"The Real Costs of Japanese Foreign Direct Investment to the European Union - With Specific Reference to the UK, Belgium and Eire"

Breverton, T.D. (1995) "The Real Costs of Japanese Foreign Direct Investment to the European Union - With Specific Reference to the UK, Belgium and Eire". In: UNSPECIFIED, Charleston, South Carolina. (Unpublished)

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Abstract

In late May 1995, an OECD Conference is scheduled specifically to discuss Foreign Direct Investment (FDI), which consists of building greenfield sites, acquisitions, or joint ventures). FDI rose four-fold between 1985 and 1993, twice as fast as world trade, but there are very few rules in existence to govern it. While politicians and companies review progress towards full European economic integration, the lack of economic growth has highlighted questions about Europe's continuing ability to attract a significant share of highly mobile international business investment. It is predicted that the EU's share of world GDP will drop from 22% in 1990 to 17% in 2010, while Asian economies will rise from 18% to 28% over the same period. No-one seems to disagree with this scenario, and the free-market view, which has taken over all Western governmental policy-making, is that European labor markets are too rigid, and the costs of employing workers is too high. This paper examines these trends and their causes, and speculates on the impacts they may have upon Japanese FDI. The paper also analyzes the impacts of Japanese FDI upon the EU, with particular reference made to the cases of the UK, Belgium, and Eire.

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