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Political Risks and Japanese Foreign Direct Investment in East Asia: A Case Study of “China-Plus-One”
The Korean Journal of International Studies 13-2 (August 2015), 383-410
Published online August 31, 2015
© 2015 The Korean Journal of International Studies.

Keisuke Iida [Bio-Data]
Received December 5, 2014; Revised July 15, 2015; Accepted July 24, 2015.
This is an Open Access article distributed under the terms of the Creative Commons Attribution Non-Commercial License (http://creativecommons.org/licenses/by-nc/3.0) which permits unrestricted non-commercial use, distribution, and reproduction in any medium, provided the original work is properly cited.
Abstract
The East Asian political situation has grown volatile as a result of territorial disputes, historical legacies, and other regional rivalries. On the other hand, another notable phenomenon among East Asian countries is a very high degree of economic interdependence. To understand these somewhat contradictory phenomena and, in particular, how private actors have engaged in cross-border economic activities to cope with political instability this study will examine the China-plus-one diversification strategy that has been adopted by some Japanese multinationals. This study finds that an increasing number of Japanese firms already employ this strategy, or are considering its use; it also finds that the impact of anti-Japanese protests against Japanese firms in China is increasing, and that the most highly preferred investment destination in terms of diversification is Southeast Asia.
Keywords : political risk, foreign direct investment, portfolio diversification, Sino-Japanese relations


17-1 (April 2019)