Japan Companies and China: Updated Jan 24, 2023

 

Japan firms vow continued investment in China despite slowing economy

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. 

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.

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.

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!