Japanese investment in China requires cooperative efforts

Masahito Tasuda, managing director of JETRO, said investment from Japanese enterprises has witnessed structural changes due to not only labor costs in China but also political disagreements between the two countries.

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Analysts hope both countries can work together.

China should pay more attention to intellectual property protection and offer preferential assistance for foreign direct investment, while Japan should restructure its investment model to shift focus from labor and material costs to market and technology, according to Li Tie.

The trilateral pact, which took effect on Saturday, will help facilitate investment among China, Japan and ROK.

The deal is considered a prelude for a Free Trade Agreement among the countries.

"The new pact has promised a more stable, transparent investment environment to lower risks," said Ding.

According to Li, the agreement not only helps Sino-Japan economic ties, but also promotes political relations.

"Trade connections between China and Japan are deeply intertwined as Japan's capital and technology is required in China while Japan needs the Chinese market and investment environment," said Li.