Japanís auto sector now accounts for one-third of U.S. auto market sales. But Japan still depends on exports and, since 2001, has been much more exposed to the Chinese market. Japanese exports to China, which were very small before 2000, make up almost 15% of total Japanese exports, while the U.S. share has declined by nearly the same amount.
Japanís export base increased at a 20% annual rate between 2002 and 2004, with almost a quarter of this growth coming from China. During this period, Chinese imports were growing at about a 50% annual rate, while Japanís exports to China were rising at almost a 60% annual rate.
ďChinaís explosion onto the world economic stage was a huge boon for Japan, which not only benefited in terms of export stimulus, but from a direct source of domestic stimulus to an economy that had struggled to find the momentum to lift itself out of its long-term recession,Ē says Fosler.
But Fosler says much of the optimism about Japanese economic growth may be a delayed reaction to the better than expected performance of 2004-2005 rather than a hard-nosed appraisal of the future. Recently, Japanís machinery export orders and industrial activity have been flat, and its profit growth is slowing rapidly and its productivity growth is stagnating. And Chinaís exports, which have been important to all of Asia, are now rising at only about a 15% annual rate.
My guess: Japanese businesses are less eager than American businesses to move factories from the home country to China. So what would have been US export growth to China instead became US companies making their goods in China for the China market. Mind you, that's just a guess.
Anyone have a source for what percentage of manufacturing of US and Japanese companies takes place in the home countries versus various other countries?
|Share |||By Randall Parker at 2006 July 23 01:02 PM Economics Trade|