Japanese government is going a step further. It will pay incentives to Japanese companies to move factories out of China and back home or to Southeast Asia. This is to reduce supply chains dependence on China. A total of 57 Japanese companies will get Yen 58 billion as subsidies. Another 30 firms will get subsidy to move to Vietnam, Myanmar and Thailand.

As Sino-US relations worsen, there are attempts in the US and other developed nations to decouple from China. Taiwan had adopted a similar policy in 2019. Prime Minister Shinzo Abe has been trying for years to improve relations with China but territorial dispute over islands and gas fields in the East China Sea have sabotaged such efforts.