Survey shows Japanese businesses value Chinese market expert urges government to act

Japanese companies have shown an increasing satisfaction with the prospects in the Chinese market, suggesting a potential strengthening of bilateral economic ties. This trend is underscored by a recent survey conducted by the Japanese Chamber of Commerce and Industry in China, revealing that a significant majority of Japanese firms view China as a crucial market and are inclined to sustain or expand their investments into 2026.

The survey results indicate a positive shift in the business conditions for Japanese companies operating in China, with 1,427 valid responses collected. Compared to the previous survey conducted for the first half of 2025, there is evidence of a gentle improvement in the sentiment among member companies, emphasizing a recovering business climate.

Satisfaction levels amongst respondents have remained robust, with 62 percent expressing either "very satisfied" or "satisfied" regarding the business environment. Factors contributing to this high satisfaction include China's comprehensive logistics infrastructure, the ease of accessing Japanese-speaking and IT talent, as well as the local availability of crucial components.

Looking ahead to investment plans for 2026, a notable 59 percent of the responding companies stated they would either "increase or maintain" their investment, reflecting a slight uptick of three percentage points from the previous survey. This optimistic outlook is particularly prevalent among firms intending to increase their investments.

Masami Miyashita, general manager at the Japan-China Economic Association's Beijing Office, highlighted that there is a recognizable trend of Japanese companies gearing up their investments to enhance production capacity in anticipation of rising market demand.

The need to enhance competitiveness amidst escalating market competition has emerged as a critical driver for increased investments. Companies are focusing on substantial equipment investments that will enable them to improve quality, functionality, and cost-efficiency.

During a recent event, Tetsuro Homma, president of the JCCIC and executive vice president of Panasonic Holdings, reaffirmed that China's status as the world's second-largest economy continues to make it a vital focus for Japanese businesses. Homma noted that over the past three decades, Japanese firms have developed extensive operational capabilities within China.

With 2026 marking the initiation of China's 15th Five-Year Plan, which aims at fostering high-quality economic growth and further opening markets, the head of the Japan-China Chamber of Commerce has stressed the opportunities available for Japanese investors.

Citing survey findings, Homma expressed that the ongoing investment plans of more than half of Japanese companies underscore their recognition of sustainable growth potentials in the Chinese market, affirming the market's importance.

Acknowledging China's role as a key trading partner for Japan, Homma pointed out that a significant share of Japan's foreign trade is with China. He maintained that this relationship has been profitable for Japan's international trade endeavors.

Despite these optimistic sentiments, concerns persist regarding diminishing dialogue between the Japanese and Chinese governments, which is perceived as a hindrance to fostering economic collaboration, as reported by Kyodo News. Companies are striving to separate political issues from business operations to mitigate such impacts.

According to Xiang Haoyu, a research fellow at the China Institute of International Studies, the survey encapsulates the perspectives of Japanese firms engaged in economic initiatives in China. He urged the Japanese government to consider these voices and take meaningful actions toward enhancing China-Japan relations, as such moves would genuinely safeguard Japan's national interests.