Japan Between Rocks and a Wet Place

[Mulboyne]

[Captain Japan]

[Video-Link Japan]

[Mulboyne]

Asahi: Foreign investment in Japan surpasses Japan's investment abroad for first time
Foreign investment in businesses in Japan hit a record high 4.0265 trillion yen in fiscal 2004, almost double the figure of the previous year and exceeding Japanese investments overseas for the first time since such statistics were compiled. Japan's direct investment in foreign countries totaled 3.821 trillion yen, down about 6 percent from the previous year, according to statistics released Wednesday by the Finance Ministry. The ministry started compiling the investment statistics in fiscal 1973...more...

[Mulboyne]

The government yesterday set another FDI target. It's now 5% of GDP by 2010 (around 28 trillion yen). That is supposed to represent a more than doubling of investment from the end of 2006. This looks, then, remarkably like the target set in 2003 to double FDI in five years. Since that isn't likely to happen, the goal posts have been moved. Some FDI-friendly policies might be a good idea instead.

[Mulboyne]

Reuters: Japan panel wants corporate tax cut to lure FDI

A Japanese government panel comprising academics and experts will call on the government to lower corporate taxes to lure more investment in the world's second-largest economy, the panel head said on Friday. The nation's corporate tax rate of around 40 percent is higher than in other major economies, making it less attractive for foreigners to invest in Japan, said Haruo Shimada, the head of the panel, whose mandate is to seek ways to boost foreign investment in Japan. But Shimada told reporters there was a rocky road ahead. "It is a taboo to call for a cut in corporate tax under the current political situation. I don't think we can propose a specific level for the tax but we want to voice the need for the cut," said Shimada, who is president of Chiba University of Commerce near Tokyo. "This country won't survive without fresh impetus from outside"...Shimada said his panel would also seek clearer rules to regulate foreign investment in areas such as national security but the main principle should be no discrimination between Japanese and foreign companies...The panel will also propose steps to promote mergers and acquisitions and the use of foreign investment to stimulate regional economies, he said...more...

[Greji]

Reuters: Japan panel wants corporate tax cut to lure FDI

Take, whatta ya going to do now?

[gkanai]

TOO LITTLE, TOO LATE!

It's not just about corporate taxes- that's only one piece of the pie. Solving that won't get a flood of new FDI.

Japan doesn't have to be more competitive than it is today, Japan has to be MORE attractive than the sectors where FDI has moved to, be it Singapore, or UAE, or SE Asia.