Reuters Next: Mizuho director Kobayashi says companies should not overreact to Trump's tariff threats

OMRON

10/12/2024 20:17

(Adds comments on US Steel/Nippon Steel and Seven &
I/Couche-Tard deals)
    By Shashwat Awasthi and Carolina Mandl
       NEW YORK, Dec 10 (Reuters) - Izumi Kobayashi, director
at Japan's Mizuho Financial, Omron, and ANA, said on Tuesday
that companies should not overreact to President-elect Donald
Trump's threats of imposing tariffs on Chinese goods.
    At an interview at the Reuters NEXT conference in New York,
she said that it would be difficult to withdraw from China given
its mammoth size.
    Kobayashi said that industrial conglomerate Omron has not
yet taken any action to prepare for potential sanctions the
incoming Trump administration may impose, but there are some
ongoing discussions about it.
        One potential measure could be to separate the Chinese
unit from the rest, but that would bring some challenges in
terms of managing that business.
  
        Japan has been paying close attention to potential
sanctions on China. Last year, Japan's financial regulator
sounded out top domestic banks about China risks and whether
they had contingency plans in place if Sino-Western tensions
escalated, as they are heavily exposed to the country.
    A major risk for Japanese banks would involve U.S. sanctions
on China, hobbling their ability to do business there similar to
the bans on Russia dealings after the invasion of Ukraine.
    
    JAPANESE COMPANIES
        On the board of directors of three Japanese companies,
Kobayashi commented on big deals involving the country's
companies and the resistance they have faced.
  
        Nippon Steel  5410.T , Japan's biggest steel maker,
plans to pay $15 billion to acquired U.S. Steel  X.N , but is
awaiting reviews from the Committee on Foreign Investment in the
United States (CFIUS) and clearance from the U.S. Department of
Justice (DOJ) under antitrust laws.
  
    It has faced stiff resistance from politicians and labour
group United Steelworkers (USW), with Republican President-elect
Donald Trump opposing the deal. "I am totally against the once
great and powerful U.S. Steel being bought by a foreign
company," he said last week.
        Kobayashi said the deal makes sense from the point of
view of business, but it could be more sensitive from a
political stand. "The steel industry is a key industry in each
country," she said, adding that the ownership of a key company
is "a serious issue."
  
        Recently, Japanese retail giant Seven & I Holdings
 3382.T  has been classified as "core" to national security,
raising questions as to whether it is a defensive maneuver by
the owner of 7-Eleven convenience stores to avoid a $38.5
billion buyout offer from Canada's Alimentation Couche-Tard
 ATD.TO .
    The executive said the role Seven & I plays in Japan
matters. "It's a private company, but in some part it takes a
part of the public service as well," she said, mentioning the
banking services it provides and how it could help in case of a
natural disaster.

        To view the live broadcast of the World Stage go to the
Reuters NEXT news page: 
  
    
        
  

 (Reporting by Carolina Mandl and Shashwat Awasthi, in New York;
Editing by Franklin Paul and Nick Zieminski)
 ((carolina.mandl@thomsonreuters.com; +1 (917) 891-4931;))