Japanese Economy – Japon Online http://japononline.net/ Sat, 15 Jan 2022 05:28:00 +0000 en-US hourly 1 https://wordpress.org/?v=5.8 https://japononline.net/wp-content/uploads/2021/05/default1-150x150.png Japanese Economy – Japon Online http://japononline.net/ 32 32 5 Global Market Themes for the Week Ahead https://japononline.net/5-global-market-themes-for-the-week-ahead/ Sat, 15 Jan 2022 05:28:00 +0000 https://japononline.net/5-global-market-themes-for-the-week-ahead/ With the US earnings season well underway, banking heavyweights such as Goldman Sachs are lining up to release their next report. The Bank of Japan is the first major central bank to meet in 2022 and investors are getting a wealth of data on China. Davos is going virtual for a second year and how […]]]>
With the US earnings season well underway, banking heavyweights such as Goldman Sachs are lining up to release their next report. The Bank of Japan is the first major central bank to meet in 2022 and investors are getting a wealth of data on China.

Davos is going virtual for a second year and how long will the pound hold up against Britain’s growing political uncertainty?

BET ON IT
The earnings season in the United States is in full swing and this time it is the financial sector, with its meteoric start to 2022, which is in focus.

The S&P 500 Financials index is up nearly 6% year-to-date, while the broader S&P 500 index is down 2% as investors bet on banks benefiting from new loans and on the higher yields that should accompany a more aggressive Federal Reserve.

Goldman Sachs and BNY Mellon report on Tuesday; Bank of America, Wednesday. Reports from major non-financial companies include Netflix on January 20.

Bank executives should be optimistic about the outlook, it remains to be seen whether this will be enough to support demand for bank stocks. As some note, bank stocks often do better before rate hikes than during rate hikes.

GOOD NEWS FIRST?
The good news for Bank of Japan officials meeting on January 17 and 18: inflation is rising, the economy is recovering.

Consumer prices rose at their fastest pace in nearly two years in November. Even Japanese affordable clothing giant Uniqlo says it has no choice but to raise prices – a change in a country where deflation is the norm and businesses face any cost increases by tightening the belt rather than passing them on.

The bad news? Inflation is rising for the wrong reasons.

Instead of being the result of nearly a decade of overpowering monetary stimulus, the price hike is due to soaring energy prices and a weaker yen.

The challenge is to prevent the rising cost of living from undermining weak household spending and a fragile recovery. So the BOJ could be debating when it can start telegraphing a rate hike.

BALANCE
Monday’s data is expected to confirm that China’s economy stabilized in the fourth quarter, rebounding from power outages and coronavirus setbacks and pushing 2021 growth to 8%.

Data on Wednesday showed new bank lending fell more than expected in December, although annual lending set a record as the central bank slowly steps up policy support to cushion the slowing economy.

Shutdown efforts to ease monetary conditions are a key focus for investors, alongside the question of whether policymakers can balance cleaning up a bloated real estate sector while containing stress.

With the Chinese New Year holiday in early February and the Beijing Winter Olympics shortly after, the central bank will be keen to keep banks and markets afloat with liquidity.

VIRTUAL IN DAVOS
For a second year, world leaders, policy makers and high-level business leaders will come to the World Economic Forum (WEF) in the Swiss ski resort of Davos from January 17-21. great challenges.

The mood is bleak: only one in 10 WEF members surveyed expect the global recovery to gain momentum over the next three years, and only one in six are optimistic about the global outlook.

Climate change is seen as the number one danger, while erosion of social cohesion, livelihood crises and deteriorating mental health are seen as the risks that have increased the most due to the coronavirus pandemic. COVID-19.

Japan’s Fumio Kishida, India’s Narendra Modi, Ursula von der Leyen of the European Commission, US Treasury Secretary Janet Yellen and Christine Lagarde of the ECB are all expected to speak. The full in-person meeting has been postponed to early summer.

HIGH HIGH
The pound is sailing high on signs that the Omicron COVID surge is easing and expectations that UK interest rates are likely to rise again in February. It is at two-month highs against the dollar and one of the best performing major currencies heading into 2022.

If the upcoming data boosts rate hike bets, currency bulls will have another reason to push the pound higher. November jobs numbers are released on Tuesday, followed by December inflation on Wednesday and retail sales numbers on Thursday.

Meanwhile, the pound appears unfazed by the growing political uncertainty. Boris Johnson’s position as Prime Minister looks vulnerable after revelations he attended a Downing Street party during a 2020 lockdown. Didn’t someone say a week is it long in politics? The same could hold true for trading the pound.

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Japan METI assists Thailand MOI in accelerating economic recovery https://japononline.net/japan-meti-assists-thailand-moi-in-accelerating-economic-recovery/ Thu, 13 Jan 2022 10:45:12 +0000 https://japononline.net/japan-meti-assists-thailand-moi-in-accelerating-economic-recovery/ Mr. Hagiuda Koichi (left), Japanese Minister of Economy, Trade and Industry and Mr. Suriya Juangroongruangkit (right), Thai Minister of Industry jointly sign a framework document on co-creation for innovative and sustainable growth at a ceremony held at Shangri-La Hotel Bangkok on January 13, 2022. Bangkok, January 13, 2022 – The Ministry of Industry (MOI) and […]]]>
Mr. Hagiuda Koichi (left), Japanese Minister of Economy, Trade and Industry and Mr. Suriya Juangroongruangkit (right), Thai Minister of Industry jointly sign a framework document on co-creation for innovative and sustainable growth at a ceremony held at Shangri-La Hotel Bangkok on January 13, 2022.

