Japanese investors want China to restart visa-free entries into ‘most important’ market
- China has relaxed some entry requirements since last year, but Japanese investors have been left out in the cold, costing them ‘an opportunity to expand business’ in China
- Following survey, Japanese Chamber of Commerce in China vows to work ‘tirelessly’ to see a resumption of visa-free border entries to China
Hundreds of Japanese investors have called on China to resume visa-free entry rules – a concession that they say would help smooth over business operations in what most described as their “most important market”.
Among several hundred respondents to a survey by the Japanese Chamber of Commerce and Industry in China, visa-free entries ranked as a top concern as they identified areas in which they “hoped” or “very much hoped” that China could improve.
“If the rule on visa-free entries to China were to be resumed – and the Japanese coming and going from China made more convenient – there would be an opportunity to expand business,” the chamber said on Monday in a summary of the survey results, which comprised 1,713 responses from November 23 to December 13.
China began relaxing some entry requirements last year, including visa-free treatment for select countries, in line with efforts to revive international exchanges, drive up foreign investment inflows, and reverse a decline in confidence among investors.
Chinese officials say 55,805 Japanese-invested companies operate in China, and statistics from Tokyo show that 107,715 Japanese people lived in China as of 2021.
From January to November 2019, about 230,000 Japanese nationals arrived in Beijing alone, compared with just 71,000 during the same 11-month period last year, according to Chinese media outlet Caixin.
The chamber also vowed to work “tirelessly” to see a resumption of visa-free border entries to China, according to Caixin.
“Visa waivers would remove a significant barrier for commercial exchanges at a time when a lot of multinational company headquarters are rethinking the importance of the China market,” said Nick Marro, lead analyst for global trade with The Economist Intelligence Unit.
But visa-free travel isn’t the end-all factor determining their interest in China, he said. “There are a lot more issues tied to the growth outlook, geopolitical risks and operational burdens that play more significant roles in investment decision-making,” Marro said.
Direct investment from Japan to China in the first nine months of last year reached 3.934 trillion yen (US$27 billion), down from 9.612 trillion yen over the same period in 2019, according to the Japanese Ministry of Finance.
The chamber survey found that 39 per cent of respondents anticipated a “decline” or a “slight decline” in China’s market position after 2024, while 25 per cent forecast an “improvement” or “slight improvement”.
Chen Zhiwu, chair professor of finance at the University of Hong Kong, said visa-free access would be only of marginal help to China’s economy.
“Anything like that would help somewhat at the margin,” Chen said. “It is a temporary need that the Chinese government feels at this moment because the economic slowdown is widespread in China, so they need to put at least a temporary stop to the economic decline to the extent that they can.”
A total of 51 per cent of survey participants said China was their “most important market” or one of three major markets in the world.
But 49 per cent said China business profits had declined last year, compared with 25 per cent who reported an increase and 27 per cent who found no change.
