Three in four Japanese companies expect US-China trade frictions to last until at least late this year, a sharp contrast to market hopes that presidents Donald Trump and Xi Jinping might soon strike a deal, according to a Reuters poll.
Nine in 10 also think China's economic slowdown will persist at least through late this year, with more than half anticipating the world's second-largest economy will slow further in 2020 or beyond, the monthly Reuters Corporate Survey indicated.
The trade war between the global titans - Japan's key export markets - has already curbed world trade, dealing a blow to the export-reliant Japanese economy.
Japanese manufacturers depend heavily on customers in China to buy their products, especially the parts and equipment that reach China's factories and fuel its domestic and export growth.
Global financial markets have been buoyed by hopes that Trump and Xi could soon iron out a deal, ever since Trump delayed a threatened March 1 tariff hike.
Treasury Secretary Steven Mnuchin said last week both sides were "working in good faith" to try to reach a deal "as quickly as possible".
Japanese firms, already suffering collateral damage from the dispute, are not optimistic about a quick resolution.
"In terms of negotiations on tariffs and trade imbalances, they may head to resolution by this year's end. But if it's substantial friction concerning hegemony, China and the United States will remain locked in dispute for coming 15-25 years," a manager of an electrical equipment maker replied in the survey.
"We hope the trade war won't morph into global recession," wrote a steel maker manager.
In the Reuters survey, 31 per cent of companies expected the trade war to end in the second half of this year and 45 per cent said it will persist to 2020 or beyond.
The Reuters Corporate Survey, conducted monthly for Reuters by Nikkei Research, polled 479 large and mid-size firms with managers responding on condition of anonymity.
About half answered the questions on trade.