Bangkok, January 13, 2022 – The Ministry of Industry (MOI) and the Ministry of Economy, Trade and Industry (METI) of Japan are working closely together on strategies to revitalize the remarkable economic and industrial development potentials of the two country. It is to provide opportunities from the ASIA-Japan Investing for the Future (AJIF) initiative within the framework of Thailand’s bio-circular-green economy (BCG model) by jointly developing innovation and technology, human capital capacity, digital technology in SMEs and the supply chain, as well as coping with economic and social changes. Additionally, continues to push its economic expansion in Thailand, investing around 70 billion baht in various projects.

The COVID-19 outbreak continues to affect economic activities and industrial sectors in many countries, according to Mr. Suriya Juangroongruangkit, Minister of Industry. Therefore, to reinforce an ever-changing framework, a method of rejuvenation is essential. During his visit to Thailand, the Ministry of Home Affairs discussed ways to restore the economy and industry with Mr. Hagiuda Koichi, Minister of METI, Japan, to find ways to mitigate the changes and existing volatility, as well as developing the BCG model in collaboration with AJIF. by defining a Framework Document on Co-Creation for Innovative and Sustainable Growth.

The framework focuses on innovation and technology, human capital capacity, digital technology in SMEs and supply chain development with the aim of fostering Japanese investment in Thailand, establishing regional connection and to exchange the outstanding potential of both countries to jointly create opportunities in various dimensions. .

Mr. Suriya Juangroongruangkit, Thailand’s Minister of Industry, said that despite a crisis in 2021 that damaged Thailand’s confidence, Japan remains a key economic partner.

Mr. Suriya also said that there are three areas of this certain cooperation, which are:
(1) Innovative and sustainable technologies and capacity building in human capital, focusing on the development and promotion of targeted industries, including next-generation vehicles, smart electronics, advanced agriculture, food processing, robotics, automation, aviation, logistics, digital, medical hub, bioindustry, circular economy and green economy, as well as supporting human resource development to promote co-creation for innovative and sustainable growth in Thailand, in particular by developing the skills and knowledge of Thai engineers in smart manufacturing and using their capabilities.

(2) Accelerating the growth of small and medium-sized enterprises (SMEs), focusing on promoting digital solutions among Thai SMEs by collaborating with the Industrial Transformation Center (ITC), as well as connecting Thai SMEs and Japan through efforts such as business matchmaking and digital platforms.
(3) Supply chain co-creation, focusing on building a resilient and competitive supply chain in the Mekong region, improving the quality and value of the supply chain through digital transformation and human resource development, and building a circular and green supply chain.

“Cooperation with relevant countries is an essential strategy to deal with the global economic crisis. These countries can help us achieve our goals by combining our various strengths in a timely manner. Through the BCG model, Japan, as a long-standing ally of Thailand, intends to bring the innovation and technology it has developed to build capacity in selected Thai industries. They also intend to increase the potential of human resources, both in the workforce and in a group of young people interested in technology, including specialized Japanese SMEs, in order to adapt to the changing global context.

Currently, the Ministry of Interior and METI of Japan are working together on various initiatives, including: (1) Establishment of a comprehensive end-of-life vehicle (ELV) management system in Thailand. Since disposing of automotive waste in Thailand is fraught with challenges, working with the Industrial Estate Authority of Thailand would reduce environmental impact while supporting the government’s BCG policy. (2) Smart Monosukuri, Lean Automation System Integrator (LASI) and Lean IoT Plant Management and Execution (LIPE). The above-mentioned projects are aimed at empowering personnel to move the industrial sector to SI (System Integrator) status and facilitate the transition to a smart factory by leveraging AI IoT automation as a mechanism to increase productivity.


Mr Suriya said that despite a crisis in 2021 that damaged Thailand’s confidence, Japan remains a key economic partner. According to a BOI study, Japan is the largest source of investment value in foreign projects approved for investment promotion, accounting for 19% of Thailand’s total foreign investment. Large projects (1,000 million baht or more) account for the majority of the investment value, including the production of petrochemical products (PET resin) worth 3,062 million baht, the production of wires or of tissues with special properties worth 2,597 million baht, and research and development activities (production using microbial cells, plant cells and cells) worth 1,990 million baht . Bearings for the automotive industry are also valued at 1,680 million baht. Japan has several projects that have been submitted for promotion in the first nine months of 2021. The development has 125 projects totaling 67,817 million baht.

The Japanese and Thai delegations gather for a group photo during the signing ceremony of the framework document on co-creation for innovative and sustainable growth.


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Policies should prioritize the poor and vulnerable as the economy is expected to recover in 2022 https://japononline.net/policies-should-prioritize-the-poor-and-vulnerable-as-the-economy-is-expected-to-recover-in-2022/ Tue, 11 Jan 2022 14:18:12 +0000 https://japononline.net/policies-should-prioritize-the-poor-and-vulnerable-as-the-economy-is-expected-to-recover-in-2022/ As global automakers continue to invest in the production of electrified vehicles (EVs), internal combustion engine (ICE) powertrains dominate future U.S. intentions, with 69 percent of U.S. consumers looking to save the technology for their next day. vehicle. Despite a growing interest in sustainability globally, more than half (53%) of US consumers are unwilling to […]]]>

As global automakers continue to invest in the production of electrified vehicles (EVs), internal combustion engine (ICE) powertrains dominate future U.S. intentions, with 69 percent of U.S. consumers looking to save the technology for their next day. vehicle.

Despite a growing interest in sustainability globally, more than half (53%) of US consumers are unwilling to pay more than US $ 500 for alternative engine solutions.

Virtual sales continue to show promise for their convenience and ease of use; however, 75% of US consumers would prefer an in-person experience for their next vehicle purchase.

