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Kansai airport disruptions feared to deal big blow to local economy

The Dotonbori entertainment district of Osaka's Chuo Ward, which has lost a little of its normal hustle and bustle following disruptions caused by Typhoon Jebi in western Japan, is seen on Sept. 6, 2018. (Mainichi)

OSAKA -- Disruptions to the operation of Kansai International Airport, which was flooded by a typhoon-generated storm surge about a week ago, are feared to deal a serious blow to the economy of the Kansai region.

The airport was shut down after the Sept. 4 flood. Terminal 2 of the airport has been partially reopened but the number of flights to and from the airport is limited.

The commodity distribution and tourism sectors -- the latter strongly supported by inbound visitors -- have been hit particularly hard by the problem.

Rohm Co., which transports half-finished semiconductor goods produced in the Kansai and other regions to China for completion, has been forced to send its products from Narita International Airport and other airports.

"It's crucial to swiftly transport electronic parts. We hope that Kansai airport will be fully restored at an early date," a company official said.

According to Osaka Customs, the amount of products exported via Kansai International Airport accounted for 34 percent of the volume of exports from six prefectures in the Kinki region, including Osaka and Kyoto, in 2017, while the figure for imports stood at 27 percent.

In particular, electronic components and pharmaceutical products account for large percentages of exports from and imports to the region, respectively.

It is now almost impossible to export and import goods via Kansai airport, and electronic parts and other manufacturers have been forced to use other airports. Murata Manufacturing Co. switched from Kansai airport to Narita airport for its exports of condensers for smartphones, while Panasonic Corp. and Kyocera Corp. also use Narita and Chubu Centrair International Airport for their exports.

Currently, there is no information that the paralysis of Kansai airport has affected companies' production activities. Still, it remains to be seen how much cargo other airports can handle in place of Kansai airport.

In fiscal 2017, Narita International Airport handled the largest amount of cargo of all airports in Japan at 2.28 million metric tons, followed by Kansai International Airport at 830,000 tons. Centrair dealt with only 180,000 tons. Currently, storage facilities at Centrair are almost filled with cargo that would have been exported via Kansai.

"We managed to handle the cargo, but if the amount continues to increase, it might affect our business," said an individual linked to Centrair.

Even though Narita has more capacity to handle cargo, an airport official said they "must ascertain whether the amount will continue to increase rapidly."

The situation in which there are no prospects that operations at Kansai International Airport will be fully restored in the foreseeable future is feared to have a more serious impact on tourism.

Kansai airport is an important gateway to Japan. Of all the people who visited Japan in 2017, 7.16 million used Kansai airport while 7.64 million others used Narita.

Since Kansai airport was submerged by the storm surge on Sept. 4, hotels in the Kansai region have received numerous cancellations of reservations for guestrooms.

Bookings for 500 guestrooms at Rihga Royal Hotel in the city of Osaka for group tours for visitors from overseas through the end of this month have been cancelled.

An official of the hotel expressed concerns that harmful rumors on the impact of the disaster on the Kansai area could have a prolonged impact on tourism in the region.

Kyoto Hotel Okura in the ancient capital also received cancellations for more than 20 reservations of guestrooms for Sept. 4 and 5 alone, and there is no sign that the flurry of cancellations will subside.

Freeplus Inc., an Osaka-based travel agency for inbound tourists, said over 80 percent of packages tours through Sept. 14 have been cancelled. Taiwanese and South Korean tourists mainly use tours organized by the firm.

"If Kansai airport remains paralyzed until China's national day in October or the season of colorful autumn leaves in Japan, it will deal a serious blow to tourism," said Hiroaki Konishi, a director of Freeplus.

(Japanese original by Natsuki Oka, Tsuyoshi Kosaka, Mihoko Kato and Yuki Tsurita, Osaka Business News Department)

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