Vaccine Boosters Critical for Japan’s Recovery, Suntory CEO Says

(Bloomberg) -- A swift and timely rollout of Covid-19 booster shots will be critical for the recovery of consumer spending in Japan next year, said Takeshi Niinami, Suntory Holdings Ltd.’s chief executive officer.

The brewer’s revenue and profit for November and December are improving, Niinami said in an interview Wednesday, adding that he expects the services sector to increase wages next year due to labor shortages, which in turn will boost spending. Japan makes up about half of Suntory’s revenue, with the rest overseas. 

The country began giving booster shots to health care workers this month and is planning a rollout for the elderly and wider population early next year. Bars, restaurants and entertainment venues have seen an uptick in sales as immunizations gained steam and the number of Covid-19 cases dropped, helping to spur sales of alcohol for Suntory and rival Asahi Group Holdings Ltd. 

“People are stressed out for not being able to spend and are venting it out now,” Niinami said. 

Many people didn’t spend assistance money handed out by the government last year and it’s important to see how that cash will be spent in the first half of next year, Niinami said. Salary hikes will boost employee morale at businesses, said Niinami, who said that increases at Suntory will be directed toward younger and mid-career workers at the brewer, rather than across the board.

“If people feel relieved to some extent and overcame coronavirus, finally Japan’s spending will be able to match that of the U.S. and Europe,” Niinami said.

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