics of the region and primary reliance upon farming and fishing by the residents means that without stabilization of the current situation, the tax base will further erode, creating a considerable social burden, and impeding any initiatives for recovery and growth.
Once the historic economy is restored, new businesses and industries can be considered. As a critical first step, through the research we have conducted via our extensive network of advisors, and the strong relationship we have built with the Cooperative, we have been awarded a Japanese government subsidy to rebuild part of the Facility. This financial assistance will allow us to leverage donations on a 9:1 basis, thus stretching donor impact. We have already successfully implemented this structure in the Koishihama Port Rehabilitation Project and intend to introduce it to other fisheries to maximize its effect.
Your kind and generous donation will have a significant impact on these important initiatives and pave the way to a brighter future for the survivors of the Events. On behalf of the Cooperative and the residents of Ryori, Ofunato and the Tohoku area, we wish to thank you in advance for your kind consideration and continued support.