According to a survey on business confidence among Japanese-affiliated
firms in Asia in 2013 released in Vietnam this Monday, 70 per cent of
Japanese firms regarded Vietnam as an important investment base and
planned to expand investment in the country.
This survey was conducted by the Japan External Trade Organisation
(Jetro) with the participation of 9,371 Japanese firms in 20 countries,
including 435 Japanese firms in Vietnam.
Vietnam out-polled Indonesia with 66.4 per cent, Thailand with 66.2 per
cent, China with 54.2 per cent and Malaysia at 51.6 per cent.
Vietnam’s popularity increased on the 65.9 per cent surveyed in 2012, reflecting growing Japanese investment in Vietnam.
“Amid the tension between Japan and China and the political unrest in
Thailand, Japanese firms are increasing their interest in Vietnam,”
Atsusuke Kawada, chief representative of Jetro’s Hanoi Representative
Office, said at a meeting with the Ministry of Planning and Investment
last week.
Nearly 90 per cent of Japanese firms said they wanted to expand
business in Vietnam because of future revenue growth, according to
Jetro’s report. For non-manufacturing firms, Vietnam’s potential for
growth was the key reason to expand investment.
Japan ranked at the top of foreign direct investment (FDI) for Vietnam
last year with $5.7 billion in committed capital. Given the result of
Jetro’s survey, Minister of Planning and Investment Bui Quang Vinh said
he expected to see a sharp increase in FDI to Vietnam from Japan this
year.
However, Japanese companies also faced risks when investing in Vietnam.
The survey pointed out that investors faced rising wages, complicated
administrative procedures, inconsistent policies, complicated tax and
custom procedures and a fragmented legal framework.
One more challenge was the weakness of local supporting industries that
meant higher production costs as manufacturers had to import components
and spare parts from other markets.
Yasuzumi Hirotaka, chief representative of Jetro’s Ho Chi Minh City
Representative Office, said Vietnam would be more attractive to Japanese
firms if it could improve its supporting industry sector.
(Source: vir.com.vn)