Back to business— Japan


With many of Japan’s businesses cruelly flattened, the rebuilding process must begin, but with energy in short supply and the economy having suffered a huge blow, that’s a big challenge. Monocle looks at 10 badly hit sectors.

Earthquake, Economic crisis, Japan, Tokyo Shoko Research, Transport

Even before the magnitude-nine earthquake and tsunami hammered Japan’s northeastern coast, the country’s economy had seen better days. Now weeks after the disaster, the idled factories, dead workers, delayed deliveries, fuel shortages and rolling blackouts pose a huge challenge for “Japan Inc”.

Few businesses have emerged unscathed. Tokyo Shoko Research estimates that more than 70 per cent of Japan’s 1,597 publicly listed companies were affected by the quake, tsunami, or nuclear crisis.

When car parts suppliers’ factories went down, most of the…


Tokyo Electric Power’s dual crises – a meltdown at the company’s Fukushima nuclear power plant and a shortage of electricity – has transformed the capital’s skyline. In the Tokyo metropolitan area, street lamps and neon lights are dark and office buildings and homes have voluntarily dimmed their lights to help out. The possibility of power blackouts is expected to continue for months.


For days after the quake and tsunami, transport in northeastern Japan ground to a halt. When Yamato Transport’s trucks were finally able to resume shipments in the region, the number two delivery service didn’t just go back to business as usual. It assigned 200 lorries and 500 drivers and personnel to carry food and supplies to the disaster zone.


It wasn’t just major brewers’ factories that lay in ruins. Suisen, a sake brewer in Rikuzen-Takada city, was an hour away from celebrating the end to its annual brewing season and production of a million litres of Yukikko sake when the quake struck. After workers fled, the tsunami destroyed 150 tanks at the brewery. Three days later, Suisen’s website read: “Due to the disaster, we will be closed for a while.”


Hokuetsu Package’s three-week shutdown of its paper carton-making plant in Hitachinaka city, Ibaraki prefecture, was partly to blame for a scarcity of juice, milk and tea on store shelves. The Tokyo-based company has 40 per cent of Japan’s market for drink cartons. But official Satoshi Eshika says its factory was only part of the story. “Just after the quake there wasn’t enough petrol for the delivery trucks,” says Eshika.


In Iitate (population 6,200) dairy farmers have been dumping milk since food safety officials found elevated radiation levels linked to the troubled Fukushima nuclear power plant. The village sits about 30km northwest of the plant and residents have been told to stay indoors or evacuate. “We can’t begin to think about aid for farmers until things at the power plant are under control,” said Iitate official Hiroyuki Murayama.


The tsunami smashed the port cities of Ishinomaki and Kesennuma, in Miyagi prefecture – Japan’s third- and sixth-largest fishing ports. Oyster farms, seafood processing plants and boats were lost. Kesennuma Fish Market aims to reopen by June but it could take years to bounce back to the pre-disaster €200m trade in mackerel, shark, tuna and salmon. Market official Masaaki Onodera says: “The market’s foundation sank one metre and the computers were completely ruined.”


On the day the quake struck, East Japan Railway Company (JR East) suspended services – five bullet train lines and around 40 local lines connecting Tokyo to regions north and south – stranding millions of passengers. The railway company has gradually restored service, but rolling blackouts continue to hamper operations. It could be months before heavily damaged lines – the 575km Tohoku Line, for instance – are running again. “We have no idea when some of the lines will restart service,” says a spokesman.

Car plants

Toyota’s domestic factories are far from the disaster zone but many of its key suppliers – rubber, plastics, battery and computer-chip makers – were damaged. With parts in short supply, the world’s largest car maker has cut back on the production of hundreds of thousands of vehicles, including its popular gas-electric hybrids. The company is racing to shift production to overseas plants and find backup suppliers.


The quake that damaged Shin-Etsu Chemical’s largest semiconductor wafer plant in Shirakawa, in Fukushima prefecture, hurt the world’s chip-making industry. The company is the world’s largest maker of silicon wafers that are cut to make computer chips, and accounts for a fifth of global supply. Hi-tech gadgets such as mobile phones and tablet computers could be affected, too.


Nuclear radiation has spooked Asian tourists. Hong Kong’s Travel Industry Council asked its 1,500 member travel agencies to cancel all tours to Japan. Oriental Land Co, which operates Tokyo Disney Resort, shut the amusement park and the nearby Cirque du Soleil theatre for weeks due to an unstable electricity supply.


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