Secondary sector grew in importance, first in the NIEs later in LDCs. The latter attractive as low-wage production sites, the former as hosts for more advanced production. Tertiary sector on the increase, complementarity between secondary and tertiary sectors, more liberal investment climate for services. FDI usually small compared to total capital formation. Also much smaller than trade flows.
Investments have more fundamental impact than trade on the economies of the host countries, though.
Japan Earlier, Japan was rather negative to outward FDI, except in resources. Strict control of capital flows. Strong increase after 1985 when appreciating yen speeded up the process of relocating industrial activities. Foreign assets became cheaper. Trade barriers for Japanese goods forced Japan to change country of origin.