The decision was made due to a slowdown in the global emissions reduction trend

Japanese steelmaker Kobe Steel has announced some changes to its investment plans for the three-year financial period between 2024 and 2026 due to rising global uncertainty. In this way, the company aims to maintain its financial stability and prioritize economic rationality in the short term, SteelOrbis reports.

Kobe Steel has reduced its investment plan for the period from approximately 950 billion yen ($6.23 billion) to 750 billion ($5.53 billion).

The company will allocate approximately 150 billion yen ($1.05 billion) to decarbonize its operations, compared to the original plan of approximately 300 billion yen ($2.09 billion) due to the slowdown in the global trend towards carbon neutrality.

The Japanese steelmaker intends to reduce its carbon emissions by 30-40% by 2030 compared to 2013 levels and achieve carbon neutrality by 2050.

To achieve these goals, the company plans to use large-scale innovative electric arc furnaces and ammonia co-combustion technology in blast furnaces starting in 2030.

Kobe Steel also aims to increase the use of scrap, integrate biomass into blast furnaces and implement energy-efficient processes.

As GMK Center reported earlier, Třinecké Železárny Group, the largest steel producer in the Czech Republic, is postponing the completion date of the largest decarbonization investment in the plant’s history.

The main reasons for the delay in the implementation of the EAF are the lack of public support, uncertainty about the future direction of Europe in the rules related to the Green Deal, the current negative situation on the steel market, and unclear import protection rules.
 
 

The Japanese government on Thursday started a revamped gasoline subsidy designed to cut prices by 10 yen ($0.07) per liter to help ease cost-of-living pressures for consumers ahead of an upcoming parliamentary election.

Under the previous scheme introduced in January 2022, the government had subsidized wholesalers to keep regular gasoline prices at around 185 yen per liter, but will now provide a fixed sum regardless of prices, which have recently dropped below that benchmark.

The government subsidy aims to reduce the wholesale gasoline price by 7.40 yen per liter in the first week, a targeted 5 yen effective decrease from a week earlier when crude price fluctuations are taken into account. It then aims to reduce the price by at least 1 yen weekly until it is 10 yen lower by mid-June.

Price reductions are expected to flow through to gas stations in two to three weeks, taking into account inventories, it said.

No end date has been decided for the program, but with around 1 trillion yen allocated to the subsidies, they could last until the end of March 2026.
The reintroduction of the subsidies comes ahead of the House of Councillors election slated for the summer.
 

 

Four decades ago, Hiroko Suzuki's father threaded the needle of a U.S. trade war by pushing the family auto-parts business into newer niche products.

Now, tariffs imposed by the Trump administration are so sweeping they threaten her own attempt to diversify the 78-year-old company into medical devices.

Prime Minister Shigeru Ishiba has called the U.S. tariffs, including 25% on automobiles, a "national crisis" for the world's fourth-largest economy. Japan's top trade negotiator, Ryosei Akazawa, headed to Washington on Friday for a third round of talks.

The worry is evident at companies like Kyowa Industrial, a maker of prototype parts and race-car components based in Takasaki, north of Tokyo. Kyowa, which employs 120 people, was among six auto suppliers that told Reuters they were concerned about their ability to withstand the tariff pressure on Japan's car industry.

"What in the world are we going to do?" Suzuki, Kyowa's third-generation president, recalled thinking when the tariffs were announced. "This is going to be bad."

The problems Kyowa and other auto suppliers face illustrate a decades-long shift in Japan, which no longer floods the world with chips and consumer electronics and is reliant on an auto industry threatened by intense Chinese competition. That marks a contrast with the 1980s, when the U.S. slapped trade barriers on a rising Japan and its then-barnstorming exports.

This report, which is based on interviews with a dozen people, including industry executives, bankers and senior government officials, provides a first-hand account of how one firm is grappling with the uncertainty, and details the deepening squeeze on the automotive supply chain at a time of profound disruption.

Kyowa and thousands of other small manufacturers comprise an auto-supply network that has for decades pursued a "monozukuri" (literally, "making things") approach to production. That culture of incremental improvement and assembly-line efficiency, based on methods developed by Toyota, helped make Japan a juggernaut.

But the shift to battery-powered smart cars has meant software, in which EV makers such as Tesla and China's BYD excel, has become a bigger selling point.

Kyowa started developing neurosurgery instruments in 2016 after Suzuki, now 65, realised the rise of EVs would eventually hammer demand for engine components. It began selling the instruments in the U.S. last year, only to find that Trump's tariffs also applied to medical devices.

Kyowa doesn't export auto components to the U.S., but Suzuki worries automakers will force suppliers to cut prices to offset tariffs. So far, that hasn't happened to her.

One Subaru Corp supplier said his company may have to start looking for partners expanding outside the U.S.

Major automakers have largely offered muted support for suppliers since Trump's tariff announcements. Last month, Toyota, Nissan and Ford  sent letters to the U.S. arms of some Japanese suppliers asking for cooperation in the face of tariffs, according to copies reviewed by Reuters, without offering specifics.

The letters haven't been previously reported.

Nissan told suppliers they should stick to previously agreed prices. It said it was "not obliged" to bear the costs of tariffs but that it would shoulder some of the hit for up to four weeks to help secure its supply chain. It added that it could later seek to recover any support payments to suppliers.

Reuters couldn't determine how much support, if any, Nissan extended. The automakers haven't sent follow-up letters, according to two suppliers, who allowed Reuters to review the correspondence on condition of anonymity.
Nissan told Reuters it was working with suppliers to mitigate the tariff impact and contain costs, including through localisation.

Toyota said it would seek to protect its suppliers, dealers, and employees while maintaining customers' trust as it navigated the uncertainty created by the tariffs. Ford told Reuters it was working with suppliers to assess their exposure and potentially reconfigure processes and sourcing.

In its letter, Toyota said it understood the "complexity and financial burden some suppliers are facing" and asked suppliers to identify and share mitigation measures. Toyota would work with suppliers "in good faith", it said.

Some Toyota suppliers, including Denso, have not given earnings forecasts for the coming year, citing uncertainty.

Julie Boote, an analyst at research firm Pelham Smithers Associates, said the trade war posed an "emergency" for Japan's auto industry that would hasten consolidation.

"In order to survive, these automakers will have to work together," she said.

 

SQUEEZED ON COST

Japanese manufacturers traditionally put pressure on smaller suppliers to lower prices, said Sayuri Shirai, a former Bank of Japan board member who is now a professor at Keio University.

If the tariffs remain in place in the longer term, it would spell more damage for regional economies hollowed out by demographic decline, she said.
The risks for Japan are already clear. The economy shrank in the first quarter, and Tokyo has compiled emergency economic measures to ease the pain of tariffs.

"Automobile exports are just too important to Japan for a 25% tariff to stay in place," said David Boling, a former U.S. trade official who is now a director at consulting firm Eurasia Group.

Boling said the U.S. is unlikely to go below the 10% it agreed with Britain.
Trump introduced a 25% tariff on automobiles and later a 24% tariff on all Japanese goods. The latter was slashed to 10% for 90 days, which runs out in July.

Akazawa, the trade envoy, on Tuesday said Japan was sticking to its guns and wanted tariffs eliminated. A White House spokesperson declined to comment on the negotiations.

A U.S. State Department spokesperson said the Trump administration wanted trading partners to align with U.S. efforts to achieve "fairness and balance in our trading relationships and protect U.S. economic and national security."

Two senior Japanese officials told Reuters Japan's auto industry was increasingly looking like a laggard and needed to use the tariffs as an opportunity to implement sweeping changes to catch up with EV rivals.

In a statement, the trade ministry said that regardless of U.S. tariffs, Japan's auto industry needed to respond to significant changes in the competitive environment.

Japan's top auto suppliers, called Tier 1, procure parts from Tier 2 suppliers, and so on down the chain. At the bottom are firms that can be little more than neighbourhood workshops grinding out a single part.

Government officials have previously urged smaller companies to innovate and consolidate, to gain scale.

At regional lender Ashikaga Bank, an automotive industry team supports some 200 companies, around 80% of which are Tier 2 or lower suppliers. A member of the team not authorised to speak publicly said they worried tariffs would lead to higher vehicle prices and a decline in Japanese car sales in the U.S., hitting the bank's clients.

Shinichi Iizuka, president of Toa Kogyo, a suspension maker in Subaru's hometown of Ota, near Takasaki, said the tariff burden will likely be shared by consumers, car dealers, automakers and suppliers.

Some 70% of Subaru's car sales are in the U.S., where it relies on both local manufacturing and imports. On Monday, Subaru said it would raise prices on several U.S. models.

Subaru CFO Shinsuke Toda this month said it was willing to talk with suppliers about sharing their burden, adding the situation remained unclear.


IT'S PERSONAL

Suzuki's drive to diversify Kyowa Industrial into medical devices mirrors the pivot made by her father during the 1980s trade friction, when Kyowa ditched mass production of less-profitable auto parts to focus on higher-margin prototypes and racing-engine components. Suzuki took over in 2000 and her father died in 2013.

Before Trump's tariffs, Suzuki had planned to build a U.S. track record in sales of medical equipment to smooth entry into other markets. With the advent of the U.S. trade barriers, she said her team considered moving production to the U.S., where costs are high, or shifting the sales focus to Asia.

Given the uncertainty around Trump's announcements, Kyowa is in talks with potential distributors in Singapore and Hong Kong, Suzuki said.

Around 70% of Kyowa's business still comes from automakers, while chip-equipment makers and Japan's space program contribute to the remainder. It supplies most Japanese car makers, General Motors and parts for Formula One race cars.

Annual sales are a modest 2 billion yen ($14 million). Still, Kyowa is larger than three-quarters of the roughly 68,000 companies that make up Japan's auto-supply chain, according to research firm Teikoku Databank.

For Suzuki, trade friction is also personal, given her deep affection for the U.S. She grew up listening to rock music on U.S. armed forces radio, learned English and went to university in America. She remembers seeing Aerosmith live at their first concert in Japan.

"Japan and America have a long history of friendship. I hope they can find a solution," she said.
 
 

Toyota Motor Corp on Wednesday unveiled its new RAV4 to the world, with plans to launch the model in Japan before the end of FY2025.

The RAV4 had its beginnings in 1994, when sport utility vehicles (SUVs) were positioned as off-road vehicles. It pioneered the crossover SUV genre for both on-and off-road driving.

Launched in 2019, the fifth-generation RAV4 was developed to further enhance its unique appeal as a model for new lifestyles. It was developed on the concept of a "Robust Accurate Vehicle with 4 Wheel Drive" as a sophisticated blend of the power and utility of an SUV.

It also adopted a new platform based on the Toyota New Global Architecture (TNGA), Toyota's structural innovation within the automobile manufacturing process. It delivered responsive driving performance with maneuverability and stability for any road surface.

Toyota said that under the concept of "Life is an Adventure," this sixth-generation RAV4 seeks to become a vehicle that allows any driver to enjoy an active lifestyle.

The driving experience has been advanced with a newly developed hybrid system that enhances acceleration. 

The key to advancing vehicle intelligence is Arene, Toyota's first software development platform. By utilizing Arene, Toyota aims to achieve a greater level of safety and peace of mind, as well as enrich the mobility experience to make the new RAV4 a companion that fits seamlessly into various lifestyles, whether in urban living or outdoor adventures.
 
 

Japan’s inflation-adjusted real wages fell 0.5 pct in fiscal 2024, which ended in March, from the previous year, down for the third straight year, the labor ministry said Thursday.

Although historic pay increases were achieved in this year’s “shunto” spring wage negotiations in the country, wage growth remained slower than inflation.

Earlier this month, the government set a goal of achieving real wage growth of some 1 pct annually in the five years through fiscal 2029.

While the pace of decline in real wages slowed from a fall of 2.2 pct in fiscal 2023, price hikes for food items such as rice and daily necessities have put pressure on households.

It is uncertain whether the government will be able to achieve the goal, also reflecting persistent uncertainty surrounding the global economy due to the high tariff policy of U.S. President Donald Trump.

In fiscal 2024, nominal monthly wages per worker, including base salary and overtime, rose 3.0 pct to ¥349,388 on average, up for the fourth successive year and marking the steepest increase in 33 years, thanks to the results of the shunto wage talks and higher minimum wages.

Still, the county’s real wages failed to outpace inflation as the consumer price index excluding imputed rent, used to calculate real wages, grew 3.5 pct.

