ID :
204973
Fri, 09/02/2011 - 18:52
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https://oananews.org//node/204973
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Quake curtails Japan's 2nd qtr business investment+
TOKYO, Sept. 2 Kyodo -
Corporate capital spending in Japan shrank 7.8 percent in the three months through June from a year earlier for the first decline in four quarters, affected by the devastating earthquake and tsunami in March, the government said Friday.
The result added to the view that the government will downgrade the country's economic growth data for the second quarter of the year. Revised gross domestic product figures will be released Sept. 9.
Business investment for such purposes as building plants and introducing new equipment by all industries, except for the financial and insurance sectors, totaled 7.71 trillion yen (about $100 billion), the Finance Ministry said.
The figure also represented a seasonally-adjusted 6.6 percent fall from the previous quarter.
''The data in the current financial statement indicate that corporate sentiment about investment has been undermined as the earnings environment has deteriorated since the earthquake disaster,'' Ryota Takemoto, economist at Nomura Securities Co., said in a report.
Electric machinery, steel and chemical industries logged major declines among manufacturers, which as a whole marked a 2.0 percent slide year-on-year. Power companies, real estate and some other sectors also cut their investments, leading to a 10.7 percent fall among nonmanufacturers.
A ministry official said a wait-and-see mood has spread with regard to spending almost across industries in the aftermath of the March 11 disaster, which significantly weighed on the nation's production and exports.
Carmakers and other transport equipment makers, one of the most seriously affected industries, marked a 2.9 percent rise in the second quarter. But this followed a 15.5 percent plummet in the same period a year before.
Electricity firms spent more on safety measures at nuclear power plants, prompted by the crisis at the tsunami-hit Fukushima Daiichi plant. However, this means they had to put on hold their earlier -- and larger -- investment plans for building output capacity, the ministry said.
The ministry surveyed 31,339 companies capitalized at 10 million yen or more, of which 22,370, or 71.4 percent, provided valid responses.
Sales of the polled companies dropped 11.6 percent to 316.49 trillion yen, the first fall in six quarters, while their pretax profit was down 14.6 percent to 11.34 trillion yen for the first decline in seven quarters.
The ministry said the recent strength of the yen hurt the profitability of many Japanese firms, particularly exporters who saw their global competitiveness eroded by cheaper products made in South Korea, Taiwan and other emerging economies.
Compared with a year before, the Japanese currency was stronger by 10 yen against the U.S. dollar in the reporting quarter, it said.
Japan's real GDP contracted 0.3 percent in the second quarter from the previous three months, or at an annualized rate of 1.3 percent, according to last month's preliminary report. The Cabinet Office is revising the data by taking into account Friday's capital spending as well as inventory figures.
Corporate capital spending in Japan shrank 7.8 percent in the three months through June from a year earlier for the first decline in four quarters, affected by the devastating earthquake and tsunami in March, the government said Friday.
The result added to the view that the government will downgrade the country's economic growth data for the second quarter of the year. Revised gross domestic product figures will be released Sept. 9.
Business investment for such purposes as building plants and introducing new equipment by all industries, except for the financial and insurance sectors, totaled 7.71 trillion yen (about $100 billion), the Finance Ministry said.
The figure also represented a seasonally-adjusted 6.6 percent fall from the previous quarter.
''The data in the current financial statement indicate that corporate sentiment about investment has been undermined as the earnings environment has deteriorated since the earthquake disaster,'' Ryota Takemoto, economist at Nomura Securities Co., said in a report.
Electric machinery, steel and chemical industries logged major declines among manufacturers, which as a whole marked a 2.0 percent slide year-on-year. Power companies, real estate and some other sectors also cut their investments, leading to a 10.7 percent fall among nonmanufacturers.
A ministry official said a wait-and-see mood has spread with regard to spending almost across industries in the aftermath of the March 11 disaster, which significantly weighed on the nation's production and exports.
Carmakers and other transport equipment makers, one of the most seriously affected industries, marked a 2.9 percent rise in the second quarter. But this followed a 15.5 percent plummet in the same period a year before.
Electricity firms spent more on safety measures at nuclear power plants, prompted by the crisis at the tsunami-hit Fukushima Daiichi plant. However, this means they had to put on hold their earlier -- and larger -- investment plans for building output capacity, the ministry said.
The ministry surveyed 31,339 companies capitalized at 10 million yen or more, of which 22,370, or 71.4 percent, provided valid responses.
Sales of the polled companies dropped 11.6 percent to 316.49 trillion yen, the first fall in six quarters, while their pretax profit was down 14.6 percent to 11.34 trillion yen for the first decline in seven quarters.
The ministry said the recent strength of the yen hurt the profitability of many Japanese firms, particularly exporters who saw their global competitiveness eroded by cheaper products made in South Korea, Taiwan and other emerging economies.
Compared with a year before, the Japanese currency was stronger by 10 yen against the U.S. dollar in the reporting quarter, it said.
Japan's real GDP contracted 0.3 percent in the second quarter from the previous three months, or at an annualized rate of 1.3 percent, according to last month's preliminary report. The Cabinet Office is revising the data by taking into account Friday's capital spending as well as inventory figures.
