Tagged: CITIC

Japanese investment is becoming increasingly stable

2020 is not over yet. According to statistics from the Ministry of Commerce, the scale of Japanese companies’ investment in China in the first half of the year was 3.9% less than that of last year. However, according to calculations by Japanese media, total investment in 2020 may be the same as last year, or even increase slightly.

More importantly, Japanese investment is becoming increasingly stable!

how to say?

The ratio between the scale of investment recovery in Japan and the amount of investment executed will be 17% in 2020, a record low in recent years. This means that after the Japanese invest, most of them continue to invest, allowing the money to be deposited in China instead of directly withdrawing it.

You must know that in April 2020, the Abe government once proposed a subsidy policy for Japanese companies to return subsidies. The above-mentioned corporate investment is very clear: Japanese companies are more stable in China.

When it comes to the return of Japanese companies, perhaps the withdrawal from Vietnam is true.

According to statistics, Japan’s direct investment in Vietnam will drop by 43% in 2020!

Vietnam is currently dominated by South Koreans. In the “Overflow”, Samsung’s related industries accounted for more than a quarter of Vietnam’s GDP and imports and exports.

Japan’s investment in Vietnam has fallen so sharply that it basically announced the end of its love for Vietnam.

On September 3, 2020, according to Beijing Business Daily, Japan Dialogue’s investment has exceeded 110 billion U.S. dollars, ranking first in foreign investment rankings for three consecutive years!

In terms of investment, to whom does Japan really love?

Money has already explained the problem.

Do Japanese companies have the idea of ​​moving out of China?

Yes, but there are fewer and fewer ideas.

According to data from the Japan External Trade Organization (JETRO), the proportion of companies that want to move to other regions in the next two years is getting lower and lower, and in 2019 it was less than 1%.

 

The reasons for these companies to move or leave are mainly labor costs and performance decline.

The Japanese think that labor costs are a big problem, but in the report of the Japan External Trade Organization (JETRO), Ye Tan Finance found that the wages of Japanese employees are far lower than expected!

In the first-tier cities, the average salary of manufacturing workers in Beijing, Shanghai, and Guangzhou is around 5,000; the salary of engineers is no more than 9,000; and the salary of managers is less than 15,000.

chart

Labor costs at this level, according to JETRO’s calculations, are currently equivalent to 80% of those made in Japan.

In order to reduce costs, Japanese companies are rushing to move to Chongqing, Sichuan and other places. This trend is basically the same as Ye Tan Finance’s previous analysis in this article.

The overall cost of 80%, to be honest, is very close to Japan. If the labor cost rises further, will the Japanese go away?

Probably still not.

why?

In 2020, China is about to surpass the United States to become the world’s largest consumer market. China has proposed internal circulation and demand-side reforms. These measures all mean that China will make every effort to make a big consumption plate in the future.

The huge consumer market has always had a siphon effect, which means that economically, Japan is likely to move closer to China.

According to data from the General Administration of Customs, the trend is already on the way.

In 2020, China’s imports from Japan will grow at 2.7%, which is much higher than South Korea’s 0.4%. In total, the closeness between Japan and China is also higher than that of South Korea.

On December 8, according to a report on the World Wide Web, Kenji Shimizu, the head of the Guangzhou Representative Office of Japan’s Trade Promotion Agency, said bluntly in an interview: “In addition to making money in China, where else?”

This sentence is actually the current voice of Japanese companies.

On November 15, 2020, RCEP (“Regional Comprehensive Economic Partnership Agreement”) was officially signed, and Japan can be said to be the biggest beneficiary.

According to the analysis by Xu Jingbo, the president of Asia News Agency, after the signing of the RCEP agreement, Japan has become the country with the largest proportion of free trade among the major countries in the world, reaching 80%.

Japanese elections have always depended on the faces of farmers. Agriculture has a great influence in Japan. In this RCEP, in order to take care of Japan’s rich specialties, rice, wheat, pork, beef, dairy products, sugar and other products have almost remained unchanged. .

According to the calculations of CITIC Securities, the difference between China’s tax allowance for Japan and Japan’s tax allowance for China is the largest in bilateral relations. The long-term tax exemption difference may reach 4 billion US dollars.

 

Opening the Nikkei index will find that after November 15th, the Nikkei index has obviously reached a new level, and after the new high, it has kept new highs, which contains the implicit gift of RCEP.

Yoshihide Suga’s past is relatively pro-China, and his attitude is expected to be more friendly than Abe, but if there are not so many gift packages and China’s boost to Japan’s economy, Yoshihide Suga might not dare to face the United States. Said “to have a good relationship with China”.

Japanese capital will not run away, and Japanese capital will still be there. The most worrying thing now is the attitude of Japanese people towards China.

According to the latest polls, China’s favorability towards Japan is picking up rapidly, reaching 34.3% in 2019, three times higher than in 2015.

What about Japan? The favorability for China is only 8.5%, and the dislike for China has risen to 44.8%.

 

The ice-breaking of the Chinese and Japanese people may be the most important thing in the future Sino-Japanese relations. This requires the common wisdom of China and Japan!