ABSTRACT
The economic relationship between the United States (US) and Japan is of paramount importance to the countries of East and Southeast Asia for several reasons. The US and Japanese economies are the two largest dynamos driving the world economy. The existing economic relationship between Japan and the countries in the Association of Southeast Asian Nations (ASEAN) is fundamentally an inequitable one. The ASEAN countries include Indonesia, Malaysia, the Philippines, Singapore, and Thailand. Japan's imports from the ASEAN countries consist mainly of raw materials and commodities. In return, Japan dominates the markets of the ASEAN countries, supplying them with goods ranging from machinery, equipment, and automobiles to electronics and other consumer goods. The dramatic increase in the value of the yen forced many Japanese companies to transfer their manufacturing processes to the developing countries of the East and Southeast Asia.
