<II. Medium-sized and SMEs>7)

1

Business outlook and demand forecast[Table 2-1-1] Transition of Japan’s economic growth rate forecasts (all industries basis)（％）

Real economic growth rate

Nominal economic growth rate
Survey year

FY

Forecast for the
next fiscal year

Forecast for the
next 3 years

Forecast for the
next 5 years

Forecast for the
next fiscal year

Forecast for the
next 3 years

Forecast for the
next 5 years

2016

1.7

1.7

1.7

1.0

1.0

1.0

2017

1.5

1.6

1.4

1.1

1.2

1.0

Note) With regard to the “forecast” for each fiscal year, for example, the “forecast for the next fiscal year” in the FY2017
survey refers to the forecast for FY2018; the “forecast for the next 3 years” refers to the forecast for FY2018 to
FY2020; and the “forecast for the next 5 years” refers to the forecast for FY2018 to FY2022 (fiscal year average).

[Fig. 2-1-1] Real growth rate forecasts of industry demand by industry
compared to the previous year’s results (next fiscal year)(%)

FY2016 survey
FY2017 survey

3.0

2.0

Non-manufacturing

Other

Processing-type

Material-type

Manufacturing

0.0

All industries

1.07) Medium-sized and SMEs with a capital of 0.1 to 1 billion yen (not incl.) among enterprises all over Japan (excl.

enterprises covered in I. Listed Companies) (hereinafter “Medium-sized and SMEs.”) The survey of Medium-sized
and SMEs started in FY2016.

- 35 - (II. Medium-sized and SMEs)

-1.0
Pharmaceutical
Insurance
Electric Appliances
Other Financing Businesses
Construction
Securities & Commodity Futures
Real Estate
Metal Products
MachineryIron & SteelInformation & Communication
Rubber Products
Glass & Ceramics Products
Chemicals
Marine Transportation
Textiles & Apparels
Warehousing & Harbor Transportation Services
Electric Power & Gas
Precision Instruments
Transportation Equipment
Nonferrous Metals
Services
Oil & Coal Products
Pulp & Paper
Wholesale Trade
Foods
MiningLand Transportation
Fishery, Agriculture & Forestry
Retail Trade
Air Transportation
Other Products

All industries[Fig. 2-1-2] Real growth rate forecasts of industry demand by sector
compared to the previous year’s results (next fiscal year)(%)

FY2016 survey- 36 - (II. Medium-sized and SMEs)

FY2017 survey

3.0

2.0

1.0

0.0

Note) Sectors include only those with 5 or more responding companies in the FY2016 and FY2017 survey.

Exchange rates[Fig. 2-2-1]Forecast yen-dollar rate after 1 year and the break-even yen-dollar rate by industry

Forecast yen-dollar rate after 1 year

( yen/dollar)

Break-even yen-dollar rate

130
120
110
100
90
80

Yen-dollar rate in the month immediately before
the survey (Dec.2017) : 113.0 yen/dollar

Non-manufacturing

Other

Processing-type

Material-type

60

Manufacturing

70
All industries

2

Note 1) “Forecast yen-dollar rate” is the average of the class values, while “break-even yen-dollar rate” is theaverage of the actual reported numbers.
Note 2) Calculation of “break-even yen-dollar rate” includes only enterprises that conduct exports.

- 37 - (II. Medium-sized and SMEs)

[Fig. 2-2-2] Break-even yen-dollar rate by sector(yen/dollar)

All industries average : 106.4yen/dollar

120
110
100
90
80

Foods

Warehousing & Harbor Transportation Services

Wholesale Trade

Textiles & Apparels

Rubber Products

Other Products

Precision Instruments

Glass & Ceramics Products

Machinery

Metal Products

Iron & SteelTransportation Equipment

Pulp & Paper

Construction

Electric Appliances

Chemicals

Marine Transportation

Nonferrous Metals

Information & Communication

60

Pharmaceutical70

Weaker yen than averageStronger yen than average

Note 1) Calculation of “break-even yen-dollar rate” includes only enterprises that conduct exports(average of reported numbers).
Note 2) Only sectors with 5 or more responding enterprises are included.

