Investment in Indonesia and the Philippines

Although Indonesia and the Philippines are in many ways very different, Japanese capital has increasingly thrown them into the same (sinking) boat. Both were primary targets of Japan’s raw material scramble in the 1970s, and Japanese capital’s primary interest in both remains in food production and raw materials. In spite of offering the lowest wages in ASEAN, neither Indonesia nor the Philippines has been able to rekindle much interest from Japan following their crises in the mid-1980s, resulting respectively from the slump in oil prices and the growing political-economic crisis that ended in the fall of Marcos. Both countries have thus been excluded from the surge of interest in ASEAN that started in 1987. Instead, Japanese capital has remained cautious, apparently still licking some of the wounds resulting from its excessive zeal in the 1970s and early 1980s, when it led rather than followed the example of the other powers.