Why Ibaraki Is the Next Must-Watch Investment and Expension Destination in Japan
kanriNestled northeast of Tokyo, Ibaraki Prefecture is often underestimated — yet it stands out as a uniquely strategic base for global companies seeking R&D excellence, industrial strength, and sustainable growth in Japan. With its blend of cutting-edge science (centered in Tsukuba), heavy manufacturing (in the Hitachi and Kashima regions), and high-output agriculture and fishery, Ibaraki offers a compelling ecosystem for innovation, production, and quality of life.
In this article, we’ll explore what makes Ibaraki a distinctive destination for foreign businesses, highlight its key strengths, and outline how the prefecture supports overseas firms looking to establish and scale.
Strategic Location & Balanced Industry Base
Geographic Advantage
Ibaraki is strategically located in the northern Kanto region, extending outward from Tokyo while providing access to the Pacific coast — a location that optimizes both connectivity to Japan’s biggest market and port-based logistics capacity. The prefecture’s infrastructure supports efficient multi-modal transportation, strengthening its appeal as both a manufacturing base and innovation center.
Well-Balanced Industries
Ibaraki boasts a diverse industrial economy:
- Top-tier agricultural producer
Especially of melon, lotus root, green peppers, and more. Agricultural output ranks among the highest in Japan. - Strong science and technology clusters in Tsukuba
- Electric and electronics manufacturing in Hitachi
- Heavy and petrochemical industry in the Kashima coastal area
- Tertiary sector
Benefits from the prefecture’s urban and logistical infrastructure, supporting service companies, research institutions, and international business functions.
This mix offers resilience and versatility: companies can leverage Ibaraki for its manufacturing strength, but also tap into its research infrastructure for innovation-driven growth.
A Leading R&D Hub: Tsukuba Science City
One of Ibaraki’s crown jewels is Tsukuba Science City, a globally recognized research ecosystem. Located in the southern part of the prefecture, Tsukuba hosts 29 national and semi-national research institutions, including JAXA, AIST, and the University of Tsukuba.
Why Tsukuba Matters for Global Business
- Talent pool
There are over 14,000 researchers based in Ibaraki, with more than 4,000 foreign researchers. - Innovation pipeline
The city is home to more than 250 academic ventures, startups, and incubators, especially in life sciences, robotics, and digital technologies. - Strategic regulatory zone
Tsukuba is part of the International Strategic Zone, which provides tax relief, regulatory easing, and R&D support tailored to high-tech companies. - Mobility
Tsukuba is well-connected — the Tsukuba Express links it to Tokyo in about 45 minutes, and it’s also accessible via highway bus routes from other major transport hubs.
For foreign firms focusing on deep tech, biotech, med-tech, or robotics, Tsukuba offers a plug-and-play R&D base with world-class institutions and a supportive innovation ecosystem.
Industrial Strength & Manufacturing Capacity
Hitachi & Electronics
Ibaraki is historically linked to Hitachi, one of Japan’s most iconic electrical and electronics companies. Hitachi City and surrounding areas house advanced manufacturing plants and component facilities.
Materials & Petrochemical: Kashima Area
The Kashima industrial zone on Ibaraki’s Pacific coast is a major hub for heavy industry, steel, and petrochemicals, supporting both domestic demand and export activities. This region benefits from port infrastructure that enables efficient import of raw materials and export of manufactured goods — particularly strategic for material-intensive companies.
Advanced Materials & Semiconductors
Ibaraki is positioning itself for the next generation of manufacturing. For instance, JX Advanced Metals recently acquired an industrial land plot in Hitachinaka (Ibaraki) to expand its production of sputtering targets for semiconductors — a signal of growing trust by global and advanced-material firms in Ibaraki’s potential.
Agricultural & Fishery Innovation
While Ibaraki is known for its heavy industry and research, its primary sector, agriculture, remains exceptionally strong. The prefecture produces a wide range of agricultural goods — melon, green pepper, lotus root — and ranks highly in output volume and value.
What’s unique, however, is how Ibaraki is combining agriculture and technology to future-proof its food systems:
- The prefecture is implementing AI-based aquaculture, for example, at Nakaminato Port in Hitachinaka, where companies farm mackerel in tanks with remote feeders and AI-monitored feeding behaviors.
- Agricultural exports have surged in recent years, with Ibaraki targeting not just domestic but global markets through increased export channels.
For global companies interested in AgriTech, food exports, or sustainable fisheries, Ibaraki offers both heritage and innovation in a way few other prefectures do.
