Two from Nikkei Asia. First up, the headline story, December 15:
Nikkei survey finds strong demand, but companies less bullish than in spring
TOKYO -- Capital investment by big Japanese companies is expected to hit a record 31.9 trillion yen ($213 billion) in fiscal 2023 ending next March, shattering the record for the second year running, a Nikkei survey finds.
Spending on plant and equipment is forecast to rise 17.3% from the previous year overall, driven by the demand for electric vehicle (EV) production and data centers as artificial intelligence (AI) becomes widespread.
The semiannual survey collected revised plans for domestic and overseas capital investment as of the end of October from 874 listed companies and others with capital of 100 million yen or more.
Year-on-year growth in spending is likely to be the fastest since fiscal 2000. The Japanese currency's depreciation in the foreign exchange market has pushed up the value of overseas capital investment in yen terms.
Manufacturing industries increased planned investment 21.0% and nonmanufacturing industries 11.5%.
By industry, only four sectors -- paper and pulp, real estate, construction, and mining foresee less capital spending than the previous year. Automakers are beefing up production capacity for EVs and car batteries, both domestically and abroad.
Toyota Motor increased its investment 5.9% to 1.97 trillion yen from its initial plan for the current fiscal year, which was already a record. Honda also revised its plan upward by 10%, mainly due to the weaker yen,...
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And also December 15, Nikkei Asia's Editor-in-Chief:
Letter from Nikkei Asia's editor: The great nanometer chip race
Shin Nakayama shares his weekly reflections and recommendations
Hello from Tokyo, where the political funds scandal continues to dominate the news. The debacle prompted a major reshuffle of key ministers in Prime Minister Fumio Kishida's cabinet this week. Kishida vowed at a press conference to show leadership in restoring public confidence, but few believe he will weather this still-unfolding scandal unscathed.
There are a number of possible scenarios, depending on how the scandal unfolds. If sitting lawmakers from the ruling Liberal Democratic Party are indicted on criminal charges, the damage to the LDP will be tremendous. All the more so because these members would most likely be from the party's largest faction -- once led by slain Prime Minister Shinzo Abe -- an outcome that could change not only the power structure of the LDP but the very direction of the country, which has been influenced by this faction for decades.
For Kishida, who essentially leads the LDP's fourth-largest faction, this could be a positive development, if only because it would reduce the power of the Abe faction. However, an unprecedented indictment of lawmakers would most likely cause the ruling party's overall popularity to plummet, and there is a greater risk that LDP members will begin to believe that the unpopular Kishida should be replaced ahead of the general election.
Kishida's term as LDP leader ends in September next year, and there will be a vote for party leader in which Kishida will seek reelection. The party may choose this moment to try to replace him -- but again, it all depends on how the scandal unfolds. Indeed, the race to replace Kishida might happen sooner than expected. We will keep a close eye on the investigation as it unfolds over the coming days and weeks.
This week's Big Story is also about a race, though not a political one. It is a look at how much further the computing power of semiconductors can improve. In line with Moore's law -- first articulated by Intel's co-founder in 1965 -- semiconductor performance has been improving exponentially. But we may be approaching the limits of that growth.
The story explores the implications of hitting this technological limit and how that would affect innovation, especially in the context of the U.S.-China rivalry. The report also provides a detailed visual explainer on how semiconductors have improved technologically -- making it easy to understand even for someone like me who is not familiar with nanotechnology....
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