The developing nations of Asia grew very rapidly as suppliers to and buyers from Japan. In 1990 these sources (including South Korea, Taiwan, Hong Kong, Singapore, Indonesia, and other countries in Southeast Asia) accounted for 28.8 percent of Japan's exports, a share well below the 34 percent value of 1960 but one that had been roughly constant since 1970. In 1990 developing Asian countries provided 23 percent of Japan's imports, a share that had risen slowly from 16 percent in 1970.

As a whole, Japan had run a surplus with noncommunist Asia, and this surplus rose quickly in the 1980s. From a minor deficit in 1980 of US$841 million (mostly caused by a peak in the value of oil imports from Indonesia), Japan showed a surplus of nearly US$3 billion with these countries in 1985 and of over US$228 billion in 1990. The shift was caused by the fall in the prices of oil and other raw materials that Japan imported from the region and by the rapid growth in Japanese exports as the region's economic growth continued at a high rate.

Indonesia and Malaysia both continued to show a trade surplus because of their heavy raw material exports to Japan. However, falling oil prices caused trade in both directions between Japan and Indonesia to decline in the 1980s. Trade similarly declined with the Philippines, owing to the political turmoil and economic contraction there in the 1980s.

South Korea, Taiwan, Hong Kong, and Singapore constituted the newly industrialized economies (NIEs) in Asia, and all four exhibited high economic growth during the 1970s and 1980s. Like Japan, they lacked many raw materials and mainly exported manufactured goods. Their deficits with Japan increased from 1980 to 1988, when the deficits of all four were sizeable. Over the 1970s and 1980s, they evolved a pattern of importing components from Japan and exporting assembled products to the United States.

Japan's direct investment in Asia also expanded with the total cumulative value reaching over US$32 billion by 1988. Indonesia, at US$9.8 billion in 1988, was the largest single location for these investments. As rapid as the growth of investment was, however, it did not keep pace with Japan's global investment, so Asia 's share in total cumulative investment slipped, from 26.5 percent in 1975 to 17.3 percent in 1988.

China is now Japan's largest export market, surpassing the U.S. despite a drop in overall trade, according to recent figures from the Japan External Trade Organization. Japan's exports to China fell 25.3% during the first half of 2009 to $46.5 billion, but due to a steeper drop in shipments to the U.S., China became Japan's largest trade destination for the first time. China is also Japan's largest source of imports