Stronger Yen and the Rise and Fall of the Bubble Economy

Active Promotion of Business Operations Abroad

In the 1980s, Japan enjoyed its reputation of being “Japan as No. 1” and existed as a major manufacturing superpower with “made in Japan” products exported all around the world. The Plaza Accord of 1985 triggered the arrival of a stronger-yen era which propelled Japan toward expanding their businesses into foreign countries and widened  the scope of sogo shosas’ activities. The bubble economy, a product of the Bank of Japan’s easy monetary policy, burst in the 1990s and sogo shoshas, which had accumulated inflated assets, found themselves in a tough situation.

 Nichimen Co., Ltd. received a succession of orders, including those for fertilizer plants, communications projects and housing construction in Malaysia, for cement and aluminum rolling facilities and desalination plants in the Middle East, and for papermaking plants and petro-chemical projects in Indonesia. In addition, Nichimen participated in projects to locally produce  engines and automobiles in Thailand and Indonesia, in order to support the industrialization of these developing countries. In the aircraft segment as well, Nichimen Co., Ltd. succeeded in their venture delivering Airbus airplanes, continuing to diversify its business away from fiber.

Nichimen remained active in the Communist bloc. They became the top sogo shosha in the purchase of crude oil and petroleum products made in the former Soviet Union, and actively promoted their  bearing business in China, founding a joint venture company. In the 1990s, Nichimen took steps to strengthen its synthetic resin business, such as through the manufacture and sale of metton resin and biaxially stretched nylon film in the United States.

 Nissho Iwai Corporation was involved with the first railroad exports following the war and consistently led the railroad industry . In 1982, Nissho Iwai made a contract for the export of 325 New York subway trains and later received multiple orders for the export of rolling stock to locations across the United States. Some of those trains are still used by New Yorkers today. In the 1980s, Nissho Iwai was quick to focus on information and communications technologies and established the personal computer communications company NIF (currently, NIFTY Corporation) in 1986.

 In 1986, Nissho Iwai set up a liaison office in Hanoi, as the first Japanese company in the country after the Vietnam War. Subsequently, the company conducted the first crude oil export and afforestation projects in Vietnam and launched a joint fertilizer venture. Nissho Iwai also supported Vietnam’s industrialization by inviting Japanese companies to the country through the development of an industrial park and participating in an electric power BOT project. In Indonesia, which was reeling from the Asian currency crisis, Nissho Iwai promoted petrochemical projects, and some of which  are connected to Sojitz Corporation’ current methanol business.