[Table 2-2-1] Transition of the forecast yen-dollar rate after 1 year and the break-even yen-dollar rate(all industries basis)(yen/dollar)

Survey year

FY

Forecast yen-dollar
rate after 1 year

Break-even yendollar rate

Yen-dollar rate in
the month
immediately
before the survey

Difference
Forecast yen-dollar rate

Yen-dollar rate for the monthafter 1 year

immediately before the survey– Break-even yen-dollar rate

– Break-even yen-dollar rate

2016

113.1

105.6

116.0

7.5

10.4

2017

113.9

106.4

113.0

7.5

6.6

Note 1) “Forecast yen-dollar rate” is the average of the class values, while “break-even yen-dollar rate” is the average ofthe actual reported numbers.
Note 2) Calculation of “break-even yen-dollar rate” includes only companies that conduct exports.
Note 3) “Yen-dollar rate in the month immediately before the survey” refers to figures in December.

- 38 - (II. Medium-sized and SMEs)

3

Prices[Table 2-3-1] Forecast rates of changes in average purchase and sales prices and thechange in the terms of trade after 1 year by industry（％、％points）

Average purchase price
FY2017
surveyFY2016
surveyFY2017
surveyTerms of trade

FY2016
surveyFY2017
surveyFY2016
survey

3.2

3.0

1.6

1.4

-1.6

-1.6

3.5

3.1

1.6

1.1

-2.0

-2.1

M aterial-type

3.9

3.9

2.2

1.8

-1.7

-2.0

Processing-type

2.8

2.4

0.8

0.4

-2.0

-2.0

Other

3.7

3.1

1.6

1.0

-2.2

-2.2

2.8

2.9

1.7

1.7

-1.1

-1.2

All industries
M anufacturing

Industry

Average sales priceNon-manufacturing

Note 1) Terms of Trade = Rate of change in average sales price – rate of change in average purchase priceNote 2) Terms of trade are derived from the rate of change of the average sales price and the rate of change of the averagepurchase price (Refer to FY2017 Statistical Tables <II. Medium-sized and SMEs> 3-1 and 3-2) that include two
decimal points. Therefore, they may not always coincide with figures calculated from the rate of change in averagesales prices and the rate of change in average purchase price in the table above due to rounding.

- 39 - (II. Medium-sized and SMEs)

Change in capital investment[Fig. 2-4-1]Change in the percentage of enterprises that increased/decreased capital investment

or are expecting an increase/decrease in capital investment for the past 3 years orover the next 3 years (all industries)

（%）
100
90

9.1

8.5

9.5

8.0

18.8

19.6

62.8

64.0

10.1

9.4

9.0

7.6

80
70

17.8

18.8

60
50
40
30

65.2

62.2

No capital investment was made./No capital investment is planned.
Decrease
No change
Increase

20100FY2017FY2016FY2016FY2017
Next 3 years

Past 3 years

Survey year

Note 1) Increase: Percentage of enterprises responding over 0%, No change: Percentage of enterprises responding 0%,
Decrease: Percentage of enterprises responding less than 0%.
Note 2) The “past 3 years” means the period from FY2015 to FY2017.
Note 3) The “next 3 years” means the period from FY2018 to FY2020.

[Fig. 2-4-2] Growth rate of capital investment by sector(%)

Past 3 years

20.0

Next 3 years

15.0

10.0

5.0

Insurance

Wholesale Trade

Securities & Commodity Futures

Construction

Transportation Equipment

Precision Instruments

Warehousing & Harbor Transportation Services

Services

Land Transportation

Nonferrous Metals

Glass & Ceramics Products

Real Estate

Metal Products

Pharmaceutical

Other Financing Businesses

Other ProductsElectric Power & Gas

Machinery

Retail Trade

Pulp & Paper

Textiles & Apparels

Foods

Iron & SteelInformation & Communication

Chemicals

Rubber ProductsElectric Appliances

Fishery, Agriculture & Forestry

Air Transportation

Marine Transportation

Mining-5.0

Oil & Coal Products

0.0

All industries

4

Note 1) The “Past 3 years” represents the growth rate from FY2015 to FY2017 (fiscal year average), and the “next 3
years” represents growth rate forecasts from FY2018 to FY2020 (fiscal year average).
Note 2) Sectors include only those with 5 or more responding enterprises for both “past 3 years” and “next 3 years.”- 40 - (II. Medium-sized and SMEs)

5

Change in the number of employees[Fig. 2-5-1]Change in the percentage of enterprises that increased/decreased employees orare expecting an increase/decrease in employees for the past 3 years or overthe next 3 years (all industries)
（%）

100
90

11.5

11.1

30.3

29.6

58.3

59.4

21.1

22.1

80
70
25.5

25.3

52.5

53.6

60
50
40
30
20
10

Decrease

No change

Increase

0
FY2016FY2017FY2016

Past 3 years

FY2017

Next 3 years
Survey year

Note 1) Increase: Percentage of enterprises responding over 0%, No change: Percentage of enterprises responding 0%,
Decrease: Percentage of enterprises responding less than 0%.
Note 2) The “past 3 years” means the period from FY2015 to FY2017.
Note 3) The “next 3 years” means the period from FY2018 to FY2020.

