Political, geopolitical and regulatory risks in overseas operations

「During the fiscal year under review, geopolitical risks continued against a backdrop of the prolonged Russia-Ukraine conflict and instability in the Middle East. The outlook remained uncertain due to the sluggish Chinese economy and the impact of U.S. tariff measures, among other factors.」

「中東情勢の悪化に伴う化学繊維の価格高騰により、 設備投資に慎重な動き。 2026年7月に予定されるUSMCA見直しによる影響への懸念。」

「During the interim consolidated accounting period, the global economy showed signs of a moderate recovery, but the outlook remained uncertain due to the prolonged Russia-Ukraine conflict, continuing geopolitical risks arising from escalating tensions in the Middle East, slower growth in the Chinese economy and the impact of additional U.S. tariff measures.」

「Furthermore, the environment surrounding our corporate group is expected to remain uncertain due to the prolonged situation surrounding Russia and Ukraine, the sluggish Chinese economy and the foreign and trade policies of the second Trump administration.」

「However, concerns over a downside to the Chinese economy due to the prolonged situation surrounding Russia and Ukraine, escalating tensions in the Middle East and sluggish property market conditions continued. In addition, certain short-term risks became more prominent, including inflation concerns arising from price pressures accompanying a possible resurgence of geopolitical tensions such as the U.S. presidential election and trade friction scheduled for November.」

「During the fiscal year under review, the global economy showed some positive developments, including resilient consumption in major countries such as the United States and China and expanding domestic demand in the ASEAN economic region. However, conditions remained uncertain due to heightened geopolitical risks resulting from the prolonged situation surrounding Russia and Ukraine, global inflation and monetary tightening in Europe and the United States.」

「During the first nine months of the fiscal year under review, inflation remained persistent due to the prolonged situation surrounding Russia and Ukraine and instability in the Middle East. The outlook remained uncertain and opaque as the economy faced foreign exchange fluctuations associated with monetary tightening in various countries and downside risks to the Chinese economy resulting from the sluggish property market.」

「During the first six months of the fiscal year under review, concerns including persistently high raw material prices resulting from the prolonged situation surrounding Russia and Ukraine and financial instability caused by policy rate increases in various countries remained, and the economic recovery slowed. A recovery in business sentiment among U.S. companies was also expected to take time, while the Chinese economy slowed against a backdrop of deterioration in the property market. Including the prolonged instability in U.S.-China relations, the outlook remained extremely uncertain.」

「The outlook remained extremely uncertain due to the prolonged situation surrounding Russia and Ukraine and stagnation in the Chinese economy, which had shown signs of recovery for a time.」

「During the first nine months of the fiscal year under review, the global economy remained unstable. Although many regions eased activity restrictions related to COVID-19, the recovery in consumption in China slowed due to movement restrictions under its zero-COVID policy. Inflation continued to advance against a backdrop of prolonged tensions surrounding Russia and Ukraine and soaring goods and energy prices, while monetary tightening by countries caused sharp foreign exchange fluctuations, leaving the outlook extremely uncertain.」

「Meanwhile, inflationary pressure became apparent against a backdrop of extensive movement restrictions in China in response to COVID-19, escalating tensions surrounding Russia and Ukraine, global increases in the prices of goods and energy, supply shortages and tight labor supply and demand, and the outlook remained uncertain.」

「During the first quarter of the fiscal year under review, the global economy continued to face disruptions to international transportation, higher transportation costs, shortages of components including semiconductors and an economic slowdown caused by China's zero-COVID policy, even as efforts to balance COVID-19 prevention with economic activity progressed. In addition, concerns over the prolonged situation in Ukraine drove up resource prices and contributed to growing uncertainty over the outlook.」

「Meanwhile, the situation remained unpredictable due to the economic slowdown caused by China's zero-COVID policy, soaring maritime transportation costs and delays, shortages of components including semiconductors, the prolonged Russian invasion of Ukraine and soaring energy prices.」

「However, the global spread of infections caused by variants continued to increase, raising the risk of a downside to the economy, and conditions remained uncertain.」

「During the first nine months of the fiscal year under review, the global economy was recovering from the significant slowdown caused by lockdowns and other measures taken in response to the spread of COVID-19, but economic growth remained well below the previous year's level and uncertainty over the outlook continued.」

「During the first six months of the fiscal year under review, the global economy remained extremely difficult as the impact of the spread of COVID-19 persisted, despite signs of recovery in some areas, including China.」

「During the first quarter of the fiscal year under review, the global economy fell into a severe recession as economic activity stagnated due to the spread of COVID-19.」