Meanwhile, a real wage index calculated for international comparison using the overall CPI, which includes imputed rent, was unchanged from the previous year, coming out of negative territory for the first time in three years.
 
 

 
Not only rice but most daily commodities have increased in price, which has diminished the popularity of the Japanese government.

Over 100 years ago in Japan, a shortage of rice and a steep rise in its price caused a great uproar for about a month. This has been called the Kome Sodo, or rice riots. Although Japan at the time was not a democratic country, the turmoil adversely affected politics, causing the government of the day to fall.

Present-day Japan is not the same country it was a century ago, and nothing like a desperate clamor for food will happen. But it is true that not only rice but most daily commodities have increased in price, which has diminished the popularity of the government.

An opinion poll conducted by The Yomiuri Shimbun in September showed that more than 90% of respondents felt that rising prices were a burden on households. Those who felt so gave Prime Minister Shigeru Ishiba a low approval rating.

This should be no surprise. At least as far back as the French Revolution, which broke out amid fierce inflation, people suffering severe price increases have been apt to feel anger and distrust toward their governments. Even in recent years, we have seen similar situations in various countries.

After the start of the war in Ukraine and economic recovery from the COVID-19 crisis, a sharp increase in energy and food prices put the world economy in turmoil, damaging the political standing of world leaders, especially in 2023 and 2024, and leading to changes in short-lived governments.

A simple illustration of this pattern is the lineup of national leaders attending the annual Group of Seven summit. At the three summits through 2019, before the pandemic, only two of the leaders were replaced.

But, 11 months after the latest G7 summit, held in June 2024 in Italy, only French President Emmanuel Macron and Italian Prime Minister Giorgia Meloni still remain in their positions.

The other five leaders had been criticized for not dealing with inflation, with some being defeated in their national elections, while others gave up on reelection bids and stepped down because they felt less likely to win.

One of those was then U.S. President Joe Biden, who met a fate similar to that of his predecessors Gerald Ford and Jimmy Carter, both of whom were in office during the oil shock era of the 1970s and failed in their bids to win another term.

In Japan, too, the ruling Liberal Democratic Party and its coalition partner Komeito suffered severe setbacks in the House of Representatives election held in October 2024. In addition to issues of money in politics, many voters held the LDP administration responsible for economic hardship caused by rising prices.

However, inflation is triggered not only by domestic policies but also by exogenous factors such as wars in distant lands, which are beyond the realistic control of governments not a party to them, making it unfair for opposition parties to place the blame for inflation on the incumbent administration.

Japan’s consumer prices in fiscal 2024 rose 3% from the previous year. Because the Japanese economy had been in lingering deflation for more than three decades, inflation started later than in other countries. Also, rising labor costs due to a decline in the working-age population will surely continue to bump up prices.

Ishiba’s administration has no immediate and easy remedy to counter structural inflation without worsening economic conditions. I am sure that Ishiba is afraid of criticism from voters that he lacks an effective economic policy. He has given up on his longtime policy regarding budget discipline. So far, his administration has done nothing but expand government expenditures to ease the grievances and fears of the people.

Another challenging factor is the unpredictable tariff policy of the U.S. government led by President Donald Trump. The policy may be negotiable, but the Japanese government should brace for Trump’s flip-flopping, which has been happening very often.

Now, Ishiba’s minority government consisting of the LDP and Komeito seems to have no other option but to concede to louder voices from the opposition demanding lower tax burdens, even though some economists argue that tax cuts and cash handouts are not desirable ways to deal with inflation. Nearly all parties have been swayed by an economic populism that focuses on short-term benefit.

This is not unique to Japan, but it is not too much to say that it is deplorable that so many politicians are downplaying the serious truth that Japan has huge financial deficits and that large-scale tax cuts will be paid for by future generations that are becoming smaller than the ones preceding them.

The immediate political situation, with the House of Councillors and Tokyo Metropolitan Assembly elections both to be held this summer, has reinforced this tendency.

One of Ishiba’s mentors was Kakuei Tanaka, who served as prime minister from 1972 to 1974 and struggled with skyrocketing prices after the oil shock.

To counter this inflation, Tanaka introduced sweeping tax cuts and expanded social security spending, including pension benefits and medical costs for the elderly. Unfortunately, Tanaka’s measures to stimulate demand made consumer prices even higher in 1974.

The Tanaka-led LDP conducted a vigorous campaign for the upper house election, but the party was defeated. Although the Tanaka administration had a solid majority of seats in the lower house, his popularity had been damaged by a money scandal and he was forced to resign a few months later.

This demonstrates that those who take incorrect measures against inflation to simply please voters are likely to lose on both fronts.

In contrast to Tanaka, who had been a leader of a large faction in the LDP, Ishiba has a weak political base. No one knows how long he can remain in office. In any case, he or his successor will be haunted by the possibility of a 21st-century version of Kome Sodo.

If that happens, all they can do is to choose whether to be criticized for a lack of strategy or to concede to populist policy and repeat the costly mistakes of 1974.
 
 

The monthly number of foreign visitors to Japan hit a record high in April amid the cherry blossom season, a Japan National Tourism Organization report showed Wednesday.

The number of inbound visitors is estimated to have risen 28.5 pct from a year before to 3,908,900 in April, topping 3.9 million for the first time for a single month.

Demand for travel to Japan, especially from China, Hong Kong, the United States and Australia, surged as cherry blossoms bloomed in many parts of the country. The reporting month also included Easter holidays.

By country or region, the number of visitors from mainland China jumped 43.4 pct to 765,100, followed by 721,600 visitors from South Korea, up 9.1 pct, 537,600 from Taiwan, up 16.9 pct, and 327,500 from the United States, up 43.1 pct.

The record monthly figure "seems to be attributed to brisk demand in China for visiting Japan and an increase in the number of flights," Japan Tourism Agency Commissioner Naoya Haraikawa said at a press conference.
 
 

Nissan Motor Co on Monday told employees at its signature Oppama plant in Kanagawa Prefecture that reports of its planned closure were not definitive, according to some workers at the factory.

The struggling Japanese automaker was reported on Saturday to be considering shuttering the plant in Yokosuka and the Shonan plant of its unit, Nissan Shatai Co, in Hiratsuka, raising uncertainty over the future employment and treatment of the workforce.

The country's third-biggest automaker by volume said last week that it will shut seven vehicle plants and cut 20,000 jobs globally after logging a net loss of 670.90 billion yen for fiscal 2024.

Nissan pioneered electric vehicle production at the Oppama plant, which has an annual production capacity of around 240,000 vehicles and employed 3,900 people, including researchers, as of the end of October last year. The Shonan plant builds commercial vehicles.

The prefectural government held an emergency meeting on Monday to discuss offering consultation and reemployment services in reaction to the potential closures.

"If they really do close, it will have a huge impact on employment and the economy," Kanagawa Gov Yuji Kuroiwa said at the meeting. "We will consider our options from a multitude of angles."

Following the discussions, Kuroiwa told reporters that Nissan contacted the prefecture on Saturday after the initial reports. Nissan officials visited the prefectural office on Monday to inform it that nothing has been decided.

The prefectural government conveyed to Nissan its hope that the automaker will endeavor to limit the consequences of its actions.

During a regular press conference on the same day, Yokosuka Mayor Katsuaki Kamiji emphasized the importance of the more than 60-year history of the Oppama plant and said he hoped it would be "restored to its former brilliance."

Nissan officials also visited the city on Monday.
 
 

The Economy, Trade and Industry Ministry will from fiscal 2028 introduce a car fuel partly mixed with biofuels made from corn, sugarcane and other biomass.

The fuel, which would mix gasoline with up to 10% biofuels, will be available in selected areas and is expected to be introduced where oil refineries and oil tanks are located.

The plan is aimed at building momentum to decarbonize the transport sector, which is responsible for about 20% of the country’s carbon dioxide emissions. The ministry will include the policy in its action plan for introduction of biofuels, which will be announced at a forthcoming expert panel meeting.

The government initially drew up plans in November last year to start providing fuels containing up to 10% biofuel in fiscal 2030. About 40% of new vehicles sold in the country are compatible with the fuel mixture.

The ministry’s decision to introduce the fuels two years earlier is intended to identify potential issues regarding safety, quality maintenance and transport systems among others to allow the subsequent plans to go smoothly.

Areas where the fuel will be introduced will be decided on by autumn, and financial support will be provided for the costs involved, such as renovating fueling stations. The government has already received approval for the plan from oil wholesalers and carmakers.

To expand use of biofuels, it is necessary to raise its mixture rate even higher. The government is planning to ask carmakers to make all new vehicles compatible with mixed fuels with 20% biofuels in the early 2030s and intends to start providing such mixed fuels in fiscal 2040.

Biofuels are made from biological resources, such as corn and sugarcane. Biofuels emit CO2 when burned but they are regarded as making de facto contributions to decarbonization because CO2 is absorbed by their biological ingredients when they grow.

The use of biofuels is spreading worldwide. Countries such as Brazil and the United Kingdom have made it mandatory to offer mixed fuels containing a certain percentage of biofuels.

Japan has a policy to procure biofuels from Brazil, the United States and elsewhere, but stable procurement and cost reduction will be problems to overcome if Japan is to make biofuels widely available.
 
 

Japanese automakers have few immediate options to offset the impact of the additional U.S. tariff on cars. Toyota Motor Corp, Honda Motor Co and other domestic manufacturers will likely rely on strong sales of their popular fuel-efficient models in the key market, potentially coupled with price increases, analysts say.

An additional 25 percent tariff that took effect on April 3 is expected to significantly dent profits at Japanese automakers, with Japan's top two carmakers -- Toyota and Honda -- projecting a 35 percent and 70 percent plunge in net profit, respectively, for the year through March 2026.

Auto manufacturers can increase local production or pass the higher tariff costs on to customers, among other effective measures to mitigate the impact.

Raising prices could help ease the pressure on profitability, but the strategy risks driving away customers.

Toyota Chief Financial Officer Yoichi Miyazaki said at a press conference on the company's latest earnings that it would not make any hasty moves and ruled out an immediate price hike, describing it as a risky strategy.

It may take years to increase local production, as carmakers will need to reorganize their supply chains, and they may be reluctant to do so without knowing how long the tariffs will remain in place, analysts said.

On top of the 25 percent tariff, U.S. President Donald Trump imposed a 25 percent tariff on auto parts and a 10 percent baseline rate for imports from all trading partners.

Toyota President Koji Sato said at the press conference that his company will continue to focus on local development and production "in the medium and long term."

If exports from Japan to the U.S. market prove difficult, Toyota should consider redirecting those vehicles to other markets in the short term, he said.

Toyota, the world's largest carmaker by volume, expects its net profit to fall 34.9 percent in the current fiscal year to 3.1 trillion yen ($21.3 billion), as it estimates the higher import taxes will reduce its operating profit by at least 180 billion yen in the first two months of the fiscal year. The company did not disclose the impact for the full year.

Honda, Japan's No. 2 carmaker, said its net profit is forecast to plunge 70.1 percent to 250 billion yen in fiscal 2025, saying that U.S. tariffs could lower its operating profit by 650 billion yen in the year, affecting its imported cars and motorcycles.

Honda plans to move production of some models to the United States from Japan and Canada to soften the impact of the tariffs.

Honda President Toshihiro Mibe said the company will also consider raising prices, closely monitoring other firms' pricing strategies to determine the timing and which models would be affected.

"We will make efforts to overcome" the impact of the tariffs, Mibe said at a press conference for the latest earnings.

Nissan Motor Co, Japan's third biggest carmaker, expects the tariffs to cut its operating profit by up to 450 billion yen in the current business year.

The additional tariffs are another blow to Nissan, which has been undergoing massive restructuring due to faltering sales in the U.S. and China markets.

The struggling automaker posted its third-largest net loss in fiscal 2024.
Nissan said it will focus on boosting sales of models manufactured in the United States to cushion the effect of the auto tariff.

Nissan builds 53 percent of the vehicles it sells in the U.S. market at local plants, more than Toyota's 49 percent but less than Honda's 62 percent, according to Tatsuo Yoshida, senior auto analyst at Bloomberg Intelligence.

For Japanese automakers, scaling back their U.S. operations is not an option. Demand for relatively high-end vehicles, which offer higher profit margins, remains strong in the world's second-largest auto market after China, analysts say.

Auto analyst Takaki Nakanishi of the Nakanishi Research Institute said the challenging circumstances do not diminish the importance of the U.S. market for Japanese automakers, and that Toyota and others should continue offering attractive products to local customers to remain competitive.

