Japan to Spend Billions to Help Its Firms Move Out of China: Fact Check


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Japan to Spend Billions to Help Its Firms Move Out of China

Story:

Japan to Fund $2.2 billion to Firms to Shift Production Out of China.

Other Versions

Japan Government is ready to spend over $2 Billion to help its country’s firms move production out of China.
Dear Indians reject anything Chinese.
China needs to be taught a Lesson.

Fact Check:

Some messages spreading online claim Japan Government is ready to spend over $2 Billion to help its country’s Firms move production Out of China. The messages also urge Indians to reject anything from Chinese as teaching them a lesson. They have come up in the wake of the deadly Coronavirus emerging from China and killing hundreds and thousands of people worldwide. Yes, the claims are true and explained here in detail.

Japan to Spend Billions to Move Firms Out of China

Facebook page Namo for 2024 shared one version of the message on 9th April 2020 urging Indians to reject anything Chinese and teach them a lesson. China is in fact Japan’s biggest trading partner and their go-to manufacturing hub for decades. However, the global pandemic has disrupted supply chains and economics of many nations amid the global health crisis and lockdown to avoid the transmission of the disease. In fact, imports from China fell to almost half in February itself starving Japanese manufacturers of necessary components.

On 8th April 2020, BloombergQuint website bloombergquint.com came up with an article with title ‘Japan to Fund Firms to Shift Production Out of China‘. It said Japan’s government would spend over $2 billion to help its multinationals leave China. It referred to extra budget Japan’s Ministry of Finance proposed to counteract the effects of the pandemic to include:

Domestic investment promotion project cost subsidy [220 billion yen] for supply chain measures
Support for overseas supply chain diversification (¥ 23.5 billion)

The financial help is for firms shifting production back to Japan and to companies seeking to move manufacturing base to other countries. The Spectator Index also tweeted about the Japan Government’s plans.

India and Other Countries

On 24th April 2020, Union Minister of India Nitin Gadkari suggested Indian firms are planning to enter into tie-up with countries like the United States and the United Kingdom operating in China and planning to shift over Coronavirus. Likewise, he asked companies to enter into joint venture and bring them directly to India. Nitin Gadkari is in fact the Minister of Road Transport & Highways, Micro, Small & Medium Enterprises. He further said whatever permission required for shifting will be given on war footing. Furthermore, some American Companies are planning to leave China. With the sentiments against China, many foreign companies are also keen to come out and set up their units elsewhere.

An April 22nd report on Business Today website businesstoday.in writes 1,000 foreign firms are thinking of shifting production to India. Around 300 companies are actively pursuing the production plans in Mobiles, Electronics, Medical Devices and Textiles.

Hoax or Fact:

Fact.


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