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Kyodo News: More than 40 Percent of Japanese Companies to Adjust Their Supply Chains

According to Kyodo News, the results of a survey show that more than 40 percent of the 96 Japanese companies that are recognized by the Japanese government as possessing critical technologies are adjusting their supply chains, including parts procurement and their supply networks. They are promoting the diversification of production bases and suppliers away from China.

The survey targeted 150 companies, all of which are listed companies that possess security-related technologies in the field of information and communication. Japan’s “Foreign Exchange and Foreign Trade Law” stipulates that foreign investors need to submit an application in advance when making capital contributions into these firms, whose stocks have been adopted by the Nikkei Index. Among the 96 that responded, 42 companies, or 44 percent, have implemented and discussed the diversification of their supply chains away from China and into Southeast Asia and India.

The Japanese government calls for the overseas production bases to be moved back home as a part of mitigating “China risks.”

Source: Kyodo News, December 30, 2020