When Japanese tourism tycoon Kimihoto Kamoru paid $A13 million to buy outright Brisbane’s famous Lone Pine Koala Sanctuary, newspapers and television current affairs shows headlined the deal as a Japanese invasion of an Australian heritage. Large increases in the level of Japanese overseas investment in recent years has attracted increased comment and public scrutiny both in Australia and in the advanced nations of the world. A survey conducted for the Business Review Weekly during February 1988: discovered that, whilst over half the 1206 people interviewed said they would like to see foreign investment encouraged, 63 per cent said they would be “very concerned by such a development". However, does the level of Japanese investment in Australia currently and in previous years warrant such concern and scrutiny?
The industry spread of Japanese direct investment in Australia has been heavily concentrated in the mining and manufacturing sectors. This pattern has changed in recent years with an increasing amount being directed to the finance, trading and business services sectors of the Australian economy as a result of structural changes in the Japanese economy, the strong value of the Yen, relaxation of Government policies, and high interest rates in Australia. However, Japanese direct foreign investment in Australia during FY1988 accounted for only 4.1 per cent of total Japanese direct investments abroad. As a percentage of total investment in Australia, Japanese sourced capital has averaged 13 to 14 per cent of the total inflow since the mid 1970's.
The purpose of this paper has been to examine: (i) the nature and patterns of Japanese foreign investment in Australia, (ii) the reasons behind Japan's promotion of investment in this country, and, (iii) the method and criteria adopted by the Japanese in deciding to invest in Australian industries and projects.