- 41 - (II. Medium-sized and SMEs)

[Fig. 2-5-2] Change in the percentage of enterprises that increased/decreased full-time
employees or are expecting an increase/decrease in full-time employees
among their employees for the past 3 years or over the next 3 years (allindustries)
（%）

100
90

11.8

11.0

29.9

29.0

58.4

59.9

21.2

21.7

80
70
25.8

26.2

52.4

52.6

60
50
40
30
20
10

Decrease

No change

Increase

0
FY2016FY2017FY2016

Past 3 years

FY2017

Next 3 years
Survey year

Note 1) Increase: Percentage of enterprises responding over 0%, No change: Percentage of enterprises responding 0%,
Decrease: Percentage of enterprises responding less than 0%.
Note 2) The “past 3 years” means the period from FY2015 to FY2017.
Note 3) The “next 3 years” means the period from FY2018 to FY2020.

- 42 - (II. Medium-sized and SMEs)

6

Overseas production ratio and reverse imports ratio[Fig. 2-6-1] Ratio of companies that conduct overseas production (manufacturing industries)

(%)

25.0

20.0

15.0

12.9

13.6

13.1

10.0

5.0
Manufacturing

Material-type

Processing-type

Other

0.0
2015

2016

2017

2018

2019

2020

2021

2022

Note) FY2016, FY2017, and FY2022 indicate actual result, estimate, and forecast, respectively.

- 43 - (II. Medium-sized and SMEs)(FY)

[Fig. 2-6-2] Transition of overseas production ratios (manufacturing industries)
(%)

8.0

6.0

4.0

4.4

3.9

3.9

2.0
Manufacturing

Material-type

Processing-type

Other

0.0
2015

2016

2017

2018

2019

2020

2021

2022

(FY)

Note 1) FY2016, FY2017, and FY2022 indicate actual result, estimate, and forecast, respectively.
Note 2) Simple average of responding enterprises including those that reported 0.0% for the overseas
production ratio.

[Fig. 2-6-3] Overseas production ratio by sector (manufacturing industries)(%)

FY2016 actual result

FY2017 estimate

FY2022 forecast

16.0
14.0
12.0
10.0
8.0
6.0
4.0

Oil & Coal Products

Foods

Pharmaceutical

Glass & Ceramics Products

Iron & Steel

Pulp & Paper

Machinery

Chemicals

Other Products

Nonferrous Metals

Metal Products

Rubber Products

Transportation Equipment

Electric Appliances

Textiles & Apparels

Precision Instruments

0.0

Manufacturing

2.0

Note 1) Simple average of responding enterprises including those that reported 0.0% for the overseas
production ratio.
Note 2) Sectors include only those with 5 or more responding enterprises in all of “FY2016 actual result,”“FY2017 estimate” and “FY2022 forecast.”- 44 - (II. Medium-sized and SMEs)

[Fig. 2-6-4] The percentage of companies expecting an increase or a decreasein overseas production ratio (Manufacturing)
(%)
100%

2.5

2.2

88.2

89.2

90%
80%
70%
60%
50%
40%
30%
20%

Decrease

No change

Increase

10%
9.3

8.7

0%
2016

2017
Survey year (FY)Note) Increase: “Forecast” – “Estimate” ＞ 0, No change: “Forecast” – “Estimate” = 0, Decrease: “Forecast” – “Estimate” ＜ 0.
(In FY2017, if the values after subtracting “FY2017 estimate” from “FY2022 forecast” of each responding company are plus,
equal, and minus, it is “Increase,” “No change,” and “Decrease.”)- 45 - (II. Medium-sized and SMEs)

[Fig. 2-6-5] Transition of the ratio of reverse imports (manufacturing industries)
(%)

40
35
30

27.8

28.3

26.2

25
20
15
10
Manufacturing
Processing-type

5

Material-type
Other

0
2015

2016

2017

2018

2019

2020

2021

2022

(FY)

Note 1) FY2016, FY2017, and FY2022 indicate actual result, estimate, and forecast, respectively.
Note 2) This is a simple average which excludes enterprises reporting 0.0% overseas production ratio,
while it includes enterprises answering 0.0% reverse imports ratio.

