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Gate 3 Medium-term Management Plan

Strategic Focus

Building on the strategies that we pursued during the term of the previous medium-term management plan, we have established a strategic focus on fields that promise conspicuous growth and where we can realize our comprehensive strengths. Over the medium to long term, Mitsui will develop these businesses that will grow to support the earnings base.

Energy Solutions Energy Solutions

With a platform that primarily comprises existing LNG development and power generation businesses as a basis, we will advance smart energy services as well as businesses that help mitigate global warming.

Over the long term, energy demand is expected to increase as the population and economy grow globally. However, society’s increased concern over the issue of climate change will cause a divergence in the traditional correlation between GDP and CO₂ emissions, thereby giving rise to new business opportunities. In response to the issue of climate change, Mitsui will expand and accelerate initiatives focused on businesses that are likely to experience medium- to long-term growth.

Key Megatrends Key Megatrends

Climate Change Countermeasures

Mitsui has become the first general trading company to set goals to achieve net-zero emissions by 2050. To this end, we will pursue the three main initiatives shown below. Further, we have introduced an in-house carbon-pricing system both for risk evaluations of existing businesses and for decisions on new investments.

1. Reduction

Reduce Company emissions by improving the portfolio quality of resource and power generation assets

2. Transition

In the medium term, promote fuel conversion through LNG and other business to contribute to reducing the environmental burden

3. Opportunity

Contribute to reducing emissions by expanding business that leverages the opportunities to address climate change in Energy Solutions and other areas

Opportunities in Energy Solutions

In April 2020, Mitsui established the Energy Solutions Business Unit, which will play a leading role in the realization of a low-carbon and a carbon-free society by focusing on the following business fields.

New Downstream Electricity(Distributed power supply, energy management services, retail)

We will offer customers one-stop services by advancing multiple energy-related businesses in such areas as electricity and gas retail, solar power generation and storage batteries, energy procurement, and energy-saving consultation and by advancing initiatives linked to electricity trading.

U.S. subsidiary ForeFront Power’s distributed solar power generator

U.S. subsidiary ForeFront Power’s distributed solar power generator

Next-Generation Fuels(Bioethanol, sustainable aviation fuel)

While closely monitoring technological innovations, manufacturing cost reductions, and the incentives of respective regions, we will accelerate the introduction of bioethanol, sustainable aviation fuel, and other next-generation fuels. Amid projections of growth in demand for gasoline, we will commercialize next-generation ethanol in such countries as China and India.

LanzaTech’s plant for the production of sustainable aviation fuel

LanzaTech’s plant for the production of sustainable aviation fuel

Hydrogen and Carbon Management(Hydrogen, carbon credits)

In the short to medium term, we will pursue projects engaged in local production for local consumption, which is a field being driven by the progressive support systems of governments. As for the long term, Mitsui will build transportation supply chains. Also, plans call for the advancement of competitive carbon credit projects and carbon capture, utilization, and storage (CCUS) projects.

A hydrogenation plant in Brunei

A hydrogenation plant in Brunei

Healthcare / Nutrition Healthcare / Nutrition

In the healthcare and nutrition sector, based on business foundations mainly comprising IHH Healthcare Bhd. (IHH), we will pursue multifaceted initiatives related to nutrition for presymptomatic diseases and disease prevention, and medical and healthcare data. In these ways, Mitsui will accelerate business growth and create added value unique to the Company.

External Environment

In emerging countries, mainly in Asia, medical expenditures are growing in accordance with population growth, the aging of societies, the expansion of middle-income classes and increasing rapidity as disease patterns change resulting from economic development. Meanwhile, medical ­service is not keeping up with demand, and a widening of the supply–demand gap is projected. Further, we expect healthcare value chains to extend further into the wellness field due to such factors as demand in the area of presymptomatic diseases and disease prevention and to the popularization of online medical consultations, which have been attracting attention as a method of preventing the spread of COVID-19. Therefore, multifaceted value creation including digital technology ­utilization is required.

