Monday 23 January 2012

Hollowing Out

Happy Chinese New Year.
Not a good day though today. There was an earthquake at quarter to nine this evening. Sudden vertical jolt followed by swaying for quite a while (force 4, nothing fell over). I was working late on my own in the office and got out pretty quickly, taking  the stairs rather than the lift.

No, it's not been a good day. In the papers over the weekend was the news that Sony Energy Devices Corporation (SEND), our biggest customer, will be moving assembly of its batteries overseas, to Singapore and China. Sony is the fourth largest manufacturer of batteries in the world and most of them are made in Koriyama. The decision's been taken because wages are cheaper abroad and because of the strong yen. It's all part of the 'hollowing out' of Japan (kudohka 空洞化). Two factories in Koriyama will continue to make lithium ion cell electrodes - the core technology of the batteries - but the factory about 50 miles south in Tochigi will be turned into a research institute. That's not much good for us. We need people to make stuff so we can supply the packaging.

And jobs will be lost. The employment situation is dire. Unemployment benefit in Japan is generous but it only lasts for six months. It's been extended twice but for a lot of people it will come to an end next month or in March. If they can't find work they'll have to go on benefit. On the other hand, some businesses are doing extremely well: construction of course, and hotels housing all the insurers, police and other temporary workers. Bars and restaurants are doing well, I hear. And then some people are doing well out of compensation. Tepco pays out 100,000 yen a month which isn't that much but if there are five in the family that's 500,000 yen, double what most families get. The pachinko halls are doing good business.

We need some good news. The Foreign Minister the other day announced that several international conferences on renewable energy will be held here this year. There's also going to be a centre for new sources of energy set up here in Koriyama. This must be the future for Fukushima. The governor has announced that he wants all nuclear plants in Fukushima closed and surely there's no other place in the world where people are more committed to new forms of energy. We just need the know-how and the money.

Meanwhile Tepco has announced it's raising electricity prices to business customers by a whopping 17%. It doesn't affect us here in the Tohoku region but it's another big hurdle for companies doing business in Japan.
Good night

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