Japanese–German business relations

Change occurred in trade between Japan and Germany at the beginning of the twentieth century, with Japan increasing its imports of German industrial products such as machinery and chemicals. The quantity of machinery imported from Germany to Japan in the period immediately preceding the First World War equaled that from the United States, and almost reached the level of imports from Britain. ¹ This trend toward increased imports abated temporarily due to the outbreak of the First World War; after the war, however, there was a resumption of Japanese demand for German industrial products. One reason for this trend was the limitations of Japanese heavy and chemical industrialization. With the First World War providing the momentum, the Japanese economic structure changed in the direction of heavy and chemical industrialization, and there was a change also in the structure of demand for heavy and chemical industrial goods. However, there was a lag in the development of the supply side of the industrial structure. A second reason was that, at the time, industrialized nations in continental Europe were locked in fierce competition and were aggressively expanding into other markets; also, they were trying to maintain their competitiveness by reducing prices.