Lujiazui area in Shanghai Photo:Xinhua
More than half,
MK sports Korea or 58 percent, of the Japanese companies surveyed in China said that they plan to increase or maintain their investment in China, which is one of their most markets important globally, according to a latest survey released by the Japanese Chamber of Commerce and Industry in China on Wednesday.
Multiple factors contributed to their investment plans, including growing demand and rising orders. Additionally, other changes have fueled Japanese businesses' confidence in the market for the new year, such as an improved business environment, a visa-free policy for Japanese citizens, and other government stimuli, including trade-in policies, the chamber said.
The survey of the business climate and business environment was conducted among about 8,000 Japanese companies operating in China from January 9 to 24, with 1,484 valid responses being collected.
Speaking at a launch meeting for the survey on Wednesday, Tetsuro Homma, an executive vice president of Panasonic Holdings, who is also chairman of the Japanese Chamber of Commerce and Industry in China, welcomed the short-term visa exemption for Japanese citizens visiting China, while expressing gratitude to the governments of China and Japan, as well as other relevant parties, for their efforts toward this initiative.
The market environment for foreign businesses has improved in China. According to the chamber, 78 percent of the surveyed companies said that they "receive more preferential treatment than domestic enterprises" or "are treated equally with domestic enterprises."
In terms of the business environment in China, 64 percent of the companies said they are satisfied with the situation, marking an increase of five percentage points from the previous quarter and 10 percentage points from the same period last year.
Key factors driving improved satisfaction with the business environment in China include strong support from local governments, well-developed infrastructure for business activities, and a rich pool of talented professionals, the chamber suggested.
Given the optimized situation, many Japanese companies stated that they will significantly increase investments, mainly due to the continued growth in demand in China. They plan to establish more factories, production lines and research and development centers, and this includes investments related to booming sectors such as electric vehicles (EVs), smart technologies and green energy, the survey showed.
The economic measures introduced by the Chinese government are being implemented, and the effects of initiatives such as trade-in subsidies are becoming apparent, Homma said.
"We anticipate the continued implementation of economic measures to ensure the stable growth of the Chinese economy in the medium to long term," he said.
Meanwhile, challenges remain for many Japanese companies, including the rising competitiveness of the Chinese market, which is also reflected in the increasing cost of labor, according to the survey.
The growing complexity of international trade, particularly with US President Donald Trump imposing additional tariffs and China implementing countermeasures, led Homma to express hope that the situation will remain stable and that businesses can operate within a free, fair and globalized economic framework.
Japanese companies have ramped up their investments in China, with the latest example being carmaker Toyota's recent plan to build a new wholly owned EV manufacturing plant in Shanghai - a strategic move to strengthen its presence in the world's largest automotive market. The initial production capacity of the factory will be about 100,000 units per year, and it is expected to create about 1,000 new jobs during the start-up phase, the Xinhua News Agency reported.
In a previous interview with the Global Times, Homma said that China's GDP is four times that of Japan's, with a population of 1.4 billion. "Japanese companies cannot and should not ignore the importance of the Chinese market in their global strategy," he said.
