JETRO Invest Japan Report 2024
Chapter2. Trends in Inward FDI to Japan Section1. Trends in Inward FDI to Japan

According to the Balance of Payments Statistics (asset and liability principle) published by the Ministry of Finance (MOF) and the Bank of Japan (BOJ), the FDI flow to Japan in 2023 declined sharply to 2.9 trillion yen, down 54.1% from the previous year . By type of capital, equity capital decreased 54.2% from the previous year to 1.3 trillion yen, reinvestment of earnings decreased 4.0% to 1.8 trillion yen, and debt instruments decreased to minus 0.2 trillion yen from 1.6 trillion yen. Debt instruments are related to the borrowing and lending of funds between companies in a capital relationship, and the results reflect activities such as borrowing by Japanese companies from their overseas subsidiaries and affiliated companies.

The FDI stock in Japan (asset and liability principle) at the end of 2023 was 50.5 trillion yen (up 9.3% from the previous year), representing 8.5% of GDP. Looking at this stock by capital type, equity capital increased 3.0% year on year to 24.4 trillion yen, reinvestment of earnings increased 11.4% to 8.8 trillion yen, and debt instruments increased 18.5% to 17.3 trillion yen. Since the breakdown of the stock began to be published in 2014, equity capital has increased significantly from 15.4 trillion yen to 24.4 trillion yen (up 58.4%), reinvestment of earnings from 5.2 trillion yen to 8.8 trillion yen (up 69.2%), and debt instruments from 3.2 trillion yen to 17.3 trillion yen (up 440.6%), respectively.