The volume of Japanese direct investments in Hawaii surged during the late 1980s. This corresponds to the rapid expansion of Japanese overseas investment in general with the sharp rise of the yen value vis-a-vis the U.S. dollar after the 1985 Plaza Accord. Between 1985 and 1995, Japanese invested no less than $12 billion in Hawaii compared to $850 million in the preceding 10 years. The highest single year of Japanese investment in Hawaii was in 1989 when net investment reached nearly $5 billion. Since 1989 annual investment volumes have fallen sharply. In the past few years, Japanese investors have begun divesting some of their assets in Hawaii so that the cumulative total of investments is less today than it was during the early 1990s (See Chart 1.0).
