As the second and third biggest economies in the world, respectively, China and Japan are the two most powerful nations in Asia and substantially impact political and economic cooperation within the area. However, at best, ties between these two nations are cordial. Due to the disagreement over the Diaoyu or Senkaku islands, which has led to repeated naval encounters, ties have deteriorated since 2010 (Lenker Andrade, 2020). As long as China resents Japan for its conduct during the Second World War, there will be tensions between the two nations. In the conflict, both sides have engaged in aggressive behavior that has not improved ties but has also avoided significant conflict.
At the same time, it is vital to consider India as a fast-evolving global power. The country has strong and developing economies. At the moment, it is 7.5% of the world’s economy by power purchasing parity and the fifth largest economy by nominal GDP (World Bank, n.d.). The researchers forecast the further development of the region and its ability to recover after the recent crises (Saxena, 2022). The state focuses on developing various industries and increasing its presence at the global level, meaning it becomes a more potent player (Saxena, 2022). South Korea is another state impacting the Asian regional market and economy because of the high pace of its development (Kawano, 2022). In such a way, China, Japan, India, and South Korea can be viewed as the critical players affecting the region’s recovery after the changes in the geopolitical environment.
Asian businesses’ ability to recover after the recent challenges can be analyzed using the automobile industry. China, India, Japan, and South Korea are countries with developed car manufacturing industries. For instance, Japan has the third largest automotive-producing industry in the world, with about 5.5 million people working in the sphere (Guilia, 2022). South Korea is another well-known manufacturer with its cars sold in numerous regions globally (Kawano, 2022). India’s automotive industry comprises 7.1% of its GDP, while China produces around 26% of all vehicles globally (MarkLines, 2022; Saxena, 2022). It means that these giants will impact the Asian economy and the development of the region in the future. Moreover, the changes in the given states’ industries impact all states globally because of the countries’ strong cooperation with numerous nations and a significant presence in foreign markets. For this reason, the sector’s ability to recover is vital for stabilizing the situation.
Thus, the pandemic became a significant challenge for the business sector. Lockdowns and restrictive measures because of COVID-19 impacted sales levels. Statistics show that in India, the number of commercial vehicle sales experienced an 88% fall, while China suffered from a similar situation, with an 80% drop (Marsh, 2022). South Korea and Japan also reported reduced client interest and revenue generated by the sector (Kawano, 2022). It resulted in the emergence of barriers to the further development of the car business in the area. Furthermore, the current geopolitical issues, such as the military conflict in Ukraine and sanctions, influence Asian vehicle sales in some markets. In such a way, Asia’s car manufacturing and distributing business sector faced severe challenges because of the existing issues. The changes in global relations and logistics have already started to impact the area.
However, regardless of the outlined problems, it is possible to predict the positive tendencies and the sector’s ability to recover. For instance, according to official statistics, production volumes increased by 22% in August in Japan (Guilia, 2022). It means the state managed to recover after the pandemic and geopolitical changes. For China and India, the situation is similar, as an optimistic forecast can be made. The first nation continues cooperation with Russia, meaning it has access to the big market and can sell its cars. India has also recovered after the pandemic and current global issues. It reported the revitalization of the sector and an increase compared to the previous year (22,9 million units) (Saxena, 2022). In such a way, it is possible to predict that the region will continue to evolve.
Altogether, Asian businesses experience severe challenges because of numerous geopolitical issues. These include the pandemic, restrictions associated with it, military conflicts, and global economic sanctions. However, statistics prove that the leading economies of the area, such as Japan, Korea, China, and India, are recovering and effectively managing the new challenges. For this reason, in the future, regional business will rise because of beneficial conditions and the stable demand for cars in the world.
References
Guilia, F. (2022). Japanese automotive market in 2022: Helping the economy to recover. Tokyoesque. Web.
Kawano, Y. (2022). Japan & Korea sales and production commentary- June 2022. IHS Markit. Web.
Lenker Andrade, E. (2020). The influence of Chinese and Japanese nationalism on foreign policy: a comparative study on the Chinese and Japanese nationalist sentiments and their repercussions on foreign policy through the Senkaku islands dispute. [Unpublished master’s thesis]. Universidad de Salamanca.
MarkLines. (2022). China – Automotive production volume, 2022. Web.
Marsh. (2022). COVID-19: Implications for manufacturing and automotive industries in Asia. Web.
Saxena, A. (2022). Running in the top gear. Invest India. Web.
World Bank. (n.d.). India. Web.