Development Bank of Japan
Research Report
No. 26

Survey on Planned Capital Spending
for Fiscal Years 2001 and 2002
(Conducted in February 2002)

May 2002

Economic and Industrial Research Department
Development Bank of Japan

Contents

I Outline ............................................................................................................................................. 1
II Summary ........................................................................................................................................ 3
1. Overall Condition................................................................................................................. 3
2. Estimated Actual Capital Spending for FY2001.............................................................. 3
3. Planned Capital Spending for FY2002 .............................................................................. 3
4. Features of Planned Capital Spending for FY2002 ......................................................... 4
III

Survey Results.............................................................................................................................. 7
1. Estimated Actual Capital Spending for FY2001.............................................................. 7
2. Planned Capital Spending for FY2002 .............................................................................. 9
3.
4.
5.

Investment Motives............................................................................................................16
Trends in Land Investment, by Principal Business Sector...........................................17
Trends in Capital Spending by Foreign-Affiliated Firms, by Principal Business
Sector ......................................................................................................................................19
6. Information Technology Investment, by Principal Business Sector...........................19

Development Bank of Japan Research Report/ No. 26iI Outline
Objectives
This survey has been conducted biannually (in February and August) since FY1956 by theDevelopment Bank of Japan to assess major trends in the capital spending of Japanese industry.
The Scope of Capital Spending
In this survey, “capital spending” refers to domestic investment in the tangible fixed assets of
one’s own corporation; these assets include buildings, structures and equipment (including ships,
aircraft, rolling stock, tools and furnishings), as well as the purchase and development of land
(excluding the purchase of land for subdivision in the real estate industry). Accordingly,
intangible fixed assets are excluded, as are capital spending abroad and investment in
subsidiaries/affiliated firms (except that “information technology investment” includes intangible
fixed assets as indicated later).
Survey Methods
The survey was conducted by means of a questionnaire (sent to and completed by individual
firms). Capital spending has been calculated based on construction. In general, it is calculated as
the sum total of tangible fixed assets, including the construction in progress account (without
subtracting resale value, depreciation and loss).
Target Firms
This survey covers all private firms in Japan’s major industries capitalized at ¥1 billion or more,excluding agriculture, forestry, finance and insurance and medicine. The Teito Rapid Transit
Authority has been included in the survey despite the fact that it is classified as a (non-financial)public corporation under the System of National Accounts (SNA).
Date of Survey
February 10, 2002
Contents of the Survey(i)
Anticipated actual capital spending in FY2001 and planned capital spending for FY2002(ii) Details of individual construction projects in FY2001 and FY2002(iii) Anticipated revenues and expenditures in FY2001 and FY2002(iv) Investment motives in FY2001 and FY2002(v) Trends in land investment in FY2001 and FY2002(vi) Capital spending abroad in FY2001 and FY2002(vii) Information technology investment in FY2001 and FY2002

Development Bank of Japan Research Report/ No. 26

1Responses
The responses to the survey are shown below. In terms of the number of targeted firms andrespondents, this survey is the largest among similar national surveys of capital spending trends.

Principal BusinessClassification
Investment-SpecificClassification

No. of Firms Targeted

No. of Firms Giving
Valid Responses

Proportion of Valid
Responses

3,559

2,906

81.7%

4,311

3,565

82.7%

On the Totals
Industrial classification
There are two types of industrial classifications: principal business classification and investment
specific classification. The former classifies and totals the companies’ responses based on themain business interest of each company, whereas the latter classifies and totals the amount ofinvestment for each business sector in a company’s response according to industrial sector.
Although mainly the investment specific classification is used for the analysis, the principal
business classification is adopted in some cases.
Timing of survey and years covered
The survey is conducted twice a year, in February and in August. Since each fiscal year issurveyed five times until planned investments are materialized, the results reveal businesssentiments in detail, for example, through the extent to which planned investments have been
modified.
Timing of survey
August 2000
February 2001
August 2001

FY1999Actual

FY2000Modified plan

FY2001
Plan for next FY

Actual expected
ActualInitial plan
Modified plan

Plan for next FY

Actual expected
ActualInitial plan
Modified plan

February 2002
August 2002

2

Development Bank of Japan Research Report/ No. 26

FY2002

FY2003

Plan for next FY

Decrease in Capital Spending for the Second Consecutive Year, Mainly in
the Manufacturing Sector:
Steady investment in urban infrastructure
II Summary
1. Overall Condition
Actual capital spending of all industries in FY2001 (based on construction; change from previous
fiscal year) again shifted to a decline, dropping 6.6%.
Planned capital spending in FY2002 dropped 2.7%, decreasing for the second consecutiveyear.
2. Estimated Actual Capital Spending for FY2001
In addition to a drop in estimated actual capital spending in FY2001 in the manufacturing sector(down 7.0%), there was also a decrease in the non-manufacturing sector (down 6.3%), resulting
in a decline for all industries for the first time in two years (down 6.6%).
3. Planned Capital Spending for FY2002
Planned capital spending for FY2002 continued to decline in the manufacturing sector (down
8.2%) while remaining level in the non-manufacturing sector (up 0.0%), leading to a decline forall industries (down 2.7%) for the second consecutive year.
In the manufacturing sector (down 8.2%), planned capital spending on petroleum will increase
due to investments in environmental measures, whereas that on automobiles will remain flat, withinvestments continuing to be made in new models. However, capital spending on electricmachinery, especially electronic devices, will again show a double-digit decrease, while thecompletion of production capacity expansions and the consolidation of production facilities inpulp & paper and a temporary pause in large-scale repairs in iron & steel will also lead towidespread declines.
Planned capital spending is projected to decrease also in the non-manufacturing sector due tothe completion of construction of thermal power plants in electrical power, cutbacks ininvestments in fixed telephones in telecommunications & information, and the completion of
construction of a large-scale theme park in services. Meanwhile, increases are planned in railways
due to further construction and extension of new railway lines, as well as in warehousing &transportation due to full-scale promotion of airport construction, in leasing as demand shifts
from purchasing to leasing, and in retail with the establishment of new supermarkets and other
outlets under the Large-Scale Retail Store Siting Law. Overall, planned capital spending in the
non-manufacturing sector remains flat (up 0.0%).
Compared to the previous survey (August 2001), the manufacturing sector and the nonmanufacturing sector were both revised downward in FY2001 (down 12.2% and 4.5%
respectively). There was an especially broad downward revision in electric machinery in the
manufacturing sector. Both the manufacturing sector and the non-manufacturing sector wererevised downward in FY2002 (down 8.7% and 2.3% respectively, for an overall decline of 3.2%).
Trends by half term against the previous year show that whereas there was an increase of
2.0% in the first half of FY2002, there was a decrease of 6.7% in the latter half.
Development Bank of Japan Research Report/ No. 26

3Investment motives in the manufacturing sector in FY2002 indicate that the share of“maintenance and repair,” “product development and upgrading,” “rationalization andlaborsaving” and “research and development” increased whereas the share of “expansion of
production capacity” dropped significantly. Meanwhile, “expansion of production capacity”
moved upward for the first time in three years in the non-manufacturing sector with thecontribution of railways, real estate and retail, whereas the shares of “product development andupgrading” and “maintenance and repair” slumped.
Land investments in FY2002 will decline in both the manufacturing and non-manufacturingsectors with planned reductions of 11.3% overall, dropping below the level of the previous year.
However, the extent of the decline at the time of the survey was small considering trends inrecent years. There is a tendency for land investments to undergo large upward revisions between
the planning and implementation stages.
Domestic capital spending (¥1,152.9 billion) by foreign-affiliated companies (137 companies,
with more than one-third foreign ownership) in FY2002 is slated to increase in wholesale & retailand telecommunications & information but, in addition to an extensive slide in electric machinery,
will also drop in transport machinery. There will thus be a decline overall (down 3.3%) for thesecond consecutive year. The domestic capital spending of foreign-affiliated companies accounts
for 5.4% of spending by all industries.
The ratio of capital spending to cash flow (net profit + depreciation cost) will fall below thelevel of the previous year in both the manufacturing and non-manufacturing sectors and willremain at a low level (all industries: 122.7% in FY2001 → 100.7% in FY2002).
Investments in information technology by users for making their own companies more
efficient is robust and will continue to increase in production and customer management relatedareas in the manufacturing sector (up 1.5%) whereas the non-manufacturing sector will shift tonegative growth (down 11.3%) in reaction to large investments in electric power, wholesale &retail and airlines during the previous year.
4. Features of Planned Capital Spending for FY2002
IT-related investments on the equipment supply side, which experienced a considerable
downward revision in FY2001, are expected overall to be restrained or postponed in FY2002 andplans are cautious with an eye to market trends. Although there is enthusiasm in some areas, suchas flat panel displays (plasma display panels [PDPs], etc.), IT-related investments will be reducedin electric machinery, mainly due to lower mos memories production. Decreases will continue incement and ceramics & glass, due to postponement in investment related to information andcommunication, and in precision machinery, due to restraints in semiconductor equipment
production. IT-related investment in the non-ferrous metals industry will decrease, due to a
substantial decrease in investment for expansion of production capacity in optical parts.
Meantime, firmness is also evident in investments for urban infrastructural development. Thisis bolstered by expanded investments in railway networks, airports and other segments of themetropolitan transportation infrastructure as well as by investments in large-scale redevelopment
projects in metropolitan Tokyo. In addition, steady investments are also apparent in fiber-optic
networks, for fiber to the home (FTTH) and digital broadcasting in telecommunications &information.

