Quarterly Survey of Overseas Subsidiaries

Quarterly Survey of Japanese Business Activities (April-June 1998)

October 1998
Enterprise Statistics Division,
Research and Statistics Department,
Ministry of International Trade and Industry,
JAPAN

1. Domestic Sales Falling, Overseas Sales Rising. Outlook for the July-December of 1998 is for Falling Sales Both at domestically-based Parent companies and locally-based Overseas subsidiaries.

   Although domestic sales for Japanese parent companies were down 6.9% on the same quarter of the previous year, exports were 4.4% up on the same quarter, restricting the fall in total sales to 4.4% on the same quarter. Overseas subsidiaries of these parent companies saw sales increase 6.3% on the same quarter of the previous year. However, for overseas subsidiaries operating within the ASEAN 4 (Indonesia, Thailand, The Philippines and Malaysia) and the NIES 3 (Singapore, Taiwan and South Korea), sales were down 21.0% and 7.7% respectively, continuing on their downward trend from the previous quarter. Sales for overseas subsidiaries operating within North America were up 11.3%, continuing on the same trend from the previous quarter.

   Regarding the outlook for sales in the July-December of 1998, for parent companies the change in the DI relative to the previous half year shows a 3.8 point decrease (from -18.4 to -22.2), implying that the share of companies predicting a fall in sales is on the rise. For the overseas subsidiaries, there was a large fall in the share of companies predicting an increase in sales, with the DI index negative in all but the others category, leading to a drop in the relative DI from 0.3 to -10.3 (27.0 to 16.7).

2. Slowing in the Increase in Employment by the Overseas Subsidiaries

For domestic parent companies employment is down 1.6% on the same quarter of the previous year, with the rate of decline seen to be rising quarter by quarter (1.3% decline in the previous quartrt, 0.7% in the quarter before that). In addition, when the figures are divided by industry we find that the fall is across all industrial sectors, as was the case in the previous quarter. For overseas subsidiaries, the composite figure for all regions was a 2.4% increase year-on-year, although the rate of increase is declining (4.0% increase in the previous quarter, 6.1% in the quarter before that).

Looking at the outlook for employment in the July-December of 1998 by relative DI, that for domestic parent companies is -18.4 points (-14.1 to -32.5), the largest drop since the inception of the survey. The overseas subsidiaries also see employment falling, with the relative DI at -2.8 points (from 5.7 to 2.9). Apart from the other category, the share of companies predicting an increase in employment fell in all regions.

3. Trade with Overseas Subsidiaries (Share of Imports and Exports) Continues to Rise.

Exports by domestic parent companies were up 4.4% on the same quarter of the previous year, while imports were down 4.9% over the same quarter. Of these sales, exports to Japanese overseas subsidiaries operating abroad were up 14.9% year-on-year, while imports from those overseas subsidiaries were up 4.4% over the same quarter, indicating a gradual rise in the share of trade with overseas subsidiaries in total imports and exports.

4. Status of Overseas Subsidiaries by region
5. Statistic

Outline of Survey

Notes on the Survey

Notes on the Report

Changes to the Content of the Survey

Response rate and yen/dollar exchange rate

E-Mail:qqcebh@meti.go.jp