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Release of the Regional Direct Investment Position (Inward Investment) (Ultimate Investor)

July 9, 2018

Ministry of Finance
Bank of Japan

Release of the "Regional Direct Investment Position (Inward Investment) (Ultimate Investor)"

The Ministry of Finance and the Bank of Japan have released the "Regional Direct Investment Position (Inward investment) (Ultimate investor)" by country (33 countries) and region -- for which data beginning from end-CY2015 are available -- as reference figures for the International Investment Position (IIP) of Japan (Calendar Year Data).

For the "Regional Direct Investment Position (Inward investment) (Ultimate investor)," data on the investment position of overseas parent companies in affiliated companies in Japan (inward direct investment position)1 are compiled by country and region regarding the country in which the ultimate investor holding ultimate control resides as the investing country (i.e., partner country).2 In addition, international standards recommend the compilation of the inward direct investment position on an ultimate investor basis as such statistics are useful for obtaining a better grasp of cross-border direct investment.

Notes:

  • 1. The recording principle of these statistics differs from that of direct investment in Japan's IIP. For details, see Recording Principles of Direct Investment.

  • 2. The investing country is decided as follows.

    • (1) When the overseas parent company A of an affiliate in Japan does not have an investor that owns more than 50 percent of the voting power, the country in which A resides is the investing country.

    • (2) When there is an investor B that owns more than 50 percent of the voting power of A but that itself is not majority-owned by another investor, the country in which B resides is the investing country.

    • (3) When there is an investor C that owns more than 50 percent of the voting power of B, the country in which C resides is the investing country.

  • 3. IMF Balance of Payments and International Investment Position Manual Sixth Edition (BPM6), OECD Benchmark Definition of Foreign Direct Investment Fourth Edition (BD4)

Data for the "Regional Direct Investment Position (Inward investment) (Ultimate investor)," are available in the MOF web site(Excel:17KB) and BOJ Time-Series Data Search.

Recording Principles of Direct Investment
Data seriesRecording principalGeneral description

•Balance of Payments

•Regional Balance of Payments

•Direct Investment by Region and Industry

1. Direct Investment Income

•International Investment Position of Japan

•Regional Direct Investment Position

•Regional Direct Investment Position and Regional Portfolio Investment Position (Assets) (All regions)

Asset and Liability Principle

Investments of Japanese companies in foreign companies are classified as assets and investments from foreign companies in Japanese companies are classified as liabilities.

For direct investment income, receipts of dividends etc. by Japanese companies from foreign companies are recorded as credit and payments of dividends etc. from Japanese companies to foreign companies are recorded as debit.

•Direct Investment by Region and Industry

2. Direct Investment Flows

3. Direct Investment Position

•Regional Direct Investment Position (Inward investment) (Ultimate investor)

Directional principle

Investments of a Japanese company in an overseas affiliated company are classified as outward investment (assets) and investments from a foreign company in a Japanese affiliated company are classified as inward investment (liabilities).

For example, investments from an overseas affiliated company in its parent company in Japan are not recorded under inward investment but recorded as reverse investments, namely withdrawals from the parent company, under outward investment.

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