TOKYO—Japanese companies would face an existential crisis if they lose China, the largest export market and source of imports, Hidetoshi Tashiro, chief economist at Japan’s Sigma Capital Ltd., has said.
Recently, some Japanese mainstream media have published articles discussing the possibility and cost of “decoupling between Japan and China.”
China is Japan’s largest trading partner and “finding a replacement for China is extremely difficult for Japan,” Tashiro told Xinhua in a recent interview.
For example, TDK, a well-known Japanese electronic components manufacturer, generated more than half of its total revenue from China between April 2021 and March 2022, Tashiro said, adding that Murata Manufacturing, another major Japanese electronic parts maker, also gets more than half of its annual revenue from China.
Tashiro argued that decoupling from China would put the two companies at risk of collapse.
According to an article published by Shukan Post weekly magazine at the end of October, the 15 Japanese companies with the highest proportion of sales in the Chinese market cover a wide range of industries, including electronic equipment, retail, chemicals and precision instruments.
Tashiro said that if decoupling from China, these companies could collapse, and the fallout would have a profound impact on the Japanese economy.
Data from Japan’s Ministry of Finance show that in 2021, Japan imported from China 2.4 trillion yen (17.2 billion U.S. dollars) worth of telephones and related equipment, accounting for 11.8 percent of Japan’s total imports; 1.7 trillion yen (12.2 billion U.S. dollars) worth of electronic automatic data processing machines, accounting for 8.1 percent; 361.1 billion yen (2.6 billion U.S. dollars) worth of projectors and receiving equipment, accounting for 1.8 percent.
Tashiro believes that decoupling from China’s economy could result in problems such as skyrocketing cellphone prices in Japan and difficulties in purchasing electronic automatic data processors, and some companies here would be struggling with operational difficulties.