ABSTRACT
This chapter explores the nature and impact of Japanese foreign direct investment (FDI) on South Africa. The motivations underlying Japanese FDI have changed over time, from investment in resource development starting in the 1950s to market expansion strategies in the 1970s, capital acquisition in the 1980s and investment strategies in the 1990s. Between 1985 and 1991 Japanese outward FDI escalated rapidly, prompting much alarm at the time in Western capitals as it was combined with persistent trade surpluses. R. F. Doner explores the notion of an emerging East Asian division of labour with Japanese FDI as a driving force. He observes that the region can be characterised as being outward-oriented in terms of trade whilst becoming increasingly integrated in terms of production. A major consideration in the choice of investment location is the growth of regional trade blocs, each with its own rules of origin and tariff schedules.