Shared mobility services like carpooling and carpooling have been slow to return to pre-pandemic levels; 76% of Americans prefer their personal vehicles to other modes of transportation.

Why it matters

As the auto industry focuses on the road ahead and returning to its pre-pandemic growth rate, consumer values ​​remain aligned with familiarity and affordability. For 12 years, Deloitte has explored automotive consumption trends impacting the rapidly evolving global mobility ecosystem. This year’s report, “Global Automotive Consumers Study 2022, ”Explores a variety of issues impacting the global automotive industry, including advanced technology development, sustainability, cost expectations of new vehicles, virtual shopping experiences and mobility services. The report is based on a survey of more than 26,000 consumers in 25 countries between September and October 2021.

Mapping the future of electric vehicles

As global automakers seek to deliver on their promises of an electrified future, consumer interest in adopting more sustainable powertrains is driven by lower fuel costs, climate concerns, and better driving experiences. . However, the limitations of electric vehicles continue to draw many drivers to familiar internal combustion engine (ICE) vehicles. At the same time, consumers’ willingness to pay for advanced technologies remains limited.

Despite growing interest in sustainability, a majority of consumers are still unwilling to pay more than US $ 500 for advanced technologies, including alternative powertrains, including 53% in the US. Additionally, consumers are unwilling to pay for other advanced features, including autonomous driving, improved safety and connectivity.

As a result, ICE vehicles continue to dominate future vehicle purchase intentions in the United States (69%). Among alternative powertrains, consumer interest in battery-electric vehicles (BEVs) is highest in the Republic of Korea (23%), China (17%) and Germany (15%), while Japanese consumers showed the strongest preference for hybrid electric vehicles (HEV / PHEV) (48%) followed by the Republic of Korea (35%).

However, growing concerns about climate change and reducing emissions are consistently among the top two motivators for electric vehicle adoption among global consumers in the United States, Germany, Japan, Republic of Korea, in India and Southeast Asia.

The majority of EV buyers plan to charge their vehicle at home, especially in Japan (76%), India (76%), the United States (75%) and Germany (70%). Demand for public charging is highest in the Republic of Korea (38%) and Southeast Asia (29%).

Among those who plan to charge their vehicles at home, two-thirds (66%) of Americans will take advantage of traditional power grids. Meanwhile, consumers in India, China and Southeast Asia plan to use both mainstream grid and renewable energy.

Range is the main concern regarding electric vehicles among consumers in Germany (24%), China (22%) and the United States (20%), while the lack of public charging infrastructure is a concern major in Asia (Southeast Asia at 28%, Republic of Korea at 26%, India at 23% and Japan at 19%).

Consumers in the United States expect fully charged EVs to travel more than 500 miles, while those in China, Japan and India are content with a range of around 250 miles.

The way to go when buying vehicles

Consumers who buy new vehicles prefer traditional in-person experiences to virtual platforms. However, virtual retailing is gaining ground for its convenience, speed and ease of use.

COVID-19 has had a significant impact on car buying decisions for consumers in India and Southeast Asia (64% and 63%, respectively). Conversely, more than two-thirds of American consumers (69%) say the pandemic has not affected their vehicle purchasing plans.

Consumers in India (45%) and Southeast Asia (31%) mentioned an increased desire to purchase a vehicle to avoid public transport; only 14% of American drivers said the same.

For consumers around the world, in-person purchases are the preferred vehicle for purchasing a vehicle, including three-quarters (75%) of US consumers. In-person experiences are an even higher priority in Southeast Asia (80%) and Germany (78%).

However, when shopping virtually, consumers in most countries would prefer to buy direct from an authorized reseller, including the United States (48%). Japanese consumers, on the other hand, would prefer to buy directly from the OEM (49%).

Sales of virtual vehicles are most often driven by convenience for people in the Republic of Korea (68%), Japan (41%), Germany (40%) and the United States (39%). Ease of use is highest for consumers in China (33%), as well as India (27%) and the United States (25%).

Personal mobility remains king

Shared mobility offerings, including vehicle subscriptions and ride-sharing services, face a slow return to pre-pandemic levels as personal vehicle ownership maintains its position as the most desirable mode of transportation .

More than three-quarters of Americans (76%) indicate that personal vehicles are their primary form of transportation. However, public transport has a significant share among consumers in the Republic of Korea (31%) and Japan (27%).

Vehicle subscription services are more popular in global markets, but still gain interest in the United States About a third of American consumers are interested in vehicle subscription services to access different models of cars, makes of vehicles and used vehicles (32% each).

Convenience, flexibility to swap vehicles, and vehicle availability are the primary factors for engaging vehicle subscription service in the United States.

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Japan’s labor shortages eclipse economic recovery https://japononline.net/japans-labor-shortages-eclipse-economic-recovery/ Sun, 09 Jan 2022 15:04:24 +0000 https://japononline.net/japans-labor-shortages-eclipse-economic-recovery/ Despite a gradual improvement in economic conditions in Japan, a labor shortage is slowly starting to be felt in sectors such as food service and manufacturing where many people have decided to change jobs while on leave in Japan. in the midst of the Covid-19 pandemic. A sharp drop in the number of foreign workers […]]]>

Despite a gradual improvement in economic conditions in Japan, a labor shortage is slowly starting to be felt in sectors such as food service and manufacturing where many people have decided to change jobs while on leave in Japan. in the midst of the Covid-19 pandemic.

A sharp drop in the number of foreign workers and students due to the pandemic measures has also had a significant impact on the labor shortage, highlighting Japan’s dependence on foreigners in the workforce. -work.

Warakuan, a soba noodle restaurant in Tokyo’s Taito district, was busy late last month when year-end gatherings usually take place and orders for toshikoshi soba, a traditional dish eaten at the end of the day. of the year, increase.

