ABSTRACT
Foreign direct investment (FDI) has clearly been indispensible in Southeast Asian growth, but Southeast Asian newly industrializing countries have not simply laid themselves open to FDI. After the advent of the endaka-—or era of the high yen—from 1985, Japanese industry has increasingly relocated elsewhere, including Southeast Asia, as exchange rates and labor shortages drove it offshore. The strategic focus of Japanese aid has shifted. In the mid-1970s, the government sought to package Japanese aid for Southeast Asia more attractively, following resentment stemming from the "first wave" of Japanese investment. For most foreigners, the "flying geese" model seems to be the development orthodoxy among Japanese economists and intellectuals. The flying geese theory anticipated western "product cycle" theories, but emphasizes national location rather than firm control. The competitors envisioned in Akamatsu's flying geese pattern shift constantly as each upgrades its industrial capacity, but at different rates.
