Having worked in international business for a while, the recent Bloomberg’s news surprised me, because for the first half of this year 41 percent of Japan’s exports were sold in JPY. According to a recent Finance Ministry report it is the biggest proportion since 2000. As a consequence then a two-year low of only 48.6 percent of Japanese shipments going out from Japan were made in dollars.
For sure Japanese business depends strongly on exports heading to Asian countries, which are payed according to the report in JPY in 48.1 percent of the cases, a much higher rate compared to the US and Europe. For me the reasons behind: Looking at the global economy presently growth is mainly found in Asia, resp. China, plus I believe an increased awareness of Asian interdependence is on the rise. For example the risks on selling in a foreign currency, according to Bloomberg news Komatsu Ltd. (large construction equipment maker) estimate their loses of about 2.8 billion yen of annual operating profit for every 1 yen gain against the dollar. China accounts for 19 percent of their total sales.
Hopefully Asia uses this opportunity to find now a way to work together for the common good.
Brought to you by Sibylle Ito (シビル伊藤)