Articles/Columns
Going Overseas: Now is a Good Time
Earlier this week, Reuters reported an increasing trend of Japanese companies going overseas. Due to the strong Yen and large cash reserves, many Japanese companies are now refocusing their market strategy to overseas territories. According to the Reuters report, Japanese companies spent 70 billion USD on cross-border acquisitions last year. Many of these companies are investing overseas for the first time. For example, Japanese toymaker Takara Tomy Co. bought U.S. toymaker RC2 Corp. last year. Also, Nisshinbo Holdings bought a European company, TMD Friction Group, which was their first overseas investment since 1999. Lately, many Japanese companies have been looking to Asia for growth, but some companies have also been looking to Europe and the U.S. to sustain their competitive positions. In addition, the market in Japan is physically shrinking (i.e. population decline) with deflationary pressures, so expanding overseas has now become more of a matter of survival rather than just global growth. Recent research by the Japanese government reveals that Japan’s population is expected to shrink 30 percent by the year 2060 and that the older population will increase upwards to 40%. If these projections hold true, then Japanese companies will have to expand overseas at some point in the future if they want to increase their chances of survival. The domestic competition will get more fierce, and new entrants from overseas like Samsung and Haier will continue to gain market share in Japan. Considering the strong Yen, now is a good time for Japanese companies to consider what options are available in overseas markets and invest.
Source: Wall Street Journal, Dec 2011
（2012/2/9 掲載）