But the restaurant was understaffed during the holiday season following the resignation of five employees during the state of emergency when business operations were curtailed.

According to the Bank of Japan’s Quarterly Economic Survey Tankan released last month, the ‘excess employment’ minus ‘insufficient employment’ index for accommodation, food and beverage services was minus 17, a sharp drop from report at most 19 in September.

The labor shortage rapidly worsened after restrictions on business activities were relaxed in late September following the end of the state of emergency.

The labor situation is pushing hourly wages up. United and Collective Co, which operates the Teketeke izakaya chain, has increased hourly wages by an average of 130 yen ($ 1.10) at around 80 outlets since October.

Hourly wages are 1,450 yen for regular shifts in some outlets in central Tokyo and over 1,800 yen for night shifts after 10 p.m. Despite this, the company said it closed nine stores at the end of last year because it was unable to hire enough staff.

According to Dip Corp, which operates the job board website Baitoru, the average hourly wage for part-time restaurant workers was 1,036 yen in November, up 3.4% or 34 yen year-on-year and of 12 yen mo. month.

The increase in job openings in the food service industry was higher than that of all other industries.

Nakazato Corp, which operates six restaurants in the Tokyo metropolitan area, increased her hourly wages when she hired staff after the state of emergency. “We were able to hire people who wanted to change jobs during the pandemic,” said the president of the company.

Labor shortages are also having an impact on the manufacturing industry. Automakers have hired more short-term workers and raised wages.

Interworks Inc, which operates a manufacturing job board, said the average hourly wage in the industry was 1,363 yen in November, up 96 yen year-on-year.

According to the Tankan survey, the “excessive employment” minus “insufficient employment” index for the entire manufacturing industry was minus 14, the lowest level since the minus 15 recorded in the March 2020 survey.

Demand for automobiles and home appliances has been strong amid the pandemic, and workers are needed to ramp up production, following operating cuts due to semiconductor shortages.

A sharp drop in the number of foreigners coming to Japan has exacerbated labor shortages in a wide range of industries.

The manufacturing sector relies on foreign interns in the workforce, but the number of those entering Japan in 2020 fell to around 105,000, down 55% from the previous year, according to the ‘Japan Immigration Service Agency. During the January-October period of last year, around 26,000 foreign interns came to Japan.

The number of foreign students, many of whom work part-time in restaurants and other businesses, who entered Japan to attend school in 2020 also fell by 68% from the previous year to around 163,000. Only around 28,000 were studying in Japan between January and October last year.

In anticipation of a recovery in the tourism sector, the transport industry has rushed to secure drivers, whose numbers have plummeted following the outbreak of the pandemic.

Bus driver positions on the Doranabi job board doubled in Tokyo and Osaka in December, compared to the summer period.

“It is difficult to predict when the number of foreign visitors will return to pre-pandemic levels as it depends on the pandemic situation in Japan and abroad,” said Shinichiro Kobayashi, chief researcher at Mitsubishi UFJ Research and Consulting Co. “As the Japanese economy recovers, the labor shortage could get even worse.

The number of people unemployed for more than a year is increasing despite labor shortages.

According to the labor force survey of the Ministry of the Interior and Communications, the monthly average of long-term unemployed was 680,000 for the period July-September 2021, up 180,000 compared to the same period. the previous year. A workforce mismatch is believed to be at the root of the problem.

Office workers who lose their jobs tend to seek out similar roles. They avoid finding jobs in relatively low-paying fields such as food and nursing services, resulting in prolonged unemployment. In some cases, it is believed that some people have not been able to find a job because they do not have the required skills.

The ratio of job vacancies to job seekers in November was 0.29 for office jobs, but 3.70 for nursing jobs and 4.20 for construction jobs, which indicates that job seekers outnumber vacancies for office positions while the latter areas are experiencing severe labor shortages.

A 52-year-old woman who was looking for a job at a HelloWork employment office in Tokyo said she left a temporary position in an office in June 2020 because she fell ill.

“I’m looking for a clerical job because it’s an area I have a lot of experience in, but the employment agency continues to recommend nursing positions,” she said. “But it’s hard for me to do that kind of work because I have a problem with my back.”

In the supplementary budget for fiscal year 2021, the government included an extension of a system under which the unemployed can receive training while receiving benefits to address the problem of workforce mismatch.

It will offer grants to universities that offer courses for workers who wish to change careers and enter the medical and nursing industry.

THE YOMIURI SHIMBUN INFORMATION NETWORK (JAPAN) / ASIA


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Omicron – will the economic impact be mild or severe? https://japononline.net/omicron-will-the-economic-impact-be-mild-or-severe/ Sat, 08 Jan 2022 02:04:10 +0000 https://japononline.net/omicron-will-the-economic-impact-be-mild-or-severe/ Paris – After limping back from the COVID-19 pandemic last year, the global economic recovery has been rocked by the rapid rise of the omicron variant. The travel industry has once again been plunged into disarray, workers have been forced to isolate themselves at home, and governments are faced with a difficult choice between imposing […]]]>

After limping back from the COVID-19 pandemic last year, the global economic recovery has been rocked by the rapid rise of the omicron variant.

The travel industry has once again been plunged into disarray, workers have been forced to isolate themselves at home, and governments are faced with a difficult choice between imposing restrictions or letting the economy run.

Could the highly contagious variant of omicron have a severe impact on recovery? Or will its mild symptoms prevent the economy from sinking again?

What impact on growth?

The director of the International Monetary Fund, Kristalina Georgieva, warned last month that forecasts for global economic growth may have to be reduced following the emergence of the omicron.

