The Journal The Authority on Global Business in Japan


December 2013

Respondents remain bullish on Japan’s economy

By Megan Waters
ACCJ Journal editor-in-chief

The fall 2013 FCIJ Business Confidence Survey—representing the opinions of members of the foreign business community in Japan—received 278 valid responses from members of 16 foreign chambers of commerce and business organizations.

Conducted twice a year by the Foreign Chambers in Japan (FCIJ), the 24th survey includes two alternating questions about management training in cooperation with the Nomura School of Advanced Management that, together with Asian Tigers Mobility, financially supports the survey.

Since the poll is conducted free of charge, two or three companies support each survey and provide questions that might be of interest to respondents.

Clas G. Bystedt, executive director of the Finnish Chamber of Commerce in Japan, believes the survey is important because it tells chambers what their members think about the Japanese economy, allows them to gain some understanding of their companies’ business performance, and gives member companies an opportunity to express their views to the chambers regarding issues that they, as members, find important.

The survey results indicate that respondents remain bullish on the Japanese economy, although slightly less so than in the previous survey (April 2013). They also expect the economy to continue growing significantly over the coming six months, suggesting that businesses here are benefitting from Abenomics.

Eighty-four percent of the respondents indicated they expect an improvement, ranging from strong to at least some, while only 3 percent said they foresee a decline.

Looking ahead 12 months, the respondents see possible growth, but less than forecast by the last survey.

The poll’s positive views on Japan’s economy reflect the respondents’ reported and expected positive performances that, in turn, are partly due to the weaker yen.

Respondents reported stronger sales over the past six months than had been noted in the April survey, and the figures were higher than at any time since the April 2007 survey. Profits also were reported to have increased.

Regarding sales forecasts for the coming six months, respondents indicated greater optimism than they had in April, while their sales predictions are the highest since the spring 2007 survey. Profits, too, were up over the April figures.

Since sales have increased more than profits, one can see that companies importing products to Japan have used the weaker yen to gain market share, rather than short-term profits.

The optimism reflected in company performance data shows that the strategies of foreign-affiliated companies in Japan continue to be bullish. While 79 percent of respondents (71 percent in the April survey) expect further growth, 15 percent expect to sustain their current level, and 3 percent are planning to downsize, but none are considering withdrawing from Japan.

In addition, the survey results enable FCIJ members to see if their performance is on par with that of other foreign companies here. Bystedt also believes the survey makes a good tool when employees must report to head office.

“For example, the fact that this survey shows 79 percent of the responding companies seek further growth in the Japanese market should be a good argument for a company’s head office that they should do so, too, and not forget Japan,” he said.

The next survey will be conducted in April 2014.

Clas G. Bystedt: the survey tells chambers their members’ opinions about the Japanese economy.

Clas G. Bystedt: the survey tells chambers their members’ opinions about the Japanese economy.