By Isabel Reynolds and Emi Urabe

Pandemic budget includes 240 billion yen to support moves
Policy comes after Xi visit to Japan was postponed on virus
Global Cost of Coronavirus Could Reach $4.1 Trillion: ADB

Japan has earmarked of its record economic stimulus package to help its manufacturers shift production out of China as the coronavirus disrupts supply chains between the major trading partners.
The extra budget, compiled to try to offset the devastating effects of the pandemic, includes 220 billion yen ( ) for companies shifting production back to Japan and 23.5 billion yen for those seeking to move production to other countries, according to details of the plan posted online.

The move coincides with what should have been a celebration of friendlier ties between the two countries. Chinese President Xi Jinping was supposed to be on a state visit to Japan early this month. But what would have been the first visit of its sort in a decade was
postponed a month ago amid the spread of the virus and no new date has been set.
China is Japan’s biggest trading partner under normal circumstances, but imports from China slumped by almost half in February as the disease shuttered factories, in turn starving Japanese manufacturers of necessary components.

That has renewed talk of Japanese firms reducing their reliance on China as a manufacturing base. The government’s panel on future investment last month discussed the need for manufacturing of high-added value products to be shifted back to Japan, and for production of other goods to be diversified across Southeast Asia.
“There will be something of a shift,” said Shinichi Seki, an economist at the Japan Research Institute, adding that some Japanese companies manufacturing goods in China for export were already considering moving out. “Having this in the budget will definitely provide an impetus.” Companies, such as car makers, that are manufacturing for the Chinese domestic market, will likely stay put, he said.


Testing Times
Japan exports a far larger share of parts and partially finished goods to China than other major industrial nations, according to data compiled for the panel. A February survey by Tokyo Shoko Research Ltd. found 37% of the more than 2,600 companies that responded were diversifying procurement to places other than China amid the coronavirus crisis.
Japan Unveils Record Stimulus Amid Virus Emergency
It remains to be seen how the policy will affect Prime Minister Shinzo Abe’s years-long effort to restore relations with China.

“We are doing our best to resume economic development,” Foreign Ministry spokesman Zhao Lijian told a briefing Wednesday in Beijing, when asked about the move. “In this process, we hope other countries will act like China and take proper measures to ensure the world economy will be impacted as little as possible and to ensure that supply chains are impacted as little as possible.”
The initial stages of the Covid-19 outbreak in China appeared to warm the often chilly ties between the two countries. Japan provided aid in the form of masks and protective gear -- and in one case a shipment was accompanied by a fragment of ancient Chinese poetry. In return, it received praise from Beijing.
In another step welcomed in Japan, China declared Avigan, an anti-viral produced by Japan’s Fujifilm Holdings Corp. to be an effective treatment for the coronavirus, even though it has yet to be approved for that use by the Japanese.

Yet many in Japan are inclined to blame China for mishandling the early stages of the outbreak and Abe for not blocking visitors from China sooner.
Meanwhile, other issues that have deeply divided the neighbors -- including a territorial dispute over East China Sea islands that brought them close to a military clash in 2012-13 -- are no nearer resolution.
Chinese government ships have continued their patrols around the Japanese-administered islands throughout the crisis, with Japan saying four Chinese ships on Wednesday entered what it sees as its territorial waters.
— With assistance by Lucille Liu
(Updates with comment from economist in sixth paragraph)

https://www.bloomberg.com/news/articles/2020-04-08/japan-to-fund-firms-to-shift-production-out-of-china

China will fall soon

.

I love this

US should do the same.

God supposed punish China small.

Jayjezey:
China will fall soon

They won't fall but it will reduce their economic power

Welcome developement.


If you've ever worked in a chinese company, you'll know how heartless this chinkos are

I think that's the right step, imagine France and US fighting over face mask from China?
They can't even produce enough face mask in US/france they had to rely on China.
I don't blame China sha, why would u allowed ur companies(apple, Nokia, Microsoft, volvo etc) moved to China all because of cheap labour, relax ur immigration law, allow immigrant to come and work, pay tax to d govt.

I predicted this two weeks ago , next America will move production to India and let's see what China is

GamalNasser:
I predicted this two weeks ago , next America will move production to India and let's see what China is

my own is dt we should calculate our losses and bill dem.
simple.

DZTech:
my own is dt we should calculate our losses and bill dem.
simple.

They will certainly be billed and we all deduct from what ever we are owing them ..me sha I know America won't pay them that 1.9trillion they owe Dem again

Good development. Let us see how the virus ridden China survive this industrial exodus !

The company producing the face mask 3M is an American own company that manufactures its products in China the capital of Wuhan virus!!!

valarmorghulis:
I think that's the right step, imagine France and US fighting over face mask from China?
They can't even produce enough face mask in US/france they had to rely on China.
I don't blame China sha, why would u allowed ur companies(apple, Nokia, Microsoft, volvo etc) moved to China all because of cheap labour, relax ur immigration law, allow immigrant to come and work, pay tax to d govt.

sammyj:
The company producing the face mask M2 is an American own company that manufactures its products in China the capital of Wuhan virus!!!

Still doesn't change the fact that they rely on China

This Chinese virus has taught the world a lesson

Stay strong Nlanders.
We will scale through this pandemic.

#PleaseAvoidCrowds
#BeHopeful
#StaySafe

Is this right or wrong? I can't yet say but my instinct says it's wrong. The Japanese government should not give handouts for companies to leave China.

China would appreciate any country that stands with it in this time of calamity. Japan seems to have blatantly done the opposite as though taking the gloves off when there was no need to wear them in the first place.

Yes, China's land grabs has soured relations with Japan but that's another issue altogether. The true belligerent is China's head of state who has a conservative no nensense alienate-your-neighbours attitude to things.

I suspect once he's gone, China will return to its peaceful-rise policy which the present head has thrown out through the window.

Great move by Japan

This is just the beginning...China never know wating hit them...

Welcome to the New World Order.

Brexit. Protectionism. Nationalism. Na Africa I just dey pity.

Oops

Dullardinhó

Nothing to see here. The Japanese economy has been dead and buried for almost 30yrs no thanks for them for being a slave to the United States. In contrast the Chinese economy is $8 trillion bigger than the United States in purchasing power parity. Japan is a ant. The Chinese dont a fvck about them

Ok

That is a thinking government.
We should collaborate with china and not be subservient.
But no, our leaders prefer the money in their personal pockets than for the nation's development

I hope China is ready for what's coming.

It won't be the Japanese government alone

Friendlyjoe:
Welcome developement.


If you've ever worked in a chinese company, you'll know how heartless this chinkos are

Seconded

Good. All the china defenders doing copy and paste on every thread about how Western propaganda is painting China bad will avoid this thread.

John6697:
see below

This one must be an idhot

Impossicant

All Eyes On China,