What do Japanese trading companies do?

Answer 1

Japanese trading companies are similar to an American conglomerate in that they control diversified large companies that encompass a large cross section of the economy. Typically in Japan a company like Mitsui or Nissan would also have control of a auto manufacturer, large bank, a steel company, a casualty insurance company, a life insurance company, an aluminun company, a electronics manufacturer, a heavy equipment company, a large consumer food company,an oil company, and other critical parts of the economy. In addition, the hunreds of suppliers of all these companies would also have stock owned by the trading company. These companies and suppliers would also own shares of the trading company. These cross share holdings are considered "expressions of interest" between these companies. The end result is a group of about six large trading companies with hundreds of crossholders that account for a large percent of the gross national product of Japan. These cross holdings encourage companies to do business with others members of the trading group.