U.S.-Japan Investment Initiative

U.S.-Japan Investment Initiative 2005 Report: Progress on Opening Japan to Foreign Investment

The U.S. Department of State and the Ministry of Economy, Trade and Investment of Japan released today the annual report prepared for President Bush and Prime Minister Koizumi. The Department of State welcomes the ongoing commitment of the Japanese Government to take concrete steps to reduce barriers to foreign direct investment in Japan as outlined in the United States-Japan 2005 Investment Initiative Report.

The report applauds Prime Minister Koizumi’s strong commitment to encouraging foreign direct investment (FDI) in Japan, notably his pledge in January 2003 to double FDI stocks in Japan within five years. Foreign investment is a catalyst for economic growth and innovation in both Japan and the United States that creates jobs, transfers technology, revives corporations, and supplies risk capital. It also helps build deeper political and social understanding between the two countries.

The report documents the Initiative’s success in promoting legislation passed this year that will expand access to merger and acquisition (M and A) techniques for foreign companies in Japan. In the report, the Government of Japan reaffirms the valuable role M&A plays in promoting foreign investment. The United States will continue to work to increase business opportunities for U.S. companies seeking to merge with or acquire firms in Japan by ensuring that they are treated in the same way as Japanese corporations.

The report stresses the need to ease restrictions on investment in educational and medical services to allow Japan to better face demographic changes. One result of the Initiative is a reform announced by the Ministry of Education in December 2004 that better integrates campuses of qualified foreign universities into Japan’s educational system. The branch campus in Japan of one U.S. university has been designated as qualifying, and other foreign branches are now applying. This reform will ease entry into Japan for foreign universities and will expand the range of educational alternatives for students in Japan.

Both governments agree on the importance of public attitudes and conducted outreach efforts in Japan and the United States to provide information on the investment climate.

The Investment Initiative is part of the U.S.-Japan Economic Partnership for Growth (EPG). President Bush and Prime Minister Koizumi launched the EPG in June 2001 to support economic renewal and revitalization in both Japan and the United States.

2005/679 Released on July 6, 2005 Media Note, Office of the Spokesman, Washington, DC, July 6, 2005

Source: state.gov more at Prime Minister Koizumi or Japan and Department of State