China, Japan strengthen ties in emerging sectors
US tariffs push Asia’s major economies closer: experts
By Li Xuanmin
With the relationship between China and Japan warming up in recent months, the two Asian economies are now keen on building closer ties in new industries such as vehicles and batteries, which industry insiders said would give full play to the advantages of both and protect them against global uncertainty.
The comments were made ahead of Japanese Prime Minister Shinzo Abe’s planned visit to China later this month, a sign of warming relations between the two Asian countries against rising global protectionism.
Japanese automakers are drawn by China’s burgeoning new-energy vehicle (NEV) market, as well as the policy inconsistency of the US. Given that relations with China are on the mend, the stage is set for deeper bilateral cooperation, said Chen Yongchong, the vice secretary-general of the Energy Storage branch under the China Industrial Association of Power Sources.
“Cooperating with firms in the US, Japan’s traditional ally, will expose Japanese manufacturers to massive policy uncertainty, and the tariffs US President Donald Trump has threatened to impose on Japanese auto imports has taught them a lesson,” Chen told the Global Times Monday.
The Chinese government, at the same time, has shown an open attitude and firm support for free trade – just like the Japanese government – which has bolstered Japanese firms’ confidence in working with domestic auto producers, Feng Shiming, a car analyst with Shanghai-based Menutor Consulting, told the Global Times on Monday.
“The US has fired warning shots against both Japan and China, giving incentives for the two nations to enhance strategic relationship so as to offset losses incurred by US trade actions,” Feng added.
For example, Toyota Motor has set up a new factory in Guangzhou, capital of South China’s Guangdong Province, which can produce 200,000 vehicles a year, and the carmaker is preparing to offer more electric cars and plug-in hybrids in China, asia.nikkei.com reported in August.
Japan-based trading house Itochu Corp also invested about 1 billion yen ($8.82 million) in Chinese NEV start-up Singulato Motors in August, Reuters reported.
“The rising global uncertainty may also offer a chance for Japanese automakers – which are latecomers to the Chinese market – to ‘overtake’ their rivals from the US, South Korea and Germany,” Chen said.
Industry insiders also stressed that the complementary strengths of Chinese and Japanese carmakers are another factor promoting the cooperation.
China’s emerging industries such as the NEV sector are experiencing technological upgrades, and Japanese enterprises are looking to participate in the new wave of cooperation so as to speed up the trend and expand their business in China, Mochizuki Eiji, the general manager of the Japan-based Next-Generation Vehicle Promotion Center under the Hamamatsu Agency for Innovation, told the Global Times in a recent interview.
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“The partnership would enable China and Japan to form alliances in the EV sector that could compete head-to-head with EU-US alliances,” Feng said.
But he stressed that the length and durability of the alliances also depends on the attitude of Abe’s administration on political issues. “It takes time for the two sides to remove disagreements,” Feng said.
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“The US has fired warning shots against both Japan and China, giving incentives for the two nations to enhance strategic relationship.” Feng Shiming Analyst with Menutor Consulting