Southeast Asian governments are closely monitoring a potentially worrisome trend -- a decline in Japanese industrial investment in their countries. While Japan has been investing abroad at a record pace, less and less of this money is being channeled toward the six nations that make up the Association of Southeast Asian Nations (ASEAN).
Partly to cope with the protectionist threat in the United States and Western Europe, Japanese companies are more and more placing their manufacturing operations there.
And growing emphasis on technology rather than labor-intensive industries is also hurting the newly industrializing ASEAN states.
With much of the region in economic difficulties, there is keen awareness of a need to persuade Japan to keep up its high level of investment -- even while, ironically, elements in these countries grumble about Japanese economic domination.
One key concern is that the changing Japanese orientation will influence other investors, many of whom who tend to regard the Japanese as the barometer for Asia.
``The Japanese are the bravest in terms of taking risks,'' says Hadi Susastro of the Center for Strategic and International Studies, Indonesia's influential think tank. ``If they are already affected, they'll affect the Europeans and Americans as well.''
According to Keizai Doyukai, an important Japanese businessmen's association, Japan has investments totaling $12.6 billion in 869 ASEAN projects in Singapore, Thailand, Malaysia, the Philippines, and Brunei.
But a recent study by the Japan External Trade Organization shows clearly the changes under way in Japanese thinking on overseas investment.
In the 1970s, the Japanese invested more heavily on resource development and labor-intensive, low-cost manufacturing ventures in developing countries. But the emphasis has now shifted to high-tech manufacturing operations, particularly automobiles and electronics in the developed world.
In 1984, the last year for which official figures are available, Japanese companies pumped $5.6 billion into the developed world and only $4.5 billion into developing nations, reversing the longstanding trend in favor of the latter.
Japanese officials and ASEAN businessmen agree that five or six years ago the region's wage structure was an important consideration. But today it hardly applies, having been overtaken by the revolution in high technology, robotics, and micro-electronics.
Indonesia has relied heavily on Japanese cash to promote moves away from heavy dependence on oil and gas revenue. But the Indonesians say new Japanese investment has declined from a high of $634.2 million in 1982 to $99.8 million last year.
Toyohiko Shimada, first secretary of the Japanese Embassy in Jakarta, says Japanese businessmen will probably restrict their new investments in the ASEAN region to certain countries because of frequent changes in government policy.
In the regional investment decline, Malaysia seems to have been hurt the least so far. Japanese officials say it has been getting Japanese capital that used to go to Thailand, especially in such fields as electronics, chemicals, and textiles.
The Malaysians have gained because of a better investment and political climate, whereas Thailand has lost ground because of Japanese concern over the volatile border situation with its communist neighbors.
Yet some Japanese analysts say Thailand's lower wage costs and plentiful raw materials for export-oriented operations, along with a large domestic market, are points in its favor.
Looking at ASEAN in the long term, Japanese officials feel investments should pick up in most countries of the region. But investors will be choosier -- turning away from heavy industry, with its outlook of questionable profits, toward areas like biotechnology, where Southeast Asia is considered to have good growth potential.