Japan Equities

An interesting article about the Japanese immigration law and policy reform in Nikkei Shimbun

http://www.nikkei.com/news/headline/article/g=96958A9C93819481E0E5E2E6988DE0EAE3E0E0E2E3E39790E0E2E2E2

This move by the Japanese Ministry of Justice will enhance the immigration of foreigners who are experts in their fields into Japan. As one part of the new changes, based on a special point system, foreigners being considered as experts with the intention of working in Japan will be able to more easily get permanent residency status, e.g. qualifying after only 5 years, instead of the current 10 years of legitimate stay. This system was taken from the British, Canadian and South Korean models. Germany a while ago introduced efforts to bring in Indian IT specialists by giving them special Green cards.

Certainly it is a good move to open Japan and make it more international and also further increase the high standard of innovation and intellectual property. But does this move really help the current problems Japan is facing? Japan’s most obvious problems are the enormous debt to GDP, and the aging population in which people over 65 will represent more than 1/3 of the population by 2025, costing 4 to 6 times more in health costs than younger groups. Domestic costs are continuously increasing, and the government spends more money than they are currently earning. Since the earthquake and tsunami of 3/11/2011, there is also an exodus of Japanese experts to other countries, especially those who are able to speak other languages.

To address these issues effectively, Japan requires more immigration not only on the expert level, but also at other levels such as unskilled labour. To name a few beneficial effects of this, domestic wages level can be lowered, and consumption can be increased. Additionally, foreign workers in Japan will create an outflow of the strong JPY to purchase goods and services in their home countries. This will lead to better equilibrium price levels for JPY.

To summarize, it is a good first step and it is to be hoped that Japan will continue with similar improvement efforts on a macro level to benefit the Japanese economy.

Dear friends,

Merry Christmas and a Happy New Year to you and your family! I wish you a happy and peaceful 2012.

With best wishes,

Hidero Niioka

新阜秀朗

Last day for Sanyo’s brand and logo appearing in public

On the 23rd of December, the huge Sanyo sign –each letter 2-3 meters high and 1.8 meters wide- was taken off the building at the main office in Moriguchi-shi. It will be replaced by Panasonic’s (Ticker: 6752 http://stocks.finance.yahoo.co.jp/stocks/detail/?code=6752.t) sign. (http://panasonic.net/sanyo/ )

Panasonic “re-“acquired the company after it initially started as a kind of spin-off of Panasonic (then Matsushita) in 1947. Sanyo was founded by Toshio Iue who married Hideko Niioka. The main strengths of Sanyo Energy such as lithium ion batteries, etc. made it worth buying the company despite its financial predicament.

Sanyo (previously under Ticker: 6764) was delisted on March 29th, 2011. (http://www.tse.or.jp/english/listing/delisting/list.html)

Right business strategy/marketing decision?

It will be interesting to see the eventual results of this this business strategy decision. Sanyo is a strong brand with high consumer recognition globally and more than 50 years of history. It used to be worth a couple of billion US dollars. There is some argument that removing the brand from the company portfolio will avoid a cannibalization situation, however, there is no guarantee that ex Sanyo customers will default to Panasonic. Looking at commentary in the media, there seem to be different opinions even within the company as to whether or not this has been the right decision and it will be interesting to see how this plays out over the next months and years.

Goodbye Sanyo… A company that my father devoted his entire working life to – over 50 years.

An interesting link on the history of Sanyo. http://sanyo.com/museum/jp/history/iue/iue_history.html