Published on : Feb 24, 2015
The Japanese electronics manufacturing industry, once a strong factor of the country’s booming economy and among the most renowned in the world, had been suffering from a minor slump in recent years. However, the signs are positive for the Japanese electronics industry, as a recent compilation of an index by Meiji Yasuda Life Insurance shows the Japanese electronics manufacturing may be on the way to stability and prosperity once again. The major drawback of the industry in recent years had been its poor performance abroad, where the developed and populous economies in North America and Europe remain much more lucrative markets for electronics manufacturers than the relatively much less populous Japan. The Japanese Yen’s recent fall against the Dollar is the root cause behind this seeming revival.
Meiji Yasuda Life Insurance recently drew up the insurer’s global competitiveness index. This shows the position of an industry by matching up the value of net exports with the total trade occurred. The insurer’s global competitive index shows the slump for the Japanese electronics manufacturing sector in foreign markets is about to bottom out soon, and will hopefully be aided by the Yen-Dollar dynamics in the near future. The index had witnessed a consistent pattern of decline since 2012.
The Japanese electronics industry had kept up its status as a global top dog since before the 90s, but the rise of the Japanese Yen against the Dollar following the 2008 global recession caused havoc in the industry. The production values went up, and manufacturers steadily started shifting their operations overseas.
Shinzo Abe’s leadership saw the Yen return to its original standing, aided by a monetary easing by the Bank of Japan. However, the effects of the Yen’s slide on the electronics industry have only started to become apparent since a few months.