The Fukuoka Stock Exchange (FSE) is an important component of Japan’s financial sector. Located in Fukuoka, the largest city on the island of Kyushu, this exchange plays an integral role in the Japanese economy and is a significant source of capital for local businesses and industries. In this article, we will explore the Fukuoka Stock Exchange, its history, operations, and the impact it has had on the financial markets.
The primary focus of the Fukuoka Stock Exchange is small and medium-sized enterprises (SMEs), and the FSE plays a substantial role in driving the local economy. By facilitating capital accumulation for smaller companies, the FSE promotes entrepreneurship, job creation, and regional economic development. Furthermore, the FSE also contributes to the national economy by providing investors with a diverse portfolio of investment options.
History of the Fukuoka Stock Exchange
- The Fukuoka Stock Exchange was established on February 1, 1949, as one of Japan’s many regional stock exchanges. It began trading operations on April 1, 1949.
- In August 2000, the FSE closed its trading floor and switched over to the electronic trading system developed for the Tokyo Stock Exchange.
- In January 2002, the FSE and four other stock exchanges in Japan, and the Japan Securities Dealers Association (JSDA), reached an agreement to establish the Japan Securities Clearing Corporation (JSCC).
Operations of the Fukuoka Stock Exchange
The FSE operates under the umbrella of the Japan Exchange Group (JPX), the entity responsible for the consolidation of Japan’s financial exchanges. The FSE operates under a market maker system, where designated securities companies commit to providing liquidity for specific stocks.
As mentioned above, the FSE is primarily focused on small and medium-sized enterprises (SMEs) and startup companies, and help provide these companies with the necessary capital for growth and expansion.
The Q-Board
The FSE operates Q-Board, a special market for new companies.
Trading on the Fukuoka Stock Exchange
Trading hours on the FSE are from 9:00 am to 3:00 pm (Japan Standard Time), with a lunch break from 11:30 am to 12:30 pm.
The FSE operates on a trading system called ‘J-Gate,’ which is the same as the Tokyo Stock Exchange. This system has been instrumental in increasing operational efficiency and reducing trade execution times.
About Fukuoka – home of the Fukuoka Stock Exchange
The Fukuoka Stock Exchange is located in Fukuoka, the most populous city on the island of Kyushu. Kyushu is the third-largest of Japan´s four main islands, and also the most southerly of the four.
In 2014, the Japanese government selected Fukuoka as the National Strategic Zone for Global Startups & Job Creation. Examples of services for startups available in Fukuoka are free business consultations, special tax rates and the startup visa.
Population
In 2023, the population of Fukuoka was roughly 1.6 million people. Together with Kitakyushu, Fukuoka forms the heavily industrialized Fukuoka-Kitakyushu Zone, which is home to over 2.5 million people.
Fukuoka surpassed Kobe in populaiton size in the mid-2010s and then Kyoto in 2011. This was the first time ever, since the founding of Kyoto in 794 CE, that a city west of the Kansai region had a population larger than that of Kyoto.
As a busy port city, Fukuoka has always had an unusually large exposure to foreigners compared to most other parts of Japan, and this internal vibe is there even today, with many foreigners who come to Japan chosing Fukuoka as their place of residence. Between December 2012 and December 2017, the proportion of foreign-born residents in Fukuoka increased faster than in any other major city in the country, including Tokyo.
Economy
Fukuoka was established along the shore of Hakata Bay. Bordered by mountains on three sides, it opens up to the bay and the Genkai Sea. As a port city, Fukuoka has been a center for international commerce since ancient times. For a long time, this port was an important gateway for goods and people entering the rest of the country, as it was – and is – the Japanese port city located closest to the Asian mainland. Having a lot of exposure to foreign traders, and being fairly far away from Kyoto, Osaka and (later) Edo / Tokyo, Fukuoka developed its own distinctive economy and culture.
The port in Fukuoka is still very busy, and the Fukuoka airport is adding to the city´s importance as a key transportation hub. Air Next, a subsidiary of All Nippon Airways is headquartered in Fukuoka, and so are the Kyushu Railway Company and the Nishi-Nippon Railroad.
Today, Fukuoka is not just the economic centre of the Kyushu region; it has become the major startup city of Japan and has the highest business-opening rate in the country. As mentioned above, it is a designated zone for startsups – so far the only one in all of Japan. In all this, the Fukuoka Stock Exchange plays an imporant role.
Unsurprisingly, Fukuoka is not only home to startups – large and well-established companies are also headquartered here, such as the department store chain Iwataya and Kyushu Electric Power – an energy company that provides power to Fukuoka and eight other prefectures.
If we look at the overall economy of Fukuoka, we see that it is dominated by the service sector, as much of the heavy manufacturing in the region takes place in nearby Kitakyushu instead. Many of the companies in Fukuoka are specializing in logistics, IT och high-tech manufacturing.
The Fukuoka-Kitakyushu Metropolitan Area
The Fukuoka-Kitakyushu Metropolitan Area is the 4th largest economy in Japan, and Fukuoka is the primary economic centre within this area.
Final thoughts about the Fukuoka Stock Exchange
Since its inception, the FSE has provided a platform for both regional and national companies to raise capital and sustain growth. Despite facing numerous economic challenges throughout its history, the FSE has successfully navigated through tumultuous periods and is today an influential player in the Asian financial markets.
The FSE may not be as well-known as the Tokyo Stock Exchange, but its significance in Japan’s financial landscape should not be underestimated. By focusing on SMEs and startups, the FSE is fostering innovation and promoting economic growth in a crucial sector of the Japanese economy. It is a testament to Japan’s commitment to diversifying its financial sector and supporting businesses of all sizes. The FSE remains an integral part of Japan’s financial system, and its role will continue to evolve in response to the changing economic landscape.
This article was last updated on: June 6, 2024