plunge

Relations between Tokyo and Beijing have plummeted over Japanese leader’s recent remarks on Taiwan.

Japanese shares linked to the tourism industry have nosedived following China’s warning to its citizens against travelling to Japan.

Relations between Tokyo and Beijing have plummeted since Japanese Prime Minister Sanae Takaichi suggested earlier this month that Japan’s military could intervene to stop China from taking control of Taiwan.

In a sharp escalation of the dispute on Friday, China’s Ministry of Foreign Affairs advised citizens to avoid travel to the East Asian country, claiming that Takaichi’s comments had increased risks to their “personal safety and lives”.

The issue continued to reverberate as Japan’s stock market reopened on Monday after the weekend break, with shares of airlines and retail outlets taking sharp falls.

Department store group Isetan Mitsukoshi fell more than 11 percent in afternoon trading, while its rival Takashimaya tumbled about 5 percent.

Japan Airlines fell about 4 percent, while Uniqlo owner Fast Retailing dipped about 5 percent. Cosmetics company Shiseido plunged about 9.5 percent.

China is Japan’s biggest source of foreign tourists, accounting for almost one-quarter of the 31.65 million arrivals in the first nine months of this year, according to the Japan National Tourism Organization.

Ryota Abe, an economist at Sumitomo Mitsui Banking Corporation, said Japan’s gross domestic product (GDP) could shrink by about 0.5 percent in the event of a total collapse in Chinese arrivals and by about 0.1-0.2 percent if arrivals decreased by about one-third.

“Even if the number of visitors decreases 30 percent because of the heightened tensions, the negative impact will be around 0.1-0.2 percent,” Abe told Al Jazeera.

Japan’s economy shrank by 0.4 percent in the three months to September, official data released on Monday showed, the first contraction in six quarters.

Japan’s Chief Cabinet Secretary Yoshihide Suga told a regular news briefing on Monday that Beijing’s travel warning was inconsistent with mutually beneficial ties and that Tokyo had requested “appropriate steps” from the Chinese side.

Japan’s top official for Asia Pacific affairs, Masaaki Kanai, departed for China on Monday for talks aimed at lowering tensions between the sides, Japanese media reported.

Masaaki Kanai will meet his Chinese counterpart, Liu Jinsong, in Beijing, where he is expected to clarify that Tokyo has made no change to its security policy despite Takaichi’s comments on Taiwan, the reports said.

Japan has long viewed China’s threats to take control of Taiwan with concern due to the self-ruled island’s close proximity to Japanese territory and its location in waters that carry large volumes of trade.

China considers Taiwan part of its territory and has pledged to “reunify” the island with the Chinese mainland, by force if necessary.

Taiwan is not officially recognised by most countries but has many characteristics of a de facto independent state, including its own military and passport, and a democratically elected president and legislature.

SEOUL, Nov. 3 (UPI) — General Motors Korea saw its sales plunge more than 20% in October from a year earlier due to a slump at home and abroad amid high tariffs under the United States’ Trump administration.

GM Korea, based west of Seoul, said Monday that it sold 50,021 vehicles last month, down 20.8% year-on-year. The company’s domestic sales dropped 39.5%, while exports declined 20%.

Citing statistics from the Korea Automobile & Mobility Association, GM Korea Vice President Gustavo Colossi offered an optimistic view about its performance this year.

“Despite the production losses in the third quarter, demand for Chevrolet vehicles remains strong both domestically and globally, as evidenced by the Chevrolet Trax Crossover ranking No. 1 in domestic passenger car exports from January to September this year,” he said in a statement.

However, some observers remain worried about the future of GM Korea.

“Most of GM Korea’s turnover comes from exports to the United States. But the 25% tariffs have weighed on the company this year. Even if the duties go down to 15%, the struggle is feared to continue,” Daelim University automotive professor Kim Pil-soo told UPI.

“Worse, its domestic sales accounted for only about 3% in October, with just over 1,000 units sold. If the situation continues, speculation about GM’s withdrawal from Korea is unlikely to fade,” he added.

Originally, South Korean automakers did not pay any tariffs when exporting their cars to the United States, thanks to the bilateral free trade agreement that went into effect in early 2012.

The Trump administration imposed tariffs of up to 25% on Korean-made automobiles earlier this year, although Washington agreed to reduce the rate to 15% late last month in return for Seoul’s promise to make major investments in the United States.

GM Korea has denied rumors that it plans to leave South Korea.