Wednesday, April 8, 2020

Japan stimulus package includes USD 2.2 Billion for Japanese companies in China to come home to Japan: "Whatever it takes" Scomo should learn from Japan, forget Andrew Forrest's advice to swap iron ore for low grade medical equipment

by Ganesh Sahathevan





It is unclear if the cargo on this 747 from Wuhan which landed in Sydney last night was part of the 
Andrew Forrest gift. It is also unclear if the cargo is sterile,or whether it is contaminated with the Wuhan Virus



Compare the pair.


Japan's stimulus package:

Japan has earmarked $2.2 billion of its record economic stimulus package to help its manufacturers shift production out of China as the coronavirus disrupts supply chains between the major trading partners.

The extra budget, compiled to try to offset the devastating effects of the pandemic, includes 220 billion yen ($2 billion) for companies shifting production back to Japan and 23.5 billion yen for those seeking to move production to other countries, according to details of the plan posted online.
Australia's stimulus package has nothing to address the over dependence on China,but Scott Morrison seems happy with this: 

WA mining billionaire Andrew Forrest says he wants Australia to position itself as the next nation after China to “switch its economy back on” after the COVID-19 crisis is brought under control.

Mr Forrest noted China had started to get its economy going with the easing of restrictions, and urged Australia to be the second economy to follow in its footsteps.

“Just look at what’s happening with our export industries, with our seafood, with our beef produce, with iron ore, they’re not buying that stuff and dumping it in the ocean — they’re buying it and consuming it, they have switched their economy back on,” he told 6PR yesterday.

“I want to see Australia as the second economy switched back on and I think we can ... we’re taking the steps now to really accelerate the protection of our frontline workers ... and the people in China who’ve stuck to their word, I’d call them heroes.”

It comes after a $160 million commitment by Mr Forrest last week to procure medical supplies from China, including more than one million N95 equivalent face masks, 400,000 surgical masks, 2.3 million medical-grade gloves, and more than 33 ICU-grade ventilators.

“The fifth plane will arrive in a couple of days’ time, and the sixth plane will go to Sydney, so we’re starting to get on top of this PPE issue now,” he said.

Mr Forrest said securing the supplies was not without difficulty with “people from other countries offering two to three times” the price for the same product, however, “they (China) stuck to their word”. “When China was in the middle of their worst crisis, I sent hundreds of thousands of products over there, the Fortescue Metals Group spent $1 million to try to help build their temporary hospital in Wuhan,” he said.

“Now they’re sending back not hundreds of thousands but tens of millions. They’re remembering that we stood up for them and they’re standing up for us.”

(reported by Meilin Chew, The West Australian, 9 April 2020)
Mr Forrest should be left to selling his iron ore in whatever way he chooses.It should not drive national economic policy.
END 

TO BE READ WITH 


Japan to Fund Firms to Shift Production Out of China

 Updated on 


Japan has earmarked $2.2 billion of its record economic stimulus package to help its manufacturers shift production out of China as the coronavirus disrupts supply chains between the major trading partners.
The extra budget, compiled to try to offset the devastating effects of the pandemic, includes 220 billion yen ($2 billion) for companies shifting production back to Japan and 23.5 billion yen for those seeking to move production to other countries, according to details of the plan posted online.
The move coincides with what should have been a celebration of friendlier ties between the two countries. Chinese President Xi Jinping was supposed to be on a state visit to Japan early this month. But what would have been the first visit of its sort in a decade was postponed a month ago amid the spread of the virus and no new date has been set.
China is Japan’s biggest trading partner under normal circumstances, but imports from China slumped by almost half in February as the disease shuttered factories, in turn starving Japanese manufacturers of necessary components.

That has renewed talk of Japanese firms reducing their reliance on China as a manufacturing base. The government’s panel on future investment last month discussed the need for manufacturing of high-added value products to be shifted back to Japan, and for production of other goods to be diversified across Southeast Asia.
“There will be something of a shift,” said Shinichi Seki, an economist at the Japan Research Institute, adding that some Japanese companies manufacturing goods in China for export were already considering moving out. “Having this in the budget will definitely provide an impetus.” Companies, such as car makers, that are manufacturing for the Chinese domestic market, will likely stay put, he said.

Testing Times

Japan exports a far larger share of parts and partially finished goods to China than other major industrial nations, according to data compiled for the panel. A February survey by Tokyo Shoko Research Ltd. found 37% of the more than 2,600 companies that responded were diversifying procurement to places other than China amid the coronavirus crisis.
It remains to be seen how the policy will affect Prime Minister Shinzo Abe’s years-long effort to restore relations with China.
“We are doing our best to resume economic development,” Foreign Ministry spokesman Zhao Lijian told a briefing Wednesday in Beijing, when asked about the move. “In this process, we hope other countries will act like China and take proper measures to ensure the world economy will be impacted as little as possible and to ensure that supply chains are impacted as little as possible.”
The initial stages of the Covid-19 outbreak in China appeared to warm the often chilly ties between the two countries. Japan provided aid in the form of masks and protective gear -- and in one case a shipment was accompanied by a fragment of ancient Chinese poetry. In return, it received praise from Beijing.
In another step welcomed in Japan, China declared Avigan, an anti-viral produced by Japan’s Fujifilm Holdings Corp. to be an effective treatment for the coronavirus, even though it has yet to be approved for that use by the Japanese.
Yet many in Japan are inclined to blame China for mishandling the early stages of the outbreak and Abe for not blocking visitors from China sooner.
Meanwhile, other issues that have deeply divided the neighbors -- including a territorial dispute over East China Sea islands that brought them close to a military clash in 2012-13 -- are no nearer resolution.
Chinese government ships have continued their patrols around the Japanese-administered islands throughout the crisis, with Japan saying four Chinese ships on Wednesday entered what it sees as its territorial waters.
— With assistance by Lucille Liu
(Updates with comment from economist in sixth paragraph)

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