No Japanese automakers currently plan to build new plants or significantly expand production capacity in the United States, as they aim to boost sales of small cars and hybrid vehicles to meet strong local demand.

"The tariff was imposed at a time when Japanese automakers' shares and sales in the U.S. market were expected to grow into 2025 with local consumers opting for smaller cars and hybrids that Japanese automakers have an edge on," Bloomberg Intelligence's Yoshida said.

"Since the additional tariff imposed by the Trump administration is not driven by hostility toward Japan-made cars, there is no reason for Japanese automakers to shift their stance. The U.S. market will remain a key source of sales, even if profits take a hit from the levies," he said.
 
 

The Finance Ministry is considering imposing the consumption tax on low-cost imported goods priced at ¥10,000 or less that are currently exempted under the de minimis rule, according to sources.

The ministry is set to revise the rule, which also exempts such goods from tariffs.

Behind the move is the situation in which Chinese e-commerce sites are boosting their sales of low-cost items under the rule. The ministry aims to level the playing field for competition between domestic and foreign businesses.

Other countries are also making changes to their de minimis rules. The administration of U.S. President Donald Trump suspended the de minimis rule for items imported from China.

Regarding the timing of making the change, the ministry is eyeing the government’s tax reform scheduled for next year or later. The ministry is considering making it mandatory for businesses managing e-commerce sites to register with the tax authority and file their tax.

The ministry is set to continue tariff exemptions, because the imposition of tariffs creates additional on-site workloads.

“De minimis” means “about minimal things” in Latin. Similar systems have been introduced in many countries to reduce the burden of customs clearance work.

Japan currently exempts imported items priced at ¥10,000 or less from a tariff and the consumption tax. According to the ministry, there were 169.66 million cases — worth ¥425.8 billion — of imports of low-cost goods priced at ¥10,000 or less in 2024, five times larger than five years ago.

Experts point out that Temu, Shein and other Chinese e-commerce sites have been increasing sales of low-cost items in recent years, taking advantage of the de minimis rule of various countries.

According to research firm Sensor Tower, Temu’s e-commerce application was the most downloaded app worldwide last year, with 550 million downloads, followed by Shein.

According to the ministry, many domestic businesses are apprehensive about the situation regarding Chinese sites.

“Their price competitiveness is strong, and they pose a threat to us. It’s possible that they could take more market share,” a domestic business said.
“The imbalance of competitiveness has too much of an impact,” another said.

An increasing number of countries are abolishing or diminishing the rule. The U.S. government suspended tax exemption for Chinese goods from May 2 to eliminate a loophole in its tax system. Vietnam abolished the system in February, and the EU is also trying to revise its rule.
 

 

Japanese technology and entertainment company Sony Corp logged an 18% rise in profit for the fiscal year through March on healthy results at its music and video-game operations.

Its chief executive, Hiroki Totoki, outlined the company's strategy for growth Wednesday, stressing that collaboration among Sony's various segments, like animation and music, were crucial to deliver the “kando,” or emotional engagement, that lies at the core of the company's vision and strength.

“Building on our momentum and results to date and working with a laser-like focus to realize our long-term Creative Entertainment Vision will be at the core of our corporate strategies moving forward,” he told reporters.

Sony's movies division has strong offerings in the pipeline, including Spider-Man films and biopics about The Beatles, while animation remains a driver of growth centered around the popular anime streaming service Crunchyroll, Totoki said.

Tokyo-based Sony reported a record annual profit of 1.14 trillion yen ($7.8 billion), up from 970.6 billion yen in the previous fiscal year. Annual sales were virtually unchanged, inching down to 12.957 trillion yen ($88 billion) from 13.020 trillion yen.

One area that lagged among Sony’s sprawling businesses was the financial segment, where revenue stalled. But its film division and its imaging and sensor solutions segment did well.

Sony officials said they were studying how to respond to President Donald Trump's tariffs, although that was a challenge because of uncertainties and constant changes. But they said the negative impact from U.S. trade policy will be kept to 10% of Sony's operating profit in the coming fiscal year by adjusting the allocation of shipments, among other measures.

Totoki stressed that Sony plans to leverage its content creating technology, like virtual reality and image sensors, to feed into its entertainment products, including working on immersive experiences.

Sony also has powerful collaborative relations with various entertainment companies like Kadokawa, which includes publishing as well as films and animation, and Bandai Namco, a video game maker, he added.

Sony will emphasize the “diversity” of its workers, helping bring out people's creative potential, Totoki said.

Among the Sony movies that fared well at the box office for the fiscal year through March were “Venom: The Last Dance,” featuring the Marvel Comics superhero, and “Bad Boys: Ride or Die,” an action comedy, where Will Smith and Martin Lawrence return in their popular cop roles in the fourth installment in the series.

Sony, which makes the PlayStation console and game software played on that machine, also posted healthy results in the gaming business.

Its music operations, which also held up, include recordings, streaming services and music for games. The top-selling recorded music projects for the latest fiscal year globally was SZA’s “SOS Deluxe: LANA,” followed by Beyonce, Future & Metro Boomin and Travis Scott.

The top seller in its Japan music business was Kenshi Yonezu’s “Lost Corner” album, followed by offerings from Stray Kids and Six Tones.

For the January-March quarter, Sony posted a 197.7 billion yen ($1.3 billion) profit, up 5% from 189 billion yen the same quarter in the previous fiscal year. Sales were 2.6 trillion yen ($17.7 billion), down 24% from 3.48 trillion yen.

Sony is forecasting a nearly 13% drop in profit for the fiscal year through March 2026, to 930 billion yen ($6.3 billion), on 11.7 trillion yen ($80 billion) sales, down 2.9% on-year.

Sony Group Corp stocks, which fell in Tokyo morning trading, rebounded to finish 3.7% higher after its financial results were announced.
 
 

Honda Motor on Tuesday forecast a 70 percent drop in net profit for the 2025-26 financial year as U.S. trade tariffs weigh on the global auto industry.

The announcement comes after rival Toyota, the world's top-selling carmaker, predicted a 35 percent year-on-year drop in annual net profit because of the levies and other factors.

Honda said it expected net profit of 250 billion yen in the 12 months to March 2026.

"Tariff impact and recovery efforts" will have a negative effect on operating profit, it warned, estimating they will cost the company around 450 billion yen over the year.

In an attempt to rev up the U.S. auto industry, President Donald Trump last month imposed a 25 percent toll on imported vehicles, dealing a major blow to Japanese carmakers.

"The impact of tariff policies in various countries on our business has been very significant, and frequent revisions are being made, making it difficult to formulate an outlook," CEO Toshihiro Mibe told reporters Tuesday.

Honda, Japan's second-biggest automaker after Toyota, logged net profit of 835 billion yen in the past financial year, a drop of almost 25 percent on-year and well short of its February forecast of 950 billion yen.

"Our automobile business experienced a decline in sales volume mainly in China and the ASEAN region" in Southeast Asia, Mibe said.

It was also "impacted by increased incentives for EV sales in North America", although "hybrid vehicle sales expanded".

But Honda may still have a better chance of weathering Trump's tariff onslaught than its competitors in Japan, analysts said.

Late last month Trump softened the auto tariffs by signing an executive order to limit the impact of overlapping levies on carmakers.

He also said he would give the industry a two-year grace period to move supply chains back to the United States.

This is good news for Honda, which builds more than 60 percent of the vehicles it sells in the United States in the country.

That is "the highest percentage" of all major Japanese automakers, Bloomberg Intelligence auto analyst Tatsuo Yoshida told AFP ahead of the results.

That means the impact from tariffs will be "comparatively smaller for Honda", he added.
 

 

Struggling Japanese automaker Nissan Motor Co plans to cut around 20,000 jobs globally, more than 10,000 above the reduction announced last fall, as it deems deeper action is needed to turn its business around, a source familiar with the matter said Monday.

The job cuts under the new plan represent about 15 percent of Nissan's total workforce. The company is set to report its earnings for the fiscal year ended March on Tuesday, with attention focused on the impact of U.S. President Donald Trump's higher auto tariffs.

The automaker is also considering closing one of its domestic factories as part of efforts to optimize production capacity amid declining sales, the source said.

In November, Nissan announced plans to cut 9,000 jobs in Japan and overseas and to reduce its global production capacity by 20 percent by fiscal 2026, as its businesses in the United States and China continued to struggle.

In February, it said it also plans to close a Thai plant and two other factories without giving details.

Nissan currently operates five vehicle assembly plants in Japan, with former CEO Makoto Uchida previously expressing a commitment to keeping domestic factories in operation.

The plan to close a domestic plant is expected to draw strong opposition from labor unions and other stakeholders, likely making coordination difficult.

Last month, the automaker projected a net loss of 700 billion yen to 750 billion yen for fiscal 2024 due to restructuring costs, which would be the company's biggest-ever annual net loss.

Nissan has been reviewing its investment strategy under CEO Ivan Espinosa, who assumed Nissan's top post on April 1.

It said last week it has abandoned a plan to build an electric vehicle battery plant in Fukuoka Prefecture, only a few months after signing a pact with local governments over the envisioned facility.

Nissan sought to merge operations with rival Honda Motor Co, but their negotiations broke down in February after Honda's proposal to make Nissan its subsidiary riled the Yokohama-based automaker's board.
 
 

Japan is seeing a boom in gold investment amid heightening concerns over a global economic slowdown caused by U.S. President Donald Trump's hefty tariffs, as investors seek a safe asset seen as unlikely to plummet in the event of turbulence.

The benchmark price of gold set by Tokyo's Tanaka Precious Metal Technologies Co. hit an all-time high in yen terms on April 22, exceeding 17,000 yen ($115) and surging around 15 percent in the three months since Trump took office on Jan. 20.

Products linked to gold price movements have also become popular among investment trusts covered by Japan's tax exemption program for private investors, known as NISA, while more people have started monthly investments in pure gold.

Among investment trusts, the inflows to the Mitsubishi UFJ fine gold fund that reflects gold prices totaled some 19.2 billion yen in March, up by about 2.6-fold from last December.

The fund ranked fourth last December in investment trusts under the NISA program in terms of value handled by PayPay Securities Corp. but topped the ranking in February and placed second in the following month, it said.

At Tanaka Precious Metal, the number of people who purchased bullion and coins increased, while the number of its members investing in pure gold at fixed monthly values expanded 26 percent in the January-April period from a year earlier, it said.

Used gold accessories are also becoming popular. At major second-hand luxury brand goods seller Komehyo Co., sales of gold products including accessories in March climbed 30 percent from a year earlier.

In Tokyo's Shinjuku district, one of its outlets sells a wide selection of products from gold necklaces and gold pendants, with price ranging from hundreds of thousands to millions of yen.

"They are mainly sold to customers in their 30s to 40s," the store's sales manager said.

Gold also has the risk of price declines like other assets but its prices have been solid at a time when the stock market has been volatile, with the Nikkei benchmark suffering its third-largest point drop in history on April 7.

"Considering the volatility in the stock market, gold continues to remain an attractive investment destination," said Atsuko Sato Whitehouse, head of the Japanese market at BullionVault.
 
 

Japan posted a record current account surplus of 30.38 trillion yen ($208 billion) in fiscal 2024, marking a high for the second consecutive year, buoyed by its biggest-ever returns on foreign investments, government data showed Monday.

In the year ended March, the surplus in the current account balance, one of the widest gauges of international trade, grew 16.1 percent from the previous year, hitting the highest level since comparable data became available for fiscal 1985, the Finance Ministry said.

Primary income, which reflects how much Japan earned from overseas investments, stood at a record-high 41.71 trillion yen, up 11.7 percent from a year earlier, driven by increased dividends from offshore subsidiaries amid a weak yen, the ministry said in a preliminary report.

The yen averaged 152.48 against the U.S. dollar in fiscal 2024, 5.5 percent weaker than the year before, with the Japanese currency's depreciation inflating the value of returns from foreign investments by domestic companies and overseas dividend income.

Among other key components, the goods trade balance registered a deficit of 4.05 trillion yen, expanding 9.8 percent, as imports climbed 4.3 percent to 110.29 trillion yen, supported by strong demand for personal computers and smartphones.

Exports rose 4.1 percent to 106.24 trillion yen, helped by shipments of semiconductor-making equipment, electronics parts and vehicles.

