Korean Tensions Hurt Japan Firms

Under Prime Minister Shinzo Abe, Japan has angered its neighbors with assertive foreign policies and looser restraints on the military, although tensions with China have not returned to levels seen in 2012 when territorial disputes prompted violent anti-Japan protests.

But the results suggest that if relations with Japan’s top and third-biggest trading partners should worsen sharply, that could hinder the fragile economic recovery Abe has engineered. It would also add momentum to a shift by Japanese companies towards investing more in Southeast Asian countries and less in China.

“If political conflict with China and South Korea becomes more serious, moves to avoid new investment in China and South Korea will of course arise,” said a manager at an electronics firm that mainly supplies companies making capital investments.


Content is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Business Information & Services, Inc. or any of its affiliates, subsidiaries, officers or directors. If you would like to reproduce or redistribute any of the content found on MarketPulse, an award winning forex, commodities and global indices analysis and news site service produced by OANDA Business Information & Services, Inc., please access the RSS feed or contact us at info@marketpulse.com. Visit https://www.marketpulse.com/ to find out more about the beat of the global markets. © 2023 OANDA Business Information & Services Inc.