Quality of Life & Talent Environment
Ibaraki is not just a business base — it’s also a livable environment for research talent, executives, and their families.
- Living environment
Tsukuba is designed as a “science city” with significant green spaces, modern residential areas, academic institutions, and healthcare infrastructure. - International community
The presence of many research institutes and foreign scientists means a multicultural network, shared facilities, and relatively strong English-language support. - Transport connectivity
In addition to the Tsukuba Express, Ibaraki has good road access and proximity to airports, making it efficient for business travel and daily commuting.
This balance of advanced work-life infrastructure and research-driven culture helps with talent attraction and retention — especially for international firms.
Support & Incentives for Foreign Companies
Ibaraki Prefecture provides a comprehensive, one-stop foreign-investor support system, largely managed by its International Business Development Division. Key support measures include:
- Joint Research Trial Subsidy
Up to 2 million JPY for foreign-owned companies to conduct collaborative R&D with local universities and labs. - Subsidy for Facility Establishment
Up to 6.4 million yen to help foreign companies set up bases in Ibaraki. - Startup Visa (Designated Activities)
Foreign entrepreneurs can receive a visa for up to 2 years while preparing a startup in Ibaraki, under certain conditions. - Subsidies for Foreign-Capital Enterprises
Covers incorporation costs, rent, R&D, and collaboration expenses according to defined criteria. - Location Support & Living Assistance
The prefecture helps with finding offices or lab space, and offers relocation support, including information on schools, hospitals, and daily life services.
These incentives significantly reduce the cost and risk of setting up in Ibaraki, especially for R&D-focused companies or startups.
Sustainability & Innovation Strategy
Ibaraki is not resting on its laurels — the prefecture is proactively shaping a future-focused vision around green innovation, life-innovation, and digital transformation.
- In Tsukuba, there are major projects related to robotics in healthcare, drug discovery, and medical devices.
- On the sustainability front, Ibaraki is exploring biomass energy, recycling systems, and circular economy models tied to industrial byproducts. invest.indus.pref.ibaraki.jp
- The prefectural government’s “Building a Bridge with International Businesses” report underscores its aim to attract deep-tech companies working on life science, environmental tech, and AI-based R&D.
For global firms, this means Ibaraki is not just a base — it’s a partner in innovation, aligned with future global challenges like health, environment, and sustainable industry.
Summary
Ibaraki Prefecture represents a rare convergence of industrial power, scientific innovation, and living quality — all within reach of Tokyo’s economic ecosystem. Its balanced economy, from advanced manufacturing to agri-fishery innovation, makes it a resilient foundation for both production and research. At the same time, Tsukuba Science City cements Ibaraki’s place as a global R&D hub, offering companies access to world-class talent and institutions.
What truly sets Ibaraki apart is its proactive, investor-friendly approach: the prefecture offers meaningful subsidies, regulatory support, and a two-year startup visa, making it significantly easier for foreign companies to establish operations. And with a strategic focus on sustainability and future technologies, Ibaraki is not only ready for today — it’s building for tomorrow.
For international enterprises looking at Japan as their next innovation frontier, Ibaraki Prefecture should be high on your radar. It provides not just a location, but a long-term, forward-leaning ecosystem.
Feel free to contact us
MAY Planning provides advice on market entry strategy and feasibility planning for Ibaraki. We also offer support on relocation, application for subsidies and incentive programs (R&D, startup visa, foreign-cap enterprise).
References:
1）茨城県への研究開発拠点の設置でビジネスにイノベーションを！. (n.d.). 茨城県外資系企業向けポータルサイト. https://www.invest.indus.pref.ibaraki.jp/
2）Ibaraki Looks to AI, Exports to Achieve Sustainability in Agriculture, Fisheries. (2023, December 8). JAPAN WiRE by Kyodo News. https://english.kyodonews.net/articles/-/44819
3）Ibaraki Prefecture in Japan Pioneers Agricultural and Fishery Innovation for Global Expansion. (2023, December 10). Fishery News. https://fishery.news/ibaraki-prefecture-in-japan-pioneers-agricultural-and-fishery-innovation-for-global-expansion/
4）Decision to Acquire Industrial Land Adjoining New Hitachinaka Factory (Tentative Name). (2025, May 27). JX Advanced Metals Corporation. https://www.jx-nmm.com/english/newsrelease/fy2025/20250530_01.html
5）Ibaraki Prefecture. (2023, April 13). Nippon.Com. https://www.nippon.com/en/guide-to-japan/pref08/
