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Expert: Japan, U.S. should share basic values in dealing with Chinese economy

  • March 17, 2021
  • , Nikkei , p. 4
  • JMH Translation

By Yoko Takeda, chief economist and general manager at the Research Center for Policy and Economy at Mitsubishi Research Institute

 

I believe the Japanese and U.S. governments’ confirming their intention to fortify the alliance in response to China will lead to positive outcomes, such as a more stable international order and a stronger foundation for economic activities.

 

We should note, however, that pandemic-stricken Japan owes much of its recent uptick in exports and increase in production to China’s economic recovery. This is especially true for semiconductor-related parts and electronic components. Japan’s forte is the production of semiconductor manufacturing equipment, and a good percentage of it is exported to China. This means that Japan must leave room for cooperation with the China.

 

The U.S.-China conflict has been largely regarded as concerning political, diplomatic, and security issues. However, the conflict will have a real and significant impact on the economic activities of nations and private corporations. A thorough understanding of the national strategies of the countries involved and the security implications of certain transactions will be a prerequisite for the companies when formulating their plans and conducting business.

 

For example, the companies will need to consider which of their products might violate the U.S. Export Administration Act. The Japanese government, in cooperation with the domestic business community, should provide support for corporations. This situation is no different for U.S. business leaders. It is equally difficult for them to detach their business from the Chinese economy.

 

Japan and the U.S. should have common basic values when dealing with the Chinese economy, which is more robust than that of any other country in the world amid the COVID-19 pandemic.

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