TOKYO - JAPAN'S Kawasaki Heavy Industries said on Friday it will withdraw from the MotoGP racing circuit as the global economic crisis pressures the firm to cut costs.

'The effect of the current financial crisis on the global economy is extremely significant and an extended period of time is required for a recovery,' Kawasaki said in a statement.

'We saw the need for efficient redistribution of our management resources and have decided to forgo participation in the Moto GP from 2009 on,' it said.

Kawasaki spends roughly four billion yen (S$64.8 million) annually to run the team, said an official of the company based in the western Japanese city of Kobe.

With the decision, Kawasaki joined a growing number of major Japanese auto manufacturers that have terminated their racing programmes to cut costs as consumer demand for new vehicles plummets worldwide.

Honda took the shock decision to retire from Formula One racing, while Subaru and Suzuki pulled out of the World Rally Championships.

Kawasaki joined the racing circuit in 2003 to boost its brand image and develop its design technology.