Spurred by increased capital participation in telecommunications and other companies, direct investment in Japan by foreign companies hit an all-time high of 2.399 trillion yen in fiscal 1999, nearly double the year-before level, the Finance Ministry said Thursday.

The previous record -- 1.340 trillion yen -- was set in fiscal 1998.

European direct investment more than quadrupled to 1.413 trillion yen in the year that ended March 31, accounting for 58.9 percent of the total. In contrast, investment from the United States plummeted to 248.7 billion yen, or 10.4 percent of the total, from 807.8 billion yen, or 60.3 percent.

The number of cases of investment by foreign companies accelerated to 1,705, up from 1,542 for the preceding year. The inflow of foreign direct investment comprised 2.136 trillion yen in acquisitions of shares in Japanese firms and 262.6 billion yen in loans to Japanese companies.

Meanwhile, investment overseas by Japanese corporations amounted to 7.439 trillion yen for fiscal 1999, up from 5.216 trillion yen the previous year. For domestic companies, the United States continued to remain the most attractive country, claiming 33.4 percent of all Japanese investment overseas with 2.486 trillion yen.

Investment in other parts of Asia came to 798.8 billion yen, accounting for 10.7 percent of the total. The top three recipients of Japanese funds in the region were South Korea at 109.3 billion yen, Hong Kong at 108.3 billion yen and Singapore with 107.3 billion yen.

Japanese direct investment in Europe amounted to 2.878 trillion yen, 38.7 percent of the total. Britain and the Netherlands were the two main target countries, receiving 1.307 trillion yen and 1.155 trillion yen, respectively.