Globalization of the economy
Japanese multinational corporations have been steadily increasing their overseas production

The ratio of foreign production by Japanese multinational corporations has been increasing steadily over the last three decades, however, it remains relatively small compared with those of other industrial nations. The overall ratio for all Japanese industries is almost 10%, compared with 21.3% for German and 25.2% for U.S. industries.

When we look at Japanese foreign production on an industry-by-industry basis, we see that the ratio of transportation machinery is the highest at around 17% while that of the electrical machinery ranks second at around 13%.
DATA (E-2)

Investment in Europe has grown significantly as the EU aims to integrate into a single common market and enlarge gradually by incorporating the former Eastern block nations.

The fear that the EU might mean "Fortress Europe" has prompted non-European companies in all industrial sectors to invest more in Europe. As a result Europe has grown into an even more significant source of corporate profit, especially for American multinational corporations.

Today some American multinationals such as I.B.M. earn higher net profits in Europe than in the U.S.

Japanese investment in Europe reached its peak in the late 1980s. Aggressive investment by Japanese multinationals in Europe in order to benefit from the new market opportunities in the European market including the former Eastern block countries continued until 1990. Particular Japanese investment in processing and assembling industries such as electronics and automobiles created more jobs for European workers.

Restructuring in the European automobile industry that paralleled the earlier restructuring in the United States enabled major auto manufacturers to improve their productivity and profitability. The automobile industry in the United States and Europe improved their industrial performance by retreating from less profitable models and markets, focusing investment on new model development and reorganizing the production in order to share more common components and parts among each company's models as well as among competitors. This resulted automakers to make in strategic and aggressive investments in regions outside their home markets, one result of which was increasing the import of cars to the Japanese market.
DATA (E-3)

[In Perspective] [Contents: Globalization of the economy]