Japan financial ppt

Main figures
Gross fixed investment : 20.3% (2010 est.)
Household income or consumption by percentage share:
Lowest : 4.8%
Highest : 21.7%
Labor force: 65.7 million (2010 est.)
Unemployment rate: 5.1% (2010 est.)
Population below poverty line: 15.7% (2009)
Budget: revenues $1.638 trillion & Expenditures $2.16 trillion (2010 est.)

Inflation rate (consumer prices): -0.7% (2010)
Industrial production growth rate: 15.5% (2010 )
Reserves of foreign exchange and gold: $1.096 trillion
Stock of direct foreign investment - at home:
$199.4 billion (31 December 2010 est.)
Stock of direct foreign investment - abroad:
$719.9 billion (31 December 2010 est.)
Main figures

Exchange rates: yen (JPY)/US dollar - 87.78 (2010), 93.57 (2009), 103.58 (2008), 117.99 (2007), 116.18 (2006).
In 2010 stood as the third-largest economy in the world after China.
One of the world's largest fishing fleets nearly 15% of the global catch.
Main figures

Imports & exports
Exports
$765.2 billion (2010 est.)
Commodities
transport equipment, motor vehicles, semiconductors, electrical machinery, chemicals
Partners
China 18.88%, US 16.42%, South Korea 8.13%, Taiwan 6.27%, Hong Kong 5.49% (2009)
Imports
$636.8 billion (2010 est.)
Commodities
machinery and equipment, fuels, foodstuffs, chemicals, textiles, raw materials
Partners
China 22.2%, US 10.96%, Australia 6.29%, Saudi Arabia 5.29%, UAE 4.12%, South Korea 3.98%, Indonesia 3.95% (2009)

Strengths of economy
A stable government with coherent economic policies
A more homogeneous population raised to cooperate a better educated workforce
Better management
Meritocratic system
A business financing system geared to the long haul rather then the next quarter's profits.
People who work 10 hours a day with a 30 minute lunch, and value their career more than their family

History of foreign exchange system
Currency matters are administrated by the Ministry of Finance (MOF), Bank of Japan (BOJ) and the Ministry of International Trade and Industry (MITI)
Before 1949, foreign trade was controlled directly by government
April 1949 Japan shifted from plural exchange rates to single exchange rate

Exchange rate arrangement
Intervention currency of Japan was U.S. Dollar
August 1971,fixed exchange rate of ¥360.00 per U.S. Dollar & 1973 another rate called Interbank Rate was set up
Demand and supply conditions in the exchange market
BOJ only intervened currency market while Yen fluctuate exchange rate regime was not changed much in Japan.

RESERVE MANAGAEMENT POLICY
The Ministry of Finance is in charge of Japan's currency policy and the management of its reserves.
The objective of reserves management is to ensure a stability yen.
They are managing the regulation for foreign reserves in proper manner

RESERVE MANAGAEMENT POLICY
Japan has been lending securities from its foreign reserves as a way to provide liquidity to bond markets overseas and more effectively manage its reserves.
Eligible assets for the reserves include central government bonds, agency bonds, supranational bonds and securitized bonds that offer high liquidity and certainty of redemption.

Regulations and companies
Companies or individuals can easily open an overseas checking account denominated in yen or other currencies.
Companies and individuals may freely engage in cross border lending and borrowing.
US dollar-based settlements between companies may freely take place to save conversion costs.
Individuals may freely exchange US dollars, and domestic retail stores may accept dollars for payments.
Retail sales of financial products may be denominated in foreign currency.
Domestic investors may buy and sell foreign securities on their overseas accounts.

Regulations and companies
Prior notification is not required for a non-resident’s issue of domestic bonds, or for a resident’s issue of overseas bonds.
There are no restrictions on forex brokerages, including derivatives trading, and over-the-counter retail trading in foreign exchange.

FINANCIAL SYSTEM
Japan's financial system has maintained its stability as a whole.
Banks can expanded share in the overall credit markets through lending and investment in bonds.
Japan's financial system has also enhanced its robustness.

