Report
Is Electricity Shortfall Deindustrializing Japan?
posted by Richard Katz on April 26, 2014
Found in Japan, categorized in Growth Outlook and Business Cycle
Report Cover
Headline
One of the big topics among economists is why the 25% drop in the yen vis-à-vis the dollar has not yielded a big increase in exports, as is usually the case.
Abstract
- Despite 25% depreciation of the yen, Japan’s real (price-adjusted) exports are no higher than a year ago and down nearly 30% from their 2007 pre-recession peak
- Real auto exports are no higher than the fall of 2012 before the deprecation began, while electrical machinery exports are down 14%
- Meanwhile, manufacturing capacity continues to shrink
- We suspect the shortfalls of electricity and uncertainty about future capacity has added to long-existing problems and led manufacturing firms to invest even more offshore
- Total industrial capacity is down 10% since the mid-1990s peak
- Non-machinery capacity is down almost a fifth
- Automaking capacity is down 15%
- Even electrical machinery, until recently a growth star, has been flat since the Fukushima disaster