Immigration Law Changes
July 2012 will see changes to the registration procedures for medium-term and long-term foreign nationals living in Japan. The changes will combine non-Japanese and Japanese resident registrations under the Juki Net System. The Juki Net System already collects basic information on citizens nationwide. The changes summarized:
1. The Alien Registration Card will be replaced with the Residence Card. The resident card will be issued at the port of entry in most cases (by mail otherwise). This card is similar in appearance to the current Alien Registration Card, but it will display less information and have an IC chip that maintains information. Like the current card, any changes are documented on the back. The current alien registration cards will remain valid during the transition period.
2. The maximum period for a visa will be extended from 3 years to 5 years. One year and three year visas will continue to be issued.
3. Foreign nationals with a valid passport and residence card will generally not require a re-entry permit if they will be returning to Japan within one year of their departure. The exception to this being where the visa expires within one year of departure, in which case the individual must return to Japan before its expiration to apply for renewal.
For periods outside of Japan of more than one year, a re-entry permitted will be required. The maximum validity for the re-entry permit will be extended to 5 years.
4. The new residence registration system will replace the current alien registration system. Notifications submission procedures will also change. Changes of residence will still need to be reported to the local ward office or city office. Other changes will need to be reported to the nearest immigration office.
The above is only a brief summary of the new system. Further information can found at:
Japanese Yen News
The yen’s appreciation of late has many Japanese exporters and policy makers concerned. It has been enough of a concern to spark an urgent conference call between G7 leaders to discuss the issue and for the Bank of Japan to intervene in the currency markets to try to rein in the appreciation. The intervention proved to provide a temporary barrier, but the yen has continued to show little signs of weakening. The BOJ has hinted at the possibility of further action. BOJ Governor Masaaki Shirakawa and Minister of Finance have both expressed that a strong yen will slow economic recovery after the events of March 11th in Japan, with the former stating the yen is “strongly overvalued.”
The recent rate is close to the post war era high of JPY 76.25 relative to the US dollar, which was reached in March of this year. The BOJ has reported that most exporters have used an average rate of 82.59 as the rate for its forecasts. Many investors see the yen as a safe haven due to the recent debt turmoil in the United States and Europe. The higher rate makes Japan’s exports more expensive abroad and lowers the value of repatriated funds both eroding profits.
Some economists argue however, that with years of deflation in Japan that the effects of the higher yen have been neutralized. In fact, a separate BOJ report from February has suggested that the “real value” of the yen has actually decreased during the last decade. The calculation of the effective exchange lags which is why forecasts and results are reported in nominal terms.
While reports of the strong yen have generally expressed the negative effects on the economy, many large Japanese companies have taken advantage of the situation and begun to make large acquisitions totaling approximately $46 billion overseas. The list of companies who have made or are pursuing acquisitions include, Kirin, Asahi, Takeda, Toshiba, Sony, and Itochu. These firms see the current rate as an opportunity to expand abroad and to boost profits amidst a saturation of the Japanese domestic market. Other firms are also considering similar strategies as well as relocating more production facilities overseas to combat the high yen.
Earthquake Reconstruction Budget
The Japanese government approved its second earthquake reconstruction budget in July. The budget of JPY 2 trillion will supplement the previous JPY 4.02 trillion budget passed earlier this year. The budget will go toward reconstruction of damaged areas, compensation to victims, health care and regular health checks for those in Fukushima affected by the nuclear crisis, among other areas. This second budget will not be funded with new debt but rather using the surplus from the previous fiscal year.
Meanwhile, the government is considering income and corporate tax increases to go along with its planned consumption tax increases in the next five years to 10% in order to support social services and the earthquake reconstruction efforts.
In other tax news, it was also recently reported that tax revenues were up in 7.1% in fiscal 2010 due to higher corporate earnings and increased revenue from personal income tax.
Japan International Trade News
The Free Trade Agreement that will eliminate nearly all tariffs between the nations over a ten year period between India and Japan began from August 1st. Notable exceptions include Indian wheat, pork and beef. The agreement provides Japan with a foothold into the fast growing economic power.
Japan is also set to begin FTA talks with Mongolia after completing a study on an agreement in March. Japan has said it hopes to invest in and help develop the Tovan Tolgoi coal mine.
Keidanren, the influential Japanese business lobby, during a tour of Europe is urging EPA talks between the EU and Japan at each of its stops. The delegation from the organization has had publicized talks with the German Economic Minister and the Prime Minister of the United Kingdom during visits to the respective nations. UK Prime Minister Cameron, said he was committed to pushing the EU toward EPA talks with Japan.
Recent positive news on the Japanese economy:
- Japanese government upgrades its view on the national economy in August for the first time in two months
- Bank of Japan upgrades 7 of the 9 regional economies in the nation:
- Tohoku, Tokai, Hokuriku, Hokkaido, Kanto-Koshinetsu, Chugoku, Kyushu-Okinawa
- Japan has its first trade surplus in three months during the month of June
- Factory output is up for three consecutive months:
- April +1.6% May +6/2% June +3.9% July +2.2%* Aug +2.0%* *projected
- Consumer Confidence rises in May, June and July
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Tokyo Executives Business Mixer
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