Japanese Investment in Australia

One of the key contentions of this book is that Australia and Japan are characterized by highly distinctive political rationalities which provide an underpinning logic to the activities of governments and economic actors within the two countries. This chapter and the following one will demonstrate what the impact of such differing political rationalities is when they are operationalized both as pragmatic public policy and as part of a general calculus of corporate activity within each country. These chapters have two principal objectives. First, to develop an empirically detailed picture of the bilateral relationship between Australia and Japan. Second, to assess the relative efficacy of Australia’s neoliberal policy framework in the light of Japan’s developmentalist approach and its highly distinctive patterns of corporate organization. Before reviewing these sectors in detail, however, it is worth reminding ourselves of both the rationale and the expectation of the neoliberal, market conforming, deregulatory model that has predominated in Australia. The government’s own specialist advisory body — the East Asia Analytical Unit (1992: 63) — provides an apposite summary. It suggests that:

Reforms already set in train by the Australian Government should increasingly influence the direction of Japanese direct investment over the next five years [1992-97]. The benefits of lower inflation, reductions in tariffs, increased labour market flexibility and lower waterfront costs will help attract investment. Further reform designed to improve the efficiency of Australia’s economy will similarly be the most important means by which the Australian Government can address the underlying impediments to stronger Japanese investment in Australia’s manufacturing sector. Indications are that Japanese confidence in the prospects for certain segments of the manufacturing sector have improved. [Emphasis added]