Japanese companies focus on supply chains, amid rising US-China trade tensions

MLex Market Insight

News

4.9 • 9 Ratings

🗓️ 14 April 2023

⏱️ 10 minutes

🔗️ Recording | iTunes | RSS

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Summary

The trade confrontation between the US and China is reverberating in Japan, where businesses are facing a flurry of regulations imposed as a result of the growing tension between the two powers. It’s a particularly complex issue for Japan, given that China is the country’s largest trading partner and the US its second-largest. The geopolitical concerns have prompted some Japanese businesses to diversify their supply chains; however, given the size of the Chinese market, Japanese companies aren’t expected to walk away from China any time soon.

Transcript

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0:00.0	Hello, welcome back to Emlex's weekly podcast covering the most significant news in regulatory affairs with the assistance of our team of reporters around the globe.
0:20.3	My name is James Panicki, senior editor
0:22.5	with Emlex's Asia Bureau, and it's great to have your company today. I hope you're well,
0:27.6	wherever you may be listening. Now, take a guess at what's keeping Japanese lawyers awake at night.
0:33.7	No, it's not antitrust rules, it's not data breaches, but supply chains and the growing
0:39.3	compliance burden that they're facing as a result of trade tensions between the US and China.
0:45.3	In fact, Japanese companies are being caught up in a flurry of trade restrictions.
0:50.4	Most recently, Japan has committed itself to restrict exports on key products and resources.
0:56.4	These include semiconductors, permanent magnets, robots and even rare earth minerals used in electric
1:03.5	car batteries. Yet there's more to it than that, with companies now burdened with navigating
1:09.2	the increasingly volatile regulatory requirements
1:12.3	from China and the US, as well as Japan itself.
1:16.9	Satchiko Sakamaki is an M-Mex senior correspondent in Tokyo.
1:21.2	She has written a fine piece of analysis about this changing landscape, and she joins us
1:26.6	now.
1:27.1	So Sachiko, firstly, let's talk about the
1:29.7	background here. Tokyo recently disclosed a plan to restrict exports of 23 items that are
1:36.0	necessary to make high-end semiconductors. So remind me firstly why that ban was put in place. What's it all
1:43.3	about?
1:44.6	Okay.
1:52.4	First of all, Japan was under pressure from the US, and US is Japan's security ally and the protector of Japanese defense, as well as Japan's second largest trading partner.
1:57.8	And the US and China have been escalating tensions over technological military supremacy.
	...

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