4

Development Bank of Japan Research Report/ No. 26

Capital Spending
FY2001(2,783 firms)
FY2000FY2001
Growth Rate (%)
ActualEstimated
2001/2000
Total
230,752
215,589-6.6
180,539-7.7
Excluding Electric Power 195,575
Manufacturing
77,306
71,880-7.0
Non-Manufacturing
153,445
143,708-6.3
Excluding Electric Power 118,268
108,659-8.1
35,17735,050-0.4
Electric Power
Note: Monetary amounts are in 100 million yen.

FY2002(2,906 firms)
FY2002Growth Rate (%)
Planned
2002/2001
212,351-2.7
179,070-2.2
67,263-8.2
145,0880.0
111,806
1.7
33,282-5.3

FY2001
Estimated
218,333
183,187
73,251145,082
109,936
35,146Growth in Capital Spending
30

%
Total

20

Manufacturing
Non-Manufacturing

10
0
-10
-20
-30
86

87

88

89

90

91

92

93

94

95

96

97

98

99

2000

2001

2002 FY(Estimated) (Planned)

Development Bank of Japan Research Report/ No. 26

5Capital Spending, by Industry
Capital Spending (100 million yen)
Growth Rate (%)
Component Rate (%)
FY2000FY2001
FY2001
FY2002
FY2001
FY2002
ActualEstimated Estimated Planned 2001/2000 2002/2001 Estimated Planned(2,783firms)(2,906 firms)(2,906 firms)
Total
Excluding Electric Power230,752
195,575

215,589
180,539

218,333
183,187

212,351
179,070

-6.6
-7.7

-2.7
-2.2

100.0
83.9

100.0
84.3

Manufacturing
Food & Beverages
TextilesPaper & Pulp
Chemicals
Organic Chemicals
Pharmaceuticals
Petroleum
Cement, Ceramics & Glass
Iron & Steel
Ordinary Steel
Non-Ferrous Metals
General Machinery
Electric Machinery
Electric Devices
Precision MachineryTransportation
Automobiles
Other Manufacturing

77,306
4,652
629
2,223
9,249
4,115
1,855
936
2,410
3,906
3,210
3,103
4,236
26,651
20,371
1,489
12,83812,1994,985

71,880
4,477
760
2,687
10,269
4,455
2,122
1,314
2,237
4,380
3,680
3,368
4,348
18,79513,004
1,322
13,784
13,0204,141

73,251
4,619
774
2,687
10,505
4,620
2,165
1,314
2,261
4,380
3,680
3,424
4,576
19,35813,182
1,354
13,79913,0294,200

67,263
4,223
683
2,026
9,898
4,481
1,927
1,704
1,881
3,790
3,019
2,943
4,204
17,218
11,497
1,269
13,684
13,025
3,741

-7.0
-3.8
20.7
20.9
11.0
8.3
14.4
40.4
-7.2
12.1
14.7
8.6
2.7
-29.5
-36.2
-11.2
7.4
6.7
-16.9

-8.2
-8.6
-11.8
-24.6
-5.8
-3.0
-11.0
29.6
-16.8
-13.5
-18.0
-14.1
-8.1
-11.1
-12.8
-6.3
-0.8
-0.0
-10.9

33.5
2.1
0.4
1.2
4.8
2.1
1.0
0.6
1.0
2.0
1.7
1.6
2.1
8.9
6.0
0.6
6.3
6.0
1.9

31.7
2.0
0.3
1.0
4.7
2.1
0.9
0.8
0.9
1.8
1.4
1.4
2.0
8.1
5.4
0.6
6.4
6.1
1.8

Non-Manufacturing
Excluding Electric Power
Construction
Wholesale & Retail
RetailReal EstateTransportation
RailwaysMarine Transport
Airlines
Warehousing
Electric Power & City Gas
Electric PowerCity Gas
Telecom. & Information
LeasingServices
Other Non-Manufacturing

153,445
118,268
1,422
13,117
10,566
10,755
17,58812,734
382
1,686
1,566
38,34035,1773,164
32,34734,562
5,033
281

143,708
108,659
1,454
10,285
8,352
8,731
16,91910,662
441
1,764
2,715
38,12735,0503,077
30,325
34,1033,273
493

145,082
109,936
1,459
10,505
8,508
8,743
16,936
10,662
441
1,764
2,732
38,22335,146
3,077
30,90034,3633,399
555

145,088
111,806
1,211
10,702
9,138
8,904
20,444
12,978
280
1,995
3,891
36,20733,282
2,926
29,72235,148
2,275
475

-6.3
-8.1
2.3
-21.6
-21.0
-18.8
-3.8
-16.3
15.5
4.6
73.4
-0.6
-0.4
-2.7
-6.3
-1.3
-35.0
75.4

0.0
1.7
-17.0
1.9
7.4
1.8
20.7
21.7
-36.6
13.1
42.4
-5.3
-5.3
-4.9
-3.8
2.3
-33.1
-14.3

66.5
50.4
0.7
4.8
3.9
4.0
7.8
4.9
0.2
0.8
1.3
17.5
16.1
1.4
14.2
15.7
1.6
0.3

68.3
52.7
0.6
5.0
4.3
4.2
9.6
6.1
0.1
0.9
1.8
17.1
15.7
1.4
14.0
16.6
1.1
0.2

Notes: Other Manufacturing includes Publishing & Printing, Rubber, and Metal Products. Other Non-Manufacturing includes
Fishing, and Mining.

6

Development Bank of Japan Research Report/ No. 26

III Survey Results
1. Estimated Actual Capital Spending for FY2001
OutlineIn estimated actual capital spending for FY2001, there was a decline in both the manufacturingsector (down 7.0%) and the non-manufacturing sector (down 6.3%), causing a downward shift tothe negative side in all industries (down 6.6%).
In the manufacturing sector (down 7.0%), spending for high value-added products inchemicals, for new model changes in automobiles and for facility improvements (primarily blast
furnaces) in iron & steel led to an increase in each of these industries. However, a considerable
drop in spending in electric machinery, especially for electronic devices, which account for the
majority of spending, led to a decline.
In the non-manufacturing sector (down 6.3%), in spite of an extensive boost in spending withthe full-scale promotion of airport construction by warehousing & transportation relatedindustries, spending diminished in wholesale & retail primarily in reaction to the accelerated
establishment of stores following the enactment of the Large-Scale Retail Store Siting Law, inrailways due to the completion of sections of new railway lines and extensions in the Tokyo
metropolitan area, in real estate due to dwindling retail-related and regional projects and in
telecommunications & information reflecting reduced investments mainly in fixed telephones.
Trends, by Industrial Sub-Sector
Trends in capital spending by industry are as indicated below (figures in curly brackets { } show
the percentage of each subsector in total planned capital spending).

Materials (up 10.1%) {11.0%}
Capital spending in the materials subsector shifted to negative growth in cement, ceramics &glass due to the postponement of investments, whereas chemicals, paper & pulp and non-ferrous
metals, which account for a large portion of capital spending in the materials industries,
continued to increase. Capital spending in iron & steel and textiles showed positive growth forthe first time in three years and four years, respectively, resulting in an increase for the second
consecutive year.
In the chemicals industry, on the other hand, capital spending recorded double-digit growth
for the second consecutive year, due to investments in high value-added products in organic
chemicals as well as plant construction and the development of research facilities forpharmaceuticals and other chemicals. In paper & pulp, there were investments for special paperand other areas as well as investments accompanying the consolidation of production facilities,
leading to double-digit spending growth for the second straight year. Spending also increased in
non-ferrous metals for the second consecutive year, due to investments in optical parts and
300mm silicon wafers. Capital spending in iron & steel rose for the first time in three years, due
to the growing move toward improvements of blast furnaces and other facilities. Textiles also
moved higher for the first time in four years, as the result of investment for the expansion of
production capacity for non-woven fabric.
Meanwhile, cement, ceramics & glass experienced a sizable downward revision in investment
in liquid crystal displays and other data communications related products, switching to a decline
following the notable increase in the previous year.

