Japanese Media: "Common Sense Broken... Competing Countries' Korean Companies Likely Unaffected by Yen Weakness"

Nihon Keizai Shimbun "Different Past and Economic Conditions... Economic Policies Also Need to Change"

The value of the Japanese yen hits its lowest in 6 years and 1 month [Image source=Yonhap News]

[Asia Economy Intern Reporter Kim Nayeon] A Japanese economic newspaper evaluated that South Korea's major conglomerates such as Samsung, Hyundai, SK, and LG do not feel threatened by the weak yen.

The Japanese economic newspaper Nihon Keizai Shimbun analyzed the yen, whose value has fallen to the lowest level in 20 years as the yen-dollar exchange rate dropped to the low 130 yen range, in an article titled "Positions Reversed Between Japan and Asian Countries Including Korea, Yen Weakness Is Not a Risk" published on the 8th.

Nihon Keizai Shimbun reported that it was commonly believed that a weaker yen benefits Japanese exports while harming competing countries like Korea, but this is not the case.

The newspaper stated, "While Japan's semiconductor industry is losing influence, Samsung Electronics and SK Hynix have pioneered the global market with their own products," and "Hyundai Motor and Kia Motors are no longer just substitutes for Japanese cars."

It also emphasized that since Japan's economic situation has changed from the past when it relied on exports, economic policies need to change accordingly.

In other words, "Although the yen is trading at levels seen 20 years ago, the economic situation Japan faces has changed significantly," and "Asia, including Korea, has grown, and for Japanese companies facing yen weakness and domestic growth slowdown, expanding business in Asia is becoming increasingly important."

Professor Watanabe Takahiko of Senshu University's Faculty of Commerce said, "If the yen weakness continues for the next one to two years, it will be difficult to accelerate Southeast Asian expansion through mergers and acquisitions (M&A)," but added, "However, Japanese manufacturers have no choice but to continue investing in Southeast Asia to reduce dependence on China and Russia."

If yen weakness does not greatly benefit Japanese export companies, another method to earn dollars is through foreign students and tourists, but with foreign tourism in Japan blocked due to COVID-19, this is also not helping.

Before the spread of COVID-19 in 2019, foreign tourists spent 4.8 trillion yen in Japan, playing a significant role in Japan's trade surplus, but due to COVID-19, this has been difficult to expect for over two years. In particular, Chinese tourists account for 30% of foreign tourists in Japan and 40% of foreign students, but they have not been able to come to Japan for over two years.

Professor Mieno Fumiharu of Kyoto University's Southeast Asian Studies Institute said, "I think there is considerable demand for travel to Japan, but the question is when it will be possible to move."

This content was produced with the assistance of AI translation services.