Photo: Screenshot of the website of The China Development Forum

The spread of US' unilateralism is hindering the global economy and although Japanese companies have been affected by trade frictions between China and the US, most Japanese companies do not want to "decouple" from China, Tadashi Izawa, president of Japan-China Economic Association (JCEA), said at the 2023 China Development Forum during the weekend.

"In recent years, the progress made by all-around globalization is obvious for all to see. However, a protectionist trend that puts national interests first is spreading in many countries," Izawa said at the forum, which started on Saturday. 

Izawa, making his speech at a panel discussion on "promoting the high-quality development of the Belt and Road Initiative," said that the prospects for economic and trade cooperation between Japanese and Chinese enterprises are optimistic.

Rising protectionism has become a problem that needs to be properly resolved, the JCEA president said. Affected by China-US trade frictions, China-Japan economic and trade cooperation is facing a spillover effect, but voices from the Japanese business community indicate that they do not want to reduce their business in China, said Izawa.

Izawa cited a recent survey which showed some 25 percent of Japanese companies that trade with China hope to expand their business in the market, while another 45 percent hope to maintain their current trade with China. Only 5 percent said they would reduce their business in China.

Over recent years, Japanese companies were affected directly or indirectly as the US pushed a technology decoupling with China, most notably in the semiconductor sector. Japan also became the key component of US groupings such as the Indo-Pacific Economic Framework.

After China optimized its epidemic responses, there have been many positive changes in Chinese and Japanese business circles, Izawa said.

Speaking at a panel discussion at the China Development Forum, Kristalina Georgieva, managing director of IMF on Sunday said IMF analysis shows that a 1 percentage point increase in GDP growth in China leads to 0.3 percentage point increase in growth in other Asian economies on average, which is a welcome boost.

Since December, many Chinese localities have sent business delegations to Japan to explore opportunities for cooperation, the Japanese trade chamber official said, noting that he is optimistic about the prospects for the resumption of economic exchanges and cooperation between the two countries.

Izawa said that the third-party market cooperation between China and Japan has broad prospects, and the model has been proven feasible. 

In 2018, companies from the two countries inked 52 cooperation memorandums covering infrastructure, IT and finance. With the Regional Comprehensive Economic Partnership trade deal taking effect in 2022, there will be more cooperation scenarios, Izawa said.

Izawa said that Japanese companies and Chinese companies can establish a newer and more complementary business model in the future to explore "Belt and Road" markets and meet local demand for high value-added products and services.