Japanese Chamber of Commerce and Industry in China releases the White Paper in Beijing on July 10, 2024 Photo: Yin Yeping/GT

More than half of the surveyed Japanese companies in China consider China to be one of the most important markets in view of the development of the second largest economy, according to a survey released by the Japanese Chamber of Commerce and Industry in China on Wednesday, indicating the remaining importance that Japanese businesses attached to the Chinese market, despite external uncertainties.

These remarks were made by the Chairman of the Japanese Chamber of Commerce and Industry in China Tetsuro Homma in the preamble for the "White Paper on the Chinese Economy and Japanese Companies." 

In preparing this white paper, opinions were solicited from 8,312 Japanese-affiliated companies that are members of the chamber.

China offers significant market opportunities for foreign companies and is a powerful source of corporate profits for many companies that have set up operations in the country, the chamber said.

According to the second survey on the perception of the economic and business environment by the chamber, regarding the amount of investment in China in 2023, of the 1,713 Japanese companies that answered, 15 percent of them plan to "significantly increase" or "increase" investment year-on-year. There were 38 percent of the surveyed companies said that their investment will be the same amount as in 2022.

When asked how they see the Chinese market this year and beyond, 51 percent of the companies said that China is "the most important market" or "one of the three most important markets."

What also noteworthy is that less than 10 percent of the respondents said that they will downsize or withdraw investment, which the chamber said showing that the majority of Japanese companies have a strong commitment to remain firmly entrenched in the Chinese market.

In the second survey, 54 percent of the surveyed companies were "very satisfied" or "satisfied" with the business environment in China.

There were 46 respondents wanting to see improvement or very much improvement, the survey said, noting that there is still plenty of room for improvement in the business environment, as they expressed their desire for visa-free travel to resume among some other issues.

Osamu Onodera, a vice chairman of the Japanese Chamber of Commerce and Industry in China, said that China is very important for foreign-funded enterprises, and at the same time, the existence of foreign-funded enterprises in China is also very important, noting that "We hope that both parties can form a win-win relationship," which is also the main reason for conducting and releasing such white paper.

External factors have caused challenges to Japanese companies doing businesses in China. Homma said on Wednesday that the impact of economic and trade frictions between the US and China has brought greater uncertainty to Japanese companies when making major decisions.

Despite challenges, Japanese companies still hope to achieve greater development with the Chinese market, Homma said.

Today, China's GDP is four times that of Japan, and the investment environment for Japanese companies is changing drastically, Homma said. 

"China is no longer just a manufacturing and consumption powerhouse, but has become an innovation and engineering powerhouse, and winning in the fast-paced and highly competitive Chinese market is to serve as a training center to enhance its competitiveness in the international market," the chamber head noted.