- 46 - (II. Medium-sized and SMEs)

[Table 2-6-1] Reason for having an overseas production base (Main reason + Other relevant reasons)
Top 5 reasons (Manufacturing industries)
FY2017 survey（％）

Manufacturing

Processing-type

Material-type

Other④ Strong demand exists, ordemand is forecast to① Labor costs are low

61.8

expand, for our products inthe local market(s) and

54.8① Labor costs are low

68.8① Labor costs are low

65.3

markets in neighboring
countries④ Strong demand exists, or
expand, for our products inthe local market(s) anddemand is forecast to

overseas market(s)46.1① Labor costs are low

50.0

following entry by our

46.3

parent enterprise or

markets in neighboring⑦ We have entered the⑦ We have entered theoverseas market(s)overseas market(s)41.9following entry by ourparent enterprise orparent enterprise orcustomer(s) and so on

customer(s) and so on⑤ We can cater effectively⑤ We can cater effectively

the local market(s) and

51.0⑦ We have entered thedemand is forecast to

37.1

the local market(s) andcountries④ Strong demand exists, or
expand, for our products in

expand, for our products inmarkets in neighboringcustomer(s) and so on

countries

following entry by our④ Strong demand exists, or⑦ We have entered thedemand is forecast to

overseas market(s)36.3

following entry by our

40.8

parent enterprise or

markets in neighboringcustomer(s) and so on

countries③ We can enjoy low costs

to overseas users’ needs

33.0

to overseas users’ needs

35.5⑤ We can cater effectively
to overseas users’ needsof materials, overall

35.0

production processes,

26.5

distributions, andland/buildings③ We can enjoy low costs③ We can enjoy low costs③ We can enjoy low costsof materials, overallof materials, overallof materials, overall

production processes,

30.4

production processes,

32.3

production processes,⑥We have contracts withreliable suppliers of parts

31.3

and/or raw materials to the

distributions, anddistributions, anddistributions, andlocal facilities in a stableland/buildings

land/buildings

land/buildings

manner

FY2016 survey

14.3

（％）

Manufacturing

Material-type

Processing-type

Other④ Strong demand exists, ordemand is forecast to expand,① Labor costs are low

61.0 for our products in the local

54.5 ① Labor costs are low

70.4 ① Labor costs are low

57.4

market(s) and markets inneighboring countries④ Strong demand exists, or④ Strong demand exists, ordemand is forecast to expand,demand is forecast to expand,demand is forecast to expand,50.0 for our products in the local

43.9 for our products in the local

for our products in the local

49.1 ① Labor costs are low④ Strong demand exists, ormarket(s) and markets inmarket(s) and markets inmarket(s) and markets inneighboring countries

neighboring countries

neighboring countries

51.9⑦ We have entered the⑤ We can cater effectively tooverseas users’ needs

35.8⑤ We can cater effectively tooverseas users’ needs

37.9⑤ We can cater effectively tooverseas users’ needs

overseas market(s) following

37.8 entry by our parent

37.0

enterprise or customer(s) andso on⑦ We have entered the⑦ We have entered the⑦ We have entered theoverseas market(s) following

overseas market(s) following

overseas market(s) following

entry by our parent

34.4 entry by our parent

31.8 entry by our parent

enterprise or customer(s) andenterprise or customer(s) andenterprise or customer(s) and

so on

so on

so on

③ We can enjoy low costs of③ We can enjoy low costs of③ We can enjoy low costs ofmaterials, overall production

materials, overall production

processes, distributions, andland/buildings

27.1

processes, distributions, andland/buildings

25.8

materials, overall production
processes, distributions, and③ We can enjoy low costs of

34.7

materials, overall production
processes, distributions, and31.5

land/buildings

25.5⑤ We can cater effectively tooverseas users’ needs

29.6

land/buildings

Note 1) The composition ratio of the “Main reason” and “Other relevant reasons” is based on the number of enterprises that
responded.
Note 2) Responding enterprises can choose one “Main reason,” and up to two “Other relevant reasons.”- 47 - (II. Medium-sized and SMEs)