The IMF previously forecast growth of 5.9% for 2021 and 4.9% this year, but it may now revise its estimates later this month.

To lessen the blow to the economy, US health officials have cut the isolation period for asymptomatic cases from half to five days.

Mark Zandi, chief economist at Moody’s, said he expects US growth of 2.2% in the first quarter, more than half of a previous estimate of 5.2%.

“Omicron is already causing economic damage, as evidenced by declining credit card spending, declining restaurant reservations, flight cancellations and the return of many schools to online learning,” Zandi said.

“However, I expect omicron to pass quickly and growth to rebound in the second quarter, and growth for the year to be unaffected,” he added.

“Overall, I think each wave of the virus does less damage to the health care system and the economy than the previous wave.”

In the eurozone, tighter restrictions, consumer cautiousness and absenteeism will reduce economic activity in the coming weeks, but the economy will rebound in February, according to Andrew Kenningham, chief economist Europe at Capital Economics.

Countries with lower vaccination rates, which are primarily developing economies, face greater uncertainty, and a ‘zero-COVID’ policy in China could dampen the growth of the world’s second-largest economy as it locks cities down whole.

Will tourism suffer?

The travel industry has been eagerly awaiting a rebound in 2022 after being devastated by border closures and blockades.

But the emergence of omicron during the key winter vacation period has resulted in thousands of flight cancellations, forced cruises to dock, and fewer hotel bookings.

Investors, however, have been bullish as airline and cruise shares have risen in recent weeks.

“The markets seemed to be watching the post-omicron period,” said Alexandre Baradez, analyst at IG France.

Is inflation going to get worse?

The economic recovery had a negative side effect: Inflation reached decades high levels in the United States and Europe as energy prices soared and growing demand faced supply shortages.

Central banks have insisted that the high inflation is only temporary and prices will eventually come down, but it has hurt consumers and businesses.

Could it get worse?

“The impact of omicron on consumer demand is far from certain, but people who stay home because of the variant are more likely to spend their money on retail products rather than services. such as dining out or in-person entertainment, ”said Jack Kleinhenz, Chief Economist. to the National Retail Federation of the United States.

“This would put additional pressure on inflation, as supply chains are already overloaded across the world,” he said.

Supply chain bottlenecks caused shortages of many materials last year, pushing up prices for many products. A higher demand for products on the available goods could further fuel the price increase.

The Federal Reserve rocked the markets this week as the minutes of its December meeting showed the US central bank was ready to tighten monetary policy more aggressively to bring inflation under control.

Elsewhere, inflation is eroding purchasing power after hitting double-digit numbers in Brazil and Nigeria.

In Britain, UK Chambers of Commerce said 58% of businesses expect their prices to rise in the next three months.

End of the recovery?

Governments rolled out massive stimulus packages in 2020 to save their economies, racking up $ 226 trillion in debt, according to the IMF.

Leave plans to keep people at work “made sense” as there was so much uncertainty and entire industries were shut down, said Niclas Poitiers, a researcher at Bruegel, a Brussels-based think tank.

“I do not yet see the need for massive funds for the economy,” Poitiers said.

Instead, the United States and Europe are investing in structural programs, such as President Joe Biden’s $ 1.75 trillion “Build Back Better” climate and social spending plan.

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US, Taiwan pledge to help Lithuania tackle China’s “economic coercion” https://japononline.net/us-taiwan-pledge-to-help-lithuania-tackle-chinas-economic-coercion/ Thu, 06 Jan 2022 02:08:24 +0000 https://japononline.net/us-taiwan-pledge-to-help-lithuania-tackle-chinas-economic-coercion/ The United States and Lithuania have agreed to cooperate on ways to counter what they have called “economic coercion” from China in a move that is likely to draw a strong rebuke from Beijing. U.S. Trade Representative Katherine Tai told Lithuanian Foreign Minister Gabrielius Landsbergis on Wednesday that the Baltic nation has Washington’s backing in […]]]>

The United States and Lithuania have agreed to cooperate on ways to counter what they have called “economic coercion” from China in a move that is likely to draw a strong rebuke from Beijing.

U.S. Trade Representative Katherine Tai told Lithuanian Foreign Minister Gabrielius Landsbergis on Wednesday that the Baltic nation has Washington’s backing in an appeal that took place amid a diplomatic dispute over the opening of ‘a representative office in Vilnius under its own name.

The two officials stressed that the United States and the European Union “as democratic market economies, share a number of fundamental values ​​and principles which we must defend at the international level”.

“The way to fight harassment isn’t to give up, it’s to work together,” Kolas Yotaka, spokesperson for the presidential office in Taipei, said in a tweet.

Lithuania faces unofficial trade hurdles and a deterioration in diplomatic relations with China after allowing the office to open in its capital, a move Beijing sees as a violation of its one-China principle. China has also recalled its ambassador, although it denies blocking the country’s exports. The EU raised the dispute with the World Trade Organization.

Earlier Wednesday, Taiwan pledged to create a $ 200 million fund to invest in Lithuania and open up markets at home in response to what it calls economic pressure from China.

Taiwan would use the fund to invest in semiconductors, lasers, biotechnology and research, Eric Huang, head of the representative office in Vilnius, said at a press conference. He will also send a team to assess Lithuania’s aspirations to develop a semiconductor industry, he added.

“It is time for us to help you with your difficulties,” Taiwanese Deputy Foreign Minister Harry Ho-jen Tseng said at the same press conference.

Lithuania has sought to forge closer economic ties with Taiwan and has expected to gain a foothold in Taiwan’s semiconductor industry since last year, when it exited the China-led 17 + 1 format, a group of EU states that China uses to engage and influence the bloc.

