Due to supply chain disruptions caused by the COVID-19 pandemic, Japan has taken a major step to support businesses in shifting production out of China. To assist companies in pivoting high-added value products to the nation, the Japanese government is setting aside $2 billion for business. The funding is also aimed at helping businesses move the production of certain goods in strategic Southeast Asian markets.
This new production diversification support is in addition to a $992 billion stimulus package, which is equivalent to 20% of the country’s economic output annually. Among the provisions within the support package, companies will have the ability to defer income and regional tax payments for a year, along with financial aid for small businesses and struggling residents.