The country's services trade deficit fell 20.2 percent to 2.58 trillion yen due to an expansion of the travel surplus, which stood at a record 6.69 trillion yen. Around 38.85 million foreign tourists visited Japan in fiscal 2024, up 34.7 percent from a year earlier, according to the ministry.

A surplus in the travel balance means that spending in Japan by foreign visitors exceeded the amount spent overseas by residents of Japan.
In March alone, the country logged a 3.68 trillion yen current account surplus, the third highest for any month, the ministry said.
 
 

The government is enhancing a system to encourage middle-aged workers in major companies to move into positions at midsize and small companies in provincial regions.

The enhanced program also upgraded a scheme for compensating transferees who are concerned that their salaries will decrease if they were to take up the new positions.

With the upgraded system, the government hopes that businesses in provincial areas will better utilize the workers’ high-level expertise.

In September last year, Hitoshi Nakayama, 53, left a position as chief of the general affairs division of a major auto parts manufacturer to take a job at Tobu Trading Co., a firm based in Matsubushi, Saitama Prefecture, that handles industrial waste.

“I wanted to utilize my experiences and skills in accounting and facility management,” Nakayama said.

He registered with REVICareer, a human resources database operated by Regional Economy Vitalization Corporation of Japan, and a job search firm that is part of the Chiba Bank group found him in the database and introduced him to Tobu Trading, with which the bank has business dealings
.
“We were looking for a talented, skilled worker who could collaborate with other divisions in our company,” said Koji Iwamoto, executive officer of Tobu Trading. “We regularly cooperate with the bank. So we had a high level of trust in its introduction.”

REVICareer, a Financial Services Agency project, began operating in fiscal 2021.

To be eligible to register with the database, the candidate has to have worked at a company with at least ¥1 billion of capital or more than 2,000 employees, or at a subsidiary of such a company. Once registered, job seekers can search for a new job using the database for a period of five years starting from when they leave their workplace.

The information of job seekers registered with the database can be accessed by 156 financial institutions, including regional banks and shinkin banks. The banks can then use that information to find job seekers who are suitable for the needs of their business partners and introduce both sides.

The program also allows the job seekers to take on the new positions as side jobs or concurrent primary occupations while remaining in their full-time positions.

Mismatches between the job seekers and the employers are said to be rare because their introductions are mediated by regional financial institutions that have detailed knowledge about the realities faced by midsize and small firms in the regions.

Differences in salaries and working conditions had been high hurdles for workers moving from major companies to smaller firms. To address this, the Financial Services Agency pays a portion of the salaries of workers who change companies using the database.

Under certain conditions, the workers can receive 30% — up to ¥4.5 million — of their new job’s annual salary from the agency for two years after assuming their new post.

As of the end of fiscal 2024, 4,343 workers were registered in the database, with the average age being 54. The total number of cases in which job seekers changed jobs or found side jobs was 178, a 2.5-fold increase from the 72 cases logged as of the end of fiscal 2023.

The agency has now tripled the program’s budget to ¥2 billion and partnered with the Economy, Trade and Industry Ministry.

The agency, through business organizations and chambers of commerce under the ministry’s jurisdiction, aims to encourage midsize and small companies in provincial regions to proactively offer jobs.

Nevertheless, the number of registered job seekers in the REVICareer database is significantly lower than in private-sector job-brokering services, so raising its name recognition is a pressing challenge.

Until last fiscal year, the conditions for job seekers to use the database were limited to current employees of major companies or those who had left jobs at major companies in the past two years. The conditions have been relaxed from this fiscal year to enable the registration of job seekers who have left a major company in the past five years.

An agency official connected to REVICareer said, “We want to increase the number of registered people to about 10,000 and accelerate the revitalization of regional communities.”
 

 

Given that the automotive industry serves as the “backbone” of the Japanese economy, a decline in its performance could undermine the drive for higher wages in the country.

With its extensive reach encompassing global corporations such as Toyota Motor Corp. and numerous small- and mid-sized parts suppliers, the industry supports 5.58 million jobs.

Japan’s annual automobile exports are worth about ¥20 trillion, accounting for 20% of the country’s overall exports. Of the exported units, 30% are destined for the United States, making it a significant market.

Amid this situation, the United States imposed an additional 25% tariff on automobiles on April 3 and on auto parts on May 3.

Recent figures reflect emerging macroeconomic challenges. As a result, the Bank of Japan significantly lowered its fiscal 2025 projection for econmic growth from 1.1% to 0.5%.

According to estimates by Daiwa Institute of Research Ltd., the implementation of “uniform reciprocal tariffs” of 10% by the United States is expected to lower Japan’s growth rate by 0.3%.

Sector-specific tariffs on automobiles and steel, among others, would lead to an additional 0.45% decrease.

The impact from tariffs on automobiles alone accounts for 0.36 percentage points, or 80%, of this decrease due to that industry’s high dependence on exports to the United States.

“Automobile tariffs will have the most substantial negative impact on the Japanese economy,” said Shinichiro Kobayashi of Mitsubishi UFJ Research and Consulting Co.

“The substantial involvement of small- and medium-sized enterprises in parts manufacturing could result in considerable damage to the real economy, underscoring the urgent need to protect this sector,” he said.
Major automakers, led by Toyota, have enjoyed strong performance due to the weak yen and have led the trend of significant wage increases in recent spring labor negotiations.

However, should they lose momentum due to adverse conditions such as tariffs and a stronger yen, the nationwide drive for higher wages could diminish, potentially resulting in reduced personal spending.

“The wage increases that have become established are in danger of being rolled back,” said Japan Chamber of Commerce and Industry Chairman Ken Kobayashi.

The United States has said it will not include automobile tariffs in the agenda for trade negotiations with Japan, raising expectations for challenging discussions.

Economic revitalization minister Ryosei Akazawa expressed growing concern, saying: “[Major automobile manufacturers] are incurring hourly losses. We seek to conclude this matter with utmost haste.”
 
 

Japanese electronics giant Panasonic, which supplies batteries to Tesla, said Friday it will target 10,000 job cuts worldwide as part of efforts to boost profitability.

The cuts, which represent around four percent of the group's workforce of nearly 230,000, will be implemented mainly in the current financial year to March, it said.

Panasonic said it would "thoroughly review operational efficiency at each group company, mainly in sales and indirect departments".

It will "reevaluate the numbers of organizations and personnel actually needed", a statement said.

"This measure targets 10,000 employees (5,000 in Japan and 5,000 overseas) at consolidated companies," and will be executed "in accordance with the labor laws, rules, and regulations of each country and region".

Panasonic became a global household name in the latter half of the 20th century, pioneering electronic appliances from rice cookers to televisions to video recorders.

The Osaka-based conglomerate is a major battery supplier for Elon Musk's U.S. electric vehicle maker Tesla, and also operates in the housing, energy and auto sectors.

Panasonic in February outlined a management reform program to resolve "various structural issues" at the company.

"Through the current management reform, the company aims to improve profit by at least 150 billion yen," it said Friday.

In its full-year earnings report, also released Friday, Panasonic forecast a 15 percent decline in net profit this year, and an eight percent slump in sales.
In the financial year to March 31, 2025, the group logged a 17.5 percent decline in net profit to 366 billion yen.

Panasonic is facing "ongoing business environment changes (such as) a slowdown in demand for EVs", it said.

As for U.S. trade tariffs, "their impact is not factored into this forecast", Panasonic added.

"The company continues to monitor the tariff situation and aims to minimize the resulting impact by taking measures from both short-term and medium- to long-term perspectives."

In an interview published in April, Panasonic Holdings CEO Yuki Kusumi told Japan's Nikkei newspaper that personnel cuts would be necessary, without detailing their scale.

Job cuts would be needed "in order for us to perform at a competitive level against other firms", he told the Nikkei.

In Panasonic's history, the group has also gradually expanded its headcount during profitable periods, Kusumi stressed.
 


 

NTT Corp. plans to fully acquire information technology services provider NTT Data group Corp. in a transaction projected to be worth about ¥2.37 trillion, the company announced Thursday.

NTT Data Group is a publicly listed subsidiary of NTT. Following the acquisition, it will likely be delisted from the stock exchange.

This strategic move is meant to expedite the convergence of telecommunications and information technology services to foster growth.
The core operations of NTT Data Group involve delivering IT services and managing data centers, primarily for corporate clients within the nation. It also oversees the NTT Group’s overseas businesses.

NTT currently holds a 57.7% equity stake in NTT Data Group and intends to acquire the remaining shares through a tender offer.

NTT has been intensifying its group restructuring initiatives, including the full acquisition in 2020 of NTT Docomo Inc., a previously listed subsidiary. Subsequently, the group centralized its international operations under NTT Data Group in 2022.

The accelerating digitization of businesses has favorably impacted NTT Data Group, resulting in strong performance and sustained growth in both revenue and profit.

For the fiscal year that ended in March 2025, the company projects consolidated revenue of ¥4.43 trillion, representing a 1.4% year-over-year increase. Operating profit, a key indicator of core earnings, is projected to reach ¥336 billion, marking an 8.5% year-over-year increase.
 
 

Japan's real wages in March fell 2.1 percent from a year earlier, marking the third consecutive monthly decline, as income growth continued to fall behind price hikes, government data showed Friday.

Nominal wages, or the average total monthly cash earnings per worker including base and overtime pay, increased 2.1 percent to 308,572 yen, rising for the 39th straight month, the Ministry of Health, Labor and Welfare said.

But consumer prices, used to calculate the pay data, grew 4.2 percent in the reporting month, driven by higher rice and other food prices, although the pace slowed from a 4.3 percent rise in February, according to the ministry.

Separate data showed the country's household spending in March rose a real 2.1 percent from the year before.

Households of two or more people spent an average of 339,232 yen in the reporting month, according to the Ministry of Internal Affairs and Communications.

The data is a key indicator of private consumption, which accounts for more than half of Japan's gross domestic product.
 
 

KDDI Corp. has started a service for the direct connection of smartphones with the Starlink satellite network of SpaceX of the United States.

It is the first time in Japan that smartphone connection services using satellites has become available. Even in places that were out of the service areas of mobile phones in the nation, some kinds of message information can be transmitted and received.

From summer this year, KDDI will make it possible for its smartphone subscribers to access the internet.

Subscribers to KDDI’s au brand smartphones can use the new service free of charge for the time being.

Although applications do not need to be made for the new service, subscribers need to use iPhone models of Apple Inc., Galaxy models of Samsung Electronics Co. or other models that are compatible with Starlink.

In the direct connection service, smartphone subscribers can transmit and receive radio waves via Starlink satellites without accessing wireless access points.

Even in out-of-service places, such as mountainous areas and on the sea, KDDI subscribers can transmit and receive short message service texts, share location information and receive emergency earthquake warnings.

Subscribers using smartphones with the Android operating system of Google LLC can send texts of questions to conversational AI programs.

Prior to rolling out the new service, KDDI provided antennas for Starlink connection to areas damaged by the Noto Peninsula Earthquake.
 
 

Indonesian Finance Minister Sri Mulyani Indrawati and Japanese Finance Minister Katsunobu Kato discussed the challenges posed by the US tariff policy in Milan, Italy, on Sunday.

On the sidelines of the ASEAN+3 Finance Ministers’ and Central Bank Governors’ Meeting, Sri Mulyani noted that Japan’s experience in dealing with the trade war with the US in the 1980s offers valuable insights and is an important reference in shaping the steps forward.

“(During the meeting) I conveyed that Indonesia received a positive response from the US government as one of the first mover countries that proactively negotiate tariffs,” she wrote on her Instagram account.

As part of the negotiations, Sri Mulyani highlighted that Indonesia has prepared a comprehensive policy package addressing various issues, including tariff and non-tariff barriers, as well as tracking the US trade deficit.

"Our discussion also covered the impact of escalating tariff wars on the automotive and electronics industries that have long been pillars of global trade and dominated by the US, Japan, China, and Europe,” she stated.

Earlier, Sri Mulyani stated that Indonesia's bargaining position remains neutral amid tensions between the US and China over reciprocal tariffs.

"Indonesia, both as the largest country in ASEAN and in its relations with the US and China, which are experiencing escalating tensions, maintains a fairly neutral position that is respected and taken into account,” she noted.

“This is a good bargaining power that we must maintain," she stressed.

She expressed optimism that Indonesia's relatively strong bargaining position is supported by its stable economic performance. With this support, Indonesia has sufficient capital to face the dynamic and tense global situation.

