Only two Japanese firms made it onto Forbes magazine's list Thursday of Asia's 200 top small and medium-size companies.
The number of Japanese firms dwindled from 24 last year, according to Forbes' latest annual "Best Under a Billion" list that picks 200 firms from 13,000 listed Asia-Pacific companies with sales below $1 billion.
Japanese firms lag far behind those from other Asian economies, including China, India and South Korea, in the ranking.
The two Japanese companies that remain on the list this year are bicycle-maker and retailer Asahi Co. and solar panel manufacturer NPC Inc.
According to Forbes, China plus Hong Kong led the pack with 71 firms, down from 78 last year.
India has 39 firms on the list, up from 20 last year.
There are also 20 South Korean firms, down from 23 last year, and 19 Taiwanese firms, up from 16 last year.
"Japan, which produced 24 entries last year, has only two companies represented this year because of domestic economic woes," Forbes said.
There are also fewer Japanese firms on the list than those from Southeast Asian countries, including Malaysia, Thailand, Singapore and the Philippines.
Countries other than Japan with two firms on the list are Sri Lanka and Pakistan.
Forbes said 151 firms were newcomers to the list and nearly half on the list are in information technology, health care or electronics.