Japanese smaller businesses are increasingly exiting China due to economic and political risks, leading to a notable decline in the overall number of Japanese firms in the country. According to a report by Nikkei Asia on July 12, 2026, the tally of Japanese companies operating in China has dropped about 10% from its peak in 2012. This trend highlights shifting dynamics in East Asia’s business landscape, with Japan reassessing its corporate footprint amid uncertainties.

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