So far, the Indonesian government and the Office of the US Trade Representatives (USTR) have signed a non-disclosure agreement, marking the start of the technical discussion phase set to take place in the next two weeks.

The agreement resulted from negotiations between the Indonesian and US governments following President Donald Trump’s announcement to impose reciprocal tariffs on numerous countries, including Indonesia, which now faces a 32 percent tariff.

However, on April 9, Trump announced a 90-day pause on the policy’s implementation for most countries, excluding China. Indonesia is among the countries granted the full three-month reprieve.
 

Sumitomo Mitsui Banking Corp (SUMFGI.UL) (SMBC) is close to agreement on acquiring a stake in Yes Bank with the Japanese firm eyeing a majority 51% equity in the Indian lender, three sources familiar with the deal said on Tuesday.

If the deal goes through, it could potentially be the largest in India's banking sector, where deal-making, especially involving foreign entities, is rare.

Shares of Yes Bank soared nearly 10% at one point on Tuesday. They were up 1.6% as of 1 p.m. local time (0730 GMT), valuing the lender at 565 billion rupees ($6.7 billion).

Restrictions on ownership, stricter capital requirements, and state domination of the banking sector have curbed foreign banks' operations in India. A takeover of troubled Lakshmi Vilas Bank by Singapore-based DBS Group in 2020 was the last major deal in the sector.

SMBC, a unit of Sumitomo Mitsui Financial Group Japan's second-biggest bank, has been in discussions with Yes Bank's largest investor, State Bank of India and India's central bank since last year, but the negotiations faltered amid concerns over ownership and voting rights.

Now, the Reserve Bank of India (RBI) has given SMBC a verbal go-ahead and a deal structure would be announced by June, one of the sources said.
Another source said SBI "is negotiating with SMBC to chalk out the final contours of the deal, but is yet to take the proposal to the board."

Yes Bank, in an exchange filing, said that it "routinely explores opportunities" with various stakeholders, which are aimed at enhancing shareholder value. However, such discussions are "preliminary" and do not warrant disclosures, it said.

The information pertaining to these discussions is "speculative" at this time and are not factually correct, Yes Bank said, referring to reports in various media on the potential deal.

None of the sources wished to be identified as the talks are private. The RBI, SMBC and SBI did not immediately respond to Reuters' emails seeking comment.

SBI holds a 24% stake in Yes Bank, as a result of the regulator-led restructuring of the lender in March 2020.

ICICI Bank (ICBK.NS), opens new tab, HDFC Bank (HDBK.NS), opens new tab, Kotak Mahindra Bank (KTKM.NS), opens new tab, Axis Bank (AXBK.NS), opens new tab and Life Insurance Corporation of India (LIFI.NS)

, opens new tab together hold an 11.34% stake in Yes Bank.
Indian regulations need the largest shareholder of a bank to reduce their shareholding to 26% in 15 years.

For the SMBC-Yes deal, "the RBI is clear" that the Japanese firm's voting rights will be capped at 26%, the first source said.
 
 

Japanese Prime Minister Shigeru Ishiba will have to continue dealing with a host of difficult issues at home and abroad after the country's Golden Week holiday period ends Tuesday.

The course of Japan-U.S. negotiations on the high tariff policy of the administration of U.S. President Donald Trump is the biggest of the challenges facing the Ishiba government.

The outcome of the ongoing bilateral negotiations will certainly have a major impact on this summer's election for Japan's House of Councillors, the upper chamber of the Diet, the country's parliament, and may affect the fate of the Ishiba administration, political watchers say.

"We are discussing all (U.S.) tariff measures, including tariffs on automobiles, steel and aluminum," Ishiba told reporters at his official residence Saturday, reiterating Tokyo's stance of calling on the U.S. side to review its tariff measures.

The gap between Tokyo and Washington is large, however, as the U.S. side apparently plans to put so-called reciprocal tariffs on the agenda of the bilateral negotiations while not including automobile, steel and aluminum tariffs from the scope of topics.
 
 

Japan Airlines Co. said Friday its revenues rose 11.6 percent from the year before to 1.84 trillion yen in the fiscal year ended March, a record high since its relisting in 2012, boosted by robust demand from domestic and international travelers.

The company said it remains vigilant over the possible effect of U.S. President Donald Trump's tariffs policy on travel and cargo demand, saying the latest earnings results have not reflected the impact of the "extremely uncertain" and fluctuating Trump policies.

CEO Mitsuko Tottori told a press briefing that the latest result gave her "confidence" to pursue further growth as it reflected continued support by customers despite incidents of pilots drinking alcohol that prompted a business improvement order from the transport ministry.

Tottori said she hopes that the World Exposition in Osaka, running for six months from mid-April, will further boost inbound travelers, not only to the western Japan city but also to other regions in Japan using domestic airline services.

JAL's net profit for fiscal 2024 grew 12.0 percent to 107.04 billion yen. The number of domestic passengers increased 2.9 percent to 36.13 million, and international travelers rose 14.4 percent to 7.58 million.

The figures picked up from fall and winter seasons after some people likely avoided traveling during the hot Japanese summer, the company said.

For the current fiscal year that began in April, the company expects its net profit to rise 7.4 percent to 115 billion yen on sales of 1.98 trillion yen, up 7.2 percent.
 
 

The Bank of Japan is closely monitoring U.S. tariff policy, as it could impact the timing of Japan’s rate hikes given the significant uncertainty the tariffs inject into the economic and price outlook.

At a press conference on Thursday, BOJ Gov. Kazuo Ueda reaffirmed that the bank would consider raising interest rates once it believes that its economic and price outlook will be realized.

However, given the major turmoil stirred up by U.S. tariffs, market observers have expressed divergent views about when interest rates will be hiked.


Outlook uncertain

The BOJ’s Outlook Report, released on Thursday, presented revised projections of inflation: 2.2% for fiscal 2025, 1.7% for fiscal 2026 and 1.9% for fiscal 2027. Notably, these forecasts have been revised downward for fiscal years 2025 and 2026 compared to the report issued in January.

During the press conference, Ueda said that the BOJ would be “slightly delayed” in reaching its target of stable 2% inflation, with that result now being expected between late fiscal 2026 and the end of fiscal 2027.

However, Ueda did not clarify whether rate hikes would be put off. This lack of clarity stems from the uncertainty associated with U.S. tariffs, which could prompt significant changes to the economic and price outlook.

“Considering the somewhat limited certainty of the [economic and price] outlook, there is a substantial probability that changes in conditions, such as tariffs, will require revisions to the outlook,” said Ueda.


Divided views

At its latest policy board meeting, the BOJ remained firm on raising the policy interest rate if “underlying inflation,” which excludes temporary factors such as rising rice prices, approaches 2%.

According to Shinichiro Kobayashi of Mitsubishi UFJ Research and Consulting Co., the prospect of a rate hike this year has almost vanished. He believes an economic slowdown is inevitable, regardless of whether tariff negotiations between the United States and other countries produce results.

“I think the Bank of Japan will likely hike rates no earlier than the start of next year. A rate hike will be more likely if wage increases are expected to remain elevated in the 2026 spring labor negotiations,” he said.

Takeshi Minami, of Norinchukin Research Institute Co., noted that there was a risk of inflation slowing down, and saw the BOJ possibly considering a raise in rates around autumn.
 
 

• Hyundai Motor holds handover ceremony with Iwasaki Group on Yakushima Island, Japan, for Hyundai ELEC CITY TOWN electric buses
• Hyundai ELEC CITY TOWN buses are optimized for Yakushima's environment, with Vehicle Dynamics Control and advanced battery management and cooling systems
• The initiative demonstrates Hyundai Motor's strong commitment to its vision of 'Progress for Humanity' and to building a more sustainable future worldwide

Seoul, South Korea and Yakushima, Japan, (ANTARA/PRNewswire)- Hyundai Motor Company today held a handover ceremony to deliver Hyundai ELEC CITY TOWN electric buses to Tanegashima Yakushima Kotsu, a regional transportation and tourism service provider operated by the Iwasaki Group in Kagoshima Prefecture, Japan.

The initiative marks a significant step in transitioning to zero-emission public transport on Yakushima Island, a UNESCO World Heritage Site.

The event was attended by Jaehoon Chang, Vice Chair of Hyundai Motor Group; Toshiyuki Shimegi, CEO of Hyundai Mobility Japan; Yoshitaro Iwasaki, CEO of Iwasaki Group; and Koji Araki, Mayor of Yakushima.

The handover follows the signing of a Memorandum of Understanding (MoU) in July 2024 between the two parties for the purchase of Hyundai ELEC City TOWN buses.

"I am delighted to see Hyundai's ELEC City electric buses running here on Yakushima, contributing towards a cleaner island environment," said Hyundai Motor Group Vice Chair Jaehoon Chang. "Being part of Yakushima's zero-emission island initiative is a significant step towards achieving carbon neutrality on the island by 2050."

Starting from June 2025, five Hyundai ELEC CITY TOWN buses will operate on Yakushima. These medium-sized, low-floor electric buses will be tailored to local conditions. They are equipped with a 145 kWh battery and a high-efficiency motor delivering a power output of up to 160 kW/217 PS.

The buses are equipped with Vehicle Dynamics Control to ensure safe and stable driving on the island's mountainous roads, characterized by steep slopes and sharp curves.

The buses also feature advanced battery management and cooling systems, optimized for Yakushima's hot and humid climate, enhancing charging performance, efficiency and driving range.

On Sunday, April 20th, ahead of the handover ceremony, Hyundai Motor signed a partnership agreement for the use of electric vehicles on Yakushima. The agreement includes utilizing the ELEC CITY TOWN's Vehicle-to-Home capabilities to supply power to evacuation shelters and medical facilities during natural disasters such as typhoons or periods of heavy rainfall.

Yakushima is located at the southwestern end of the Japanese archipelago and is known for its stunning natural scenery, often referred to as the 'Alps of the Ocean'. As a UNESCO World Heritage Site, the island is recognized as a leading eco-tourism destination, making emissions control essential for environmental preservation.

Kagoshima Prefecture has designated Yakushima as a key area in its plan to achieve carbon neutrality by 2050. Yakushima aims to transition its vehicle fleet to primarily EVs as part of its aim to become a zero-emission island.

Hyundai Motor anticipates that the ELEC CITY TOWN buses will contribute to Yakushima's carbon neutrality goals by providing a mobility solution that supports local sustainability efforts and reflects the needs of the community.

This initiative aligns with Hyundai Motor's global vision of 'Progress for Humanity' and its ongoing commitment to building a more sustainable future.


 

When a severe rice shortage sent prices skyrocketing in Japan last year, Tokyo restaurant owner Arata Hirano did what had once seemed unthinkable: he switched to an American variety.  

The price of the Californian Calrose rice he buys has doubled since his first purchase last summer, but even so it's far cheaper than home-grown grains.
"Unless domestic prices fall below Calrose prices, I don't plan to switch back," said Hirano, whose restaurant offers meal sets of fish, rice, soup and sides.

His willingness to embrace foreign rice may presage a seismic change in mindset for Japanese businesses and consumers - one that could allow Tokyo leeway to relax some restrictions if rice becomes a thorny topic in tariff talks with U.S. President Donald Trump, who has called out Japan's high levies on its staple grain.

Wholesale prices for domestic rice have surged about 70% over the past year to hit their highest levels since current records began in 2006. Crops were hit by extreme heat while a tourism boom has added to demand. Worries abound that not much will change this year.

With inflation also raising the cost of living, businesses are now betting that a nation of people known for their discerning palates and pride in their staple grain is open to change.

Supermarket giant Aeon last week began selling an 80-20 American-Japanese blend that's about 10% cheaper than domestic rice after a test sales-run proved a hit. Fast-food chain Matsuya and restaurant operator Colowide began serving pure American rice this year. At supermarket chain Seiyu, Taiwanese rice has been flying off the shelves since last year.

It's a sharp contrast to 1993, when the Thai rice the Japanese government imported during an acute shortage was largely shunned, leaving supermarkets with piles of unsold bags.

Rare shortages aside, for most of the past six decades, nearly all of Japan's so-called staple rice - which is consumed at meals as opposed to rice used for feed or ingredients in other products - has been home-grown. There hasn't been much need for imports while high tariffs, put in place to ensure Japanese self-sufficiency for its most basic food, have protected local farmers from competition.

Japan limits tariff-free "minimum access" imports of staple rice to 100,000 metric tons a year, or around 1% of total consumption. The U.S. accounted for roughly 60% of that amount last fiscal year, trailed by Australia, Thailand and Taiwan. Anything above that is subject to a levy of 341 yen per kilogram.