Development Bank of Japan Research Report/ No. 26

7Processing & Assembly (down 14.6%) {21.9%}
Despite the shift to positive growth in automobiles for the first time in four years and an increasein general machinery, spending in processing & assembly industries dropped substantially overall
due to considerable declines in electric machinery and precision machinery, where conspicuous
growth was recorded in the previous year, as well as to the continuing slide in food & beverages.
Though investment remained constrained in automobiles, there were investments for newmodels and the restructuring of production systems, recording an increase for the first time infour years. In spite of the turn to a decline in general machinery parts, general machinery
continued to increase, primarily in office and household equipment.
Meanwhile, in electric machinery, extensive cutbacks in spending for electronic devices, which
account for the majority of investment in the industry, led to a broad drop in spending incontrast to the significant increase in the previous year. In spite of increased spending for medical
instruments, spending in precision machinery experienced a double-digit decline due to theextensive deterioration in semiconductor production equipment. In addition, although
investments were evident along with the restructuring of the sugar industry, spending in food &beverages was weak overall and the decline persisted.
Energy (up 1.0%) {18.3%}
The outlook for the energy industries remains at almost the same level as in the previous year.
Spending in the electric power industry decreased for the eighth year running due to curbs on
investment by the nine major power suppliers in production and distribution facilities together
with the peaking of thermal power plant construction. The gas industry also recorded a drop forthe sixth straight year, due to the completion of large-scale investments in exclusive LNG
business operations and thermal energy distribution. Meanwhile, spending in petroleum increased
for the first time in nine years with stronger investments for gasoline desulfurization and otherenvironmental measures as well as the consolidation and renovation of distribution facilities.
Non-Manufacturing, excluding Energy (down 8.5%) {48.8%}
Despite increases in construction, total spending in non-manufacturing excluding energy shiftedto a decline, reflecting a downturn in investments in wholesale & retail, real estate,
telecommunications & information, services, transportation and leasing.
There was a broad drop in wholesale & retail in reaction to the accelerated establishment of
stores following the enactment of the Large-Scale Retail Store Siting Law in the previous year andalso in real estate in reaction to the acquisition of existing assets the year before. In
telecommunications & information, spending turned down due primarily to curtailed investments
in fixed telephones. Spending in services declined extensively as investments in a large-scale
theme park in the Tokyo waterfront area had either been completed or had passed their peak. In
transportation, although airport-related investments increased, spending in railways decreased
due to the completion of the construction of new railway lines and extensions. Leasing also
shifted to a decline reflecting deterioration in the business environment.
Meanwhile, an increase was evident in construction for the first time in nine years with theacquisition of business restructuring related assets.

8

Development Bank of Japan Research Report/ No. 26

Capital Spending, by Industry
Growth Rate (%)
FY1998 FY1999 FY2000 FY2001 FY2002
Materialsa-12.8

Share (%)
FY1999 FY2000 FY2001 FY2002

10.0

10.1

-11.7

9.7

8.5

9.1

11.0

10.0

-29.4

24.2

20.9

-24.6

1.0

0.7

0.9

10.1
-21.1

11.0
12.1

-5.8
-13.5

4.3
2.2

3.9
2.0

4.1
1.6

1.2
4.8
2.0

1.0

-22.4
-14.0

4.7
1.8

-12.2
-2.7
-0.0
-18.6

15.1
-3.2
38.7
-3.2

-14.6
-3.8
-29.5
6.7

-7.4
-8.6
-11.1
0.0

21.0
2.2
7.2
5.9

20.8
2.4
8.2
5.3

23.0
2.2
10.8
5.0

21.9
2.1
8.9
6.0

20.9
2.0
8.1
6.1

-9.2
-32.5
-8.0

-7.4
-32.3
-5.6

-9.9
-36.8
-9.5

1.0
40.4
-0.4

-4.3
29.6
-5.3

17.6
0.8
15.4

18.0
0.6
16.0

15.7
0.4
14.0

18.3
0.6
16.1

18.0
0.8
15.7

Non-Manufacturing
Excluding Energyd
Construction
Wholesale & Retail
Real EstateTransportation
Telecom.& Information
LeasingServices

-4.8
-16.6
-1.7
-19.2
-8.8
3.7
-6.5
-7.1

-4.5
-35.0
-8.5
-19.2
-2.7
-12.5
7.6
38.9

3.7
-5.4
6.6
17.7
-5.0
2.1
5.4
3.7

-8.5
2.3
-21.6
-18.8
-3.8
-6.3
-1.3
-35.0

2.0
-17.0
1.9
1.8
20.7
-3.8
2.3
-33.1

51.6
1.2
4.8
4.3
7.0
16.4
16.5
1.3

52.7
0.8
5.2
4.0
7.6
15.4
17.6
2.1

52.2
0.7
5.6
4.8
7.0
15.7
16.2
2.1

48.8
0.7
4.8
4.0
7.8
14.2
15.7
1.6

51.1
0.6
5.0
4.2
9.6
14.0
16.6
1.1

All Industries
Excluding Electric Power

-8.0
-8.0

-8.4
-8.9

4.1
6.8

-6.6
-7.7

-2.7
-2.2

100.0
84.6

100.0
84.0

100.0
86.0

100.0
83.9

100.0
84.3

Manufacturing
Non-Manufacturing
Excluding Electric Power

-13.0
-5.6
-4.9

-15.5
-5.0
-4.8

12.5
0.4
3.5

-7.0
-6.3
-8.1

-8.2
0.0
1.7

31.6
68.4
53.0

29.9
70.1
54.1

32.5
67.5
53.6

33.5
66.5
50.4

31.7
68.3
52.7

Paper & Pulp

-33.8

Chemicals
Iron & Steel

-10.2
0.3

Processing & Assemblyb
Food & Beverages
Electric Machinery
Automobiles

-12.1
-12.1
-21.9
-4.2

Energyc
Petroleum
Electric Power-21.5

FY1998

Note: FY2001 and FY2002 share (%) figures are based on 2,783 companies that responded to the survey in both years.
aMaterials: textiles; paper & pulp; chemicals; cement, ceramics & glass; iron & steel; non-ferrous metalsb
Processing & assembly: food & beverages; general machinery; electric machinery; precision machinery; transportation; othermanufacturingcEnergy: petroleum; electric power; city gas and coal; crude oil & natural gas
dNon-Manufacturing, excluding energy: non-manufacturing industries excluding those industries mentioned in ‘Energy’ above

2. Planned Capital Spending for FY2002
OutlinePlanned capital spending for FY2002 shows a decrease for the second year in a row amounting to
2.7%, with persisting declines in the manufacturing sector (down 8.2%) and a leveling-off in the
non-manufacturing sector (up 0.0%).
In the manufacturing sector (down 8.2%), in spite of an expected increase in spending forenvironmental measures in petroleum and the leveling-off in automobiles with new modelchanges, continuing double-digit deterioration is expected in electric machinery centered onelectronic devices, and decreases are also planned in paper & pulp due to the completion of
production capacity expansions and the consolidation of production facilities, and in iron & steel
due to large-scale improvements, resulting in a decline overall.
Development Bank of Japan Research Report/ No. 26

9Meanwhile, the non-manufacturing sector is expected to move downward due to thecompletion of construction of thermal power plants in electric power, restrained investments in
fixed telephones in telecommunications & information, and the completion of a large-scale
theme park in services. In contrast, increases are planned in railways due to the progress in newline and extension construction, in warehousing & transportation due to the full-scale promotionof airport construction, in leasing as demand shifts from purchasing to leasing, and in retail withthe establishment of new supermarkets and other outlets under the Large-Scale Retail Store
Siting Law. Overall, therefore, growth in the non-manufacturing sector will remain flat (up 0.0%).
Trends, by Industrial Subsector
Trends in planned capital spending for FY2002, classified by industrial subsector, are as follows(figures in curly brackets { } show the percentage of each subsector in total planned capitalspending).

