Japan

The problems Japan has experienced are well known by most investors but considerable change has begun to occur over recent years. Investors have witnessed structural improvements to help with economic growth and support for the stockmarket. There also appears to be further scope for reform. This could offer opportunities for investors looking for a long-term prospect. Political change has enabled reform to begin, which is revitalising the domestic economy. Restructuring the financial system in particular should continue to prove beneficial for companies. Although Japanese investors have experienced volatile performance, there have been stronger periods of progress more recently and business confidence has improved. Most now believe the economy is making progress, even if stockmarket performance remains inconsistent. Corporate Japan has also seen reform. Many Japanese companies have restructured and are looking to pass cost savings to shareholders in the form of dividends. Some large Japanese companies have become global leaders in their field – and the fact Japan is located near the sources of cheaper labour has also been supportive. Japan is likely to be well placed to benefit from the expanding economies of Asia, particularly China, in coming years. With improving domestic demand also boosting growth, the region could finally see a more robust recovery in its stockmarket. For Independent Financial Advice, please contact Mark or Clare at GMP Independent Financial Advisers LLP 0207 2886400