Week of December 14, 2015
- Frustration over the slow progress of the negotiations on the EU - Japan trade agreement: "Why don’t they want Belgian chocolates? Or Italian spaghetti?” Now that the Trans Pacific Partnership agreement between the USA, Japan, Australia and 9 other countries has been signed, there is still little progress between Europe and Japan. The trade agreement between Europe and Japan should be concluded in 2016, says Mauro Pettriccione, Europe’s main trade negotiator with Japan (Financial Times).
- The Japanese government is to spend considerable money to make Japans farmers more competitive, as US (rice, meat), Australian (meat) and New Zealand farmers (dairy) are eying the Japanese market (Nikkei).
- With China’s intention to play a dominant role in East Asian waters, Tokyo is responding by stringing a line of anti-ship, anti-aircraft missile batteries along 200 islands in the East China Sea stretching 1.400 km from the country's mainland toward Taiwan. Long read from Reuters.
- The target of 2% inflation should be abandoned, some say in Bank of Japan’s board. In this article also another sign that the Japanese government and Japanese corporation are not in tune (yet) when it comes to pay rise (Bloomberg).
- Friday’s Nikkei stock market was a roller coaster when BoJ’s governor Kuroda sent mixed signals on its policy. Worrying note: the central bank’s balance sheet surpasses three-quarters the size of the economy and policy makers are having to solve operational challenges to keep its reflation program going (Bloomberg). The Nikkei 225 closed at 18.986, well below the magic 20.000.
- After a month with trade surplus, Japan showed again a trade deficit, and this is expected to continue for some time with exports slowing (Financial Times).
- M&A from Japan into the rest of the world is on the rise again. In 2015 more than 1.000 Japanese companies were involved in cross-border mergers and acquisitions, the most since at least 2003, the data show. The value of such deals climbed 49 percent from a year earlier to EUR 100 billion, the highest since 2012. But it is not always about mega-deals and here an article on Goldman Sachs’ strategy: to focus on Japanese companies with market values of JPY 100 - 200 billion or EUR 750 - 1500 million (Bloomberg).
- Off-shore wind in Japan is attracting the attention of European players, incl. companies like Fugro, claiming to be able to provide expertise in building offshore platforms quicker than their Japanese counterparts (Nikkei).
- Toshiba, once (or better: until some months ago) a shining example of Japanese corporate power, is reporting big losses, massive write-offs and job cuts (Nikkei).
- Humor in Japan is above all “Schadenfreude” is my modest opinion. The Nanniyatteru Bar (“What are you doing bar”) is making a laugh about it by apple pie-throwing and beer-showering parties (Nikkei).
- Two weeks ago I reported you on Japan’s prisons. Here news on the death penalty in Japan: two executions by hanging in Japan last week. One of them was - for the first time - convicted by lay judges. By now 14 people have been killed by the state since Shinzo Abe became prime minister in 2013. Japan’s “secret” executions have been condemned as particularly cruel. Typically, prisoners are kept in solitary confinement for years and given only a few hours’ notice before being led to the gallows. Their families and lawyers are usually notified about the execution only after it has taken place (The Guardian).
- Finally, an article by David Polling, the FT’sAsia Editor with a long track record in Tokyo, on China’s rise. In Japan (and Europe) many secretly hope that China will fail. "China has shown that Japan’s success can be emulated, if not yet matched, on a much larger scale”, and that is something to think about in the coming weeks when we enter the festive season.