Materials (down 11.7%) {10.0%}
Planned capital spending in the materials subsector is expected to shift to a double-digit decreasein chemicals as well as in the heavily weighted industries of paper & pulp, iron & steel, nonferrous metals and textiles together with a broader range of decline in cement, ceramics & glass,resulting in lower capital spending in all industries and a decline overall for the first time in three
years.
In chemicals, the termination of large-scale investments of the previous year in the organic
chemical subsector and the completion of investments for capacity expansions inpharmaceuticals will result in slower spending growth for the first time in three years. The
completion of investments for increased capacity and the consolidation of production facilities inpaper & pulp will cause a shift to negative growth for the first time in three years. Despite somefacility improvements in iron & steel, capital spending will decrease again due to the completionof large-scale improvements in the previous year. Non-ferrous metals will see a drop for the firsttime in three years through a significant decline in investments for capacity expansions for opticalparts and fibers. Based on plans, textiles will see another drop, in spite of some continuing
investments in non-woven fabrics.
In cement, ceramics & glass, the decline in spending from the previous year is expected to
expand, due to postponement of IT-related investment in glass.
Processing & Assembly (down 7.4%) {20.9%}
Capital spending in the processing & assembly subsector is expected to record a decline overall
for the second consecutive year reflecting persistent subdued growth in automobiles and thecontinued double-digit decline in the heavily weighted electric machinery industry, continued
negative growth in food & beverages and precision machinery, and a shift to a decline in generalmachinery.
Automobile investment was restrained, though there were investments for new modelchanges and for production system restructuring, and overall it remained level.
Meanwhile, though there was evidence of some increases such as in flat panel displays (plasma
display panels [PDPs], etc.) in electric machinery, plans generally call for curtailed investments
especially in mos memories and a double-digit fall is expected, continuing from the previous year.
In spite of large investments for beverages in food & beverages, investments along with therestructuring of the sugar industry will come to an end, leading to a decline for the fifth straight
year. Precision machinery will experience a drop for the second year in a row due to thecontinuing double-digit decline in semiconductor production equipment, notwithstanding the10

Development Bank of Japan Research Report/ No. 26

continued rise in medical instruments. In addition, general machinery will see negative growth forthe first time in three years due to the expanded decline in general machinery parts andproduction equipment.

Energy (down 4.3%) {18.0%}
Plans in the energy subsector call for lower spending in electric power and gas.
In the electric power industry, the completion of construction of thermal power plants by thenine major electric power companies and the peaking of investments for wholesale electric power
supply operations will cause a drop in spending for the ninth consecutive month. In gas, largescale investments for LNG bases and research facilities for city gas are expected to end, and there
are also plans for a reduction in exclusive LNG business operations and thermal energy
distribution, which will result in a decline for the seventh consecutive year overall. Meanwhile,
petroleum is expected to show a double-digit increase over the previous year throughinvestments in light oil desulfurization facilities and other environmental measures as well as inself-service gas stations.
Non-Manufacturing excluding Energy (up 2.0%) {51.1%}
Looking at non-manufacturing excluding energy, declines will continue in spending in services,
telecommunications & information and construction, but increases are planned in transportation,leasing, wholesale & retail and real estate, which will result in a shift to positive expansion in thesubsector as a whole.
The completion of a large-scale theme park in the Tokyo waterfront area in services and curbs
on investments in fixed telephones in telecommunications & information will bring about a drop
for the second year running in both industries, whereas real estate figures will begin to decline inreaction to the acquisition of assets in the previous year.
In contrast, a significant increase is expected in transportation due to both ongoing airport
construction and construction projects for new railway lines and extensions, especially in theTokyo metropolitan area. A switch in demand from purchasing to leasing is anticipated in leasing,
and, as full-scale metropolitan redevelopment projects are undertaken in real estate and as new
supermarkets and other outlets are established in wholesale & retail, plans call for a switch to anincrease in both industries.
Trends and Features of Capital Spending in FY2002, by Industry
Trends and features of capital spending in major industries are shown below. The figures inparentheses ( ) indicate changes in the rate of growth in capital spending for the industry inquestion between FY2001 and FY2002 and the figures to the right show the percentage of eachindustry in total planned capital spending in FY2002.

Materials
Chemicals (11.0% → -5.8%) 4.7%
In spite of investment for reinforcing mainstream business operations in organic chemicals, ashift to a decline is expected, partly in reaction to the previous year, whereas pharmaceuticals willshow a double-digit drop due to the completion of capacity expansion investments, and subdued
investments are expected in general in inorganic and other chemicals, leading to an overall
decline for the first time in three years.

Development Bank of Japan Research Report/ No. 26

11

Iron & Steel (12.1% → -13.5%) 1.8%
Though investments and facility improvements will be evident, partly due to the consolidation of
production system facilities, large-scale repairs will come to an end as investments become
increasingly restrained, resulting in a shift to negative growth again.
Non-Ferrous Metals (8.6% → -14.1%) 1.4%
In spite of 300mm silicon wafer related investments, there will be a shift to a decrease for the
first time in three years due to the broad downturn in investments for capacity expansions in
optical parts and fibers.
Paper & Pulp (20.9% → -24.6%) 1.0%
Though there will be some construction work left over from the previous year, a decline is
expected overall due to the completion of investments for capacity expansion and theconsolidation of production facilities.
Cement, ceramics & glass (-7.2% → -16.8%) 0.9%
Besides continued restrained spending in cement, postponement of IT-related investment is also
expected in glass and others, bringing about the first decline in two years.
Textiles (20.7% → -11.8%) 0.3%
A decrease is expected again in spite of some continued investments in non-woven fabric.

Processing & AssemblyElectric Machinery (-29.5% → -11.1%) 8.1%
Although spending is expected to increase somewhat in flat panel displays (plasma display panels[PDPs], etc.), plans call for a continued drop in investments for electronic devices, which accountfor the majority of spending in the industry, as well as for both electronic and electric equipment.
Therefore, a two-digit slide in capital spending is expected in the industry as a whole for thesecond year in a row.
Automobiles (6.7% → -0.0%) 6.1%
Despite continued controls on investments in four-wheeled vehicles, investments for new modelchanges and production system restructuring will result in level growth. Though investments for
new models will also increase spending in parts & chassis, a drop is foreseen in reaction toincreased investments, leading to a standstill for the industry overall.
Food & Beverages (-3.8% → -8.6%) 2.0%
Although spending is expected to increase considerably in soft drinks, there will be a decline in
the industry overall due in part to inactivity in investments in flour milling, sugar processing andedible oils as the sugar production industry restructures.
General Machinery (2.7% → -8.1%) 2.0%
In the midst of the intensifying overall tone of restraint, the extent of the decline in generalmachinery parts, due to the completion of large-scale investments, and in industrial machinery,
due to the effects of business restructuring on the deterioration of supply and demand, is
expected to expand further. Furthermore, large investments in office and household equipment
have passed their peak and plant investments in metal processing machinery are completed,
12

Development Bank of Japan Research Report/ No. 26

resulting in a decrease in capital spending in the industry overall for the first time in three years.
Precision Machinery (-11.2% → -6.3%) 0.6%
In spite of an increase in medical instruments, the double-digit decline will continue in spending
for semiconductor production equipment due to deterioration of the market environment,
resulting in a decline for the second consecutive year.

EnergyElectric Power (-0.4% → -5.3%) 15.7%
Plans call for a reduction in capital spending both in the nine major power companies and inother power companies following the completion of construction of thermal power plants amidst
persistent restraint, and because investments in the independent power producers are expected topeak.
Gas (-2.7% → -4.9%) 1.4%
In addition to a decrease in capital spending in city gas due to the completion of investments forthe construction of LNG bases and large-scale investments in research facilities, the continuing
downturn in capital spending in specialized LNG operations and thermal energy distribution willlead to a reduction in the industry as a whole for the seventh year running.
Petroleum (40.4% → 29.6%) 0.8%
In addition to an increase in investments for light oil desulfurization facilities and otherenvironment measures at oil refineries, investments are also slated to increase in distribution
facilities and self-service gas stations, resulting in continued double-digit growth in capitalspending.

Non-Manufacturing excluding Energy
Leasing (-1.3% → 2.3%) 16.6%
An increase is expected due to intensified demand for capital spending in order to switch toleasing.
Telecommunications & Information (-6.3% → -3.8%) 14.0%
Controls on investments (especially in fixed telephones) in telecommunications, which are thecore of this industry, will continue for the second year in a row in spite of continued investments
in next-generation mobile telephones and the development of fiber optic networks, for fiber tothe home (FTTH). Information services, too, will experience depressed spending. Increased
spending is planned in broadcasting due to the construction of new company premises andinvestments in digitalization. Overall, the industry will see lower spending for the second straightyear.
Railways (-16.3% → 21.7%) 6.1%
A broad increase in capital spending in railways is anticipated due to progress in the constructionof new railway lines and extensions, especially in the Tokyo metropolitan area.
Wholesale & Retail (-21.6% → 1.9%) 5.0%
In wholesale, spending will be reduced for the fourth straight year due in part to the completion
Development Bank of Japan Research Report/ No. 26

13

of some investments in head offices. In retail, in spite of reduced spending due to the completionof investments in department store floor space expansions and renovations, the establishment ofsupermarkets and other outlets under the Large-Scale Retail Store Siting Law has begun and so
spending is expected to increase following the broad decline of the previous year.
Real Estate (-18.8% → 1.8%) 4.2%
Despite a slowdown in investments for development primarily in areas surrounding commuter
railway stations, the full-scale promotion of construction of a large-scale redevelopment projectin the Tokyo metropolitan area, which will be completed in the second half, will lead to a slightincrease in spending.
Services (-35.0% → -33.1%) 1.1%
A significant decrease in capital spending is expected for the second year in succession due to thecompletion of construction of a large theme park in the Tokyo waterfront area.
Warehousing & Transportation (73.4% → 42.4%) 1.8%
A substantial increase is expected for the second straight year as airport construction gets
underway.
Construction (2.3% → -17.0%) 0.6%
Reduced spending is planned amidst continuing curtailments in spending by general contractors
due in part to a decline in reaction to asset acquisition relating to business restructuring.
Airlines (4.6% → 13.1%) 0.9%
In spite of a possible downward revision due to an anticipated shift to leasing, there are plans forincreased spending in the industry due to the acquisition of aircraft.
Marine Transport (15.5% → -36.6%) 0.1%
A shift to significant negative growth is expected in reaction to ship construction and acquisition.

