COVID-19 Pandemic: Japan To Fund Firms to Shift Production Out of China
Japan has earmarked ¥243.5 billion as an economic support package to help manufacturers seeking to move their production out of China. The decision has come out for those seeking to shift their production units.
A new sensational news has come out that Chinese President Xi Jinping was supposed to visit Japan early this month but the visit was postponed a month ago and no new date has been set. The imports from China leaned by almost half in February as the COVID-19 Pandemic shuttered factories.
Owing to the situation, Japanese government has asked all its companies with their manufacturing plants in China to reduce reliance on China as a manufacturing base and shift back to Japan. Japan government is now helping its home organizations to shift their manufacturing plants from China owing to the supply chain disruptions. The Japanese government has also allocated a fund of $2 Billion to help them deal the crisis.
The extra budget, assembled to try to offset the shattering effects of the pandemic, includes 220 billion yen ($2 billion) for companies shifting their manufacturing units back to Japan. Further, another fund amounting 23.5 billion yen is expected to be allocated for Japanese companies to move production to other countries like Southeast Asia.
Many in Japan are inclined to blame China for mishandling the early stages of the outbreak. China is being blamed for not stopping the visitors from the country to travel to other parts of the world sooner. This is known to be one of the main causes of spreading the pandemic.
China is a major trading partner of Japan and the current circumstances has saw imports from China declined by almost half in February as the factories started getting closed which in turn let Japanese manufacturers run out of necessary components.
At the moment, it seems like China’s relations with the U.S and western European also are unraveled.