The Taiwan National Development Council and the Lithuanian Ministry of Economy have further discussed details of the investment fund, which will be financed by the Taiwan National Development Fund. An even larger fund for investments backed by Taiwan’s central bank is in the works, Huang said.

On the commercial side, Taiwan is also working to redirect some 120 containers of Lithuanian products that have been stopped at Chinese ports and to open up the island’s market to Lithuanian dairy and grain products, Huang said. A Taiwanese company also bought 20,400 bottles of Lithuanian rum that China refused to let into the country, according to the South China Morning Post.

“Taiwan is committed to speeding up the process for Lithuania as Lithuania faces such economic coercion unprecedented in the history of international trade,” Huang said.

The dispute sparked political tensions in Lithuania, where President Gitanas Nauseda on Tuesday criticized the government for opening up the office with Taiwan and said the use of the democratically ruled island’s name in the label was a mistake.

Nauseda later returned to the remarks, saying his stance on opening the office remained positive and unchanged, adding that he had never called it a mistake.

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Global economy: Asian factories take Omicron risks in stride, for now https://japononline.net/global-economy-asian-factories-take-omicron-risks-in-stride-for-now/ Tue, 04 Jan 2022 03:01:00 +0000 https://japononline.net/global-economy-asian-factories-take-omicron-risks-in-stride-for-now/ An employee inspects a printed circuit board on the controllers production line at a factory in Gree, following the coronavirus disease (COVID-19) outbreak in Wuhan, Hubei province, China, on August 16, 2021. China Daily via REUTERS Register now for FREE and unlimited access to Reuters.com Register Chinese private PMI for December grows at fastest pace […]]]>

An employee inspects a printed circuit board on the controllers production line at a factory in Gree, following the coronavirus disease (COVID-19) outbreak in Wuhan, Hubei province, China, on August 16, 2021. China Daily via REUTERS

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  • Chinese private PMI for December grows at fastest pace in 6 months
  • Japan, South Korea: factory activity continues to grow
  • Most other Asian economies show solid expansion in activity
  • Supply constraints and rising costs continue to cloud the outlook

TOKYO, Jan. 4 (Reuters) – Activity at Asian factories increased in December, with companies picking up on the growing number of global cases of the novel Omicron coronavirus variant, although supply constraints persist and the surge input costs cloud the outlook for some economies.

The rising rate of infections around the world has raised eyebrows among policymakers, with outbreaks in China forcing some companies to halt production and threatening to disrupt production from memory chip giants like Samsung Electronics (005930.KS). Read more

For now, however, Omicron’s direct hit on production appears moderate, according to polls released Monday and Tuesday.

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Chinese factory activity grew at its fastest pace in six months in December, according to the Caixin / Markit Manufacturing Purchasing Managers Index (PMI) earlier today. Read more

The results of the private survey, which focuses more on small businesses in coastal regions, are consistent with those of China’s official PMI which indicated a slight increase in factory activity. Read more

Other parts of Asia have also performed well with the expansion of factory activity in countries such as Vietnam, Malaysia and the Philippines.

“Manufacturing PMIs and current trade data show that the export-oriented Asian industry gained momentum at the start of the year,” said Alex Holmes, Emerging Asia Economist at Capital Economics.

“While the Omicron variant poses a key threat to the outlook, it is unlikely to disrupt the industry as much as Delta did in the third quarter,” he said.

In Japan, the world’s third-largest economy, manufacturing activity increased in December for the 11th consecutive month. And South Korea’s flagship exporter has seen its major factories enjoy the fastest pace of expansion in three months, according to surveys.

“We expect the recovery in exports and investment in Asia to be supported by the continued global recovery, and Asian manufacturing PMIs will remain moderately strong over the next few months,” Morgan Stanley analysts wrote in a report. research note.

Some economists have warned, however, that supply shortages and rising input costs remain risks, especially for export-dependent countries like South Korea.

“Given South Korea’s importance to the automotive and electronics industries, substantial improvements in global supply chains will be needed before we see a significant acceleration in manufacturing growth,” said Joe Hayes, senior economist at IHS Markit.

Japan’s PMI index stood at 54.3 in December, remaining above the 50 Mark threshold indicating an expansion in activity, but below November’s 54.5 as growth in new orders slowed down. Read more

South Korea’s PMI rose to 51.9 from 50.9 in November to mark the 15th consecutive month of expansion, as rising domestic demand offsets weak overseas sales. Read more

Indian manufacturing activity continued to grow in December, but at a slower pace than in November, as high price pressures remain a concern. Read more

“The Omicron variant poses short-term growth risks by delaying the resumption of consumption, but higher vaccination rates in Asia could help limit damage to growth compared to the Delta wave,” analysts said by Morgan Stanley.

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Reporting by Leika Kihara Editing by Shri Navaratnam

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Finding stronger together in 2022 https://japononline.net/finding-stronger-together-in-2022/ Sat, 01 Jan 2022 23:00:50 +0000 https://japononline.net/finding-stronger-together-in-2022/ JAKARTA – As a born optimist, I consider 2021 to be a year of recovery. The COVID-19 pandemic is not yet over, but there is a silver lining for a better future both in the health sector and in the economy at large. Safe and effective vaccines have reduced deaths from COVID-19, while government fiscal […]]]>

As a born optimist, I consider 2021 to be a year of recovery. The COVID-19 pandemic is not yet over, but there is a silver lining for a better future both in the health sector and in the economy at large. Safe and effective vaccines have reduced deaths from COVID-19, while government fiscal interventions have helped spur economic growth. But the global recovery remains uneven, owing to varying countries’ pre-pandemic economic conditions and divergent stimulus policies.