14

Development Bank of Japan Research Report/ No. 26

Characteristics of Capital Spending, by Industry

‑30

‑20

Increase
‑10

0

10

20

30

Food & beverages

3.8
2.0

Paper & pulp

−

11.0
4.0

33.5

Share (%)

Manufacturing (%)
−7.0

7.2
1.0

−

10

20.9
1.0

Chemicals

Cement, ceramics & glass

20

−

8.6
1.3

2.7
1.8

33.5

16.9
2.2

−

30

40

50 Change on
previousyear ( %)

8.6
2.1

−

Chemicals−5.8
4.8

Petroleum

16.8
1.0

29.6
0.6

Iron & steel

13.5
2.0

−

Non-ferrous
metals

14.1
1.6

−

General machinery−

20

Electricalmachinery

8.1
2.1

11.1
8.9

−

Precisionmachinery

30

Automobiles

14.4
0.4

0.0
6.0

−

Other manufacturing
−

10.9
1.9

Construction

Wholesale & retail
1.9
4.8
Real estate
1.8
4.0

17.0
0.7

−

40

Real estate
−18.8
4.7

Marinetransport

Marine transport

15.5
0.2

Railways−16.3
5.5

Warehousing &transportation

Airlines
4.6
0.7

50

73.4
0.7

Other transportation

Electric power

0.4
15.2

−

Gas
−2.7
1.4

0.0
66.5

70

Airlines
13.1
0.8
Warehousing &transportation

2.7
0.7

−

Non-Manufacturing

9.5
0.6
60

Railways
21.7
4.9

36.6
0.2

−

Other transportation

Non-Manufacturing

20& glass

10

19.6
0.3

2.3
0.6

21.6
5.7

42.4
1.3
Electric power

5.3
16.1

−

60

Gas
4.9
1.4

−

70
Telecommunications &information technology

Telecommunications &information technology

3.8
14.2

−

6.3
14.0

−

80

80

Leasing
−1.3
15.0

90

Leasing‑40‑30Services−33.1
1.6

Other non-manufacturing
75.4
0.1
‑20

‑10

2.3
15.7

90

Services
−35.0
2.2
100
‑50

10

Food & beverages

24.6
1.2
Cement, ceramics−

Construction

−

66.5

0

6.3
0.6

Other transport equipment

Wholesale & retail

−6.3

‑10

Other transport equipment

6.7
5.3

Other manufacturing

50

‑20

Increase

−

11.2
0.6

40

‑30

−

Automobiles

−

−

−8.2

29.5
11.5

Precisionmachinery

30

12.1
1.7

‑40

Textiles−11.8
0.4

Paper & pulp

PetroleumNon-farrous
metalsElectricalmachinery

‑50
0

20.7
0.3

40.4
0.4
Iron & steel

Generalmachinery

Share in FY2001 spending

Decrease
Change on
40
50 previous year
Textiles (%)

Share (%)

‑40

Change on previous year in FY2002

Figures indicate[FY2002]

Share in FY2000 spending

Manufacturing (%)

Decrease‑50
0Change on previous year in FY2001

Figures indicate[FY2001]

0

10

20

30

40

50

100
‑50

‑40

‑30

‑20

‑10

0

Other non-manufacturing
−14.3
0.3
10
20
30
40
50

All industries average

All industries average−6.6 %−2.7 %Development Bank of Japan Research Report/ No. 26

15

3.

Investment Motives

Investment Motives in the Manufacturing and Non-Manufacturing Sectors in FY2002
The respective weightings of each category of investment motive for the manufacturing sector in
FY2002 indicate increases in the shares of “maintenance and repair,” “product development andupgrading,” “rationalization and laborsaving” and “research and development” as well as a huge
drop in “expansion of production capacity.”
Meanwhile, in the non-manufacturing sector, the share of “expansion of production capacity”
rose for the first time in three years due to the contribution of railways, real estate and retail,whereas the shares of “product development and upgrading” and “maintenance and repair” aredeclining.
Investment Motives in the Manufacturing Sector’s “Materials” and “Processing &Assembly” Industries
There was a considerable increase in the share of “maintenance and repair” (28.6% → 32.4%)
in the materials subsector in FY2002 due to the contribution of iron & steel, and the shares of“product development and upgrading” (8.0% → 8.9%) and “research and development” (6.5%→ 7.4%) also rose. Meanwhile, there was a significant drop in “expansion of production
capacity” (27.2% → 22.4%) due to the diminished shares of cement, ceramics and glass andnon-ferrous metals.
In addition, in processing & assembly industries, there was a sizable increase in the share of“product development and upgrading” (25.0% → 26.1%) in line with the contribution of
precision machinery, as well as in the share of “rationalization and laborsaving” (9.9% →11.6%) due to the contribution of automobiles and the share of “maintenance and repair” (13.6%→ 14.8%), reflecting the contribution of electric machinery. On the other hand, there was abroad drop in the share of “expansion of production capacity” (29.5% → 25.3%) due to the
reduction in the shares of electric machinery and food & beverages. As a result, the share of“product development and upgrading” in FY2002, albeit based on plans, exceeded the share of“expansion of production capacity” for the first time since the surveys in the relevant category
began (1986).
Shift in Investment Motives within the Manufacturing Sector
Looking at the change in the share of each category of investment motive in the manufacturingsector, the share of “expansion of production capacity” declined broadly from 28.8% to 24.8%
due to reduced investments in semiconductors for electric machinery and to inactivity in thedevelopment of IT-related materials in cement, ceramics & glass and non-ferrous metals.
In “product development and upgrading,” the share increased with the contribution of iron &steel in the materials subsector and it also increased in processing & assembly industries due tothe contribution of precision machinery, where there was an increase in medical instruments,
thus resulting in an increased share (18.6% → 19.6%).
Despite a drop in “rationalization and labor-saving” in the materials subsector due to thecompletion of rationalization in paper & pulp and iron & steel, its share increased in processing& assembly industries with the contribution of automobiles, resulting in an increased shareoverall (12.3% → 13.3%).
The share for “research & development” increased from 8.4% to 8.7% in the manufacturingsector as a whole with an increase in the materials subsector due to the contribution of chemicals,
16

Development Bank of Japan Research Report/ No. 26

which is related to pharmaceuticals, as well as non-ferrous metals. R&D also increased in theprocessing & assembly subsector due to the contribution of automobiles, where there wereenvironment-related investments.
The share of “maintenance and repair” increased from 19.2% to 21.3% overall, led by anincrease in assembly industries due to the contribution of iron & steel, where there were blast
furnace repairs, and supported by increases in processing & assembly industries, reflecting thecontribution of electric machinery.
Investment Motives
Total

Manufacturing

Non-Manufacturing(1,770 firms)
FY2001

FY2002

Materials

Processing & Assembly

FY2001

FY2002

FY2001

FY2002

FY2001

FY2002

FY2001

FY2002Estimated Planned EstimatedPlannedEstimated

PlannedEstimated

PlannedEstimated

Planned

Expansion of Production
Capacity

49.0

50.2

28.8

24.8

27.2

22.4

29.5

25.3

55.8

57.9

Product Development
and Product Upgrading

8.1

6.9

18.6

19.6

8.0

8.9

25.0

26.1

4.6

3.0

Rationalization andLabor-Saving

5.3

5.5

12.3

13.3

16.9

16.3

9.9

11.6

2.9

3.1

Research & Development

2.9

2.8

8.4

8.7

6.5

7.4

9.8

10.0

1.1

1.0

Maintenance

18.2

18.5

19.2

21.3

28.6

32.4

13.6

14.8

17.9

17.6

Others

16.5

16.2

12.6

12.3

12.8

12.5

12.2

12.2

17.8

17.4

Total

100.0

100.0

100.0

100.0

100.0

100.0

100.0

100.0

100.0

100.0

Note: Figures are given as percentages.

