Two years after protests, 'China risk' still haunts Japanese firms

Well, the companies can thank politicians like Ishihara and Abe, whom they likely voted for. The Anti-Japan protests they speak of that caused this were caused by the moves made by such politicians. China's reactions are, of course, equally if not more childish, but the fact remains that the companies are suffering as a result of political posturing.

In the end, both China and Japan want $$$$$!! This BS about some rocks sticking out of the ocean, ones being called the Senkakus by Japan and then China calling them by some other name, is just an old ploy by CHINA! Yes, everytime CHINA is getting angry at BEIJING, and not just the minorities, not just the Tibetans and Muslims, but your average Wang etc..what better way to use that ANGER tan to focus it right on JAPAN! This is the OLDEST strategy by China!

Before Ishihara's move, China had been sending ships to Senkaku islands many times, some landed and arrested. The previous owner had been approached by China many times, and stressed out. It was not really Ishihara's fault.

Simple but common sense rule: don't settle business in China! The globalization-addicted, exploitive industry should know better now.

The Chinese economy will eventually overtake the U.S. to become the single biggest economy, but there will be risks in investing there, Japanese companies are wise to seek out alternative places to invest in

Japan’s direct investments to China fell nearly 20% in 2013 and dropped another 40% to 300.8 billion yen ($2.8 billion) during the first half of 2014 compared with a year earlier.

Good. When Chinese run amok and start burning, looting and attacking Japanese owned companies due to political issues surrounding rocks in the sea and hate propaganda being pushed in their schools/society this is what happens.

There is little to no gratitude being shown for Japan's massive investments in China since the 70s. Get out of this dirthole and invest in S/E Asia. They've put the early 20th Century behind them. China's still rolling in that filth.

tinawatanabe

Before Ishihara's move, China had been sending ships to Senkaku islands many times, some landed and arrested. The previous owner had been approached by China many times, and stressed out. It was not really Ishihara's fault.

It was Ishihara's fault. Before Ishihara, China and Japan had made a secret deal: They wanted to "shelve" the Senkaku issue, so that both sides would agree to shut up about the whole thing, since neither sides could settle it. BOTH countries had claimed the rights to the islands. It's an unsolvable issue, that would eventually lead to an armed conflict. Ishihara selfishly wanted to appeal to his right-wing fans because of his ambition of wanting his son to run for the PM. He announced that he would buy the islands to Americans first for some reason, because he knew that that would please the American conservatives, and to become the PM, you need the support of the US.

So, that's what's it's all about. Ishihara using gullible right-wingers and nationalist sentiments just so his son could run for PM. It all failed of course, and the Japanese people, especially its companies had to pay the price in the end.

A visit to the Danyang park, the brainchild of former Toyota Motor Corp executive Kazuo Azuma, challenges the view that Japan Inc's engagement with China is slowly recovering from the shock of anti-Japanese protests that erupted two years ago.

Good, Japan needs to stay the hell away from that insane asylum known as Communist controlled China. Hope Japan continues investing it's money wisely.

smithinjapanSep. 14, 2014 - 03:49PM JST Well, the companies can thank politicians like Ishihara and Abe, whom they likely voted for.

enough_ropeSep. 14, 2014 - 06:52PM JST It was Ishihara's fault. Before Ishihara, China and Japan had made a secret deal:

Historical reality and facts seem to elude some folks as usual.

First off it wasn't those politicians paying Communist Chinese protestors to hit the streets and burn down anything Japanese, it was the Communist Chinese government that did that.

The protests were staged and their mock anger was fanned by Communist China and not by any Japanese politicians words.

http://articles.latimes.com/2012/sep/20/world/la-fg-china-japan-protests-20120921

http://www.theepochtimes.com/n2/china-news/behind-chinas-anti-japan-protests-the-hand-of-officials-292859.html

Next Prime Minister Abe had nothing to do with what happened in those Chinese protests, he wasn't in power.

smithinjapanSep. 14, 2014 - 03:49PM JST The Anti-Japan protests they speak of that caused this were caused by the moves made by such politicians. China's reactions are, of course, equally if not more childish, but the fact remains that the companies are suffering as a result of political posturing.

