Press Release

Corona Flashsurvey #7

2020/09/15
  • The effects of the COVID19-induced crisis continue to have a strong negative impact on German business in Japan, due to declining demand and the strict entry policy of immigration authorities.
  • A full recovery of the Japanese economy is not expected before the second half of 2021.
  • German managers in Japan expect a continuation of "Abenomics" under the new prime minister.

Six months into the crisis, the effects of the Coronavirus pandemic continue to have a strong impact on German business in Japan. Above all, the strict entry policy of the Japanese authorities continues to be a significant obstacle to 85% of German companies in Japan. German managers do not expect a real recovery to pre-crisis levels until the second half of 2021, according to a recent survey of almost 400 German companies conducted by the German Chamber of Commerce and Industry in Japan (AHK Japan).

Almost half of the German companies had to readjust their targets for the current year, with 40 percent expecting to achieve them. 57 percent of the companies expect a decline in sales between 10 and 50 percent in 2020. The outlook has stabilized compared to the last survey in June. This is mainly due to the measures implemented by German companies. These include accelerated digitization, savings in personnel-related expenses and an adapted business model. 20 percent of the companies have now reduced their staff, compared with just 7 percent in June. 29 percent of the companies have applied for public support programs, compared to 6 percent in June.

The Corona crisis has a particularly drastic effect on business travel habits. In the future, managers will strictly distinguish between essential and non-essential business trips. The use of flexible working models is also to be maintained in the long term. At the same time, however, 54 percent of those surveyed report challenges in managing virtual teams.

"We see German business in Japan stabilize and adapt to the new reality", said Marcus Schürmann, Delegate of German Industry and Commerce in Japan and Chief Executive Officer of AHK Japan. "At the same time, however, it is clear that a full recovery to pre-crisis levels cannot be expected before the end of 2021." The survey also revealed that the Japanese economy is still in a state of crisis.

Japan’s New Administration and the Olympics
The majority of German companies does not expect the change of Japan’s leadership to have a major impact on their business. More than half of them assume that the new Japanese prime minister will continue the economic policy of his predecessor called "Abenomics". Two-thirds, however, believe that the time until the next general election in 2021 is too short for comprehensive reforms.

Regarding the Olympic Games in Tokyo, only a quarter of those surveyed still believe that these will be held in the summer of 2021. Half of the German companies in Japan now assume that the Games will be completely cancelled or postponed again.

The current online survey of the AHK Japan was conducted from September 7 to 11, 2020. 102 responses from 380 companies were included in the evaluation. This represents a response rate of 27 percent.

Results of the Corona Flashsurvey #7

Since the beginning of the Corona crisis, the AHK has conducted surveys on a regular basis. More COVID-19 related information and results of past surveys can be viewed on our homepage:

https://japan.ahk.de/en/covid-19

 

Contact for the press

Communications
German Chamber of Commerce and Industry in Japan (AHK Japan)
Tel.: +81(0)3 5276 8741
Email: press(at)dihkj.or.jp