Surge in Japanese inward investment underlines benefit of a weak yen

Tokyo

FOREIGN direct investment (FDI) in Japan has surged and while this is due partly to the government's promotional efforts, falling business costs on the back of a weaker yen have also been an important factor, according to a newly released survey by the Japan External Trade Organization (Jetro).

The FDI situation parallels that in Japan's inward tourism where nearly 20 million people visited the country last year, a near 50 per cent rise over 2014, spending 3.4 trillion yen (S$42 billion) and making the inward tourism industry equal in value now to Japan's exports of motor-vehicle parts.

The most visible impact of the sharp yen drop after the Bank of Japan (BOJ) launched aggressive monetary easing three years ago was on Japanese exports and corporate profitability. Bu…