Publication of 2021 Survey on Planned Capital
Spending for Fiscal Years 2020, 2021 and 2022
Survey on Planned Capital Spending for Fisical Years 2020, 2021and 2022 (Conducted in June 2021)
Development Bank of Japan Inc. (DBJ) is pleased to announce the publication of the Survey on Planned Capital Spending for fiscal years 2020, 2021 and 2022.
Our findings reveal the following three characteristics regarding planned domestic capital spending for FY2021:
- a K-shaped recovery from a sizable decline during the Covid-19 pandemic, particularly prominent in the manufacturing sector;
- investment to address pressing issues for achieving carbon neutrality nationwide, including the development of cutting-edge technology mainly in urban areas; and
- widespread investment to enhance resilience, including the diversification of overseas sites and suppliers.
According to the survey, domestic capital spending by major firms dipped 10.2% overall in FY2020, the first decline in nine years as the Covid-19 pandemic affected both manufacturing and non-manufacturing sectors. Planned capital spending for FY2021 shows a recovery (up 12.6% overall) led by the manufacturing sector (up 18.6% in manufacturing and 9.7% in non-manufacturing), on the back of the implementation of projects postponed during the pandemic and the acceleration of investment in preparation for a carbon-neutral, digitalized society.
Taking into account our findings from the Mind Survey on Corporate Activities, planned capital spending for FY2021 also shows the following characteristics, including trends among medium-sized firms and by region.
Impact of Covid-19
- Capital spending in the manufacturing sector will exceed the pre-Covid level, but investment in transportation, services and other non-manufacturing industries hit hardest by the pandemic is not expected to resume the pre-Covid level. Overall, the recovery will be K-shaped as further cuts in spending are planned by medium-sized firms for FY2021 with downward pressure coming from the lodging industry in particular.
Investment for carbon neutrality
- Investment is planned to address immediate pressing issues (electric vehicles, energy conservation, renewable energy, etc.) while many firms remain at the stage of preparation, seeking to establish their vision.
Innovation to advance toward a carbon-neutral, digitalized society
- In view of the mounting technological challenges for carbon neutrality, firms are engaging in research and development including for energy transformation in recognition of the rising need for innovation. Many projects are also planned to invest in AI- and IoT-driven innovation for remote contactless operation and automation, a trend accelerated during the pandemic.
Investment to enhance resilience
- Efforts have been made to strengthen supply chains following major disasters both in Japan and abroad. Supply chains have come under further scrutiny during the pandemic with heightened awareness of semiconductor shortages and geopolitical risks, resulting in planned spending on the diversification of overseas sites and suppliers.
Characteristics by region
- Investment for innovation, including in the development of cutting-edge technology, is planned in metropolitan areas in particular. Spending is planned across the board to address pressing issues, including on electric vehicles and renewable energy, and on disaster risk management.
Please note that no information regarding individual firms will be provided by DBJ, as the survey is conducted under conditions of confidentiality and anonymity.
More details on the survey are available on the Survey Reports (Research Report) page of the DBJ website (https://www.dbj.jp).
DBJ's reports are one of the ways in which it fulfills its corporate philosophy of "Design the Future with Financial Expertise: Continue to expand financial frontiers; Provide the best solutions for customers and society; Pursue sustainable development for Japan and the world."
Inquiries:
Chief Research Office
Economic & Industrial Research Department
Tel. +81-3-3244-1845 E-mail: capex@dbj.jp
Regional Research & Planning Department (information by region)
Tel. +81-3-3244-1633 E-mail: rpinv@dbj.jp