Certainly, COVID-19 vaccines have been a game-changer. Rising vaccination rates have bolstered herd immunity, creating opportunities to ease restrictions and boost the economy. Yet while multilateral institutions have strived to ensure equitable global distribution of vaccines, many developing countries still struggle to get enough doses for their citizens while advanced economies deploy vaccines at high speed. This underpins an uneven global recovery and exacerbates inequalities.

Because we are only as strong as our weakest link in the fight against the pandemic, global collaboration is imperative. Every country wants to control the virus and get back to normal life. Multilateral institutions should therefore assume a greater role in ensuring that all can carry out their immunization programs quickly.

We also need to establish an early warning system and improve our crisis preparedness – in the form of resources, governance mechanisms, decision-making and information sharing – for future pandemics. Managing the frequent tensions between national sovereignty and global governance will be a major challenge. As the COVID-19 pandemic has shown, failure to do so risks causing further catastrophic damage in the future.

Boats are moored at a jetty in a fishing village in the Indonesian province of Aceh in May. | AZWAR IPANK / AFP / VIA GETTY IMAGES

As for the economy, countries are currently in different stages of recovery and are pursuing various types of post-pandemic strategies, both in terms of policy and timeframe. But in a highly interconnected world made up of many different but interrelated financial and economic systems, the easing of stimulus measures in one country will affect others. In particular, normalization of monetary policy in developed economies, if not communicated transparently, can increase volatility and trigger potentially destabilizing capital outflows from emerging markets.

The COVID-19 crisis has put enormous pressure on the public finances of many developing countries, leaving governments grappling with rising debt levels as they attempt to fight the pandemic. International financial institutions and private creditors must work together to ensure a fair burden-sharing system to help them. While the tailor-made approach envisioned under the common framework of the G20 Debt Service Suspension Initiative is useful, this relief remains a temporary measure. Multilateral institutions need to provide increased surveillance and advice to address the growing debt problems of developing economies and alleviate their high financial distress.

Additionally, as the economic recovery begins to take hold, the global supply chains that have been disrupted by the pandemic cannot immediately adapt to meet the current surge in demand. This problem may be transient, but it is costly. The pandemic is therefore expected to prompt businesses and policymakers to reassess current global supply chains and resource allocation – a calculation that could generate momentum for emerging markets to gain a greater share of the global economic recovery.

Meanwhile, demand for energy has exceeded its pre-pandemic level, causing a global crisis. Besides the risk that soaring prices will spur inflation, the energy crisis also threatens our efforts to tackle climate change. Like the fight against the pandemic, measures to combat global warming can only be successful if we implement them together and in a coherent manner.

A ranger carries his grandson after completing a patrol in the Indonesian province of Aceh.  |  CHAIDEER MAHYUDDIN / AFP / VIA GETTY IMAGES
A ranger carries his grandson after completing a patrol in the Indonesian province of Aceh. | CHAIDEER MAHYUDDIN / AFP / VIA GETTY IMAGES

Today, we have the opportunity to jumpstart the economy and tackle climate change at the same time by fostering a green, resilient and inclusive recovery. Grasping it requires us to design positive economic policies for the climate and to provide more sustainable financing. As part of Indonesia’s economic recovery strategy, for example, the government has introduced programs to create alternative activities that both generate income and preserve forests for local communities.

Green stimulus programs are also likely to empower women, who have typically been hit harder than men by the pandemic and the climate crisis. In many cases, women act as change agents for sustainable initiatives. As a country with one of the largest areas of rainforest in the world, Indonesia is firmly and clearly committed to implementing a green recovery. And as the co-chair of the Coalition of Finance Ministers for Climate Action, I firmly believe that green initiatives should not be unfunded mandates.

Indonesia will assume the presidency of the G20 in 2022 and the presidency of the Association of Southeast Asian Nations in 2023. It can therefore help define the strategic direction of these groups to ensure a sustainable global recovery, resilient and inclusive. In particular, G20 members must establish an effective common framework to address the major global challenges of our time, including pandemic prevention, sustainable financing and climate change.

None of this will be easy, of course. But, like I said, I am an optimist. By generating sufficient political will, I am convinced that we can come back together, and therefore stronger, from the COVID-19 crisis.

Sri Mulyani Indrawati is Minister of Finance of Indonesia and Co-Chair of the Coalition of Finance Ministers for Climate Action. © Project Syndicate, 2021

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ENEOS and PFN pass trial at AI-controlled petrochemical plant https://japononline.net/eneos-and-pfn-pass-trial-at-ai-controlled-petrochemical-plant/ Fri, 31 Dec 2021 11:18:15 +0000 https://japononline.net/eneos-and-pfn-pass-trial-at-ai-controlled-petrochemical-plant/ The project lasted two days and consisted of monitoring important factors and adjusting valves based on simulated data processed by the system. © ENEOS Corporation ENEOS Corporation and Preferred Networks, Inc. announced that they have successfully operated a stand-alone butadiene extraction unit at the ENEOS Kawasaki refinery petrochemical plant for two consecutive days using a […]]]>

The project lasted two days and consisted of monitoring important factors and adjusting valves based on simulated data processed by the system.


ENEOS Corporation and Preferred Networks, Inc. announced that they have successfully operated a stand-alone butadiene extraction unit at the ENEOS Kawasaki refinery petrochemical plant for two consecutive days using a new intelligence system artificial. The system, which was jointly developed by the two companies, automates large-scale and complex operations at oil refineries and petrochemical plants that currently require skilled operators.

The AI ​​was designed to predict future unit sensor values ​​and valve operating requirements based on past data of complex correlations between multiple similar values ​​generated via simulated data. The trial lasted for two days, during which time the system managed to monitor 25 important factors including internal temperature, pressure, flow rate and product conditions, and autonomously adjust 12 valves in the unit. extraction of butadiene.

