MORE THAN 40% OF JAPAN TECH FIRMS PULLING OUT OF CHINA

More than 40 percent of Japanese companies the government recognizes as possessing sensitive technology linked to security are shifting their manufacturing bases and sources of parts supplies from China in a bid to diversify their supply chains, a Kyodo News survey found.

The move to reduce their reliance on Beijing and mitigate security risks comes in response to rising US-China competition over technological supremacy and concerns about potential concentration of medical production in China amid a shortage of medical supplies propelled by the novel coronavirus pandemic.

Forty-four percent, or 42 companies, of 96 respondents said they have diversified or are considering diversifying their supply chains by moving to India and Southeast Asian countries, according to the survey.

Kyodo recently surveyed some 150 major listed companies, of which 96 responded. The respondents include Canon Inc., Toyota Motor Corp., KDDI Corp., NEC Corp., Kobe Steel Ltd. and Mitsubishi Heavy Industries Ltd.

Only three respondents said they have or will downsize operations or withdraw from China, signaling the importance of the world's second-largest economy to many Japanese companies.

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