japan’s economy feels the sting of china’s slowdown - air purifier machine for home
Tsutomu Nyuwa's metal processing store in Yasugi, Japan, has supported China's economic boom 700 miles away in a small way.
Many sophisticated machines
Gear, bearings and other components manufactured by Mr.
Nyuwa and his 14 employees finally arrived at the Chinese workplace in a giant earth-moving engine that powered China's amazing construction speed.
But as China's economy slows
Business downturn in Nyuwa
Data released on Monday showed that Japan's economy, like other countries, fell into recession again.
Japanese equipment manufacturers like Komatsu, Kubota and Hitachi Construction Machinery are selling fewer excavators and bulldozers in China, in turn, from like Mr. Nyuwa.
He estimates that orders for construction fell 40% this year.
"It will definitely come back to reality and we will feel it," Mr.
Nyuwa talks about the Chinese market.
Japan needs everything more than many other developed countries to boost economic growth.
Population and Labor are decreasing. Once-
Big industries like consumer electronics are under pressure from low-end markets. cost rivals.
Three years ago, Japanese Prime Minister Shinzo Abe won power with a promise to speed up the metabolism of Japan's economy, but despite some remarkable success --
The unemployment rate is very low, and profits from many big companies have set a record.
Broad growth in growth and income remains elusive.
With the development of the economy, even small setbacks will have a significant impact.
In the most recent quarter, companies with cautious outlook cut investment in factories and equipment, sending the economy into its fifth recession in seven years.
The sharp decline in exports to China has intensified the recession in economic activity and the general unease.
China's economic slowdown has caused repercussions around the world.
Falling demand for oil, iron ore and other products from commodities
Exporting countries such as Australia, Brazil and Ecuador.
Developing economies that rely on China to invest in resource projects have become vulnerable.
Other countries such as Japan and Germany have provided many machines for building Chinese skyscrapers and equipping thousands of factories.
For them, the manufacturing industry is losing money.
Paul Sheard, chief global economist at Standard & Poor's, a credit rating agency, said Japan supplies "everything used in China's infrastructure expansion"
Because of this, Japan is now at risk of being hurt by a slowdown in expansion.
China's economy has hardly been damaged.
The annual growth rate is 6.
According to official government estimates, the third quarter was 9%.
While this is enviable by the standards of more advanced countries, at the height of the global financial crisis, it was the lowest level since 2009.
In particular, eager buyers of Japanese capital products, such as manufacturing, construction and mining, are in worse shape than the economy as a whole.
Ten years ago, China overtook the United States as Japan's largest trading partner.
Strong exports of products such as mining trucks, textile looms and semiconductor manufacturers have been a highlight of the Japanese industry, which has lost its edge in more conspicuous areas such as consumer electronics.
The diplomatic disputes that have divided Tokyo and Beijing have failed to prevent the growing business dependence.
However, business relations between China and Japan have been changing.
Rising labor costs in China have prompted many Japanese companies with factories in China to diversify their investments into Southeast Asian countries such as Thailand and Indonesia.
Japanese retailers are pouring into China to target new and wealthy Chinese consumers.
Convenience stores and clothing chains like Uniqlo are expanding rapidly.
Tomokatsu Shiina, a construction designer who often works in China in Tokyo, recently returned from Shanghai, where he was responsible for the design of a Japanese discount shoe retailer's first store in the city.
"These are budget consumer goods," he said . "
"This is the activity now.
"It is also in Japanese shopping areas such as Ginza, Tokyo, where the standard amenities for tour groups from China are an extra empty suitcase to fill up the brand
Name of clothing, handbags and electronic products.
A tourist explosion brought 3.
In the first nine months of this year, 8 million mainland Chinese went to Japan, more than double the same period last year.
Their shopping habits inspire a new Japanese word "bakuugai" or "explosive buying ".
"Dong Changyuan is one of several new Chinese employees hired by electronics chain Laox in its Ginza store in September.
Laox has 20 to 30 Chinese staff to help visitors find the right air purifier, heated toilet seat or highRice cooker.
"Some people buy four at a time for friends and relatives at home ". Dong said.
The yen's weakness is still a draw, he added, despite a slowdown in China's economic growth.
At a small shoe store in the same block, about 15 Chinese shoppers were checking the products the latest afternoon.
Kazuiro Kawashima, the company's manager, said the number of Chinese customers had increased, but their purchases had decreased from a few months ago.
"They used to buy everything, it was all bakugai, but now they are more selective," he said . ".
He estimated that the average consumption per customer fell by about 5,000 yen, or $40.
Retail and tourism are not enough to fill the gap left by heavy industry.
Japan's overall export to China fell by 3.
According to trade data released by the Japanese government, the Japanese economy fell 5% in September for the second consecutive month.
Some industries such as steel, auto parts and industrial machinery have fallen even more.
Several big Japanese companies, including Canon, a maker of cameras and office equipment, have issued a profit warning in the past few weeks, saying growth has slowed.
Steel manufacturers such as Japan Steel, Sumitomo Metal, JFE Holdings and semiconductor suppliers-
In response to the decline in Chinese demand, they also lowered their forecasts.
Toshizo Tanaka, Canon's chief financial officer, told reporters: "It will take time to recover . "
His colleague, fujitio Fujitsuka, in Komatsu, said the company had "no sense of bottoming out" in China ".
The headwinds from China have made it harder for the Japanese government to create economic momentum. Mr. Abe’s three-year-
The old plan, known as Abenomics, centered on the positive stimulus from the central bank, suppressed continued consumer price declines and benefited exporters by weakening the yen.
The unemployment rate is only three.
4%, the lowest level in 20 years.
However, the project is still "half
It's over . "Sheard of S. &P.
As deflation has not yet been addressed safely, many families and businesses remain concerned about the future.
To bring new impetus to the economy
The Abe government is working on an economic stimulus package worth three yen.
According to Japanese media, the figure is $5 trillion, or about $29 billion.
But the constant stimulus is politically tricky. Mr.
Abe said he promised to raise the national sales tax in April 2017, after he delayed the planned 2% tax rate by 18 months to ease the pressure on economic growth.
The Japanese Ministry of Finance wants more taxes to offset Japanese government debt. Japanese government debt is the world's largest relative to the size of Japan's economy.
In his gold shop.
Nyuwa said he believes the government's policies will not play a big role in changing the direction of economic development.
Abe economics may have helped big companies and investors with stakes at the top of the food chain, he said, but it doesn't bring much benefit to small businesses like him.
"There has never been a real connection," he said . ".
"Now is the time for you to dig and bear it in this cycle.