TOKYO: Small and medium-sized enterprises (SMEs) in Japan are bracing for the impact of US tariffs while relying on their niche expertise to stay competitive. Mitsuwa Electric, a 92-year-old firm specialising in precision metal components, exemplifies this resilience. Company president Yuji Miyazaki remains confident despite looming 25% tariffs on Japanese goods set for August 1.
“We provide highly specialised products where changing suppliers isn’t easy, even with higher tariffs,“ Miyazaki told AFP. The firm, which holds a Guinness World Record for the smallest commercial metal coil, supplies global giants like Toshiba and Koito Manufacturing.
Prime Minister Shigeru Ishiba’s government has sent envoys to Washington seeking tariff relief, but negotiations remain stalled. US-bound Japanese vehicle exports, tied to 8% of national employment, dropped 25% in May and June. The uncertainty has triggered over 2,000 SME inquiries to JETRO, Japan’s trade support agency.
Mitsuwa’s diversified customer base across Asia, Europe, and North America has cushioned the blow so far. However, Miyazaki admits concern over potential 200% tariffs on pharmaceuticals or medical equipment.
SME expert Zenkai Inoue of Kyushu Institute of Information Sciences urges firms to adopt a “tricycle strategy” – securing at least three clients in different regions. “Financial stability and market expansion are critical for survival,“ he said. Some firms, slow to prepare despite Trump’s 2024 campaign warnings, risk repeating past mistakes from over-reliance on single markets like China. - AFP
