PAST EXPERIENCE & FUTURE STRATEGY OF MITSUBISHI CORPORATION IN LATIN AMERICA

1. PAST EXPERIENCE & FUTURE STRATEGY OF MITSUBISHI CORPORATION IN LATIN AMERICA Santiago, November 27, 2007

2. From Global Trader to Total Solution Provider Trading Company The origin of Sogo Shosha No longer a stereo-typed image of trading company Total Solution Provider NOW Consultants…. Sell fragmented knowledge & know-how Upon request (Consultants are asked to examine clients’ “needs”) Receive consultant fee just for once (Most cases) do not take risks Use specialized functions From Clients On the other hand, Sogo Shoshas…. Use knowledge & know-how and actively involve in actual business operation Gain profits through business operation and handling goods Take necessary risks Use integrated functions From Clients Identify potential “Needs” As actual players in the commercial flow, SOGO SHOSHAs make the most of gained knowledge. Virtuous Circle

3. MC = Trading + Investment + Finance Providing services for trading business Providing services for integrated business approaches Agency (Working with partners in creating M&A and joint ventures/Building information networks) Sales & Purchases (Marketing and creating sales channels) Organization of Business (Undertaking export business in place of manufacturers and supplier) Logistics (Creating efficient transport systems/ Operating logistic facilities) SOGO SHOSHA Screening Technologies Finance (Researching and introducing new technologies) (Arranging export finance, guarantee, corporate loans, etc) Providing Information Processing (Processing goods to meet consumers’ needs) Business Investment Consulting (Researching, analyzing and reporting various information/Creating reports on regional affairs, legal issues, market trends, etc) (Providing due-diligence/Advising management/Providing solutions) (Developing investment projects/Creating investment strategies/Establishing subsidiaries and affiliated companies)

4. MC Parent Company Consolidated Subsidiaries MC’s Profit Structure  Origin of profit shifted from Trade Activities to Investments Origin of Gross Profit (MC) 1990 2006

5. Corporate Profile • 7 business groups (trade with approx. 10,000 companies worldwide) • Over 200 offices around the world • More than 554 Group companies • More than 50,000 employees (parent company: 6,000) • Annual operating transactions of 20.5 trillion yen • Consolidated net income of 415.9 billion yen (2007.3)

6. M C I N L A T I N A M E R I C A S E C T O R S MACHINERY Brazil, Argentina, Chile, Venezuela, Peru, Ecuador, Bolivia, Guatemala, El Salvador, Panama METALS Chile, Colombia, Peru, Argentina, Brazil, Venezuela LEG / FOOD Brazil, Argentina, Chile, Colombia, Ecuador, Venezuela, Bolivia, Paraguay, Guatemala, El Salvador, Peru CHEMICALS Venezuela, Brazil, Colombia, Chile, Peru, Argentina ENERGY Brazil, Venezuela NBIG/IT Brazil, Chile

7. Period of Development of Japan, China & Latin America

8. Business Obstacles in Latin America for Japanese Companies in the past 1950s  Latin America = Traditional European and American Market  Unfamiliarity with Japanese products  Distance from Japan

9. Strategy in Latin America in the past AT PRESENT 1960s - 1970s  Japan = Added-Profit Trade  Import of Natural Resources from Latin America to Japan  Export of Industrial Products from Japan to Latin America GLOBALIZATION VALUE ADDED PRODUCTS NATURAL RESOURCES FROM L.A. JAPAN

10. Trade between Latin America and Japan/ China • IMPORTS FROM LATIN AMERICA TO JAPAN/ CHINA • Metal Resources ( Copper, Iron Ore,etc), Cotton, and Sugar • Increase of Metal and Agricultural Products EXPORTS FROM JAPAN/CHINA TO LATIN AMERICA • Export items shifted fom heavy machinery equipment such as power plants to high-tech products • Manufacturing base shifted from Japan to other countries in Asia and Latin America

11. IMPORTS TO JAPAN 1500 1300 1100 900 700 500 300 100 -100 1970 1980 1990 2000 Copper Iron Ore Coffee Trade between Latin America and Japan % MAIN IMPORT ITEMS FROM LATIN AMERICA TO JAPAN AT PRESENT MAIN PRODUCTS IMPORTED FROM JAPAN BY BRAZIL (share in 2006) Source: JETRO

