Direct Investment in China and Japan

Paper Summary:

The writer discusses the policy of direct investment and various forms of incentive governments utilize to encourage foreign investment. The paper shows how countries can protect and nurture their growth toward mutual benefit of the investing organization and the country receiving the investment. The paper follows the plan China has used to its benefit and also cites the less positive results in Japan.

From the Paper:

"During the 1980's China recognized a need for significant foreign investment, particularly in those infrastructure and productive areas in which a complete modernization and/or overhaul was needed. Foreign investment encouragement in the form of tax reductions and exemptions was implemented, especially in the coastal "Special Economic Zones"; this has expanded into the interior. (Braham and Ran, p.9)."

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