China's technological catch up is not the end of Japan's competitiveness

ASIA

Japanese firms remain technological leaders, but the Chinese are catching up.

Often this is driven by the Government. In areas where it feels the nation should develop its own industries, foreign firms cannot operate independently and must share some technology with local firms via joint ventures. As the Chinese market has become so important to Japanese firms, there is little choice but to comply. The implication is increasing competitiveness in the Chinese markets and lowered market share and returns for the Japanese. Chinese firms still have a considerable way to go to match the durability and quality of the Japanese. It is also simplistic to believe technol...