CENTRAL BANK
Besides cash, there is banknotes and coins, people also use bank deposits as money to make payments for transactions in goods and services.
The value of money is stable (price stability).
The payment and settlement system is reliable and efficient (financial system stability).

NATIONAL TREASURY
As part of its banking services, the Bank accepts deposits from the government and provides various services related to payment and receipt of the government’s money (treasury funds services).
For example receipt of national taxes and payments for public works and pensions.

COMMERCIAL BANKS
Initially, commercial banks generally followed the traits of their nationalities or joint ventures, but after experiencing mergers, they became more like Japanese banks.
Larger banks continued to expand across the country, transforming the character of the local bank into a nation-wide entity.

Global informations on the internal market
This country has a GDP (Gross Domestic Product) of 5068,1 bilions USD in 2009.
Per capita it represent 39,731 USD.
And it is 6% of the the world total GDP (PPP) as share

Internal markets problems
The most problematic factors for doing business are the following :

Interest Rates

The local financial market
City Banks (12 commercial banks of the largest cities) collect savings and use it to provide medium-term financing for business, industry and agriculture. These banks dominate business finance because they provide three-month loans that leave business financially vulnerable. City banks are not permitted to manage trusts or pension funds.
Regional Banks (63 local banks)
Savings and Loan Institutions (71) they lend primarily to small retail, wholesale and construction firms.
Industrial Banks (3) was created by the Meiji government in 1902 to provide long term financing to heavy industry. It raised its funds by selling five-year debentures. After World War II it became a private bank. Two competiting banks were created at that time, the Long Term Credit Bank of Japan and the Nippon Credit Bank.

Trust Banks (7) is only trust banks that are permitted to manage trusts, pension funds and such. Trust banks raise about half of their funds by selling two to five year trust certificates. The rest comes from depositors and the income from managing trusts. The biggest trust banks are Mitsubishi Trust & Banking and Sumitomo Trust & Banking. Both had assets of substantially more than $200 billion in the late 1980s.
Postal Savings Bureau is a savings bank operated by the postal service through its 23,000 post offices. In the late 1980s it had more than $500 billion in deposits and was the world's largest savings institution.
Norinchukin Bank is the bank owned by farm and fishery cooperatives employees. It is a major supplier of funds to city banks.
The Bank of Japan was established in 1882 to control the money supply and to be the lender of last resort to the banking system. It controls the money supply primarily through its control of the discount rate, the interest rate for loans from the Bank of Japan to banks. The government owns 55 percent of the Bank of Japan and the private investors own the rest. There is an uneasy relationship between the Bank of Japan and the Ministry of Finance .

Bank of Tokyo for foreign exchange and trade financing. The government supplied one third of its capital and gave it a special relationship with the central bank, the Bank of Japan.
Insurance Companies Japan has the world's largest life insurance market because Japanese buy significantly more life insurance per person than Americans do.
The Ministry of Finance is the most powerful agency in the Japanese government. It combines the powers held in the U.S. government held by the Treasury Department, the Federal Reserve, the Internal Revenue Service, the Securities and Exchange Commission and the Department of Commerce. In addition it drafts the national budget for the legislature to approve.

Impacts of the international financial crisis on local financial markets and the economy
36% apreciation of Yen/$
-58% in stock market changes
-11% in GDP growth (from june 2007 to March 2009)
Increase of short term external debt
Decrease in exports and imports
Big increase in primary commodities prices, particularly energy (+300% compared to 2000)

Consequences of the tsunami and the earthquakes
The Bank of Japan (BoJ) injected into the financial system more than 200 billion dollars
This is just a « drop » considering the huge damages
To meet the financing needs "post-earthquake," Japan could soon turn to the bond market
This tragedy could have impacts on international markets

Conclusion
Japan was subject to many crisis. And it still crossing one.
These disasters will push Japan into recession
Toyota & Nissan stopped their production these plants make 420,000 small cars each year.
Financial system should be stable > FOREX

Sources
OCDE
TSE (TOKYO STOCK EXCHANGE)
GLOBAL COMPETITIVENESS REPORT 2011
BANK OF JAPAN
(the complete list on the written report)…

Japan financial ppt

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