Japan’s factory output rose for a ninth straight month last month, but consumers kept a tight hold on their purse strings amid a fragile economic recovery, official data showed yesterday.
Japan’s industrial production increased 2.6 percent last month, extending the longest unbroken expansion since 1997, the government said. The figure was slightly better than analysts had expected.
“Japanese manufacturers’ production and profits are growing robustly on the back of expanding exports,” said Naoki Murakami, chief economist at Monex Securities.
With Japan’s population ageing and shrinking, Asia’s biggest economy remains dependent as ever on foreign markets to drive growth in the face of weak domestic consumer spending.
Japan’s retail sales fell by 1.0 percent last month from a year earlier, marking a 15th consecutive month of declines, a separate report showed.
Another report showed the average Japanese salary last month fell 2.8 percent from a year earlier, dropping for an 18th straight month.
With overseas economies clawing back from the global recession, however, Japan’s factory output is expected to rise 3.4 percent this month and by a further 1.3 percent next month, the government said, citing manufacturers’ own forecasts.
“Materials makers are stepping up production as demand from China and the rest of Asia is expanding more strongly than companies had expected,” Murakami said in a report.
Japan’s exports to the rest of Asia rose 4.7 percent last month, posting the first rise in 14 months.
“Exports are key to the fate of the Japanese economy,” said Hiroshi Watanabe, an economist at the Daiwa Institute of Research.
Factory output is likely to slow somewhat as the recovery in exports moderates, reflecting the fading impact of worldwide stimulus spending efforts, he said.
Japan’s economy returned to growth in this year’s second quarter after a severe year-long recession, but renewed deflation and weak domestic demand are major concerns for policymakers.
Compared with a year earlier, last month’s industrial output was down 3.9 percent, and is still far below levels seen before the global economic downturn began.
The benefits of higher production in Japan are also limited by the fact that companies are using a chunk of their profits to build new factories overseas, said Hideyuki Araki, an economist at Resona Research Institute.
“Nowadays higher production sometimes results in capital spending elsewhere in Asia” where labor costs are lower, he said.
The government announced this month a fresh stimulus package, including incentives to encourage people to buy energy-saving cars and home appliances.
Among the rows of vibrators, rubber torsos and leather harnesses at a Chinese sex toys exhibition in Shanghai this weekend, the beginnings of an artificial intelligence (AI)-driven shift in the industry quietly pulsed. China manufactures about 70 percent of the world’s sex toys, most of it the “hardware” on display at the fair — whether that be technicolor tentacled dildos or hyper-realistic personalized silicone dolls. Yet smart toys have been rising in popularity for some time. Many major European and US brands already offer tech-enhanced products that can enable long-distance love, monitor well-being and even bring people one step closer to
Malaysia’s leader yesterday announced plans to build a massive semiconductor design park, aiming to boost the Southeast Asian nation’s role in the global chip industry. A prominent player in the semiconductor industry for decades, Malaysia accounts for an estimated 13 percent of global back-end manufacturing, according to German tech giant Bosch. Now it wants to go beyond production and emerge as a chip design powerhouse too, Malaysian Prime Minister Anwar Ibrahim said. “I am pleased to announce the largest IC (integrated circuit) Design Park in Southeast Asia, that will house world-class anchor tenants and collaborate with global companies such as Arm [Holdings PLC],”
TRANSFORMATION: Taiwan is now home to the largest Google hardware research and development center outside of the US, thanks to the nation’s economic policies President Tsai Ing-wen (蔡英文) yesterday attended an event marking the opening of Google’s second hardware research and development (R&D) office in Taiwan, which was held at New Taipei City’s Banciao District (板橋). This signals Taiwan’s transformation into the world’s largest Google hardware research and development center outside of the US, validating the nation’s economic policy in the past eight years, she said. The “five plus two” innovative industries policy, “six core strategic industries” initiative and infrastructure projects have grown the national industry and established resilient supply chains that withstood the COVID-19 pandemic, Tsai said. Taiwan has improved investment conditions of the domestic economy
Sales in the retail, and food and beverage sectors last month continued to rise, increasing 0.7 percent and 13.6 percent respectively from a year earlier, setting record highs for the month of March, the Ministry of Economic Affairs said yesterday. Sales in the wholesale sector also grew last month by 4.6 annually, mainly due to the business opportunities for emerging applications related to artificial intelligence (AI) and high-performance computing technologies, the ministry said in a report. The ministry forecast that retail, and food and beverage sales this month would retain their growth momentum as the former would benefit from Tomb Sweeping Day