External Environment External Environment

Enhancement of the Value of the Hospital Business

In 2011, Mitsui initially acquired an equity interest in IHH. Since becoming IHH’s largest shareholder in 2019, we have been further increasing our influence on business management and steadily implementing growth strategies in close collaboration with the company’s management team. Going forward, we intend to expand our business foundation, especially focusing on IHH, through (1) regional expansion by growing business in China, India, and other countries; (2) functional expansion by integrating and/or spinning out hospital ancillary businesses such as examination and diagnostics; and (3) business expansion by leveraging the huge amounts of medical data collected by IHH. Also, with our sights set on the “New Normal” emerging worldwide as a result of the current COVID-19 pandemic, we will realize sustained growth by utilizing online medical consultations and AI to transform methods of providing healthcare and to heighten consumer trust.

Utilization of Healthcare Data to Create New Value

Data is expected to become the “currency” of the next generation. We will implement value creation aimed at utilizing data to propose solutions that improve the management of hospitals and to promote medical expenditure reductions and personalized medicine in such ancillary areas as insurance, drug discovery, presymptomatic disease measures, and disease prevention. While realizing this will not be easy, such as the measures it takes to ensure information security, we will promote data acquisition, accumulation, and mutual usage primarily in hospital, examination, diagnostics, and logistics businesses with a view to realizing better medical care and healthcare. In the future, we will implement multifaceted initiatives with our sights set on expanding into the wellness field, and we will contribute to create a better tomorrow where people smile and live healthy, enriched lives.

Data Accumulation and Mutual Usage

Data Accumulation and Mutual Usage

Market Asia Market Asia

In addition to maintaining and expanding resources and infrastructure businesses—which we originally have strength in—we aim to build businesses that mainly target middle-income consumers, who are driving high economic growth. As for consumer businesses, due to the penetration of digital technologies, power is gradually shifting toward customers who won access to information and enjoy an increasingly advantageous position. Further, the millennial generation,* who are digital natives, are expected to give additional impetus to this trend. Accordingly, Mitsui will capitalize on its comprehensive strengths to build platforms that provide Asian consumers with the products that they need.

Those born between the early 1980s and the mid-1990s

External Environment

High growth rate
Demand and Consumption
  • Growing influence of the middle-income classes, ­millennials, and Generation Z*
  • Acceleration of digital technology penetration
  • Heightening health awareness
Supply
  • Rising energy demand
  • Increasing environmental awareness and environmental restrictions
  • Introduction of government policies encouraging local production for local consumption and the upgrading of industry

The generation born in or after the mid-1990s

Consumer Businesses Leveraging Digital Technologies

Mitsui will help Asians realize the quality of life to which they aspire by combining the Company’s unique functions and businesses to build a differentiated consumer “ecosystem” rooted in Asia.

Consumer Ecosystem (Simplified)

Consumer Ecosystem (Simplified)

Examples of Our Initiatives

Food and Retail

We will cater to diversifying food needs through such businesses as a dairy products business in Indonesia and a curry restaurant business in India.

Food and Retail

Retail Finance

By utilizing the huge volume of customer data gathered through our motorcycle retail finance business in Southeast Asia and by utilizing AI technology jointly developed with a partner, we have created an original credit and collection scoring system that is enhancing our risk adaptation capabilities.

In addition to the hospital business, we will help upgrade Asia’s health and wellness services through such initiatives as the development of an integrated prevention and healthcare platform.

Resources and Infrastructure Businesses

Mitsui’s core businesses in the areas of mineral & metal resources, energy, and social infrastructure have robust business foundations in Asia. Going forward, we will promote initiatives in new fields to strengthen and evolve these business foundations. Such efforts will entail moving forward with the development of distributed energy generation businesses and other energy solutions businesses, downstream businesses, and such peripheral value-added businesses as computerized construction systems.