TPT July 2012

Global Marketplace

when Mayor Muroi brought back an agreement with the Chinese heavy equipment maker Zoomlion, he received a hero’s welcome. “The deal could create jobs and revitalise Aizu,” the newspaper Fukushima Minpo said in an editorial. “It’s a ray of hope for Fukushima.” The Chinese are also buying struggling Japanese companies. Last year, the Times reported, the washing machine and refrigerator business of Sanyo Electric was bought by Haier, a Chinese company, for $124 million. In 2011, for the first time on record, the number of mergers and acquisitions by Chinese companies in Japan exceeded those by American businesses in the country. › The Times ’s Ms Tabuchi cautioned that the new openness, if it is to last, will require Japan to break decades-long habits that discouraged foreign investment while most other developed countries were doing everything possible to lure foreign capital. The Japanese impediments have included relatively strong regulations, high operating costs and tax rates, and weak government inducements. Even now, in Japan’s disaster zone, there have been expressions of concern that foreign companies, helped by generous subsidies, will hurt local businesses trying to rebuild. But, Ms Tabuchi wrote from Aizu-Wakamatsu, “The overriding impulse seems to be to seek help from whoever is willing to offer it.”

“We’ve come to a point in Japan where we can no longer grow without outside help,” Mr Muroi told the Times . “Whether you are based in China or America, we want you to please come do business in Aizu-Wakamatsu.” Ms Tabuchi observed that the new dynamic in Japan is a sign of a larger regional power shift. A small but rapidly increasing amount of foreign capital comes from neighbouring China, which is seeking to diversify its export- orientated approach to doing business. Recent Chinese manufacturing deals with Japan include plans for a plastics plant in Tottori and a heavy machinery factory in Kochi, both in western Japan. “The Chinese are starting to look like saviours,” said Kotaro Masuda, an economist at the government-affiliated Institute for International Trade and Investment in Tokyo. Aizu-Wakamatsu, the fourth-largest city in Fukushima, with a population of 125,000, has known for a while that domestic industry can no longer sustain local employment. At the height of the global economic crisis in 2009, a semiconductor plant run by Fujitsu, a cornerstone of the local economy for almost 40 years, announced it would eliminate a third of its 2,000 jobs. The outlook for Japanese manufacturers has only worsened since then. It is little wonder, then, wrote Ms Tabuchi, that ‘ ray of hope for F ukushima ’

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July 2012