4. Trends in Land Investment, by Principal Business Sector
Estimated Actual Land Investment for FY2001
Estimated actual land investment for FY2001 (based on figures for the 1,649 firms that
responded in both FY2000 and FY2001) was down 29.9% compared with the previous year, thefifth consecutive annual decline. The primary factor involved in the decrease was the overall lackof activity in asset acquisition due to business restructuring, which had been at a high level in
FY1999 and FY2000. Other factors included the low level of acquisition of land for new plant
construction in the manufacturing sector, with acquisition of land for redevelopment projects
having passed its peak especially in the Tokyo metropolitan area in the non-manufacturing sector,
despite investments in land for construction of new airports (in transportation) and head offices(in telecommunications & information). As a result, there were year-on-year decreases of 44.5%
and 26.9% in the manufacturing sector and non-manufacturing sector, respectively. Consequently,
the share of land investments in total capital spending was 4.8% (2.2% for the manufacturingsector and 5.8% for the non-manufacturing sector).
Planned Land Investment for FY2002
Planned land investment for FY2002 (based on figures for the 1,920 firms that responded in
FY2001 and FY2002) was down 11.3% due to reaching the peak of investments in new airport
sites (in transportation) and to other uncertain factors, despite an increase in sites for new railway
lines in the Tokyo metropolitan area. The ratio of land investment in total capital spending is
4.1%.
There is, incidentally, a tendency for large upward revisions in land investment between theplanning stage and actual implementation.
Development Bank of Japan Research Report/ No. 26

17

Trends in Land Investment
FY2000FY2001
ActualEstimated(1,649 firms)
Total Investment
Investment excluding Land
Investment in Land
Share of Land (%)

Growth Rate (%)
2001/2000

FY2001
FY2002Estimated
Planned
(1,920 firms)

Growth Rate (%)
2002/2001

108,861
101,897
6,965
6.4

102,334
97,450
4,884
4.8

-6.0
-4.4
-29.9

114,455
109,158
5,297
4.6

114,324
109,624
4,700
4.1

-0.1
0.4
-11.3

28,76527,5881,177
4.1

29,20328,551
653
2.2

1.5
3.5
-44.5

32,36531,577789
2.4

30,06529,755
310
1.0

-7.1
-5.8
-60.7

80,09774,3095,788
7.2

73,131
68,899
4,231
5.8

-8.7
-7.3
-26.9

82,08977,581
4,508
5.5

84,25979,869
4,390
5.2

2.6
2.9
-2.6

Manufacturing
Total Investment
Investment excluding Land
Investment in Land
Share of Land (%)
Non-Manufacturing
Total Investment
Investment excluding Land
Investment in Land
Share of Land (%)

Growth Rate of Total Investment in Land by All Industries
(％)
30

93

94

95

96

20

97

98

99

2000

(FY)
2002

2001

18.1

10
0
-10
-20
-30
-40
-50
-60

-11.1

-31.9
-36.3

-22.7
-28.8

-11.3
-11.6

-14.8
-18.0

-16.5
-24.5

-4.3

-6.5

-23.9

-26.2
-31.6
-40.7

-41.6

-41.6

-47.6
-56.7

-53.6

-58.3

-70
ActualEstimated (Survey in February of the following year)
Planned (Survey in February of the same year)

18

-29.9

-34.3

Development Bank of Japan Research Report/ No. 26-39.7

5. Trends in Capital Spending by Foreign-Affiliated Firms, by Principal Business Sector
There were 137 foreign-affiliated firms (more than one-third foreign ownership) among the 2,906
that responded to the survey in both FY2001 and FY2002, accounting for a 5.4% share (FY2002)of the capital spending of all firms.
The outlook for estimated actual capital spending in FY2001 was a decrease of 9.3%. Despite
drops in cement, ceramics & glass and electric machinery, the manufacturing sector (up 3.2%)
will rise due to a large increase in the heavily weighted chemicals sector. Decreased spending is
expected in the non-manufacturing sector (down 31.4%) due to a broad drop in services with thecompletion of a large-scale theme park that will more than offset an increase intelecommunications & information.
Capital spending plans in FY2002 call for a drop for the second consecutive year of around
3.3%. While the non-manufacturing sector (up 2.2%) will increase due to the establishment of
new outlets in wholesale & retail and increased network-related investments intelecommunications & information, the manufacturing sector will shift to a downturn (down
8.3%) reflecting restrained investments in the heavily weighted electric machinery and transportmachinery sectors.
Capital Spending by Foreign-Affiliated Firms, by Principal Business Sector
Capital Spending
FY2000
Actual

FY2001
Estimated(128 firms)
Total

FY2001
Estimated

Growth Rate (%)
FY2002
PlannedFY2002
2000/2001

2001/2002(137 firms)

8,313

7,542

11,926

11,529Manufacturing

5,319

5,488

6,273

Non-Manufacturing

2,994

2,054

5,654

Materials

1,287

1,522

Processing & Assembly

3,846

EnergyNon-Manufacturing
excluding Energy

185
2,994

Share (%)

(137 firms)(All firms)

-9.3

-3.3

100.0

5.4

5,754

3.2

-8.3

49.9

8.5

5,775

-31.4

2.2

50.1

4.0

1,657

1,599

18.3

-3.5

13.9

7.5

3,715

4,365

3,698

-3.4

-15.3

32.1

8.3

250

250

457

35.1

82.7

4.0

1.2

2,054

5,654

5,775

-31.4

2.2

50.1

5.3

By sector

Notes: Foreign-affiliated firms are firms with over one-third foreign ownership. Monetary amounts are in 100 million yen.

6. Information Technology Investment, by Principal Business Sector
Contents of the survey
The surveys are conducted relating to trends in information technology investments implemented
for the purpose of increasing efficiency and enhancing productivity in one’s own company(corresponding to any of the following four factors: “tangible fixed assets”, “intangible fixed
assets”, “lease contract amounts”, and “other expenses”). These surveys started with the August
2000 survey, the present survey being the fourth.
Actual IT investment in FY2001
Actual IT investment in FY2001 (based on the 1,496 firms that responded to the survey in both
FY2000 and FY2001) rose 17.0% for all industries, exceeding the growth rate of total capitalspending (up 7.6% in manufacturing and up 21.3% in non-manufacturing). In the manufacturing
Development Bank of Japan Research Report/ No. 26

19sector, investment in product management systems was evident in the materials subsector andoverall. The non-manufacturing sector saw broad increases in wholesale & retail, and airlines andrailways in the transportation subsector, in addition to those of the heavily weighted electric
power sector.
A breakdown of IT-related investments in terms of actual investments in FY2001 shows arelatively even distribution among tangible fixed assets (30.5%) and intangible fixed assets(29.7%).
Planned IT investment for FY2002
Planned IT investment for FY2002 (based on the 1,374 firms that responded to the survey inboth FY2001 and FY2002) shifted to negative growth in the non-manufacturing sector (down
11.3%), showed sluggish growth in the manufacturing sector (up 1.5%), and recorded an overall
decline of 7.6% for all industries. By industry, investments in the manufacturing sector remained
firm in product inventory control and customer management and continued to increase.
Meanwhile, the non-manufacturing sector moved downward in reaction to the heavy
concentration of investments in electric power, wholesale & retail and airlines in the previous
year.
As a result of the above, there was a drop in the ratio of IT-related investment in total capitalspending.
Revisions to IT investment
Considering the conditions of revisions in the previous survey on IT investment (August 2001),
the downward revision of 6.2% in estimated actual investments in FY2001 indicates a trend
approaching that of the downward revision in overall capital spending.
Overview of IT Investment (estimated actual figures for FY2001)
Industrial Sector(1,496 firms)
Total
Manufacturing
Non-Manufacturing
By Sector
Materials

Processing & Assembly
EnergyNon-Manufacturing
Excluding Energy

Amount of IT
Investment

20

IT Investment /Capital Spending(%)
FY2000FY2001
Actual Estimated
7.6
9.3
10.6
11.6
6.7
8.6

FY2000
Actual
8,954
2,828
6,127

FY2001
Estimated
10,475
3,043
7,432

872
1,822
2,419

1,027
1,856
2,986

17.7
1.9
23.5

5.7
-9.9
2.0

9.7
20.3
27.0

9.8
17.7
28.5

8.2
11.9
6.6

9.2
13.4
8.0

3,842

4,607

19.9

-10.3

42.9

44.0

6.9

9.2

Note: Monetary amounts are in 100 million yen.

