Japan Begins 'Mass Exodus' of Manufacturing from China
Japanese Prime Minister Shinzo Abe vows to be 'less dependent on one country, China'
Japan has started a "mass exodus" of manufacturing from China as the country moves to become more self-sufficient and less reliant on the Chinese Communist Party's supply chain.
The Japanese government is seeking to end reliance on its Chinese neighbor following the coronavirus pandemic that originated in China.
Japanese Prime Minister Shinzo Abe has vowed to build "an economy that is less dependent on one country, China."
Abe is proposing that Japan brings much of its manufacturing home and imports less from abroad so "the nation can better avoid supply chain disruptions" in the future, Nikkei Asia Review reports.
The move will likely strike fear into the Communist Party of China (CPC) as many of the world's leading economies look set to follow suit.
The United States has been touting an America First policy for the last four years under President Donald Trump's leadership, leading to a booming economy, pre-pandemic.
President Trump has already set the wheels in motion to end reliance on Chinese supply chains in response to the COVID-19 crisis.
Britain and the EU now also look set to follow America's lead.
In Beijing, the country's unelected ruling Communist Party is said to be in a state of panic.
"There are now serious concerns over foreign companies withdrawing from China,” a Chinese economic source said.
"What has particularly been talked about is the clause in Japan’s emergency economic package that encourages (and funds) the re-establishment of supply chains.”
"Had the pandemic not struck, Chinese President Xi Jinping’s maiden state visit to Japan would have been wrapped up by now with Xi proudly declaring a 'new era' of Sino-Japanese relations.
"He would have cheered on Abe as Japan prepared for the next big event, the 2020 Olympics.
"Instead, both Xi’s trip and the Tokyo Olympics have been postponed, and Sino-Japanese relations find themselves at a crossroads."
As Neon Nettle previously reported, Japan has started making moves to end its reliance on China in early April, by paying out billions of dollars to companies to quit the communist country and move their production elsewhere.
In its coronavirus stimulus relief package, the Japanese government has earmarked hundreds of billions of yen to go toward helping its manufacturing companies to withdraw their production plants from communist China.
The country is seeking to end dependence on China while bringing companies back to Japan or to relocate to other countries.
“The extra budget, compiled to try to offset the devastating effects of the pandemic, includes 220 billion yen (US$2 billion) for companies shifting production back to Japan and 23.5 billion yen for those seeking to move production to other countries, according to details of the plan posted online,” Bloomberg News reports.
"That has renewed talk of Japanese firms reducing their reliance on China as a manufacturing base," the outlet added.
"The government’s panel on future investment last month discussed the need for manufacturing of high-added value products to be shifted back to Japan, and for production of other goods to be diversified across Southeast Asia.”