When Trump announced sweeping tariffs on much of the world this month, he lambasted Japan for what he said was a 700% tariff on rice, a reference to that levy. Japanese policymakers called his remarks on the sensitive topic "regrettable". They also dispute the 700% figure, saying it's based on outdated international rice prices.

It's unclear, however, just how much - if at all - rice will be discussed in bilateral tariff negotiations that began this week. Some analysts think Trump's Republican administration might not be focused on rice as exports to Japan come from California, a Democratic-leaning state. Nor is it clear how much Japan might be willing to yield in opening up its rice market.

In one sign that there might be room for some change, a panel advising the finance ministry on Tuesday proposed expanding imports of staple rice, saying that lifting the 100,000-ton tariff-free cap could help stabilize supply.

That said, Prime Minister Shigeru Ishiba's Liberal Democratic Party is unlikely to risk angering farmers, traditionally a strong support base, ahead of upper house elections in July.

"It's not possible to make big concessions on rice just before the elections," said Junichi Sugawara, senior fellow at Tokyo-based Owls Consulting Group.

 

MORE IMPORTS TO COME

What is clear is that supply remains an issue. 
In the financial year that ended in March, tariff-free imports of staple rice hit Japan's 100,000-ton cap for the first time in seven years. 

The amount of tariffed imports, while still tiny, also jumped, quadrupling in the first 11 months of fiscal 2024 to just under 1,500 tons.

And this year, rice importer Kanematsu is shipping in its first large-scale purchase of American staple rice, 10,000 tons worth. 

"We're receiving many enquiries from the restaurant industry, convenience stores, supermarkets and rice wholesalers," a Kanematsu spokesperson said. 
In the week to April 6, Japanese supermarket rice prices hit an average of 4,214 yen ($29.65) per 5 kg, marking their 14th straight week of increase and more than double the same period a year earlier.

That's despite a rare release of rice from the government's emergency stockpiles that started last month and is set to continue every month through July.

As for the quality and taste of imported rice, Miki Nihei, a customer at Hirano's restaurant, Shokudou Arata, said she had no complaints and was surprised to learn it wasn't Japanese.

"I had no idea," she said. "I have no qualms about eating imported rice. Prices have gone up, so I'm always looking for cheaper options."
 
 

Core consumer prices in Japan’s capital rose 3.4% in April from a year earlier, data showed on Friday, accelerating for the second straight month and making the central bank’s task of balancing risks from higher U.S. tariffs and rising prices more challenging.

The increase in the core consumer price index (CPI), which excludes volatile fresh food costs, was faster than a median market forecast of 3.2% and followed a 2.4% gain in March.

The Tokyo core CPI rose above 3% for the first time since July 2023.
The higher reading reflected a reduction in government subsidies to curb electricity and gas bills, as well as a series of price hikes for food that took place on April 1, the start of Japan’s new financial year.

A separate index that strips away the effects of both fresh food and fuel costs, closely watched by the Bank of Japan as a broader price trend indicator, rose 3.1% in April from a year earlier after a 2.2% rise in March.
The Tokyo inflation figures are considered a leading indicator of nationwide trends.

The data comes ahead of the BOJ policy meeting on April 30-May 1, where the central bank is widely expected to keep short-term rates steady at 0.5%.

While BOJ Governor Kazuo Ueda has signaled the central bank’s readiness to keep raising rates, sweeping U.S. tariffs have complicated its decision on when and how far it could hike.

The BOJ will cut its economic growth forecasts and warn of escalating risks from U.S. tariffs, which are expected to dent global demand, sources have said.
 
 

A Türkiye-Japan economic partnership agreement seeking to reduce the imbalance in bilateral trade is still under negotiation, Trade Minister Ömer Bolat has said.

Attending a Türkiye-Japan CEO Round Table Meeting in the capital Tokyo on April 24, he said: "We believe that the agreement will be a strategic tool for diversifying and balancing trade, increasing investments, and establishing a true 'win-win' partnership."

"As we approach the final stages of negotiations, we are confident that we will find common ground that respects the sensitivities of both sides and paves the way for new opportunities," he added.

He said Türkiye has proven itself as a “regional center” in production and logistics with access to markets such as Europe, Asia, and Africa, adding that the two countries’ trade volume last year reached $5.4 billion.

Türkiye welcomed the 11.4 percent increase in Türkiye's exports to Japan last year, Bolat said, but added that the structural imbalance in trade is still an important problem.

The countries are determined to eliminate this imbalance and create a more sustainable trade structure, he stressed.

In Tokyo, he met with Land, Infrastructure, Transport and Tourism Minister Nakano Hiromasa.

They reaffirmed their commitment to deepening cooperation in transportation, infrastructure and projects carried out in third countries based on a long-term partnership vision and sustainable development goals, Bolat said in a post on X.
 
 

Japanese auto giant Nissan on Wednesday announced the launch of two models aimed at picking up speed in its key market of China, where it has been outpaced by local rivals.

At industry show Auto Shanghai, the group announced an investment of 10 billion yuan ($1.4 billion) into China, and said it would increase the number of new models it planned to launch by summer 2027 to 10, up from eight.

The group's China chief, Stephen Ma, told a press conference the aim was to match Chinese competitors, and that Nissan had been slow in approaching the market with new models.

"We were not at the same speed, mainly because the Chinese brands were exceptional with speed," Ma said.

With fewer than 800,000 vehicles sold, in the 2023 financial year Nissan's sales fell by 24.1 percent in China, the world's leading car market.

The company is struggling on several fronts, with fragile accounts and an aborted merger attempt with Honda exacerbated by the tariff turmoil affecting its biggest market, the United States.

The group's renewed China offensive was on display at its booth on Wednesday, in the hulking form of the Frontier Pro truck.

It is Nissan's first plug-in hybrid vehicle, and designed to appeal to Chinese consumers' tastes.

The N7 electric sedan, meanwhile, produced with local partner Dongfeng, promises a range of up to 635 kilometers, customisable lighting and advanced driving assistance systems.

Nissan also plans to export the two models outside of China "in less than a year", Ma said, without specifying where -- other than not to the United States.
 
 

The finance chiefs of Japan and the United States are expected to hold talks on currency this week with Japanese representative Katsunobu Kato departing Tuesday for Washington to attend international gatherings.

The U.S. dollar fell below 140 yen on Tuesday for the first time since September, after U.S. President Donald Trump criticized Federal Reserve Chair Jerome Powell for not reducing interest rates.

At around 2:30 p.m. in Tokyo, the U.S. dollar fell to around 139.90 yen. It traded at 140.83-93 yen in New York and 140.55-57 yen in Tokyo at 5 p.m. Monday.

The dollar also came under pressure amid speculation that the U.S. administration will urge Japan to address the yen's weakness against the dollar when the Japanese and U.S. finance chiefs meet in Washington.

The bilateral talks will likely take place on Thursday, and come after Trump accused Japan of pursuing a policy to reduce the yen's value, a claim rejected by the Japanese government.

Before his departure, Kato said he intends to discuss exchange rate issues with U.S. Treasury Secretary Scott Bessent as part of broader talks between the two governments centered on tariff negotiations.

The two previously confirmed they will discuss the issues closely, the finance minister said, while declining to comment further as it could cause speculation and unforeseen impact on the market.

During his visit, Kato will attend a two-day gathering from Wednesday of finance ministers from the Group of 20 major economies, to be held on the fringes of the spring meetings of the World Bank and the International Monetary Fund.

Bank of Japan Governor Kazuo Ueda will also join the gatherings.
The U.S. dollar has been declining against the yen recently amid speculation the U.S. administration will urge Tokyo to address the dollar's strength against the Japanese currency, as Trump seeks to reduce his country's hefty trade deficit.

The Japanese government has rejected Trump's claim that it has devalued the yen and put U.S. manufacturers at a disadvantage, pointing to its yen-buying, dollar-selling interventions in recent years to prop up the currency.

Japan and the United States have been engaging in trade talks, with the Asian nation urging its close ally to reconsider tariffs introduced by the U.S. president.

Last week, economic revitalization minister Ryosei Akazawa, Japan's chief negotiator, held the first round of talks with Bessent in Washington, but said exchange rates were not discussed.
 
 

Japanese Prime Minister Shigeru Ishiba plans to launch a new program next month to reduce gasoline prices by 10 yen per liter, in response to U.S. President Donald Trump's tariff measures and the rising cost of living, informed sources said Tuesday.

He also plans to bring back subsidies aimed to cut down on electricity and gas bills during the July-September period, as part of the central government's efforts to tackle the torrid summer heat, according to the sources. Such subsidies had been provided up until March this year.

The government is now not expected to submit a fiscal 2025 supplementary budget bill featuring cash handouts during the ongoing ordinary session of the Diet, Japan's parliament.

 

By implementing measures in place of the proposed extra budget, Ishiba hopes to alleviate the financial strain on members of the general public in their daily lives ahead of a House of Councillors election to be held this summer.

Currently, the government is offering oil wholesalers subsidies to ensure that gasoline prices are kept at around 185 yen per liter.

Ishiba is considering implementing a program starting next month to set the gasoline price reduction rate at 10 yen, instead of deciding target gasoline prices, the sources said.
 

 

The Japanese currency strengthened to the 140-yen level against the dollar in Tokyo on Monday. It's the first time in about seven months that it's climbed to that range.

The move comes after US President Trump described "currency manipulation" as a non-tariff trade barrier in a social media post. Japan has repeatedly denied that it has a policy to devalue its currency.

Market players took Trump's comment as a sign the US will pressure Japan to take steps to reverse the weakening of the yen against the dollar.

The issue is likely to be on the agenda when Japan's Finance Minister Kato Katsunobu meets Treasury Secretary Scott Bessent in the US later this week.
Investors are buying the yen in anticipation of those talks.
 
 

Japan’s Nikkei share average dropped more than 1% on Monday, weighed down by a stronger yen that pressured exporters, while investors looked ahead to currency talks between Japanese and U.S. finance chiefs later this week.

The Nikkei ended 1.3% lower at 34,279.92, while the broader Topix slipped 1.2% to 2,528.93.

“Investors bought back stocks as the Nikkei extended losses during the session, but the buy-back did not last long. But it is not like what happened earlier this month, where any drop in the index drove further sell-offs,” said Shuutarou Yasuda, a market analyst at Tokai Tokyo Intelligence Laboratory.

“The market was not ready to become a risk-on mode yet.”

The yen rose to a seven-month high against the dollar as shaky confidence in U.S. assets was exacerbated by U.S. President Donald Trump’s attacks on the Federal Reserve.

A stronger yen typically weighs on exporter shares by reducing the value of overseas earnings when converted back into Japanese currency.

Automakers declined, with Toyota Motor and Honda Motor slipping 2.9% and 1%, respectively. Suzuki Motor lost 3.9%.

Finance Minister Katsunobu Kato plans to visit Washington later this week, where he is expected to meet U.S. Treasury Secretary Scott Bessent for discussions on currency rates.

Shares of domestically focused companies advanced, with the railway sector rising 0.86%, while the retail sector was little changed, edging up 0.03%.
The pulp and paper sector rose 3.5%, making it the top performer among the Tokyo Stock Exchange’s 33 industry sub-indexes.

Oji Holdings jumped 6.68% to become the top percentage gainer in the Nikkei after the paper products maker raised its dividend payout ratio and announced a share buyback.

Nitori Holdings, an operator of home interior goods stores which relies heavily on imports for materials, jumped 2.8%.
 
 

Plug and Play Japan has launched its first fund, “Plug and Play Japan Fund I,” to support startups in Japan.

The fund aims to solve key challenges such as limited access to global markets for Japanese startups.

It has secured over 3 billion yen (around US$21.1 million) in its initial closing, with backing from Mitsubishi UFJ Bank, the Organization for Small & Medium Enterprises and Regional Innovation, Tokyu Land Corporation, and Sazaby League.

The target is to expand the fund to 5 billion yen (around US$35.1 million).
Around 80% of the fund will go to Japanese startups, while the remaining 20% will be allocated to international startups that align with Japan’s market.
 
 

The Shibuya Ward Tourism Association and local businesses in Shibuya Ward, Tokyo, are working together to turn paper bags, receipts and other scrap paper into toilet paper for local elementary schools.

The association is asking other businesses and retail outlets to participate in the project, saying, “Our goal is to realize the ‘local production, local consumption’ of paper in [Tokyo’s] Shibuya Ward.”

