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Japanese firms in China worry over effects of Abe's shrine visit

Publication Date : 28-12-2013

 

Japanese companies doing business in China are stepping up vigilance in anticipation of possible anti-Japanese protests, as there were in 2012, over Prime Minister Shinzo Abe’s visit to Yasukuni Shrine on Thursday.

In autumn 2012, anti-Japanese protests were triggered by the nationalisation of three Senkaku Islands in Okinawa Prefecture. However, some people say such protests will not spread because it would have an adverse impact on the Chinese economy if investment from Japan to China were to decrease due to protests.

“The timing [of Abe’s visit to Yasukuni] was just when things had finally calmed down. I hope things won’t go back to square one,” said an executive of a Japanese-affiliated parts manufacturer working in China.

Rioters in China destroyed Japanese-affiliated business facilities, including a plant and an automobile retailer, in September 2012 in protests over the Japanese government’s purchase of three of the Senkaku Islands from a private Japanese owner.

Some protesters looted a convenience store and a supermarket and attacked Japanese restaurants.

More than one year has passed since then, and Japanese companies in China had finally begun to enjoy calm again as anti-Japanese sentiment had begun to cool off.

Although sales of Japanese automakers dropped by half for a while after the anti-Japanese movement, sales recovery is becoming notable. For example, Honda Motor Co.’s monthly auto production jumped to a record high in November. In Beijing, Japanese restaurants are now attracting customers like they used to.

“[Abe’s decision] came after careful planning and consideration for the country. Therefore, [Abe] will be able to take responsibility [for anything that happens as a result of his actions],” Yasuchika Hasegawa, chairman of the Japan Association of Corporation Executives, or Keizai Doyukai, told reporters at a hotel in Tokyo.

Hiromasa Yonekura, chairman of the Japan Business Federation (Keidanren) who visited China with about 180 business executives in November, did not make any comment, apparently concerned about what effects his comments might have.

Though there have been no reports of significant damage to Japanese companies doing business in China as of Thursday night, the Japanese Embassy in Beijing sent an e-mail to Japanese living in China cautioning them of possible anti-Japanese sentiment in the near future.

According to an expert in business in China, Hikojiro Takahara, CEO of Consul Bution Co., “A plant of a certain midsize company was destroyed, and the company went bankrupt following the anti-Japanese riots, because the plant was not covered by special contract insurance.” Therefore, Takahara stresses the need for businesses to prepare for any possible damage to property.

On the other hand, some Japanese companies doing business overseas are increasingly shifting their investments to Southeast Asia, fearful of riots.

“Beijing does not want to see investment from Japan decrease,” a person who is engaged in a manufacturing industry said. “I think they want to avoid a situation in which a political row will throw the economy into confusion.”

“The Chinese authorities are worried about anti-Japanese movements turning into dissatisfaction with Chinese society,” said a Japanese government source in Beijing. The source also said that Abe’s visit to Yasukuni Shrine has a low possibility of causing riots similar to the one that occurred last year.

 

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