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Japan Inc. Faces “Unexpected” Covid, Again



COVID in Japan: Japan has a remarkable record in its response to Covid.


Japanese companies are temporarily closing offices or suspending production as they grapple with a record wave of COVID-19, disrupting businesses in a country that far exceeds most advanced economies Better facing the pandemic.

Automakers Toyota Motor Corp and Daihatsu Motor Co last week halted production line shifts due to staff transitions. KFC Holdings Japan Ltd. has had to close some fast-food restaurants and transfer employees to fill gaps, while Japan Post Holdings Co. has temporarily closed more than 200 mailing centers.

The number of Kovid cases in Japan has increased significantly compared to other countries, as the ba.4 and ba.5 variants are dominating the world. Data from the World Health Organization shows that more than 1.4 million new COVID cases were reported in Japan in the past week.

Companies are scrambling to deal with it.

“We’ve divided meal times into multiple time slots and told workers to sit in one direction and not talk at all,” Subaru Corp CFO Katsuyuki Mizuma recently told reporters. ,

Newly diagnosed COVID cases on Wednesday rose to an all-time high of nearly 250,000 for Japan. Hospitalizations and deaths are also increasing due to the prevalence of vaccinations and booster shots, but not as in previous waves.

Japan has had a remarkable record in its response to COVID, avoiding the disruptive lockdowns and large deaths that accompany the pandemic elsewhere.

There have been more than 32,000 deaths in a country of 125.8 million people, a fraction of the toll in the United States and Britain, for example.

The latest outbreak will likely show whether it can maintain its resilient response aimed at “living with the corona” and limiting the economic impact, especially if the disruption being felt now worsens for an extended period.

“There is still a shortage of semiconductors and the spread of the coronavirus is currently increasing,” a Toyota spokesperson said last week.

“The future remains unpredictable.”

Health officials recommend that those who test positive should quarantine for 10 days and isolate their close contacts for at least five.

Dai-ichi Life Group chief economist Toshihiro Nagahama said there would be some pain in production and retail as infected people and their close contacts would stay at home.

“As infections and close contact increase, it will certainly have an impact on people’s confidence to go out for food, shopping and the like,” he said.

delivery method

The disruption has had a particularly significant impact for the job market over the decades, especially for the small and medium-sized enterprises that make up the majority of Japan’s companies.

Large companies may hire temporary workers who have to take time off, said Yoshiaki Katsuda, an occupational health expert at Kansai University of Social Welfare, but they are still vulnerable to supply chain headaches.

“If small companies supplying products have to shut down for a long period, the production of large companies may get affected,” he said.

The wave of infection is also shaking the transport.

Railway operator Kyushu Railway Company last week suspended 120 train services in southern Japan after 53 crew members tested positive or where there were close contacts of cases. Mitsui OSK Lines Limited canceled four ferry crossings in western Japan, and bus operator Odakubus Company Limited cut dozens of routes around Tokyo.

The central government has delegated the authority on infection control to prefectural governments, so that they can take precautions as they see fit. Twelve prefectures have put in place measures with a focus on reducing risk to the elderly.

Tetsuya Inoue, a senior researcher at the Nomura Research Institute, said support for Prime Minister Fumio Kishida has increased in recent elections as COVID-19, but a strong showing for the ruling Liberal Democratic Party in elections last month. Gave them some relief.

“At the moment, Mr. Kishida and his administration are prioritizing the maintenance of economic activity rather than returning to very strict measures against COVID,” Inoue said.

Inoue said that whatever the pressure on the domestic economy due to the wave of infections, the biggest problems for Japan are the lockdown in China and the impact on supply chains.

Relief could be seen for Japanese companies and the broader economy. Health experts predict that the wave of infections will peak at the beginning of this month.

“Given current trends, it is unlikely that infections will continue to expand over a long period of time, and there is little need for strict behavioral restrictions,” doctors from the Tokyo Foundation for Policy Research wrote in a recent paper.


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