Risk of Political, Economic and Institutional Changes Overseas, Including China

「一方、石油化学製品を中心に、中国の内需を上回る生産とそれに伴う輸出拡大の影響が続いております。」

「There are concerns about an economic downturn caused by growing tensions in the Middle East, declining consumer sentiment because of inflation, higher interest rates and foreign exchange volatility, and uncertain conditions are expected to continue.」

「There are concerns about downside risks caused by a continued decline in consumer sentiment because of inflation, the impact of US trade policy, the delayed recovery of the Chinese economy and geopolitical risks, and uncertain conditions are expected to continue.」

「Meanwhile, the global economy faces numerous concerns, including the continued high level of interest rates in the United States and Europe, the delayed recovery of the Chinese economy and growing geopolitical risks, and uncertain conditions are expected to continue.」

「However, the global economy entered difficult conditions because of global monetary tightening, declining consumer willingness to spend because of inflation, the delayed recovery of the Chinese economy, the prolonged Russia-Ukraine conflict and growing tensions in the Middle East.」

「However, the global economy entered difficult conditions because of the prolonged Russia-Ukraine conflict, monetary tightening in the United States and Europe, the delayed recovery of the Chinese economy and declining consumer willingness to spend because of inflation.」

「However, the global economy entered difficult conditions because of the prolonged Russia-Ukraine conflict, monetary tightening in the United States and Europe, the delayed recovery of the Chinese economy and declining consumer willingness to spend because of inflation.」

「Current concerns that may affect the Group's operating results and other matters include tighter environmental and safety regulations in China, stalled trade resulting from the fragmentation of the global economy into blocs, and deterioration in Japan-China relations due to growing tensions surrounding Taiwan.」

「However, difficult conditions are expected to continue for the time being, owing to the prolonged Russia-Ukraine conflict, declining consumer willingness to spend because of cost-push inflation, and a slowdown in the global economy caused by monetary tightening by the United States and other countries.」

「There are many factors weighing on the economy, including the prolonged Russia-Ukraine conflict, surging resource and energy prices accompanying the rapid depreciation of the yen, and concern about a slowdown in the global economy caused by monetary tightening by the United States and other countries, and uncertain conditions are expected to continue.」

「There are many factors weighing on the economy, including surging resource prices and supply chain disruptions caused by Russia's invasion of Ukraine, higher import prices resulting from the weaker yen, restrictions on social and economic activity caused by China's strict implementation of its zero-COVID policy, monetary tightening by the United States and other countries, and concern about the spread of the seventh wave of COVID-19, and uncertain conditions are expected to continue.」

「The impact on the economy of China's strict implementation of its zero-COVID policy, moves to strengthen environmental and safety regulations in China, the impact of the zero-COVID policy aimed at containing COVID-19, and deterioration in Japan-China relations resulting from the division between Eastern and Western countries caused by US-China tensions and Russia's invasion of Ukraine were identified as developments that could affect the Group's operating results and other matters.」

「However, there are many current concerns, including a sharp increase in infections from the Omicron variant of COVID-19, rising resource prices, the global semiconductor shortage and changes in the monetary policies of various countries, and uncertain conditions are expected to continue.」

「There are many current concerns, including automobile manufacturers' production cuts caused by the global semiconductor shortage and difficulties procuring parts from Southeast Asia, as well as the impact on the economy of power shortages in China and concerns about the creditworthiness of real estate companies, and uncertain conditions are expected to continue.」

「Toho Chemical (Shanghai) Co., Ltd., a consolidated subsidiary of the Company that received an order to suspend production from the Jinshan District Emergency Management Bureau of Shanghai, China, dated 30 April 2021, was granted permission to resume production by the same bureau on 27 July 2021 and resumed production activities on 28 July 2021.」

「However, the end of the COVID-19 pandemic is still not in sight. Rather, a sharp increase in infections from winter onward could lead to the reissuance of a state of emergency at the beginning of the year, potentially putting the brakes on the economic recovery, and uncertain and difficult conditions are expected to continue for the time being.」

「During the six-month period ended [the relevant period], Japan's economy deteriorated rapidly as domestic and overseas economic activity stagnated due to the spread of COVID-19. Although signs of a recovery have emerged recently, concern remains about a prolonged slump in personal consumption caused by rising unemployment and deteriorating income conditions, as well as declining capital investment caused by worsening corporate earnings, while the pandemic remains unresolved, and difficult conditions are expected to continue for the time being.」

