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Japan, one of Vietnam's leading partners
Japan has always been among Vietnam's leading partners in both trade and investment, said Mr Hiroyuk Moribe, Chief Representative of Japan External Trade Organisation (JETRO) in Hanoi in an interview with a Nhan Dan reporter.
Japan -Vietnam economic co-operation has constantly developed with a balance of import and export turnover. Japan's direct investment to Vietnam has also increased markedly, mostly concentrating on manufacturing, contributing to sustainable economic development in the country.
Japan is currently one of the biggest investors in Vietnam and also the investor with the highest disbursed capital.
Vietnam and Japan is making preparations to start the third phase of the Vietnam-Japan Joint Initiative, which is scheduled from September 2008 to late 2009.
The success of the first and second phases of the Initiative was the result of the close co-operation between relevant agencies of both countries and the deep concern of the Japanese business community in Vietnam. The Initiative has reflected quite effectively the opinions by Japanese investors who are operating in Vietnam.
Speaking about the Vietnamese investment environment, Mr Hiroyuk Moribe said Vietnam is currently considered as a new emerging market in the region which offers great potentials to investors. Especially, with a big population, abundant labour force, reasonable labour costs, Vietnam has been a suitable destination for sectors using labour intensive.
According to a JETRO's survey on Japanese businesses in Asia, cost for labour in Vietnam is lowest among ASEAN countries and also nearly lowest in Asia. This is one of the reasons for many Japanese investors to choose Vietnam as their investment destination.
However, investors complains about high office and apartment rents for foreigners in Vietnam, plus inconvenient conditions relating to supporting industries, infrastructural facilities, energy, administrative and customs procedures.
According to Hiroyuk Moribe, Japanese investors feel secure with stable political condition in Vietnam and, psychologically, Vietnam and Japan share various cultural similarities. In addition, Vietnamese people show a positive attitude to Japan, especially the people and products of Japan.
Japanese investment in Vietnam has been focusing in heavy industries, including in labour intensive and it is therefore possible to take advantage of Vietnam's low labour cost.
Vietnam's increasing income has led to increasing purchasing power, making Vietnam a potential market to Japanese products. This explains why many Japanese investors have planned to expand their investment in Vietnam.
Asked about measures to attract foreign investment, Mr Hiroyuk Moribe said Japan looked forwards to clear messages from the Vietnamese government in improving the business environment in Vietnam which is manifested through strong determination, specific action plans and commitments to strictly carrying out those plans.
While the global prices are escalating, Vietnam also has to face high inflation, which makes business and living costs increase too. Mr Hiroyuk Moribe said he hoped that the measures that the government has put forward would show its effectiveness in the later half of this year so that inflation could be contained.
Due to Vietnam's less-developed supporting industries, the country has had to import a great deal of materials, components and parts for production while a free-duties ASEAN will be effective in less than ten years. At that time Vietnamese market will be flooded with cheaper products imported from regional countries. Therefore, Mr Hiroyuk Moribe said it would be a challenge for development of manufacturing industries in Vietnam if the domestic supporting industries do not develop accordingly.
ND
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