Japanese business confidence has soared to a more than six-year high, the Bank of Japan said yesterday, underscoring a fragile economic recovery, but company bosses appear cautious about the future.
The tankan survey, which covers the January-March quarter, surged to its highest level since December 2007, with a reading for large manufacturers rising to plus 17 from plus 16 in its survey in December last year — marking the difference between firms that are upbeat from those that see conditions as unfavorable.
Small and medium-sized firms, as well as companies in the non-manufacturing sector, were also more positive about their businesses and the wider economy.
However, the closely watched survey of more than 10,000 companies pointed to tepid investment among major firms and slumping sentiment for the April-June quarter, possibly due to Japan’s sales tax rise, which came into effect yesterday.
Tokyo approved the hike from 5 percent to 8 percent in an effort to tame huge public debt. The government is also mulling another rise to 10 percent, still modest compared to some nations’ consumption tax.
The rise has presented a huge challenge for Japanese Prime Minister Shinzo Abe since he swept to power in late 2012 on a ticket to drag the world’s No. 3 economy out of a cycle of falling prices and tepid growth.
Yesterday, defending the rise, Abe pointed to spiraling healthcare and social welfare costs, which are straining the public purse in a rapidly aging society.
The rise “is meant to offset increases in social security costs over the years and to maintain the country’s trust,” he told reporters, adding that the battle to defeat years of growth-sapping deflation would continue.
Stephen Garrett, a 27-year-old graduate student, always thought he would study in China, but first the country’s restrictive COVID-19 policies made it nearly impossible and now he has other concerns. The cost is one deterrent, but Garrett is more worried about restrictions on academic freedom and the personal risk of being stranded in China. He is not alone. Only about 700 American students are studying at Chinese universities, down from a peak of nearly 25,000 a decade ago, while there are nearly 300,000 Chinese students at US schools. Some young Americans are discouraged from investing their time in China by what they see
MAJOR DROP: CEO Tim Cook, who is visiting Hanoi, pledged the firm was committed to Vietnam after its smartphone shipments declined 9.6% annually in the first quarter Apple Inc yesterday said it would increase spending on suppliers in Vietnam, a key production hub, as CEO Tim Cook arrived in the country for a two-day visit. The iPhone maker announced the news in a statement on its Web site, but gave no details of how much it would spend or where the money would go. Cook is expected to meet programmers, content creators and students during his visit, online newspaper VnExpress reported. The visit comes as US President Joe Biden’s administration seeks to ramp up Vietnam’s role in the global tech supply chain to reduce the US’ dependence on China. Images on
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