The Environment for International Investment and Japan

- Views on MAI Negotiations -

The Desired Environment for International Investment

Today, the movement of capital & technology as well as that of goods and services affects the growth of the world economy. With the increasing importance of investment, an environment for international investment is having a significant impact on the economic growth and level of welfare in the world.

We desire an international investment environment in which investment is liberalized, the freedom of business activities is assured, each foreign capital is properly protected, and a mechanism for the dispute settlement is in effect. The Multilateral Agreement on Investment (MAI) will provide a common foundation for each country as an effective international framework for achieving such an environment. From this viewpoint, we welcome the efforts of member governments of the Organisation for Economic Co-operation and Development (OECD).

We feel that Japan, as a responsible member of the international community, must take part in the establishment of better international environment for investment and continually contribute to the stimulation of investment. Following upon our commitments to the World Trade Organization (WTO) and our contributions to Asia-Pacific Economic Cooperation (APEC), Japan should play actively in rule-making during the MAI negotiations. In addition, although the MAI is expected to be an a high standard international treaty, a very important issue will be obtaining the understanding and participation of non-OECD Member countries. Japan, as the only OECD member from Asia, must assume an active role in making recommendations to facilitate the participation in the MAI by non-OECD Members.

Furthermore, Japan must not only contribute to the economic growth of the recipients of its foreign direct investment, but also must work toward the establishment of a market for investment in Japan for the purpose of advancing the acceptance of foreign direct investment into Japan.
In this Interim Report, we assert the viewpoint of Japan's economy, based on an understanding of the above.

First, the General Views give an outline of the MAI framework and discuss the particularly salient points therein. Next, the Itemized Discussions include: 1) the basic stance; 2) problems facing each country; and 3) requests for the MAI negotiations. Lastly, issues facing Japan are clarified in the Supplementary Discussion.