「In addition, risks with an unclear outlook, including the spread of the novel coronavirus, the slowdown in the Chinese economy and U.S.-China trade friction, have increased.」

「During the first nine months of the fiscal year under review, the global economy remained weak, mainly because of slower growth in the Chinese economy resulting from the impact of protectionist trade policies. Demand for capital investment in industrial sewing machines was cautious due to the impact of U.S.-China trade friction and political instability in Latin America, and sales remained sluggish.」

「During the first six months of the fiscal year under review, the global economy showed signs of slowing, as growth in the Chinese economy decelerated under the impact of protectionist trade policies and manufacturing conditions also deteriorated in the United States.」

「During the first quarter of the fiscal year under review, the global economy showed signs of slowing as uncertainty over the outlook increased due to the impact of U.S.-China trade friction and slower growth in the Chinese economy.」

「During the fiscal year under review, the global economy generally remained firm, although the Chinese economy slowed markedly in the second half of the year as trade policies between the United States and China intensified. U.S. personal consumption remained resilient, while the outlook remained uncertain due to factors including uncertainty over negotiations on the United Kingdom's withdrawal from the EU, global geopolitical risks, developments in global trade policy and changes in countries' monetary policies.」

「Although the global economy showed moderate growth, it also faced destabilizing factors, including the impact of intensifying tensions between the United States and China on economic conditions and foreign exchange markets.」

「Although the outlook for the global economy remained uncertain due to the impact of global trade friction resulting from U.S. trade policy, the United Kingdom's withdrawal from the EU and geopolitical risks, the U.S. economy remained firm, supported by improving employment conditions and an upward trend in personal consumption.」

「The global economy remained firm, driven by domestic demand in both developed and emerging economies, despite concerns including prolonged trade friction centered on the United States and a slowdown in the Chinese economy as China moves to curb excessive investment.」

「Some of these countries, which are customers of our corporate group, are politically, geopolitically or economically unstable. Labor disputes, terrorism, war, civil war, currency crises and natural disasters such as earthquakes could make it difficult to continue operations and manage overseas bases due to frozen foreign exchange transactions, defaults on debt, expropriation of investment assets and other consequences.」

「During the cumulative third quarter of the fiscal year, the Japanese economy continued its gradual recovery against a backdrop of improving corporate earnings and employment conditions, but the economic outlook remained uncertain due to US policy trends and geopolitical risks.」

「During the cumulative second quarter of the fiscal year, the Japanese economy continued its gradual recovery against a backdrop of improving corporate earnings and employment conditions, but the economic outlook remained uncertain due to US policy trends and geopolitical risks.」

「During the cumulative first quarter of the fiscal year, the Japanese economy continued its gradual recovery against a backdrop of improving corporate earnings and employment conditions, but uncertainty remained over the economic outlook due to US policy trends and heightened geopolitical risks.」

「During the cumulative third quarter of the fiscal year, the Japanese economy followed a gradual recovery trend against a backdrop of improving employment and income conditions, but the outlook remained uncertain, including because of exchange-rate movements associated with the transition to a new US administration. In the global economy, personal consumption in the US remained firm amid improving employment and income conditions. The European economy continued its gradual recovery despite concerns about the UK's withdrawal from the EU, while uncertainty continued due to the slowdown in China and other emerging economies.」

「During the cumulative second quarter of the fiscal year, the Japanese economy remained uncertain, as corporate earnings and personal consumption lacked strength amid the appreciation of the yen and uncertainty over the outlook for the global economy. In the global economy, personal consumption in the US remained firm against a backdrop of improving employment and income conditions. The European economy continued its gradual recovery despite concerns about the UK's withdrawal from the EU, while uncertainty continued in China and other emerging markets as their economies slowed.」

「During the cumulative first quarter of the fiscal year, the Japanese economy remained in an uncertain state, with a growing sense of stagnation in corporate earnings and personal consumption against a backdrop of the rapid appreciation of the yen and unstable conditions overseas. In the global economy, the US economy continued to recover, with employment conditions and personal consumption remaining firm. The European economy continued its gradual recovery, although concerns remained about a deterioration in the outlook due to political instability and other factors. The Chinese economy showed clear signs of slowing, while emerging economies remained uncertain despite signs of recovery in some areas.」

「Labor disputes, terrorism, war, civil war, currency crises, earthquakes and other natural disasters could make it difficult to continue operations or manage overseas sites by causing foreign exchange transactions to be frozen, defaults on debt obligations, or the expropriation of investment assets.」