Business Monitor International (BMI) has released its latest special report, "Japan After The Quake: Resurgence Or Another Lost Decade?" examining the state of Japan's economy and exploring the risks and potential areas of outperformance across six industries covering retail, agribusiness, IT, automotives, commercial banking and power.
The report outlines BMI’s views on Japan's recovery and the future prospects of the Japanese economy, focusing on the longer-term implications of the disaster.
While it has been encouraging how quickly the economic downturn has stabilised, Japanese consumers are unlikely to start spending again soon. BMI expects that the Japanese consumer to place a greater emphasis on price over quality. The reconstruction efforts will divert capital resources away from other sectors of the economy, and a slowdown in China will impact the export sector.
Further, the March earthquake and tsunami has had a major impact on Japan's ICT and retail industries, with the ICT sector struggling especially to resume full operations on the back of supply chain disruptions and power shortages. Faced with a precarious domestic outlook, ICT firms will, instead, turn to growing emerging market demand to boost their revenues, a strategy that is also being pursued by the Japan autos sector with varying success.
That said, other sectors are better poised to capitalise on the "back-to-basics" spending of consumers with major convenience store retailers outperforming in this challenging environment. While March's retail sales growth fell to its worst level since 1998, retail sales in recent months have bounced back, underlining a recovering demand outlook for Japanese retailers.
More broadly, the longer-term economic outlook remains fraught with risk, with Japan staring at another lost decade of economic stagnation. Indeed, BMI predicts that consensus expectations for Japan's GDP growth of 2.9% in 2012 are too optimistic.
BMI's portfolio of products provides comprehensive analysis across Japan's industries and enables global investors, strategists and decision-makers across the corporate spectrum to assess and evaluate how far Japan has come since the crisis in terms of economic stabilisation and industry consolidation.
About Business Monitor International:
Business Monitor International (BMI) established in 1984 with headquarters in London is recognised as a leading independent source for analysis and forecasts on Country Risk and Industry, spanning 175 countries. BMI provides research to multinational corporations, banks, funds, research centres and governments in 140 countries around the world, including more than 400 of the Fortune Global 500 companies.
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