12. Trade between Latin America and China TOTAL EXPORTS FROM CHINA TO L.A. TOTAL IMPORTS FROM L.A. TO CHINA 4.3% 3.7% 1.8% 2.7% Main Products (2004): electrical appliances, woven and knit apparel , computers, machinery Main Products (2004) : soybean, iron, copper, wood and woodpulp Source: MOFCOM

13. Mitsubishi Corporation’s Strategy for the Future The BRICs+VISTA Era

14. Business Post-World War II • Foundation of Tozan Farm in Brazil • Restart of Mitsubishi Corporation • Offices open in Buenos Aires and São Paulo • 1955Offices open in Rio and Santiago • 1956Office opens in Lima • 1957Office opens in Caracas • 1958Office opens in Bogota • 1970s Japanese imports create growth in L.A. • Decrease of Business in L.A. offices • Decrease of Investment in Latin America • Increase of Trade, Finance, and Investment • in Latin America • 2005 Introduction of Regional CEO for L.A. System • End of World War II • Postwar Reconstruction Period • 1960s & 1970s • High -Growth Period • 1980s The Lost Decade in Latin America • Debt Crisis in 1982 Brazil declares Moratorium in 1987 • 1990s Structural Recession in Japan • Rebuilding of Relationship between Japan and L.A. • L.A. in spotlight again • Recovery of Japanese economy and growing export of natural resources from L.A..

15. Keyword 「Ｌ－Ａ－Ｔ－Ｉ－Ｎ－A」 「L」・・・ Logistics 「A」・・・ Agriculture 「T」・・・ Trade with Other Regions 「I」・・・ Investment 「N」・・・ Natural Resources & National Staff 「A」・・・ Alliance with Local Partners

16. Investments to Secure Resources •  Copper, Iron Ore, Methanol, Agriculture, and Fishery • Development in the Cerrado region ANTAMINA COPPER MINE- Peru PRODUCTION 1986- 1,100 Tons 2006- 650,000 Tons LARGEST COPPER MINE IN PERU PRODUCTION 2007 Estimation 380,000 Tons SALMON CULTURE - Chile SOYBEAN PRODUCTION IN BRAZIL 2005- 51M Tons Doubled in 10 years METHANOL PRODUCTION TURNOVER (2006) USD 246 M DEVELOPMENT OF THE CERRADO - Brazil METOR - Venezuela

17. Finance • Export-Import Financing, Project Financing, Corporate Financing, etc PRA-1 PLATFORM BRAZIL US$ 910 MM Structured Finance based on the JBIC Overseas Investment Loan and a Syndicated Loan by 12 Commercial Banks arranged by Mitsubishi Corporation in 2005 COSIPA HSM Revamp Project BRAZIL CORPORATE FINANCING(MC’s Own Finance) Loan Amount: US$13,5 M Grace Period: 2.5 yrsTenor: 6 yrs CENTRAL COSTANERA ARGENTINA Contract Price: USD 240 M SUPPLIERS CREDIT Finance : USD 190 M

18. MITSUBISHI MOTORS Manufacturing Bases in Latin America  Steel Products and Machinery (Automobiles, Boilers, etc) CBCBoilers RIO NEGROSteel Processing

19. Market Expansion in Latin America  IT, CDM, Partnering with Japanese Technology (Digital TV, etc) IT COMPANIES - Brazil POLITEC TechnicalCenter ITF’s MITAKA ComandCenter Brazil = Daytime Japan= Nighttime Japanese Digital TV standard - Brazil NEWSPAPER ARTICLE OF THE EVENT TO CELEBRATE CDM PROJECT- Chile

20. MC’s Global Activity Expansion • Export of Chinese Industrial Products to Latin America (Ex: Steel Manufacturing Equipment) • Export of Food Products from Latin America • Bioenergy • Infrastructure (Ex: Panama Canal)  Chile => Strategic Partners ( CAP, Luksic, Sigdo Koppers)

21. Example of New Business : L.A., China and Japan JAPAN INVESTMENT LATIN AMERICA CHINA COFFEE

22. MC’s REGIONAL AID PROGRAM: ECOTOURISM PROJECT IN IBERA, ARGENTINA TOZAN FARM - BRAZIL MC’s REGIONAL AID PROGRAM: PATROL CARS FOR THE NATIONAL FOREST INSTITUTE -NICARAGUA MC’s REGIONAL AID PROGRAM: INTERNATIONAL SCHOLARSHIP PROGRAM- UNIVERSIDAD DE ORIENTE - VENEZUELA MC’s Commitment in Latin America