| In the 1980s, after the 18 consecutive years of high speed and high qualityeconomic growth, foreign trade surplus accumulated over the years, trade frictionwith Europe and the United States intensified, together with the sharp appreciation ofthe yen, and the need to upgrade the domestic industrial structure urgently, Japan wentinto the large expansion era of foreign direct investment and became the largestforeign direct investor in the world in the late eighties. The situation of China’sforeign direct investment is quite similar with the case of Japan in the 1980s. Chinaand Japan are both surpassing countries. Many problems of China’s foreign directinvestment during the 20thcentury are those that Japan had experienced in the 1980s.The experience and lessons of industry choice of Japan’s large-scale foreign directinvestment means a lot to China in many aspects such as easing the escalating trend ofdomestic energy shortage and trade friction, enhancing the competitiveness ofdomestic enterprises and accelerating the transformation and upgradation of domesticindustry.Japan’s foreign direct investment is divided into the foreign direct investment inmanufacturing industry and the foreign direct investment in non-manufacturingindustry. The share of foreign direct investment in manufacturing industry as the totalamount of overseas investment remained at around 25%, a little bit increase ordecrease in some years throughout the 1980s, but the tendency would further decline.Including 1981-1984, Japan gave priorities to foreign direct investment in the electricmachinery, transportation machinery and iron, non-ferrous and metals industry. By thesecond half of the 80’s, the foreign direct investment in the electric machinery andtransportation machinery industry was more active, occupying half of the foreigninvestment in manufacturing. While the foreign direct investment in“marginalindustry”such as the chemicals and pharmaceuticals industry and the textile industrywas in a moderate recession. Foreign direct investment in non-manufacturing whichhad accounted for an average of 73.83% of the total share was the main areas ofJapan’s overseas expansion in the 1980s. Its several major industries just like thefinance and insurance industry, the services industry, the transportation industry andthe real estate industry had ranked the international development level and the foreigndirect investment in non-manufacturing had changed the old model of supplementary investment which primarily compensated for the disadvantages. With the above, Japanstarted the expansion of foreign direct investment based on its strong economicstrength and highlighted its status as one of the most powerful financial and capitalcountries in the world. Meantime, further empirical research found that the long-termbenefits were more obvious than the short-term brought by the industries in whichJapan chose to put its foreign direct investment. What’s more, the related industrialstructure had been further optimized and the employment structure of the threenational industries also had been regulated effectively. The trade-creation coefficient,the homogeneity of industrial structure coefficient and the employment-initiationcoefficient which were proposed accordingly applies to the effects verification ofindustry choice of China’s foreign direct investment.The economic and social impact of industry choice of large-scale foreign directinvestment in Japan is profound. We can model the experience and lesson in industrychoice of Japan’s foreign direct investment: selecting the industries which are facingthe increasing conflicts in international trade to invest, choosing the industries owningthe comparative advantage in brand or technology to invest, stressing the governmenteffectiveness in industry choice of foreign direct investment from regulating,promoting, coordinating and funding aspects, reducing the investment friction andpreventing the industrial hollowing caused by excessive foreign direct investment. |
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