Investing in North American Infrastructure – Norton Rose Fulbright hosts conference in Tokyo for Japanese investors
Global | Press release - Business | May 2023
On April 18, 2023, Norton Rose Fulbright presented a full day conference on North American infrastructure investment at the Embassy of Canada to Japan in Tokyo. A team of 11 lawyers from 7 Norton Rose Fulbright offices across the US and Canada were joined by an expert panel of individuals from Brookfield Asset Management, Fengate Asset Management, Northleaf Capital Partners and One Queen Capital Inc. (a subsidiary of CPP Investments). Tracy Reynolds, Minister (Commercial) and Senior Trade Commissioner, welcomed more than 150 institutional investors from Japanese trading houses, utilities, commercial banks and pension funds, among others.
Across six sessions, speakers discussed critical drivers of infrastructure investment in North America, including deglobalization, decarbonization and digitalization, and the impacts of the four recent groundbreaking pieces of legislation: i) the U.S. Infrastructure Investment and Jobs Act; ii) the U.S. Inflation Reduction Act (the “IRA”); iii) the U.S. CHIPS and Science Act; and iv) the Canadian government’s 2023 budget in response to the IRA, announcing the availability of C$80 billion in tax credits and other funding for investment in clean energy projects and programs over the next decade. Speakers sought to share perspectives on how Japanese investors can capitalize on and access opportunities in the North American infrastructure sector.
A common theme was that the next ten years represent a golden age of infrastructure investment in North America, given the IRA in the US and Canada’s recently announced federal budget initiatives, with both nations focusing on investment in clean energy. It was observed that standalone battery storage and other subsectors, such as clean hydrogen, carbon capture, pumped-storage hydro and renewable natural gas, are poised to see even more activity, especially in light of the new transferability of US tax credits and the refundable nature of the Canadian tax credits. Domestic manufacturing, including by foreign investors, of components related to the green economy (such as steel and iron construction materials) will also increase given significant subsidies. Speakers also referred to the minerals critical to clean energy—lithium, zinc, cobalt, nickel—as essential building blocks of the green and digital economy and referenced Canada’s aim of leveraging its abundance of critical minerals to become a world-leading electric battery manufacturer. Digital infrastructure, the need for increasing data center capacity and the requisite digital rewiring involving fiber connectivity was also a recurring theme. A well-constructed infrastructure portfolio, speakers observed, is able to withstand and manage market risk, and retain, preserve and grow value despite inflationary environments.
“Japan has traditionally been the world’s biggest source of direct offshore investment,” commented Norton Rose Fulbright's Global Head of Infrastructure and Resources, Doug Buchanan. “Given the evolving access to opportunities, competition among players, amounts of capital to be deployed and expansion of traditional infrastructure asset classes, it was timely for our conference attendees to engage in a mutually beneficial discussion with Norton Rose Fulbright of the North American infrastructure sector.”
George Gibson, managing partner of Norton Rose Fulbright’s Tokyo office added, “It was an honor to host delegates from Japan’s active investor community and a testament to the strength of our global team to provide a forum on the challenges and potential solutions of issues our clients face as they seek to deploy their capital in private markets, diversify their portfolios and maximize returns.”
Norton Rose Fulbright was recently awarded 2022 Global Legal Advisor of the Year by IJGlobal and has been ranked as the leading North American infrastructure legal advisor by volume every year for the past seven years by Inframation/Infralogic.
The conference aligned with the expansion of Norton Rose Fulbright’s capabilities in Japan with the recent hire of a Japanese-law qualified banking, finance and restructuring partner, Akihiko (“Aki”) Takamatsu. Norton Rose Fulbright now operates in Japan as a Gaikokuho Kyodo Jigyo, or foreign law joint enterprise.
Should you have any queries related to this conference or would be interested in viewing the full program agenda, please contact Madeleine Moulton.
