Japan’s government on Friday said it would start subsidizing some companies to invest in factories in Japan and Southeast Asia as part of efforts to reduce reliance on manufacturing in China.
Fifty-seven companies including privately held mask-maker Iris Ohyama Inc and Sharp Corp would receive a combined ￥57.4 billion (US$536 million) in subsidies from the government to invest in production in Japan, the Japanese Ministry of Economy, Trade and Industry said.
Another 30 firms would receive money for investments in Vietnam, Myanmar, Thailand and other Southeast Asian nations, according to a separate announcement, which did not provide details on the amount of money.
While the ministry’s statement did not explicitly state that the money is to move production out of China, Japanese Prime Minister Shinzo Abe in March said that Japan needed to bring production back home or diversify output to ASEAN and elsewhere to cut reliance on any one country such as China.
The government would pay a total of ￥70 billion in this round, the Nikkei newspaper reported.
The payments come from ￥243.5 billion that the government in April earmarked to reduce reliance on Chinese supply chains, with the money aimed at helping companies shift factories back home or to other nations.
Amid a US-China trade dispute, there have been increasing discussions in the US and elsewhere about how to “decouple” economies and firms from China. Japan’s decision is similar to a Taiwanese policy last year, which was aimed at bringing investment back home from China.
So far, no other country has enacted a concrete policy to encourage the shift.
China is Japan’s biggest trading partner under normal circumstances and Japanese companies have massive investments there. The COVID-19 pandemic has damaged those economic ties as well as China’s image in Japan.
Japanese exports fell by more than 20 percent for a third straight month even as key markets started to reopen from virus shutdowns.
The value of Japan’s overall shipments overseas slid 26.2 percent last month from a year earlier, led by steep declines in exports of vehicles and auto parts, the Japanese Ministry of Finance reported yesterday.
Economists forecast a 24.7 percent fall.
Although exports continued to be down sharply compared with the previous year, there were signs that declines might have bottomed.
Vehicle exports halved last month compared with falls of about two-thirds in May. Overall drops in exports to the US and the EU were 4 to 5 percentage points less than in the prior month, data showed.
Improving shipments to China have helped prevent Japan’s export declines from being even worse. Shipments to the world’s second-largest economy dropped just 0.2 percent last month, compared with a year earlier, data showed.
Taiwanese firms have increased investment in the Philippines in recent years as Manila’s ties with Washington deepen and global supply chains continue to shift away from China, an expert at the Chung-Hua Institution for Economic Research (CIER, 中華經濟研究院) said yesterday. The Philippines had not been among Taiwanese investors’ top choices in Southeast Asia, CIER Taiwan ASEAN Studies Center director Kristy Hsu (徐遵慈) said at a seminar in Taipei. However, Taiwan’s investment in the country has grown significantly since the COVID-19 pandemic, reaching US $257 million last year, a high in recent years, she said. Although Taiwan’s total investment in the Philippines still lags
Intel Corp regards Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) as a longstanding partner, as the US chipmaker would continue outsourcing production of advanced chips to TSMC, Intel chief executive officer Lip-Bu Tan (陳立武) said yesterday. “I don’t look at people as competitors. I look at the collaboration... Nvidia is also, you know, a good friend,” Tan told a news conference following his keynote speech at the Computex trade show in Taipei. “It’s a very trusted partnership for us... We are a big, top customer for them, and we’re going to continue doing that,” he said, referring to TSMC, the world’s largest foundry
Hon Hai Precision Industry Co (鴻海精密) yesterday said it would work with US chipmaker Intel Corp to jointly develop and deploy next-generation artificial intelligence (AI) infrastructure and intelligent computing platforms in a move to capture booming demand for AI computing systems. Hon Hai, also known as Foxconn Technology Group (富士康), said in a statement that the partnership would combine its global manufacturing scale, system integration expertise and AI data center deployment capabilities with Intel’s strengths in processor architecture, silicon technologies and software ecosystem. The companies said they plan to work on equipment used in AI data centers, including server racks powered by
Artificial intelligence (AI) agents would supplant smartphones as the center of people’s digital lives, fundamentally reshaping personal devices and driving a major computing upgrade cycle, Qualcomm Inc CEO Cristiano Amon said yesterday. In his keynote speech for this year’s Computex trade show in Taipei, Amon said that the rise of "agentic AI" — AI systems capable of reasoning, planning and carrying out tasks autonomously — would transform how people interact with technology across phones, PCs, vehicles and wearable devices. Describing the technology as the next major evolution in computing, Amon said that "2026 is the year of agents.” For decades, smartphones have sat
RSS