Those companies aren't suffering, all they had to do was invest elsewhere. The ones that are suffering are the employees that lost their jobs due to Communist China's theatrics and mush.

And the fact is, BOTH countries claim the islands. Of course China thinks that Diaoyu is "theirs", and Japan thinks that Senkaku is "theirs". And nationalists like you are being played and fooled. LOL.

If BOTH countries claim certain territories, then it WILL end in an armed conflict. It doesn't matter whether it's historical blah blah blah, the reality has always been that you claim territories via military might.

Yes, it's pretty stupid that there's going to be a conflict and a war over some rocks. But that's how every wars start. The question is, who benefits? No one. Japan will likely lose the most out of this.

JoeBigs

First off it wasn't those politicians paying Communist Chinese protestors to hit the streets and burn down anything Japanese, it was the Communist Chinese government that did that.

The fact is, the Chinese people got mad, because they'd always believed that Diayou was "theirs". The Chinese government felt betrayed, because Ishihara broke the secret deal made by either governments. It was pretty much Ishihara's fault, no question about that.

I'm sure that the European companies etc, are thanking God everyday for the stunt that Ishihara had done.

Pull the plug on the Chinese, they cannot be trusted, are ungrateful and will surely destroy anything related to Japan when they decide to run amuck next time.

There are plenty of other nations who would welcome japan with open arms and they are probably more deserving than the Chinese.

We had stock sitting on the port over there that they would not clear through customs and ended up getting damaged simply because it had come from japan at one time. They are in serious need of social skills when it comes to dealing with the international community, and stoop to very low levels to get their thrills.

Dump before they cause you more grief Japan, Thailand, Vietnam, Malaysia, phillipines and half a dozen other countries would love half the chance to manufacture goods for the Japanese companies, so go and grow their economies not these Chinese ungrateful hate mongers.

enough_ropeSep. 14, 2014 - 06:52PM JST tinawatanabe "Before Ishihara's move, China had been sending ships to Senkaku islands many times, some landed and arrested. The previous owner had been approached by China many times, and stressed out. It was not really Ishihara's fault."

It was Ishihara's fault. Before Ishihara, China and Japan had made a secret deal: They wanted to "shelve" the >Senkaku issue, so that both sides would agree to shut up about the whole thing, since neither sides could settle it.

No you're wrong. China sent the fishing trawler to the Senkakus in 2010 to ram the JCG vessels and cause an international incident. This is before Ishihara.

“Do we see any ray of hope?” asks Azuma, who has spent more than 20 years in China, mostly building factories for Toyota. “To be honest, none at the moment. Japan’s full of risk-birds chirping, ‘China risk.’”

Risk birds. What an idiot. Why would any Japanese company want to do business in PRC? Sell your goods there, fine. But produce them somewhere else. Anywhere else. PRC is a totally unpredictable country. Anything could happen there. They abide by no international norms and the "law" is whatever the CPC says it is. I would go so far as to say that any company stupid enough to still be "investing" in PRC deserves to lose their shirts.

It was not really Ishihara's fault.

Of course it wasn't. But don't disturb smith with the facts. He's happy in his fantasyland.

The Chinese economy will eventually overtake the U.S. to become the single biggest economy, but there will be risks in investing there

Yeah, I make a lot of money from China, but we don't leave any money there that we aren't willing to lose. The country will either implode, or the government will grab everything foreign, at some point in time. It's just a matter of when.

Why would any Japanese company want to do business in PRC? Sell your goods there, fine. But produce them somewhere else. Anywhere else. PRC is a totally unpredictable country. Anything could happen there.

