Japan is the most expensive economy in the world for a foreign company to set up or operate a business, according to a study released Tuesday by the British think tank Economist Intelligence Unit.
According to the EIU report, Japan ranks top among 31 economies in terms of labor costs, rent, business travel expenses, costs for expatriate staff, corporate taxes, perceived corruption levels, telecommunications and other costs.
However, Asian economies including Hong Kong, South Korea and Taiwan offer good value for the operation of foreign businesses, with costs running roughly one-fourth of those in Japan, the report shows.
The United States and Germany, which rank second and third, respectively, are about two-thirds as expensive as Japan, the report says.
Taking Japan at the base index of 100, the EIU put the costs of operating a business in the U.S. at 66.3 and Germany at 66. Britain came fourth at 64.
Japan ranks second in terms of corporation taxes, according to the report.
Among Asian economies, Hong Kong ranked 14th with a score of 27.3, followed by South Korea with a score of 27.1 and Taiwan at 26.6. Singapore ranked 17th with a score of 22.4, Malaysia at 25th with a score of 11.1, and India 27th with a score of 8.7.
China ranked 28th with a score of 7.7, while Thailand scored 7.3. The cheapest country in which to operate is Indonesia, at 1.7, the study shows.