Development Bank of Japan Research Report/ No. 26

Change inCapitalSpending(%)
2001/2000
-5.0
-1.7
-5.9

Share of
IT Investment(%)
FY2000FY2001
ActualEstimated
100.0
100.0
31.6
29.0
68.4
71.0

Change inIT
Investment(%)
2001/2000
17.0
7.6
21.3

Overview of IT Investment (planned figures for FY2002)
Industrial Sectors(1,374 firms)
Total
Manufacturing
Non-Manufacturing
By Sector
Materials

Processing & Assembly
EnergyNon-Manufacturing
Excluding Energy

Amount of IT
Investment

Change inCapitalSpending(%)
2002/2001
0.6
-6.8
3.0

Share of
IT Investment(%)
FY2001
FY2002Estimated Planned
100.0
100.0
28.8
31.7
71.2
68.3

IT Investment /Capital Spending(%)
FY2001
FY2002Estimated Planed
9.8
9.0
11.9
12.9
9.2
7.9

FY2001
Estimated
6,783
1,956
4,826

FY2002
Planned
6,265
1,986
4,279

Change inIT
Investment(%)
2002/2001
-7.6
1.5
-11.3

529
1,266
1,721

537
1,244
1,546

1.5
-1.7
-10.2

-11.0
-7.4
-1.1

7.8
18.7
25.4

8.6
19.9
24.7

9.2
13.4
6.3

10.5
14.2
5.7

3,267

2,938

-10.1

7.8

48.2

46.9

12.3

10.3

Note: Monetary amounts are in 100 million yen.

Comparison between IT Investment and Capital Spending (FY2001, FY2002)
Industrial Sector(1,374 firms)

Total(2001/2002 growth) (%)
Excluding leasing
Manufacturing
Non-Manufacturing
By Sector
Materials
Processing & Assembly
EnergyNon-Manufacturing
Excluding Energy

Note:

Tangible Fixed
Assets in IT
Investment(Tangible Fixed
Assets + Leasing)in IT Investment

Capital Spending

Tangible Fixed
Assets/Capital
Spending(%)(Tangible Fixed
Assets +Leasing)/Capital
Spending(%)

FY2001
Estimated

FY2002
PlannedFY2001
Estimated

FY2002
PlannedFY2001
Estimated

FY2002
PlannedFY2001
Estimated

FY2002
PlannedFY2001
Estimated

FY2002
Planned

1,646

3,591

2.0

5.2

4.4

61,421
16,47752,632

69,544
0.6
61,746
15,35354,191

2.4

3,575
863
2,728

3,060
-14.8
3,052
844
2,216

69,109

1,643
268
1,378

1,388
-15.6
1,387
291
1,097

2.7
1.6
2.6

2.2
1.9
2.0

5.8
5.2
5.2

4.9
5.5
4.1

74
177
515

73
195
321

236
586
972

241
556
690

5,718
9,469
27,342

5,088
8,770
27,040

1.3
1.9
1.9

1.4
2.2
1.2

4.1
6.2
3.6

4.7
6.3
2.5

880

799

1,797

1,574

26,581

28,647

3.3

2.8

6.8

5.5

Monetary amounts are in 100 million yen.

Revisions to IT Investment
Industrial Sector
Total
Manufacturing
Non-Manufacturing
By Sector
Materials

Processing & Assembly
EnergyNon-Manufacturing
Excluding Energy

FY2001, Estimated
IT Investment
Revisions(1,424 firms)(%)
Aug. 2001
Feb. 2002
10,762
10,098
-6.2
3,137
2,821
-10.1
7,626
7,277
-4.6
1,024
1,889
2,904

971
1,689
2,986

-5.1
-10.6
2.8

4,945

4,451

-10.0

Note: Monetary amounts are in 100 million yen.

Development Bank of Japan Research Report/ No. 26

21

Composition of IT Investment (estimated actual figures for FY2000)
Other expenses
15.4%
Tangible fixed assets
30.5%

Intangible fixed assets
29.7%
Leasing contracts
24.4%

Note: The chart shows the FY2000 distribution of the 1,496 firms that responded to the survey both in FY2000 and FY2001.

Transitions in IT-related Investment Growth Rate
(%)
25.0
20.0
15.0
10.0
5.0
0.0
-5.0
-10.0

Total
Non-Manufacturing

Manufacturing

00

01

-15.0
02

(FY)

Share of IT-related Investment in Total Capital Spending
(%)
14.0
12.0
10.0
8.0
6.0

Total
Non-Manufacturing

4.0

Manufacturing

2.0
99

22

00

Development Bank of Japan Research Report/ No. 26

01

02 (FY)

List of Back Numbers (Including JDB Research Report)
No. 26 Survey on Planned Capital Spending for Fiscal Years 2001 and 2002 (Conducted in February 2002)(this issue)
No. 25 Environmental Information Policy and Utilization of Information Technology: Toward a Shift inEnvironmental Policy Paradigm, March 2002
No. 24 The Changing Structure of Trade in Japan and Its Impact: With the Focus on Trade in Information
Technology (IT) Goods, March 2002
No. 23 Microstructure of persistent ROA decline in the Japanese corporate sector: Inter-company disparties
and investment strategies, March 2002
No. 22 Recent Trends in the Japanese Economy: The Japanese Economy under Deflation and Prospects ofEvolution, February 2002
No. 21 Survey on Planned Capital Spending for Fiscal Years 2000, 2001 and 2002, December 2001
No. 20 Current Situation and Challenges for Cable Television in the Broadband Era, October 2001
No. 19 Recent Trends in the Japanese Economy: The Japanese Economy under Deflation, August 2001
No. 18 Introduction of a Home Appliance Recycling System: Effects & Prospects: Progress towards
Utilisation of Recycling Infrastructure, June 2001
No. 17 Survey on Planned Capital Spending for Fiscal Years 2000 and 2001, June 2001
No. 16 Revitalization of Middle-aged and Elderly Workers in Japan’s Labor Markets: Requiring the
Expansion of the Vocational Training Functions, March 2001
No. 15 Risk-Averting Portfolio Trends of Japanese Households, March 2001
No. 14 Consumption Demand Trends and the Structure of Supply: Focus on Retail Industry Supply
Behavior, March 2001
No. 13 Recent Trends in the Japanese Economy: Weakness of Current Economic Recovery and Its
Background, March 2001
No. 12 Empirical Reassessment of Japanese Corporate Investment Behavior: Features and Changes sincethe 1980s, based on Micro-level Panel Data, March 2001
No. 11 Survey on Planned Capital Spending for Fiscal Years 1999, 2000 and 2001, October 2000
No. 10 Job Creation and Job Destruction in Japan, 1978-1998: An Empirical Analysis Based on EnterpriseData, September 2000
No. 9

Recent Trends in the Japanese Economy: Information Technology and the Economy, September
2000

No. 8

Trend of International Reorganization Affecting the Japanese Automobile and Auto Parts Industries,
June 2000

No. 7

Survey on Planned Capital Spending for Fiscal Years 1999 and 2000, June 2000

No. 6

Current Status and Future Perspective of the Japanese Remediation Industry: Technology andMarket for Underground Remediation, May 2000

No. 5

Recent Trends in the Japanese Economy: The 1990s in Retrospect, March 2000

No. 4

Destabilized Consumption and the Post-bubble Consumer Environment, February 2000

No. 3

The Slump in Plant and Equipment Investment in the 1990s: Focusing on Lowered Expectations,the Debt Burden and Other Structural Factors, January 2000

No. 2

Survey on Planned Capital Spending for Fiscal Years 1998, 1999 and 2000, November 1999

No. 1

Corporate Strategies in Japan’s Semiconductor Industry: Implications of Development in Other
Asian Countries, November 1999

JDB Research Report
No. 96 Recent Trends in the Japanese Economy: Focused on Fixed Investment and Capital Stock, August
1999
No. 95 Efforts to Protect the Natural Environment in the United States and Germany: Environmental
Mitigation and Biotope Conservation, July 1999
No. 94 Survey on Planned Capital Spending for Fiscal Years 1998 and 1999, June 1999
No. 93 Towards the realization of ‘environmental partnership’: A survey of Japan’s environmental NPO
sector through comparison with Germany, June 1999
No. 92 The Impact of Demographic Changes on Consumption and Savings, March 1999
No. 91 Recent Research and Development Trends in Japanese Enterprises: Technology Fusion, March
1999
No. 90 Recent Trends in the Japanese Economy: Prolonged Balance Sheet Adjustment, January 1999
No. 89 Impact of Asset Price Fluctuations on Household and Corporate Behavior: A Comparison between
Japan and the U.S., December 1998
No. 88 Survey on Planned Capital Spending for Fiscal Years 1997, 1998, and 1999, December 1998
No. 87 Foreign Exchange Rate Fluctuations and Changes in the Input-Output Structure, November 1998
No. 86 Structural Changes in Unemployment of Japan: An Approach from Labor Flow, November 1998
No. 85 Recent Trends in the Japanese Economy: Characteristics of the Current Recession, August 1998
No. 84 R&D Stock and Trade Structure in Japan, August 1998
No. 83 Survey on Planned Capital Spending for Fiscal Years 1997 and 1998, August 1998
No. 82 The Significance, Potential, and Problems of DNA Analysis Research: Establishing Public
Acceptance is Essential, May 1998
No. 81 The Japan Development Bank Reports on Capital Spending: Survey for Fiscal Years 1996, 1997 and1998 Conducted in August 1997, March 1998
No. 80 Recent Trends in the Japanese Economy: Growth Base of the Japanese Economy, January 1998
No. 79 Information Appliances: The Strength of Japanese Companies and Tasks for the Future, January
1998
No. 78 Challenges and Outlook for the Japanese Machinery Industries: Impact of ISO14000 Series andEnvironmental Cost, January 1998
No. 77 Current Conditions and Issues of Computerization in the Health Care Industry: For theConstruction of a Health Care Information Network, January 1998
No. 76 Household Consumption and Saving in Japan, December 1997
No. 75 The Direction of Japanese Distribution System Reforms: Strengthening the Infrastructure to
Support Diverse Consumer Choices, November 1997
No. 74 Foreign Direct Investments by Japanese Manufacturing Industries and Their Effects on
International Trade, October 1997
No. 73 The Impact of the Changing Trade Structure on the Japanese Economy: With Special Focus on the
Effects on Productivity and Employment, October 1997
No. 72 An Analysis of Foreign Direct Investment and Foreign Affiliates in Japan, August 1997
No. 71 Recent Trends in the Japanese Economy: Stock Replacement and New Demand as Aspects of
Economic Recovery, August 1997
No. 70 Corporate Fundraising: An International Comparison, June 1997