Which is why smart companies will mitigate their risk. But the extremely low price of high-volume manufacturing and production makes the country a very appealing place to have factories. There really aren't any competitors on the same level. And it's we the consumers who are to blame - we want everything cheap, cheap, cheap, and the cheapest way to build is to build in China.

And it's we the consumers who are to blame - we want everything cheap, cheap, cheap, and the cheapest way to build is to build in China.

To a point, but I think that's really only half the story. Sure people want cheap stuff. But in reality, the consumer, if they want the item badly enough, pays whatever the price is on the price tag. I think the lion's share of the blame goes to corporations who want to sell more stuff to more people so they try to find the price sweet spot that will entice the greatest number of customers to buy their stuff. Quality of product be damned. They also want to avoid costly and "troublesome" things like labor unions, worker's rights, environmental regulations and so on. And finally, most corporations would sell their souls for a ten percent bump in profits and a corresponding rise in their stock price. PRC and its lawless, money grubbing government has provided these greedy corporations with the perfect environment to achieve all their goals.

Personally, I never buy made in PRC items if I can possibly help it. I will pay more, much more, to avoid supporting PRC or companies that do business there. I realize its like tilting at windmills at this point, but articles like this give me hope that one day corporations will see the light and move their operations elsewhere. Of course my first choice would be to bring back the manufacturing to North America and Japan, but I realize that ship has probably sailed by now. I still think that there are other viable alternatives to supporting belligerent communists. Ooops ... sorry, fake communists. ;)

Sure people want cheap stuff. But in reality, the consumer, if they want the item badly enough, pays whatever the price is on the price tag.

Not if the price tag on the item beside it, that was made in China, is cheaper.

Fortunately there are some out there like you who use discretion. My parents try to not buy anything made in China (though this is an almost impossible goal). But unfortunately most people will choose a cheaper price tag over morality.

Japan needs trade with China more than it needs those specs of rock near Taiwan. The economic losses to the Japanese economy over the last five or six years since this debacle started has cost Japan more than any amount of oil or natural that 'might' be in the waters around the islets and it is only going to I continue to grow as Japanese companies pull out from their biggest trading partner due to the anti-japan sentiment growing daily in China. Make a deal with them and stop letting cultural pride overrule common sense!t takes two to make an argument, but only one to dissolve it!

China is not the source of the cheapest goods. Various surveys and consumer report already proves this. For example Far East Tradings(UNIQLO) already moved to Bangladesh to manufacturer their garments.

Vietnam is booming with construction and both Myanmar and Cambodia is gaining steam in various new start ups. The big problem was infrastructure but many foreign manufacturers had overcome that by introducing their own electric generator plants. Now many industrial estate developers provides the electricty to their clients by constructing electricity generator plants of their own and the government provides tax cuts to the fuel they import becoming a win - win for all. The only problem is fresh water and sewage treatment but Japanese ODAs are providing various solutions in that section which is usually neglected.

You never should invest where Government is campaigning against nationality instead of protecting property of investors.

Japan only should invest in Communist China when country becoming true democratic nation.

With Communist Government, the more you invest the more you get attack from Communist Government. Don't invest your money in unfriendly country. If you see the carrot and then you must also see stick as well.

Japan's investment in China in 2014 is so minuscule that it is several times smaller than Singapore's investment. Abe is really a boon to producers from the US and EU countries. They are watching with glee as their exports and goods manufactured in China grow and break new records. It is really a shame to see Abe destroy the good work by the previous governments. Compared to him, Koizumi seems pretty okay. If the trend continues, then the economy of Japan will slide further!

Now's the time to get out of China, not become more dependent on it. Invest in democracies to become more democratic, not communism to become more corrupt

Asian2014Sep. 15, 2014 - 01:35AM JST Japan's investment in China in 2014 is so minuscule that it is several times smaller than Singapore's investment. Abe is really a boon to producers from the US and EU countries. They are watching with glee as their exports and goods manufactured in China grow and break new records. It is really a shame to see Abe destroy the good work by the previous governments. Compared to him, Koizumi seems pretty okay. If the trend continues, then the economy of Japan will slide further!