Both companies expect the AI ​​system to help improve the safety and stability of plant operations by reducing reliance on different skill levels of operators. Its development is supported by 2020 grants from the Japanese Ministry of Economy, Trade and Industry.

The trial will continue to achieve stable operations and expand its use to other major plant units, including same-site crude stills and other refineries. Following the success of its joint venture, ENEOS and PFN plan to implement a new AI-based autonomous factory operating model to increase production and energy efficiency.

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Here are five major predictions for 2022 https://japononline.net/here-are-five-major-predictions-for-2022/ Wed, 29 Dec 2021 18:18:03 +0000 https://japononline.net/here-are-five-major-predictions-for-2022/ It’s time to make my best guesses for next year: 2022 is a year to go big and bold, because a boom is ahead. Not a boom in everything, but definitely a lot. Some good, some not so good. Let’s talk about the booms to come. Friendly reminder: don’t be a hero and take these […]]]>

It’s time to make my best guesses for next year: 2022 is a year to go big and bold, because a boom is ahead. Not a boom in everything, but definitely a lot. Some good, some not so good.

Let’s talk about the booms to come.

Friendly reminder: don’t be a hero and take these predictions as investment advice. They are not. They are made for fun and to get you thinking. You can tell me if they’re wrong at the end of the year.

Having said that, I have basically gone 5 to 5 on my predictions this year. One could procrastinate on the “Roaring 20s” prediction, given omicron, but there is no indication that the economy is slowing, so I will consider this a victory. As of this writing, ETF Invesco DB Commodity Index Tracking and medical device company DexCom, which I referred to in my forecast, have both increased by over 40% since the start of the year. . That’s more than the ETF Invesco QQQ, which gained 28%, and the S&P 500, up 27% in 2021.

Traders work on the floor of the New York Stock Exchange (NYSE) on December 02, 2021 in New York City.

Spencer Platt | Getty Images

Now it’s time for 2022 and the booms to come.

1. Price boom

Prediction: CPI exceeds 4% on average all year round

Inflation will get worse before it gets better. Salaries are rising (that’s good!) But costs are likely to rise even more (that’s bad). House prices and rents are still too high. Car prices stay in the stratosphere. Energy costs will increase this winter. Want to eat? Not only are food prices rising – or packaging getting smaller – but Record fertilizer prices now could push food prices even higher next year. Also, no, the shipping and port situation is hardly any better, despite what you can hear. On the contrary, the ships just move more offshore. And sorry, Federal Reserve Chairman Jay Powell, unless you learn how to grow or unload containers, a few interest rate hikes won’t matter much in the short term. Assuming the government doesn’t change the inflation metrics on us (hey, it’s an election year after all), we should end 2022 with a consumer price index gain of more than 4%.

2. Baby boom

3. Japan Boom

Prediction: Nikkei 225 tops S&P 500

Japan is a booming country. Sounds strange, doesn’t it? Of course, Japan has a stagnant economy. Has been for years. Numerous recessions in recent decades. And hey, Japan is so badly in need of a baby boom that the government has come up with policies to encourage the creation of a family. But from a business perspective, Japan has done it. Valuations of Nikkei companies are well below those of the S&P 500, even as earnings rise. Oh, and Japan’s tax policy is as simple as ours. Jefferies analysts see value in many Japanese companies like Sony, Toyota, Suzuki, Subaru, Denso and others. Result: the iShares MSCI Japan ETF EWJ outperforms the S&P 500 in 2022.

4. Boom EV

Prediction: sales of electric vehicles exceed 10% of the automotive market

Hope finally meets the hype. Electric vehicles (EVs) are still a tiny bit in the US auto market. They represent around 4% of passenger car sales, according to BloombergNEF. They are hampered by high prices and concerns about battery life. This changes in 2022. The number of electric models available will double to around 20. This is still only a fraction of the roughly 300 models available in total, but significant for two reasons. First, you no longer need to be a Bitcoin billionaire to afford an EV. Then we get what Americans really want: trucks and SUVs. Between the Ford F-150 Lightning and the Rivian R1T (Motor trend Truck of the Year for 2022), as well as so-called mid-size ‘cute utility’ like the Volkswagen ID.4, there are the options that American families want (especially if we get the aforementioned baby boomer) . The prices are also falling.

Perhaps the biggest sales hurdle outside of cost – the availability of charging stations – is also being addressed nationally. As I discovered on a 517 mile road trip in an all-electric Polestar in August, range anxiety is a real thing. But as more charging stations are built and drivers can see that they won’t have to worry about where to charge when they’re not at home, it will be a cycle. positive bullish which will increase sales.

5. Heavy metal boom

Prediction: copper and palladium look like gold

Want to build an EV? You need copper. Charging station? The copper. A giant battery to store renewable energy? You guessed it, copper. The average electric car uses over 150 pounds of copper. Now multiply that by millions of cars, batteries, power lines and whatever else we want to build on the grid. It is a lot of metal that must be extracted from the ground. The world’s largest copper mining country, Chile, has just elected a new president who sound like he doesn’t like to mine copper. Freeport McMoRan must be in mining heaven. Meanwhile, palladium has been a dog of a metal this year, but that can change. Palladium is primarily considered to be used in gas guzzling cars, but it is now being tested in new battery technologies. It all sounds like a recipe for increased demand over little increased supply. Bullish.

Special Bonus Prediction: The 10-year Treasury yield ends in 2022 below 1.75%. Timestamp that!

Happy New Year and on the way to a healthy, happy and pandemic end of 2022.


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