「Although economic activity is gradually being restored at present, uncertain conditions are expected to continue because COVID-19 remains rampant in many overseas regions, concern remains about a second wave of infections in Japan, and US-China tensions may be prolonged.」

「If risks in China, including deteriorating political and economic conditions, unexpected changes in laws and regulations, difficulty recruiting and retaining personnel, terrorism, war, labor disputes and other social unrest, and worsening public security, materialize, they may adversely affect the production and sales activities of the Group's 3 consolidated subsidiaries located in China, thereby affecting the Group's operating results and other matters through lower sales and higher costs. In particular, current developments that may affect the Group's operating results and other matters include moves to strengthen environmental regulations in China, tighter import and export regulations and higher tariff rates resulting from worsening trade relations between China and other major countries.」

「Uncertain conditions are expected to continue, owing to developments in US-China trade issues, the outlook for the Chinese economy, the impact of the United Kingdom's withdrawal from the EU, changes in conditions in the Middle East and concern over the spread of COVID-19.」

「Uncertain conditions are expected to continue, owing to the prolonged impact of US-China trade issues, the United Kingdom's withdrawal from the EU and growing tensions in the Middle East.」

「During the three-month period ended [the relevant period], Japan's economy began to show signs of stagnation. Although the recovery in personal consumption and solid corporate capital investment continued, some weakness emerged in exports and production against a backdrop of a slowdown in the Chinese economy. Uncertain conditions are expected to continue, owing to the impact of US-China trade issues, the United Kingdom's withdrawal from the EU and growing geopolitical risks.」

「Going forward, concern remains about a slowdown in the global economy caused by trade friction and intensified competition resulting from inflows of inexpensive petrochemical products as large-scale new plants come on stream overseas.」

「During the six-month period ended [the relevant period], Japan's economy continued a moderate recovery, although the increase in exports stalled somewhat because of natural disasters and other factors. Capital investment increased, reflecting solid corporate earnings, while personal consumption remained firm against a backdrop of improving employment and income conditions. Meanwhile, concern remains about the impact on corporate earnings of rising raw material, labor and logistics costs, as well as the impact of trade friction accompanying the spread of protectionist trade policies, and uncertain conditions are expected to continue.」

「Concern remains about the impact on corporate earnings of rising raw material, labor and logistics costs, as well as the impact of trade friction accompanying the spread of protectionist trade policies, and uncertain conditions are expected to continue.」

「During the nine-month period ended [the relevant period], Japan's economy continued a moderate recovery, with exports maintaining an upward trend as the global economy recovered moderately, domestic capital investment increasing in line with solid corporate production activity, and personal consumption remaining firm as employment and income conditions improved.」

「During the six-month period ended [the relevant period], Japan's economy continued to expand moderately and in a well-balanced manner across both external and domestic demand: exports trended upward as overseas economies recovered, domestic capital investment increased against a backdrop of solid corporate earnings, and personal consumption remained firm as employment and income conditions improved.」

「Looking ahead, we expect the economy to continue on a moderate recovery track, supported by firm domestic and overseas economies. At the same time, many uncertain factors remain, including trends in crude oil prices and foreign exchange rates and geopolitical risks, and we expect conditions to remain such that optimism about the outlook is not warranted.」

「Through the first half, exports declined and production slowed because of the slowdown in overseas economies and the stronger yen, while personal consumption remained weak as the boost from inbound tourism faded, and stagnant conditions continued. From October onward, however, exports and production turned positive, supported by increased IT-related investment, government fiscal spending and the effect of a weaker yen,」

「During the six-month period ended [the relevant period], Japan's economy continued to recover moderately on an underlying basis, but exports continued to decline owing to the slowdown in overseas economies and the stronger yen, corporate earnings slowed, and personal consumption also weakened as the boost from inbound tourism faded, resulting in generally stagnant conditions.」

「In June, following the decision for the United Kingdom to leave the EU, uncertainty surrounding the outlook for the economy increased further as uncertainty in the global economy grew and the yen surged. In the chemicals industry, the trend of a weaker yen and lower crude oil prices, which had driven up corporate earnings through the previous fiscal year, has paused, and concern is growing that a stronger yen amid a global economic slowdown will worsen the export environment.」

「Deteriorating political and economic conditions overseas, unexpected changes in laws and regulations, worsening public security and other factors may affect the Group's operating results and financial position.」