FDI in China is actually down this year. With nations and investors getting wary of the Chinese economy.

http://www.reuters.com/article/2014/08/18/us-china-economy-fdi-idUSKBN0GI08O20140818

http://thebricspost.com/fdi-into-china-down-16-95-in-july/#.VBYKh6PlqJA

The other giant pink elephant that is worrying to nations and corporations are Communist China's corruption probes into foreign corporations. When Emperor Xi said that he was going after "tigers and flies" everyone thought he meant he was going after corrupt politicians and officials that force foreign corporations to pay bribes to do business and not the corporations that have to pay bribes to do business there.

http://www.irishtimes.com/business/economy/us-firms-worried-about-china-probes-1.1921656

http://www.reuters.com/article/2014/09/14/us-usa-china-antitrust-idUSKBN0H90VM20140914

http://www.bdlive.co.za/world/asia/2014/09/10/eu-business-echoes-us-criticism-of-chinese-antitrust-probes

Communist China has taken note of the worry and is trying to do damage control. They are doing what they do best, tell the West to look at the left hand while the right continues to do what it is doing, targeting foreign corporations.

http://www.bloomberg.com/news/2014-09-09/china-s-antitrust-probes-mostly-target-local-firms-premier-says.html

http://www.ft.com/cms/s/0/ac1a3c12-38f4-11e4-a53b-00144feabdc0.html#axzz3DKUMZleM

http://www.ibtimes.com/china-no-longer-top-destination-foreign-companies-due-prosecution-1675470

OssanAmerica

No you're wrong. China sent the fishing trawler to the Senkakus in 2010 to ram the JCG vessels and cause an international incident. This is before Ishihara.

That was not China, it was some private individuals, which BOTH SIDES SHUT UP ABOUT AND NEVER MENTIONED IT... Japan agreed to quietly send the fishers back to China, and China agreed to keep the whole thing quiet. THAT'S HOW THE "UNSPOKEN" DEAL WAS MADE...! And Ishihara had foolishly broke the unspoken agreement.

China has been provoking japan over the senkakus long before ishihara suggested buying them, or abe came to power, the strife from china goes back further than 2010 look at your history, China has been causing trouble down that way for years, its not a recent thing.

@enough_rope I think it was Ishihara that was the direct cause, but an indirect cause is the constant hate being preached in Chinese schools. In any event, the nationalization should not have continued to be an issue. Maybe something else would have provided the spark, but at this point we are where we are, and you can't negotiate with communists except from a position of strength.

Japanese businessman are much wiser than Japanese politician, China will replace United Stated to be the number one in GDP around 2024, and 3 times of United States around 2050, this is epic change over last 100 years, if Japan's politician like Abe continue to bury his head into the sand, it will bring doomed future for Japanese as a whole.

if you are stayed in China recently, you will find overwhelming advertisement from Japanese Car manufacturers to woo the potential customers, which will account for 50% of global car market around year 2020.

StormR

China has been provoking japan over the senkakus long before ishihara suggested buying them, or abe came to power, the strife from china goes back further than 2010 look at your history, China has been causing trouble down that way for years, its not a recent thing.

It was NOT China, as China doesn't own those fishing boats, duh. Of course, there are some stupid nationalists from either countries (and let's not forget Taiwan, are you saying that Taiwan has been provoking Japan too?) that swim to those islands every now and then. The fact is, China, Japan and Taiwan ALL CLAIM THE RIGHTS TO THE ISLANDS. This is not a solvable issue, and hence the Chinese and Japanese leaders agreed to in the past to "shelve" the issue and forget about it. Otherwise, it WILL lead to an armed conflict! No question about that. The question is, who will lose the most? Japan will likely lose the most from this.

enough_rope you do not recall the boats from china and the Chinese nationalist who used to set sail from Hong Kong, of course its china and Chinese aggravating the situation as they have for long before ishihara or abe mentioned these islands