Perspectives on Japanese Investment, Employment and Management in Australia (original) (raw)

1999, Asia Pacific Economic Papers

In the postwar period Japanese foreign direct investment in Australia has played a key role in strengthening trading links between the two countries and influencing the industrial structure of Australia. This paper surveys the pattern and intensity of Japanese investment in the 1990s as well as the motivations of Japanese investors-both in Australia and the rest of the world. It assesses the organisational and industrial distribution of investment, employment creation, and the conduct of industrial relations by Japanese firms in Australia, in a range of industries. The role of Japanese management and differences in the conduct of industrial relations in Japanese workplaces in Australia are considered in comparative perspective. The paper surveys the characteristics and outward orientation of these firms, particularly in the automotive industry-one of the largest areas of Japanese investment and employment in Australia. Overall, Japanese subsidiaries in Australia are considered to have relatively similar employment and industrial relations practices as other firms. Pacific Economic Papers mineral resources, such as coal and iron ore, to the establishment of a marketing network, and to the relocation of labour-intensive manufacturing industries (Komiya and Wakasugi 1990). By 1970 direct investment was only significant in the mining, lumber and pulp, and textiles industries. A decade later, the chemicals, steel, and electrical equipment industries had become active investors. FDI accounted for over 1 per cent of industry GDP, but half of the investment came from the manufacturing industry. The revision of the Foreign Exchange Law in 1980 removed an administrative obstacle to investment, since investors no longer required the prior approval of the Ministry of Finance, but were merely required to notify the Ministry of intended investment. The expansion of Japanese FDI in the 1970s was dwarfed by what was to follow, as both manufacturing and non-manufacturing industries increased their investment abroad, especially to the United States and East Asia. In the second half of the 1980s, following the sharp appreciation in the yen after the Plaza Accord, outflows grew very quickly.