Monday, February 17 2020

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Up to 64% of Japanese firms want to expand business in Việt Nam: Jetro

Update: February, 07/2020 - 16:49

 

 

A production line of a Japanese company in Việt Nam. About 64 per cent of Japanese firms expect to expand their business in the country. — Photo daidoanket.vn

HÀ NỘI — About 64 per cent of Japanese enterprises plan to continue expansion of their business in Việt Nam due to its favourable investment environment.

Chief Representative of Jetro Hà Nội Takeo Nakajima presented the figure as part of the Japan External Trade Organisation (Jetro)'s survey on Japanese investment in Asia and Oceania 2019 to Deputy Minister of Industry and Trade Đỗ Thắng Hải at their meeting on Thursday in Hà Nội.

The Japanese enterprises will continue to expand their businesses in Việt Nam based on revenue growth, development ability, stable production and consumption network, low cost, labour resources, regulations and business procedures.

Takeo Nakajima was quoted by the Công thương (Industry and Trade) newspaper as saying: “The investment environment in Việt Nam has many advantages for Japanese businesses, such as political and social stability, ideal living environment for foreigners and cheap labour costs."

According to this survey, 65.8 per cent of Japanese enterprises doing business in Việt Nam have been profitable, especially the manufacturing sector, which accounts for 80 per cent of profitable firms.

The number of newly established Japanese businesses has also increased in Việt Nam.

However, the representative of Jetro Hanoi also raised concerns that there are many risks for Japanese enterprises in Việt Nam, including rising labour costs, and complicated administrative procedures and tax regulations.

Jetro's survey also showed that Japanese companies have increased purchases of raw materials from Vietnamese enterprises since 2010. However, 56.2 per cent of Japanese enterprises still face difficulties in buying accessories and raw materials from local firms.

At present, Japanese enterprises in Việt Nam are still very concerned about issues relating to production and business activities, such as costs, administrative procedures and localisation rate, but they hope to develop their business here, he said.

In addition, Jetro also says that in the future, Việt Nam and Japan can promote cooperation to improve productivity, including in robotics, IoT and AI applications. Start-ups of the two countries are expected to boost cooperation.

To create favourable conditions for Japanese enterprises, Jetro has proposed Việt Nam’s Government and the Ministry of Industry and Trade to remove existing difficulties and obstacles for Japanese investors, he said.

At the meeting, Deputy Minister Đỗ Thắng Hải said the ministry as well as other ministries will create more favourable conditions in production, business and investment for Japanese firms. While, Vietnamese businesses need to coordinate further with Japanese enterprises to take advantages of free trade agreements (FTAs).

Hải hoped that Japan would promote further cooperation in supporting industries to improve production capacity and raise the localisation rate in Việt Nam.

He said at present, the coronavirus epidemic has seriously affected Việt Nam's exports to China, so Việt Nam expects to promote trade activities between Việt Nam and Japan. — VNS

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