February 9, 2017
Keywords: Eco-business / Social Venture
Image by DrTerraKhan Some Rights Reserved.
According to a survey of Japanese private companies holding 20 million yen (about U.S.$198,000) or more in capital, environmental businesses are enjoying favorable economic conditions, with positive six-month and ten-year outlooks. Here are some highlights from the Ministry of the Environment (MOE) survey.
MOE has been conducting Kankyo Tankan, a biannual economic survey of about 12,000 companies in Japan, since December 2010, on its views and confidence in environmental businesses. The results of the latest survey, conducted in June 2016, were published by MOE on August 29, 2016.
The diffusion index (DI) of business confidence--the percentage giving "positive" replies minus the percentage giving "negative" replies--was +16 for environmental businesses, down by 5 points from the previous survey conducted in December 2015, but higher than the DI of +11 for all businesses, showing continued economic strength in environmental businesses. As for future prospects, environmental businesses are expected to grow, with the DI reaching +18 in six months and +22 in ten years.
By major environmental business categories, the DI was +9 for Category A (Pollution Management), +25 for Category B (Countermeasures against Climate Change), +6 for Category C (Waste Management and Efficient Use of Resources), and -9 for Category D (Natural Environment Management), which highlights the contribution of Category B to the overall business confidence. As for the ten-year projection, the survey predicts that the DI will be +22 for A, +27 for B, +9 for C, and +18 for D. The negative value for Category D is thought to be temporary, and natural environment management businesses are expected to recover.
Environmental sectors that look promising in Japan include Energy-Saving Vehicles, which ranked first at 26.0 percent, followed by Air Pollution Control (equipment & facilities) at 16.6 percent, and Renewable Energy (excluding solar power generation systems) at 10.8 percent. In the six-month outlook, Energy-Saving Vehicles remain at the top of the list, but in the ten-year predictions, Renewable Energy (excluding solar power generation systems) ranks first in the promising businesses list.
Renewable Energy (excluding solar power generation systems) also tops the list of environmental businesses that respondent companies want to launch in the future at 28.5 percent, followed by Energy-Saving Consulting at 17.6 percent.
Survey details are as follows:
Survey period: June 1, 2016 to July 8, 2016
Survey subjects: 11,676 Japanese companies selected by capital- and industry-based stratified random sampling from among private companies capitalized at 20 million yen or more. Valid responses were obtained from 5,010 companies, giving a valid response rate of 42.9 percent.
Survey method: Responses were obtained through regular mail, via fax, online, or by email.