Japan's Direct Investment Location Choice

Foreign investment has already become the important means of internationalization, Realization of foreign investment is depended on multinational corporations. When the multinational corporations make decisions of investment, the choosing of host country and the specific investment locations is the most important things. The regional conditions, of investment location have promoted or suppress influence on the investment project.China and Japan are the neighboring countries that separated only by a stripe of water both countries have long traditional history. From the 80s.Japanese foreign direct investment began came to China, and developed very fast. This article studied the relationship of foreign investment and location choosing, discussed Japanese FDI behavior in China and it's location choosing.Japanese FDI in the type of trade's direct purpose is to expand Japan's marginal industry. The comparative advantage of the location in global economic development pattern, especially the obtaining of production factors and the utilization of production factors effectively, decided the location difference of Japan's FDI motivation. The motivation of Japan's FDI to North American and Europe is the use of their market, information and technology, and also including trade friction avoidance, and the motivation of Japan's FDI to China is based on the following two points. Firstly, China is big country in both territory and population, have potential markets, and abundant work force resources, furthermore, China is a developing country, in Asia, China is still a relatively undeveloped country. In China, the salary is low, this is the advantage for investment. Secondly, there are double structures in Chinese economy, some areas have better social economy foundation, not only have higher purchasing power, but also possess different engineering conditions for industrial production. All these decided foreign country including Japan, invest in China, in order to obtaining Chinese market share.In China, Japan's FDI have become gradient distribution. Eastern coastal area has corporations. The quantity of Japanese corporations is large, but is west regions is less. Industrial distribution is that the manufacturing and the not manufacturing industry are higher in eastern that is central and west area. It 's because of the location difference in China. In Eastern the downstream of Changjian River, Bohai Gulf and Southern area is close to Japan, these area's own economy develop very fast, all this become the advantage of attracting Japan's FDI. In Midwest workforce, land resource present lower competitiveness. Some labor-intensive manufacturing industry because cost pressures, became shift to Midwest too. The proportion of the Changjang River midstream and downstream, Bohai Gulf and Southern region attract Japan FDI is different before the end of the 1990s. Bohai Gulf was the most important region for Japanese FDI, but recently, it's proportion presenting downward trend. The midstream and down-steam area of Changjiang River's Japan FDI is growing. In the year of 2003.This region's Japan FDI have grown 13 percent, and also, this region became new center of Japan investment. The low salary and good location of southern area has become it advantage that attract more Japanese FDI.Because of geographical advantage and cost advantage, attracting Japanese investment. But China has many shortcomings, in China, laws and regulations are not perfect and it is become big problem, and all foreign investor must face this problem.In 20 years of Japan invest to China, while China offering needed conditions China also benefit a lot from that, cooperation brings benefit for both side. So it is necessary to promote China attracting Japanese FDI to further extent.