A key component of the project is collecting used paper from participating businesses. In mid-March, a collection wagon stopped outside Freak’s Store Shibuya, a local clothing and goods retailer, and a female employee handed over a box of discarded receipts and flyers.

Daytona International, the Shibuya Ward-based company that operates the Freak’s Store outlet, said that from December through February, about 2,800 kilograms of used paper was collected from its stores and headquarters and turned into more than 15,600 rolls of recycled toilet paper.

Daytona International distributed some of the toilet paper to public elementary schools in the ward and gave some to customers as a souvenir.
Recycled paper is also used in the toilet paper’s packaging, which has information on it about the company’s recycling efforts.

“Awareness of the effort to collect used paper is spreading within the company,” said Mami Saikawa, 33, a member of the company’s brand strategy department. “The feedback from our customers has also been very positive.”

Initiated by the association in 2023, the project aims to “contribute to sustainable urban development and create products that can be used locally.”

The project includes plans to collaborate with Shizuoka-based paper
manufacturer Corelex Shin-Ei Mfg. Co. to produce toilet paper from used paper collected from businesses and stores in Shibuya Ward. Daytona International joined the initiative last summer, and paper collection began in December.

Corelex Shin-Ei has been collecting used paper in collaboration with more than 100 institutions, including inns in Atami, Shizuoka Prefecture, since 2010. It continues to supply them with recycled toilet paper.

While the Shibuya Ward Tourism Association currently only collects used paper from Daytona-affiliated businesses, it hopes to expand its collection network to include local hotels and commercial facilities and has cited the efforts of those involved with the program in Atami.

“If many businesses and stores participate, it will reduce waste and lower the cost of buying toilet paper,” said Hiroyo Koike, 45, the association’s secretary general. “Eventually, we may be able to sell it as a product of ‘local production, local consumption’ in Shibuya Ward.”
 
 

Fukoku Mutual Life Insurance plans to invest in Japan’s super-long government bonds this fiscal year after their yields skyrocketed, and is considering shifting from foreign debt.
 
"Yields have risen to levels that align with our investment perspective, so we will proceed with bond re-balancing while actively increasing holdings,” said Junya Morizane, general manager of the insurer’s Investment Planning Department. "There is ample room to continue purchasing super-long bonds.”
 
The debt, the main investment for Japan’s life insurers, has seen wild swings along with its U.S. counterparts as the global trade war deepens. After a steep selloff drove the 20-year sovereign yield to its highest since 2004, super-long bonds rebounded this week as Bank of Japan Gov. Kazuo Ueda suggested a policy response to higher U.S. tariffs.
 
Investment decisions by Japan’s life insurers are closely tracked as they can move global markets, and Fukoku will be the first among its major peers to report such plans for this fiscal year. They have combined invested assets of about ¥390 trillion ($2.7 trillion), according to the Life Insurance Association of Japan.
 
Fukoku aims to increase domestic government bond holdings by ¥30 billion, and gross purchases may reach ¥300-400 billion. The company is taking a proactive approach to investing even as U.S. President Donald Trump’s trade war roils global markets.
 
"It has been a tiring couple of weeks,” said Morizane. "We decided on this plan in March, but the underlying assumptions have changed significantly.”
 
"There’s been so many meetings and we are analyzing how far our revenue will fall and how much we can recover in this environment,” he said.
 
Expectations for further rate hikes by the BOJ had helped boost yields earlier this year, but tariffs have muddied the picture, with overnight index swaps showing a 54% chance of an increase by the end of this year.
 
Fukoku sees two rate hikes this fiscal year, and expects Japan’s 10-year yield to sit at 1.7% at the end of March 2026, up from 1.305% as of Thursday. Yields on 20-year bonds may end the financial year at 2.4%, according to Morizane, compared with about 2.23% recently.
 
"The 20-year has reached more than 2%, so it’s sufficient,” said Morizane, adding that Fukoku is already making considerable efforts to buy Japan’s super-long bonds. "It’s totally possible to switch from foreign bonds to domestic without compromising profitability, and we are considering revising our plan in May.”
 
Japanese investors offloaded foreign bonds at a slower pace last week amid the worst selloff in Treasuries in over two decades.
 
"Our strength lies in refraining from investing during the era of aggressive monetary easing,” Morizane said. "Even if other companies can’t act in this high-volatility environment, we are able to invest steadily.”
 

Japan recorded a trade deficit in its March-April fiscal year but racked up a surplus with the U.S., the Finance Ministry reported Thursday.

Japan’s global trade deficit totaled 5.2 trillion yen for the fiscal year through March, for the fourth straight year of deficits, according to the provisional statistics.

The surplus with the U.S. ballooned to 9 trillion yen.
Exports to the U.S. are a contentious issue for U.S. President Donald Trump and Japanese negotiators are in Washington to argue their case against higher U.S. tariffs. Japan is a key longtime U.S. ally and major investor in the U.S., employing hundreds of thousands of Americans.

Trump said on April 2 that he planned to impose a 24% tariff on imports from Japan as part of an announcement of higher tariffs on dozens of countries. After financial markets panicked, he put a partial 90-day hold on the import taxes, while increasing his already steep tariffs on Chinese goods to as much as 145%.

Japan still faces a 10% baseline tariff and a 25% tax on imported cars, auto parts, steel and aluminum exports. Most of those duties took effect recently, but they pose a grave challenge for embattled Prime Minister Shigeru Ishiba.

Some analysts say Tokyo could at some point announce surprise concessions, like importing more American rice. Rice holds a special place in the Japanese psyche as the nation’s staple and has long been a protected sector in Japan. But recently a rice shortage has been pushing up prices.

Japan’s annual exports climbed 5.9% from a year earlier, helped by strong shipments of goods like computer chips and vehicles. Imports rose 4.7%. But a weaker Japanese yen made imports more costly.

A recent influx of foreign tourists to Japan has pushed exports higher, since such spending counts as exports.

For the month of March, Japan recorded a trade surplus of 544 billion yen ($4 billion). Exports climbed nearly 4% from a year earlier, for the sixth straight month of gains, although the surge was slower than in February.

Exports to the U.S. rose 3%, while shipments to the rest of Asia grew 5.5%. Exports to China fell, while shipments to Hong Kong, Taiwan and South Korea surged.

“This is likely due to the rerouting of exports within Asia to avoid tariff conflicts with the U.S.,” Min Joo Kang, a senior economist at ING, said in a report.
 
 

With U.S.-Japan trade negotiations beginning in earnest on Thursday, Japanese companies face increasing uncertainty regarding their export prospects, especially with some sectors already feeling the initial impact of the new U.S. tariff policies.

While they have seen significant growth in the U.S. market due to the popularity of Japanese cuisine and a weaker yen, the potential impact of the tariffs is a major concern, creating both anticipation and anxiety about the outcome of the talks.

Fenix Co., a frozen food manufacturer in Kitakyushu, has seen a sharp drop in wholesale orders for squid products exported to Japanese restaurants in the United States this month, with only one order received compared to the usual five or six on a monthly basis, it said. The company attributes the drop to customers holding off on purchases in anticipation of increased import costs due to the tariffs.

The company exports its products to the United States, South Korea and Australia, with the U.S. market accounting for 30% of its overseas sales.

The president of the frozen food company voiced his concerns about potential costs of freezing and storing raw materials, saying: “If this situation persists into next month, it will be a major blow. Given the significant U.S. role in these negotiations, we hope the Japanese government will stand firm and not be swayed.”

Eco-rice Niigata Co., a rice producer in Nagaoka, Niigata Prefecture, has applied to the government to export about 200 tons of last autumn’s harvest, 70% of which is bound for the United States.

The company wants to export it during the 90-day temporary suspension of reciprocal tariffs, which ends in early July. However, it anticipates congestion at U.S. customs due to a surge in other exports, which may prevent its rice from being cleared by the deadline, it said.

Due to regulations, rice destined for export is usually not allowed to be sold domestically. Commenting on this restriction, President Yu Toyonaga, 61, said: “It is simply not feasible to export an entire year’s rice production in 90 days. We want these negotiations to at least secure an extension of the temporary suspension.”

In Aomori Prefecture, the nation’s second largest scallop-producing region after Hokkaido, many people are closely watching the progress of the trade talks.

“We hope that the fisheries and agricultural sectors will not be unduly burdened by being used as bargaining chips for automobiles and other sectors,” said Harumi Niki, chairman of the prefecture’s federation of fisheries cooperative associations.

In 2023, Aomori Prefecture’s agricultural, forestry and fisheries product and food exports to the United States totaled about ¥900 million, with scallops accounting for more than 40% of that export value.

Scallops have been exempt from tariffs, but the imposition of reciprocal tariffs would significantly increase costs for American buyers. “If Hokkaido’s scallops destined for export to the United States are redirected within Japan, we could see a drop in the price of Aomori scallops,” Niki said.

Meanwhile, some companies are looking to diversify their sales channels beyond the United States. Tsutomu Foods, a konnyaku yam cake manufacturer and seller in Tomioka, Gunma Prefecture, already exports to 12 countries and regions, where it enjoys strong sales in Japanese supermarkets.

The company’s sales in the United States have experienced significant growth, rising from about ¥70,000 in fiscal 2020 to ¥40 million in fiscal 2023. Yet, this progress was directly affected by the high tariff policy.

To maintain consumer demand despite potential tariff-related price increases, the company plans to begin exporting konnyaku noodles. “We aim to differentiate our new offerings from our existing products and expand our sales channels to the Middle East and other regions,” said Kazumi Tsuchiya, 45, managing director.
 
 

Japanese manufacturers expressed improved business sentiment in April versus March though are bearish about their outlook over the next three months as they brace for the impact of sweeping U.S. import tariffs, a Reuters Tankan poll found.

The poll, which tracks the Bank of Japan quarterly business survey, yielded a manufacturers' business sentiment index of plus 9 in April, recovering from minus 1 in March.

For the three months ahead, however, the index was seen falling back to zero.

A positive figure indicates optimistic respondents outnumber those who are pessimistic about their business outlook.

The poll was conducted over April 2-11, just as U.S. President Donald Trump introduced a 25% tariff on car and truck imports and a further 24% tariff on Japanese goods - though the latter has been cut to 10% for 90 days.

The outlook turned sour particularly among export-heavy businesses such as automotive and machinery makers.

"With uncertainty increasing around Trump's tariffs and other global affairs, we've seen a slump in orders since late February and there are a number of other worrying factors ahead," a manager at a precision machinery maker wrote in the survey on condition of anonymity.

"It's absolutely impossible to predict the impact of Trump's tariffs," wrote a manager in the automotive sector.

Another manager at a machinery maker said clients have been cautious about investing due to tariff uncertainty.

Some also cited weakness in China's economy as a source of concern.
"Weak demand in China has caused low-priced products to flow into the Japanese market," a chemicals firm manager wrote.

Of 505 major, non-financial companies surveyed, 222 responded.
The poll's service-sector business sentiment index rose to plus 30 in April from plus 25 in March, while the index was seen at plus 21 in the three months ahead.

Real estate and information service firms were confident about their outlook whereas shipping firms voiced concern about rising labour costs and falling volume due to intensifying Sino-U.S. trade tension.
 
 

Automaker Honda said Wednesday it will shift production of its hybrid Civic model from Japan to the United States in June or July, but stopped short of saying the reason was US tariffs.

The rationale behind the decision "is not a single issue", a spokesman for the Japanese firm said. "The decision is based on the company's policy since its foundation that we produce cars where the demand is."
 
 

For the whole of 2025, tourist arrivals are on pace to eclipse last year’s all-time level of 36.87 million

Japan crossed the 10 million visitor mark at the fastest ever pace this year, reaching that level already in March, official data showed on Wednesday (Apr 16), as the weak yen propelled an unprecedented tourism boom.

Arrivals of foreign visitors for business and leisure reached 3.5 million last month, bringing the total through the first quarter to 10.5 million, data from the Japan National Tourism Organization (JNTO) showed.
Last year, Japan reached 10 million visitors in April.

For the whole of 2025, tourist arrivals are on pace to eclipse last year’s all-time level of 36.9 million. The nation’s famed cherry blossom season helped boost demand in March, which saw record arrivals for any single month among travellers from the United States and Canada, the JNTO said.

The boom in tourist numbers, and their spending, has been a welcome boost to Japan’s economy. Purchases by visitors, classified as exports in national accounts, are now Japan’s second-biggest export sector after autos and ahead of electronic components.

