Japanese companies are increasingly withdrawing from China, with their number reportedly down about 30% from the peak. According to a survey by Teikoku Databank, 10,118 Japanese companies were operating in China as of June, including 3,961 in Shanghai, while the number operating in Beijing had halved.
According to a survey by Teikoku Databank, the total number of Japanese companies operating in China stood at 10,118 as of June, down approximately 30% from the period when it was at its former peak.
There were reportedly 3,961 Japanese companies operating in Shanghai, down approximately 30% from 4 years ago. The number of companies operating in Beijing has also halved.
Against a backdrop of deteriorating Japan-China relations and a sluggish Chinese economy, Japanese companies are proceeding with withdrawals from and downsizing in the Chinese market. As the diversification of Chinese companies and supply chains, along with decoupling, gathers pace, the role of China in Japanese companies' businesses is being reassessed.
Teikoku Databank said that withdrawals from China are likely to accelerate against a backdrop of heightened country risks, including deteriorating Japan-China relations, export controls and the Anti-Espionage Law. Withdrawals and diversification may continue in the future.