14 July 1997 00:00 [Source: ACN]
THE Japanese chemical industry is spending more on equipment to improve enviromental protection and increase efficiency in the battle against foreign competitors.
Japan's Ministry of International Trade and Industry (Miti) estimates that producers will boost investment in equipment by 7.7%to Yen152.8bn (US$133.4m) during the current financial year, ending March 1998.
Investments to boost capacity, however, are likely to slow down,according to a Miti survey. Chemical division section chief Koichi Inoue said this is due to poorer chemical markets and the depressed Japanese economy.
Among the 34 producers surveyed, Miti estimates that the average investment in equipment which will boost capacity will account for 37.9% of a company's total budget for all equipment investment,down from 39.3% last year.
Miti also predicts that the share of the budget set aside for streamlining operations will increase this year by 3.6% to 14.6%,and from 1.6% to 4.3% for environmental protection.
Japan Petrochemical Industry Association research manager Shoichi Kagayama said Japanese producers need to streamline operations to overcome cheap imports and the threat from Asean countries.
More companies are also divesting less strategic businesses and focusing on core businesses, he noted.
Inoue said increased awareness of environmental issues were behind the increase in spending on equipment for environmental equipment, noting that an international conference to address the greenhouse effect will be held in Kyoto, Japan, this December.
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