Spending by foreign visitors in the January–March amounted to 2.3 trillion yen (S$20.89 billion), preliminary data from the transport ministry showed, up 28.4 per cent from last year. Last year, visitors spent a record 8.1 trillion yen, up 53 per cent from the prior year.
 

 

Three companies including Waymo LLC, a self-driving vehicle company affiliated with Google LLC’s parent Alphabet Inc., announced Thursday that they will begin test runs of self-driving taxis in Tokyo from Monday.

Taxi drivers belonging to Nihon Kotsu Co., a major taxi company in Tokyo, will drive 25 such vehicles in Chiyoda, Minato and five other wards as part of preparations to introduce the self-driving cars into service.

The cars are equipped with cameras and radars to collect data such as road conditions as part of efforts to adapt self-driving technology to Japan’s traffic rules.

On Thursday, a demonstration run of a self-driving vehicle was held at Takanawa Gateway City in Minato Ward. Ichiro Kawanabe, chairman of Go Inc., the operator of taxi-dispatch app “GO,” said, “We will proceed with absolute safety to secure transportation methods in Japan, which is facing a declining birthrate, an aging population and labor shortage.”
 
 

Japan's defense-related spending for fiscal 2025 is expected to total about 9.9 trillion yen ($70 billion), equivalent to 1.8 percent of gross domestic product three years earlier, Defense Minister Gen Nakatani said Tuesday.

Nakatani told a press conference that the government will allocate around 8.5 trillion yen for its defense budget and about 1.5 trillion yen for related outlays in its initial budget for the current fiscal year starting this month.

In updating the long-term National Security Strategy policy guidelines in late 2022, the government set a goal of raising defense-related spending to 2 percent of that fiscal year's GDP by fiscal 2027 and pledged to obtain "counterstrike capabilities" to strike enemy territory directly in an emergency.

The latest estimate was released at a time when the United States under President Donald Trump has been increasing pressure on its allies, including Japan, South Korea and NATO members, to shoulder more of the costs for their defense and for hosting U.S. military forces.

The figures "show our efforts to strengthen our defense capabilities are steadily progressing" toward the numerical target, Nakatani said. Japan is increasing its spending in response to security challenges, such as China's rapid military buildup and North Korea's missile and nuclear development.

Having a war-renouncing Constitution, Japan had long capped its defense spending at about 1 percent of GDP, or around 5 trillion yen.
 
 

If humans eventually colonize the moon, the early settlers might toast their success with a bottle of sake, realizing the dream of brewer Asahi Shuzo Co.
Yamaguchi-based Asahi Shuzo, known for its Dassai sake brand, in February took a leap forward, unveiling at an event in Tokyo a bottle of high-end sake that it will attempt to brew in space.

The price for the 100-milliliter bottle of Dassai Moon is 110 million yen -- the going rate for an alcoholic beverage produced in space given that it will be the first of its kind.

Inspired by the U.S.-led Artemis moon exploration program and other efforts to establish a sustainable human presence on the Moon, Asahi Shuzo is serious about wanting the eventual inhabitants to be able to enjoy a low-gravity tipple.

"It's not a case of trying it out once for the sake of publicity but rather starting with the Moon and moving on to other possibilities," Asahi Shuzo President and CEO Kazuhiro Sakurai told Kyodo News.

Before any lunar endeavor, Asahi Shuzo will attempt to brew sake on the International Space Station where equipment will recreate the gravity of the moon's surface. The specialized brewing equipment and ingredients could be launched into orbit as early as September.

Speaking at the event in Tokyo, Japanese astronaut Soichi Noguchi said that he and other astronauts are excited by the project, especially as brewing sake on the Moon would be a step beyond what has been achieved in space so far.

"Until now, we were just taking something into space. Now they are actually going to make sake in space, which is a huge undertaking," Noguchi said.
Asahi Shuzo has made a habit of looking far beyond its base in the mountains of Iwakuni to seek new undertakings and new markets for its Dassai brand.

In early December, when much of the industry was congratulating itself after the traditional knowledge and skills used in sake-brewing were added to UNESCO's Intangible Cultural Heritage list, Asahi Shuzo was sending out updates about its aim to brew sake on the Moon.

While Sakurai recognizes the UNESCO listing as a potential boon for sake, he is wary of complacency.

"I believe that sake can and must evolve," he said. "There's a significant risk of becoming fixated on the history when, with a higher quality of sake, there is potential to reach bigger markets."

The bold ambitions of Asahi Shuzo came from a basic need to survive. When Sakurai's father took over the family business in 1984, Asahi Shuzo was selling directly to local stores with a consumer base confined to a radius of around five kilometers.

Across the sake industry, sales were in decline following the oil crisis of the early 1970s, a trend that would extend to the local population in the decades to come.

The new president decided to break out of Yamaguchi, and Asahi Shuzo took its sake to Tokyo, in the form of the high-end junmai daiginjo choice brew.

That year, the company recorded sales of around 100 million yen. Between October 2023 and November 2024, sales reached 19.5 billion yen, with 45 percent coming from exports.

Eyeing the world stage, in January, Asahi Shuzo announced more developments. From June, it will change its name to Dassai Inc. to strengthen its brand globally.

After the Oscars ceremony in Los Angeles on March 2, Dassai was served to Hollywood's elite at the Governors Ball afterparty -- the first time for a Japanese sake brand to feature on the cocktail menu as an event sponsor.

Despite the glamor and the globetrotting, the company maintains its roots at its headquarters in a remote corner of western Japan. The approach follows mountain roads through a landscape of farms and quiet villages.

Until, that is, the main brewery building comes into view. At 12-stories, it would not look out of place in central Tokyo. The on-site store has the interior of a boutique.

Inside, there is no veteran toji, or master brewer. Instead, Asahi Shuzo employs a young crew of brewers, largely focused on making junmai daiginjo sake.

Speaking in the brewery's analysis room in February, Sakurai was clad in an immaculate suit befitting his surroundings.

"I think it is important not to make sake the same way it was a hundred years ago," he said. "For us, making good sake means going beyond tradition. It means innovating and taking on new challenges."

Behind Sakurai, staff in lab coats carried out tests and analyzed data. At one end of the room, charts covered the wall, each one detailing the alcohol content and temperature, among other conditions in tanks containing fermenting sake mash.

"It allows us to see what's going on in each tank at a glance," Soya Uetsuki, chief of innovation and research, said. With around 200 tanks to be monitored each day, that is 200 graphs to take in.

Even with all the data and innovation, there are elements of sake-brewing at Asahi Shuzo that still demand the human touch.

Inside the koji muro, the room where koji mold is added to steamed rice, the work of separating rice grains is hot, sweaty and hands-on. In the fermentation room, staff plunge poles deep into tanks to stir the sake mash within, and in doing so release fruity aromas.

At the end of the brewing process, the president and others gather to sample the pressed sake. Objectivity is key. "This is not a discussion about how delicious it is, it's about judging whether or not it can be shipped," Uetsugi said.

As for where Dassai will be shipped next and in what surroundings it will be served, there appears to be no limits. New York, Hollywood. The moon.

"It's so interesting to see how our sake can go out into the world and interact with the cultures and people of other countries to create something new," Sakurai said.


© KYODO
 
 

Japan will not use its US Treasury holdings as leverage in upcoming trade talks with the US, scheduled for April 17.

Itsunori Onodera, policy chief of the Liberal Democratic Party, emphasized that Japan, as a US ally, wants to avoid actions that could disrupt financial markets. “Causing market disruption is certainly not a good idea,” he said.

This announcement follows Japan’s pullback from US Treasuries last week, which caused long-term yields to rise.

The move has sparked speculation that global reserve managers, including China, might reconsider investments in US government debt amid trade tensions.

Japan is seeking an exemption from the US tariffs imposed on April 9, which include a 24% tariff on Japanese goods and a 25% tariff on Japan’s auto industry. The US, in turn, is asking for concessions on agricultural products and LNG.

 
1️. Japan faces unprecedented auto industry impact despite alliance status

Japan’s response to the tariffs reveals the difficult position of a traditional US ally facing significant economic damage.

The 25% tariffs on its vital auto industry could cost Japanese manufacturers an estimated $24 billion according to industry analysis.

This represents a serious threat to Japan’s economy, with UN trade agencies projecting potential losses of $17 billion in car exports alone.

The Japanese government’s explicit statement that they “would not intentionally take action against U.S. government bonds” highlights their delicate position, needing to defend economic interests while maintaining alliance obligations.

Japan’s automotive industry has relied heavily on exports to the US market, with companies like Toyota and Honda now facing dramatically reduced profitability that threatens their global business models.

 
2. New tariffs mark historic shift in US trade policy

The current tariffs represent a significant protectionist shift in American trade policy.

The average effective US tariff rate has risen to 22.5%, reaching levels not seen since 1909 according to economic analysis by Capital Group.

These tariffs end over three decades of relatively free trade in North America, fundamentally altering the economic landscape that Japanese companies had built their strategies around.

The broader regional impact is significant, with Japan highlighting the challenges faced by ASEAN neighbors who are also impacted by the new system.

This protectionist approach marks a departure from the multilateral trade framework Japan and other countries had operated within since World War II.
 

3. Economic ripple effects extend beyond direct tariff costs
 
The tariffs will trigger complex economic consequences beyond just the immediate impact on Japanese exports.

Analysts project that the tariffs will increase US consumer prices by 2.3% on average, resulting in approximately $3,800 in lost purchasing power per American household.

For Japanese automakers specifically, the situation forces difficult choices about production locations, with many having invested heavily in Mexican manufacturing facilities that are now disadvantaged by the new tariff structure.

The Japan Automobile Manufacturers Association has warned that production adjustments will be necessary, potentially affecting jobs both in Japan and at Japanese-owned plants in the US.

These interconnected impacts demonstrate how modern global supply chains make tariff impacts far more complex than in previous eras of trade conflict.
 

 

World Expo opened on Sunday with 160 countries and regions showcasing their technology, culture and food, with host Japan hoping to provide the world with some much-needed hope.

Expo 2025 opened with the theme of life, world and the future, and Japan hopes to bring unity and portray a future society.
 
But the event's celebrations have been somewhat dampened by U.S. President Donald Trump’s recent tariff threats, which add to global tension and uncertainty.
 
Japanese Prime Minister Shigeru Ishiba, speaking at the opening ceremony expressed his hope that the event will help restore global unity in a world plagued by conflicts and trade wars.
 
Expo is also known as a World's Fair, and the phenomenon, which brought the Eiffel Tower to Paris, began with London's 1851 Crystal Palace exhibition and is held every five years.
 
The 2020 edition in Dubai was postponed by the COVID-19 pandemic, so Osaka Expo organisers say it will "restore much-needed connections" and "provide the opportunity to create a better tomorrow."
 
It is Osaka's second world expo after the 1970 event that scored a huge success and attracted 64 million visitors — a record until Shanghai in 2010.
This time, Japan has faced dwindling public interest, and support and was hit by soaring construction costs due to the weaker yen.

The cost nearly doubled from the initial estimate to 235 billion yen ($1.64 billion), about 14% of which went to the ring, triggering criticisms from many Japanese over the government's use of their tax money.
 
 

 

The East Japan Railway Co. (JR East) announced Tuesday it plans to experimentally deploy a system that will use facial recognition technology to allow passengers to move through ticket gates for the Joetsu Shinkansen bullet train line at Niigata and Nagaoka stations.

The company will confirm the system’s accuracy and determine the best position to install the devices, among other measures, with the goal of establishing ‘walk-through’ ticket gates within the next 10 years.

The experiment will start around autumn this year and continue until spring 2026, and JR East will ask for participation from passengers who have passes for the Shinkansen line section between the two stations.

At Niigata Station, facial recognition devices from NEC Corp. will be attached to existing ticket gates. At Nagaoka Station, new gates will be installed that will incorporate facial recognition devices from Panasonic Connect Co.

Facial recognition systems for passengers have already been introduced in airports in Japan and abroad and are scheduled to be used to allow staff through entrance gates at the 2025 Osaka-Kansai Expo.

If facial recognition systems for train lines are realized, passengers will be able to pass through ticket wickets without using IC cards or paper tickets, even if their hands are occupied by large baggage or baby strollers.

JR East President Yoichi Kise said at a press conference Tuesday, “The system will be so easy to use that it will work even for passengers wearing glasses or masks.”