Japan Will Pay Its Firms to Leave China, Relocate Production as Part of Stimulus Package

[Tumba]

Japan will most likely to move manufacturing of hi-end machinery Parts and medical equipment parts Back to Japan as major Japanese behemoths will only be increasing production due to chinese market.

These parts don't offer any exponential margins to Japanese manufacturers as shipping cost don't add much to overall costs and mostly these parts are already use majority of automation.

Many of Japanese core auto parts are still imported from Japan To India lately there were options for same from China Of same Japanese company but the cost difference were almost negligible.

Japan will most probably add 100s of more automation robotics with this govt package and start supplies... overall dont see much impact on chinese Export billions from same as many parts are as small as a screw A 100$ one

 

[kankan326]

belief is a much stronger adhesive than blood & flesh..otherwise traitors would not exist.
u r wrong

Not really. No other place can compete with East Asian countries in term of solidarity. Beliefs bond different races together. But not in a solidary way.

 

[Mace]

Japanese companies will still retain their marketing office, sales force, and warehouses in China, they just move the production outside China with higher possibility to relocate to ASEAN countries. So it doesnt mean Japanese companies will leave Chinese market.

This also means Japanese stimulus money benefits Japanese companies and stays in Japan.

Expect to see this trend from many countries including mainly USA.

 

[Han Patriot]

This also means Japanese stimulus money benefits Japanese companies and stays in Japan.

Expect to see this trend from many countries including mainly USA.

Some might move to Japan, but you must remember China is a big market for Japanese goods too. If they could have done it, they would have done it.

 

[Indos]

Moving all of their production lines to some south east asian countries, like indonesia or vietnam will be a suicide for those japanese companies. And they know that

No body here said they will relocate all of their current production lines from China into South East Asian countries instantly. If they ever want to do it, they will do it gradually, and it is why they only provide 2.2 billion dollar as compensation for a start. Japanese strategies also has calculated every thing, so of course they also dont want their private companies to suffer in the future. This decision show that relocation to South East Asian countries are viewed by their strategic planner as feasible action economically. While in term of national security and geopolitical perspective, ASEAN countries are already highly favored by Japanese.

Indonesia nor vietnam doesn't have many high skilled labour to produce High tech products, and also doesn't have MARKET Big enough to generate profit like 1,4 Billion people Market who have more than USD 10,000 Nominal GDP for each person (China)

Baseless statement from you. Japan has already produced many high tech product in Indonesia for domestic and export market. Toyota for instant produces cars, including its steel and aluminium engine, from scratch in Indonesia. They exported engine from Indonesia to around 70 destination countries. There are also many companies producing car and motorcycle parts in here that support automotive industry in Indonesia.

Indonesia is on the radar of high quality investment from multinational companies already. For example, one IT company from Netherland that I know also has put their entire software development division in Indonesia (Bandung) while maintaining other division in Netherland.

Indonesia biggest problem in attracting foreign direct investment is mostly due to its labor law that is very pro labor like its severance pay that is ridiculous (32 months salary). This is why after embracing democracy we dont grow more than 6 percent for the last 2 decades. Not only foreign business that get the pain from that law but also our own businesses, particularly small and medium size company. Jokowi try to change the labor law this year using his power in parliament and I have high hope that if the process in parliament is finished, Indonesia will be very attractive to both domestic and foreign investment, and also many start ups and entrepreneurship will likely to flourish inshaAllah.

Exporting finished products from indonesia to China's market will add another Logistic Cost and Taxes to their products. And they will lose Competitive edge over their rivals who choose to keep their production lines in China.

Nope, Indonesia have many raw material sources and recent regulation have also force many companies to produce intermediary product in here like nickle and aluminium smelter so that logistically Indonesia will be more competitive for some industries. It is logistically reasonable to set up factories where the raw materials are abundant and also supported by huge market demand.

Indonesia for example has effectively banned nickle export this year that is mostly exported to Chinese market. It make Chinese stainless steel company relocate their factory here and have flooded Chinese market from their factory in Indonesia since 2017. Other raw material like thin and others will be banned as well for exporting gradually until 2024.

Another example, Indonesian aluminium and steel producers have supplied automotive industry in Indonesia, so the whole value chain process has already been conducted in Indonesia that make Indonesia is quite competitive for automotive production base logistically.

ASEAN-China FTA agreement will also prevent any additional import tax from China to any product produced in ASEAN countries that target Chinese market.

And they KNOW that.
That's why many companies choose China and not indonesia or vietnam to build their High Tech Production lines.

Toyota also has similar 2 billion dollar plan investment in Indonesia to make hybrid car. This investment plan will triple Indonesian automotive export if comes true inshaAllah.

Toyota’s $2 Billion Pledge Revs Up Indonesia’s Electric Car Push
July 19, 2019,

https://www.bloomberg.com/news/arti...-pledge-revs-up-indonesia-s-electric-car-push

Another big automotive investment

Hyundai Motor to invest $1.55 billion in first Indonesia car plant
November 26, 2019

https://www.reuters.com/article/us-...on-in-first-indonesia-car-plant-idUSKBN1Y00TP

For electronics sector investment

Pegatron to Invest up to $1 Billion in Indonesian iPhone Chip Factory
May 28, 2019

Apple supplier Pegatron plans to invest up to $1 billion in an Indonesian factory to produce chips for Apple smartphones, an Indonesian ministry official said on Tuesday

The Taiwan manufacturer made the pledge in a signed letter to the Indonesian government, in which it said the chips would be produced in partnership with Indonesian electronics company PT Sat Nusapersada, according to Deputy Minister Warsito Ignatius.

