Japan firms vow continued investment in China despite slowing economy
SHANGHAI (Kyodo) -- Japanese companies participating in a major trade fair in Shanghai vowed Monday that they will continue to invest in the Asian market despite challenges, including a slowing economy amid a property sector crisis and a harsher business environment for foreign companies.
Tetsuro Homma, head of the Japanese Chamber of Commerce and Industry in China, told a press conference that Japanese firms operating in the country are "very much encouraged to further expand their businesses," as Chinese Premier Li Qiang pledged at the opening of the event Sunday to promote the market's opening-up.
Ideas:
Most likely, China is too much of a continued opportunity to just leave because of current challenges related to the Chinese economy.
The Chinese economy might be slowing, there might be continued challenges with the property sector, and its seems the environment appears to be more challenges for foreign companies.
But that is China. The challenges for foreign companies have always been there, but there have always been dividends to those companies that can navigate the environment and continue to do business in China.
Article:
About 350 Japanese firms accounting for more than 10 percent of the total participating companies are taking part in the annual China International Import Expo, becoming the biggest group of foreign businesses, added Homma, who also serves as executive vice president of Panasonic Holdings Corp.
Panasonic President and CEO Yuki Kusumi told reporters before the news conference that the company will "actively invest in China to help solve its social issues and enhance the quality of people's lives," referring to challenges such as aging.
Ideas:
Its interesting that some or many South Korean companies are leaving China as their sales and profits continue to decrease. It could be the so-called differences between China and South Korea, lingering issues still there.
But its seems, despite the ban of Japanese seafood into China, and a lot of Chinese tourists going to Japan, that the challenges that South Korea isn't strong issues in between China and Japan.
Panasonic seems to be a company that that wants to improve people's lives as some its ads and commercials promote,whether true or not.
It quite possible there are more than 350 Japanese companies operating in China, but maybe those at the expo were mainly companies that import into China and or have manufacturing plants in China.
Article:
The Panasonic booth exhibited items used for its "wellness smart town," a condo project catering to the demands of wealthy Chinese retirees.
Satoshi Shimizu, vice president of Ryohin Keikaku Co., the operator of retail brand Muji, said the company plans to open some 50 new outlets per year in China, with the aim of more than doubling the number of stores from the current figure of about 370, as his company joined the trade show for the first time.
Ideas:
Panasonic is smart to seize the opportunity to cater to wealthy Chinese retirees, and at the same time a "wellness smart town" which also showcases many of its products.
Muji is a another good company that sees the future in Japan and will continue to invest in China despite the Chinese economy is not where it used to be.
For example China's GDP grew around 5.5 % in 2023, which is much less than it usually grow, but its still very good.
Its interesting that Uniqlo was not mentioned in the article, as Uniqlo also has a large presence in China.
Article:
He said the retailer, which has been operating in China since 2005, still sees "great potential" in the market despite headwinds, such as the domestic economic slump and geopolitical concerns stemming from an intensifying U.S.-China rivalry.
Toyota Motor Corp. showcased a self-driving "robotaxi" concept car at its booth, which it jointly developed with startup Pony.ai Inc. with the aim of commercializing the autonomous taxi business in China.
Ideas:
China still has great potential if companies stick to the basics of doing business and know how to navigate the current political environment.
Japanese companies should ignore the China/US situation and just focus on doing business when in China, and focus on doing business in the US in the US.
Toyota, Nissan, and Honda, need to be more proactive and invest more in electric vehicles as Chinese companies are now maybe the world leaders in electric cars.
But having some kind of joint venture with a Chinese company might be a winning strategy.
Have a nice day and be safe!
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