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Economy

Japan companies line up for 'China exit' subsidies to come home

Applications swell to 11 times the budget as pandemic spurs diversification drive

A textile factory in the Chinese city of Qingdao, Shandong Province. Many Japanese textile companies applied for the government's relocation subsidies in the first round.   © Reuters

TOKYO -- The Japanese government has seen an overwhelming surge of interest in subsidies to bring manufacturing back as the coronavirus pandemic highlights the risk of having supply chains concentrated in a single region, particularly China.

The program to promote domestic manufacturing had 220 billion yen ($2.07 billion) earmarked in the supplementary fiscal 2020 budget. In the first round, which ended in June, the government approved 57 projects totaling 57.4 billion yen, or over half the 90 applications.

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