The Japanese government has allocated billions of dollars in a stimulus package to help manufacturers move production out of China and into other countries.
The stimulus package, which is to offset the financial hit of the coronavirus, includes 220 billion yen, or $2.2 billion, for companies shifting production from China back to Japan, and 23.5 billion yen for companies to shift to other nations, according to Bloomberg.
“There will be something of a shift,” said Shinichi Seki, an economist at the Japan Research Institute. “Having this in the budget will definitely provide an impetus.” Companies that manufacture for the Chinese market, such as car makers, will likely remain, he said.
The move comes as Japanese Prime Minister Shinzo Abe attempts to establish friendlier ties with China. A meeting between Abe and Chinese President Xi Jinping was slated for earlier this month in Japan, what would have been the first state visit in a decade, was postponed due to the coronavirus pandemic.
“We are doing our best to resume economic development,” Chinese Foreign Ministry spokesman Zhao Lijian said at a briefing Wednesday in Beijing when asked about the two countries’ relationship. “In this process, we hope other countries will act like China and take proper measures to ensure the world economy will be impacted as little as possible and to ensure that supply chains are impacted as little as possible.”