Japan is a country with very shortage of natural resources and human resources. Therefore, as early as the 1970s, Japan had completed industrial upgrading and began industrial transfer in the middle and late stages. The direction of
transfer was mainly the " Four Little Dragons " at that time, ASEAN four countries and mainland China. As the main body of the inheritance, China gradually developed into a "manufacturer" that surpassed Japan.
But in the past few years after the outbreak, Japan found that it was a big problem to transfer manufacturing abroad. Supply chain problems are becoming increasingly prominent, and with the sharp depreciation of the yen, manufacturing costs are constantly rising. Japan now has to face the "backlash" brought to itself by globalization - withdrawing their manufacturing equipment from China and moving back to Japan.
JVC is a wireless electronics company that is transferring the production of in-vehicle navigation systems from China and Indonesian to Japan, while significantly increasing its production capacity at Nagano Prefecture factory. An administrator at home appliance company Alice said it transferred production of about 50 plastic components from China to Japan last month due to soaring energy prices. This trend is also emerging in the clothing industry. Clothing maker World is significantly increasing its production in Japan, after only 40% of its products were produced in Japan, but now it has risen to 90%.
The Japanese government's conscious encouragement is accelerating this process. On Monday, Japanese Prime Minister Kishida Fumio said that Japan will provide more assistance to companies seeking to reduce costs in China and return to Japan's manufacturing business, and will provide financial support for the production and construction of products in key industries such as semiconductor , vaccines and batteries.
Economists agree that although many companies do not intend to completely break away from the crucial Chinese market, if they receive financial support, they will also consider producing more domestically. However, given that China is still a very important market, Japanese companies now have an additional option - "China +1", which not only enjoys the subsidy for returning to Japan, but also does not completely give up on China.
In fact, as early as the early stages of the outbreak, some companies were considering whether to continue their business in China, and the weak yen happened to "push" a hesitant Japanese company.
According to actual value, the yen exchange rate is at a 53-year low, which means that Japan has become one of the lowest production costs in Asia. When companies return to Japan to produce, the profits of exporting products will be higher.
But these Japanese companies must be clear that Japan is a rapidly aging and shrinking market, and there are serious restrictions on both labor and production scale, which is also the reason why these companies moved their factories out of Japan at the time.
Of course, many industry insiders are very clear about this. In the long term, China will still be a very important growth market. Recently, many Japanese media have also predicted that Japan will suffer huge losses after "left" the Chinese market. So to some extent, it may be not just for economic factors to move Japanese companies out of China.
Previously, the United States had called on some American companies in China to move their factories back to China, or transfer them to other countries to reduce the risk of dependence on China. Although Japan did not receive similar clear instructions, Japanese companies with a large number of key technologies immediately smelled the "stakes" and invisibly felt huge pressure.
However, as the Japanese media themselves reported, completely detached from China will cause immeasurable losses to Japan every year. With the continuous shrinking of the Japanese market and the shortage of various resources, how long can Japan maintain its prosperity with the advantage of the weak yen? We don’t know this, but in the past few decades, Japan has completely integrated its industry into the Chinese market, and moving back to Japan is not a matter of a day or a night.
