Foreign Investment in Asia in the 1990s: Trends,Problems and Implications for Manpower Movements

The diversity and rapidity of change in direct foreign investment (DFI) are described for flows among North America, Western Europe, Japan, ASEAN, Taiwan, China, Hong Kong, Korea and Russia. The U.S. share of DFI in Pacific Rim countries has declined, while that of Japan and Western Europe has increased. The NIEs have emerged as new investors in the region. The decline in U.S. DFI is likely to be compensated by Asian intra-regional flows initiated by Japan, South Korea, Singapore and Hong Kong. On one hand, international capital flows can serve as a substitute for international labor flows; on the other, DFI can also give rise to bidirectional flows of manpower ranging from unskilled to professional levels.