Fifteen more Japanese firms want to open plants in Vietnam

Fifteen more Japanese businesses want to open plants in Vietnam, Chief Representative of the Hanoi Office of the Japan External Trade Organization (JETRO) Takeo Nakajima told a press conference on July 23.

27, Jul. 2020

Photo by carlos aranda on Unsplash
Photo by carlos aranda on Unsplash

HANOI, VNA - Fifteen more Japanese businesses want to open plants in Vietnam, Chief Representative of the Hanoi Office of the Japan External Trade Organization (JETRO) Takeo Nakajima told a press conference on July 23.

Nakajima said the Japanese Government has launched a programme to help Japanese firms diversify their supply chains in ASEAN member countries. As many as 30 enterprises have registered for the programme, 15 of them want to open factories in Vietnam, he added.

Due to the far-reaching effects of the COVID-19 pandemic worldwide since February, the supply chains for the automobile, mobile phone and machinery industries have been disrupted, resulting in a shortage of components, he elaborated.

The Japanese Government is encouraging companies to diversify their supply chains to avoid dependence on a single market, he said, adding that each business joining the programme will receive a maximum grant of 5 billion JPY (47 million USD).

Explaining the reason why Vietnam is attractive to Japanese firms, Nakajima said the Vietnamese Government’s dedicated effort to draw Japanese capital is a crucial factor.

Another Vietnam’s advantage is the fact that a large number of its workers are fluent in Japanese language though those from Malaysia and the Philippines have better English skills.

According to the JETRO official, a 95 million population along with improving living conditions will soon turn Vietnam into an attractive market. Apart from exports, Japanese goods made in Vietnam could also cater to the host country.

However, he also noted that as Vietnam’s labour and land lease costs have been rising over the years, it will gradually soon lose low-cost advantages. Moreover, the country also should develop its supporting industry to raise the rate of locally-made products. - VNA