Pegatron expects the investment to come somewhere between $695 million and $1 billion, although the variables influencing the exact amount have not been disclosed.

https://www.macrumors.com/2019/05/28/pegatron-invest-in-indonesian-iphone-factory/

 

[Viet]

Japan will most likely to move manufacturing of hi-end machinery Parts and medical equipment parts Back to Japan as major Japanese behemoths will only be increasing production due to chinese market.

These parts don't offer any exponential margins to Japanese manufacturers as shipping cost don't add much to overall costs and mostly these parts are already use majority of automation.

Many of Japanese core auto parts are still imported from Japan To India lately there were options for same from China Of same Japanese company but the cost difference were almost negligible.

Japan will most probably add 100s of more automation robotics with this govt package and start supplies... overall dont see much impact on chinese Export billions from same as many parts are as small as a screw A 100$ one

You don’t see any impact on China economy. If I was you I would feel deeply concerned. If Japan withdraws capital, technology, smart people from China what would remain?

 

[tower9]

You don’t see any impact on China economy. If I was you I would feel deeply concerned. If Japan withdraws capital, technology, smart people from China what would remain?

China has far more domestic capital, technology and smart people than Japan has, and far more than what Japan has in China. Quite a deluded comment.

 

[Viet]

China has far more domestic capital, technology and smart people than Japan has, and far more than what Japan has in China. Quite a deluded comment.

Ok China has capital. China has people. Technology? Sorry, what China does not have is technology. You don’t mind if China falls back in making shoes? But Ok that’s your opinion.

 

[tower9]

Ok China has capital. China has people. Technology? Sorry, what China does not have is technology. You don’t mind if China falls back in making shoes? But Ok that’s your opinion.

How does China not have technology? It is literally the second most powerful tech power to the US and Shenzhen is starting to rival Silicon Valley. You must be stuck in circa 2002.

 

[flameboard]

If they tie it in with CPEC and move things to Pakistan. China will still be mad but maybe not as much say if factories moved to for example Taiwan

 

[tower9]

Ok China has capital. China has people. Technology? Sorry, what China does not have is technology. You don’t mind if China falls back in making shoes? But Ok that’s your opinion.

https://nextunicorn.ventures/how-the-united-states-and-china-became-a-unicorn-factory/

Try not to sound profoundly ignorant. You are honestly stuck 20 years ago. The reason why the US deep state is so hysterical now is because China has started to overtake the US in many technology fields and has become a major threat.

 

[Viet]

How does China not have technology? It is literally the second most powerful tech power to the US and Shenzhen is starting to rival Silicon Valley. You must be stuck in circa 2002.

Where can I find Shenzhen technology in today’s computer, coding, software, video and audio, network, internet, telecommunications etc?
Shenzhen is a cheap clone, cheap copy of Silicon Valley.

Without injection of ideas from the West, chinese hightec is not going anywhere.

https://nextunicorn.ventures/how-the-united-states-and-china-became-a-unicorn-factory/

Try not to sound profoundly ignorant. You are honestly stuck 20 years ago. The reason why the US deep state is so hysterical now is because China has started to overtake the US in many technology fields and has become a major threat.

You mix up things.
US politics is a mess.
The politicians screw up many things.
However US economy is very strong because there are many talented people.

 

[tower9]

Where can I find Shenzhen technology in today’s computer, coding, software, video and audio, network, internet, telecommunications etc?
Shenzhen is a cheap clone, cheap copy of Silicon Valley.

Without injection of ideas from the West, chinese hightec is not going anywhere.

It is true that China was largely a cheap copycat for decades, primarily because it lacked an industrial base and had to start from the bottom. However, in the past 20 years it has invested significantly in education and has immensely expanded college enrollment. At this point, China is at a major confluence where it has immense capital, a well developed foundation of technology and a young and well educated research/scientist labor pool that is now equal in size to the US and still rapidly increasing. This is why China is a major threat.

As far as innovations, they are recent but in terms of 5G (Huawei), Mobile Pay (Wechat and Alipay), Drone technology (DJI), China has begun to take the lead. Not to mention that it has dominated the Supercomputer list in recent years and is now investing heavily into quantum computing.

The US is undoubtedly still the leader but China is fast catching up in its innovative capabilities.

Japan however has receded greatly in the last 15 years. China is far ahead of Japan technologically in most fields except for some very specific fields involving advanced robotics or industrial machinery. That might change in the next 5 years.

 

[zhxy]

Copy is the law of history. The modernization process of a country always starts from copying a more modern and civilized country

Americans and Germans copy the UK
The Japanese copy the United States
Korean copy Japan

 

[Yaseen1]

japan should instead develop new startup in japan and try to compete with its competitors in china by improving efficiency,bribing already existing company will lead to loss in long run as it is not legit manner and opposite to law of economics for any company to compete in market as there is extent to which you can pump money for providing subsidy to company and will promote corruption in companies