No. 69 The Japan Development Bank Reports on Capital Spending: Survey for Fiscal Years 1996 and 1997
Conducted in February 1997, May 1997
No. 68 The Japan Development Bank Reports on Capital Spending: Survey for Fiscal Years 1996 and 1997
Conducted in August 1996, August 1997
No. 67 An International Comparison of Corporate Investment Behavior: Empirical Analysis Using Firm
Data from Japan, France and the US, April 1997
No. 66 Housing in the National Capital: Analysis of the Market for Housing using Micro Data, March 1997
No. 65 The Environment for Locating Business Operations in Major East Asian Cities, January 1997
No. 64 Direction of Reconstruction of Business Strategy in the Chemical Industry, January 1997
No. 63 Reflection on Discussions Concerning Regulation of the Electric Power Industry: Deregulation of
the Electric Power Industry in Japan and Implication of Experiences in the United States,
December 1996
No. 62 Current Status and Future Perspective of the Japanese Semiconductor Industry, November 1996
No. 61 A Breakthrough for the Japanese Software Industry?: Responsiveness to Users’ Needs is the key,
October 1996
No. 60 Recent Trends in the Japanese Economy Focusing on the Characteristics and Sustainability of theCurrent Economic Recovery, September 1996
No. 59 Analysis of the Primary Causes and Economic Effects of Information: Related investment in the
United States and Trends in Japan, August 1996
No. 58 Selected Summaries of Research Reports: Published in FY1995, June 1996
No. 57 The Japan Development Bank Reports on Capital Spending: Survey for Fiscal Years 1995 and 1996
Conducted in February 1996, May 1996
No. 56 Recent Trends in the Japanese Economy, May 1996
No. 55 Issues Concerning the Competitiveness of the Japanese Steel Industry, February 1996
No. 54 Changes in the Financial Environment and the Real Economy, January 1996
No. 53 The Japan Development Bank Reports on Capital Spending: Survey for Fiscal Years 1994, 1995 and1996 Conducted in August 1995, October 1995
No. 52 Current Economic Trends: Focusing on the Appreciation of the Yen and its Effects, October 1995
No. 51 Problems Concerning the International Competitiveness of the Petrochemical Industry, October
1995
No. 50 An Economic Approach to International Competitiveness, October 1995
No. 49 Selected Summaries of Research Reports Published in FY1994, July 1995
No. 48 Strategies for Improving the Efficiency of the Japanese Physical Distribution System: Part 2, July
1995
No. 47 Issues on International Competitive Strength of the Auto Industry, June 1995
No. 46 Problems Concerning the International Competitiveness of the Electronics and Electric Machinery
Industry, June 1995
No. 45 The Japan Development Bank Reports on Capital Spending: Survey for Fiscal Years 1994 and 1995
Conducted in March 1995, June 1995
No. 44 Strategies for Improving the Efficiency of the Japanese Physical Distribution System, March 1995
No. 43 Capital Spending Recovery Scenario Cycle and Structure, August 1994
No. 42 Progress of International Joint Development between Industrialized Countries on the Private Level,
May 1994

No. 41 The Japan Development Bank Reports on Capital Spending: Survey for Fiscal Years 1993, 1994 and1995 Conducted in August 1994 , November 1994
No. 40 Selected Summaries of Research Reports Published in FY1993, June 1994
No. 39 Recent Trends in Japan’s Foreign Accounts, April 1994
No. 38 The Japan Development Bank Reports on Capital Spending: Survey for Fiscal Years 1993 and 1994
Conducted in March 1994, April 1994
No. 37 Economic Zones and East Asia Prospect for Economic Activity Oriented Market Integration,
December 1993
No. 36 Japanese Corporate Responses to Global Environmental Issues, December 1993
No. 35 The Japan Development Bank Reports on Capital Spending: Survey for Fiscal Years 1992, 1993 and1994 Conducted in August 1993, September 1993
No. 34 Structure of Profit to Capital in the Manufacturing Industry, September 1993
No. 33 Comparison of the Japanese and The U.S. Labor Markets, October 1992
No. 32 The Relative Competitiveness of U.S., German, and Japanese Manufacturing, March 1993
No. 31 The Japan Development Bank Reports on Capital Spending: Survey for Fiscal Years 1992 and 1993
Conducted in March 1993, April 1993
No. 30 The Japan Development Bank Reports on Capital Spending: Survey for Fiscal Years 1991, 1992 and1993 Conducted in August 1992, December 1992
No. 29 Flow of Funds in the 80s and Future Corporate Finance in Japan, November 1992
No. 28 The Japan Development Bank Reports on Capital Spending: Survey for Fiscal Years 1991 and 1992
Conducted in February 1992, April 1992
No. 27 An Analysis of Foreign Direct Investment in Japan, March 1992
No. 26 Projection of Japan's Trade Surplus in 1995: Analysis of Japan's Trade Structure in the 80s, February
1992
No. 25 Intra-Industry Trade and Dynamic Development of The World Economy, November 1991
No. 24 The Japan Development Bank Reports on Capital Spending: Survey for Fiscal Years 1990, 1991 and1992 Conducted in August 1991, September 1991
No. 23 The Japan Development Bank Reports on Capital Spending: Survey for Fiscal Years 1990 and 1991
Conducted in February 1991, March 1991
No. 22 Trends of the Petrochemical Industry and its Marketplace in East Asia, March 1991
No. 21 The Japan Development Bank Reports on Capital Spending: Survey for Fiscal Years 1989, 1990 and1991 Conducted in August 1990, September 1990
No. 20 Deepening Economic Linkages in The Pacific Basin Region: Trade, Foreign Direct Investment andTechnology, September 1990
No. 19 The Japan Development Bank Reports on Capital Spending: Survey for Fiscal Years 1989 and 1990
Conducted in February 1990, March 1990
No. 18 Petrochemicals In Japan, The US, and Korea an Assessment of Economic Efficiency, February
1990
No. 17 The Japan Development Bank Reports on Capital Spending: Survey for Fiscal Years 1988, 1989 and1990 Conducted in August 1989, October 1989
No. 16 Impact of the EC Unification on Japan’s Automobile and Electronics Industries, August 1989
No. 15 Industrial and Trade Structures and the International Competitiveness of Asia’s Newly
Industrializing Economies, August 1989

No. 14 The Japan Development Bank Reports on Capital Investment Spending: Survey for Fiscal Years
1988 and 1989 Conducted in February 1989, March 1989
No. 13 The Japan Development Bank Reports on Capital Spending: Survey for Fiscal Years 1987, 1988 and1989 Conducted in August 1988, September 1988
No. 12 Growing Foreign Investors’ Activities and the Future of Internationalization, September 1988
No. 11 Futures Tasks and Prospects for the Japanese Machine-Tool Industry, July 1988
No. 10 International Division of Labor in the Machine Industries Among Japan, Asia’s NICs and ASEANCountries, June 1988
No. 9

Trends of the Petrochemical Industry and its Marketplace in East Asia around Japan, May 1988

No. 8

The International Competitiveness of Japan and U.S. in High Technology Industries, April 1988

No. 7

The Japan Development Bank Reports on Private Fixed Investment in Japan, March 1988

No. 6

Economic Projections of the Japan’s Economy to the Year 2000, February 1988

No. 5

The Japan Development Bank Reports on Private Fixed Investment in Japan, September 1987

No. 4

Current Trends in the Japanese Auto Parts Industry in Overseas Production, July 1987

No. 3

Current Moves for Foreign Direct Investment into Japan, May 1987

No. 2

Overseas Direct Investments by Japanese Corporations, May 1987

No. 1

Current U.S. Consumption Trends, May 1987