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Laos proves attractive to Japanese investors
Japanese investment in the Lao manufacturing sector is expected to see a big surge in the coming years as Japanese businesses seek new production bases, according to the president of the Lao Garment Industry Association.
A Japanese shoemaker recently doubled its production capacity in Laos.
Mr Onesy Boutsivongsakd made the comment after attending the opening of a new Japanese shoemaking factory in Huaynamyen village, Naxaithong district, some 20 km outside of central Vientiane, last week.
He said that a number of Japanese businesses are looking for new production bases in less developed countries due to increasing labour and investment costs in Japan and China, adding that the situation will boost Japanese investment in the Lao garment industry.
“Japanese investors will not go to Cambodia and Vietnam because investment quotas in those countries will soon be filled,” he said, adding that the Lao government has a unique opportunity to attract more Japanese investment.
Mr Onesy, who co-owns a Lao-Japanese joint venture, said that the government should take advantage of the emerging opportunities and increase its efforts to attract Japanese investment in the manufacturing and garment industries.
He said that Japanese businesses operating in Laos have a policy to train the local labour force so that Lao people can take up high-ranking positions in the company in the future, a fact that will help to create jobs and boost income levels for Lao people.
“Japanese business people will send Lao workers to study overseas before they place them in jobs,” he said.
He said that the Lao garment industry has a strong potential to attract Japanese investment due to the low cost of labour. He also said, as a least developed nation, Laos is able to export many goods to developed countries at reduced or zero tariff rates.
Mr Onesy said that the Lao government has implemented attractive investment policies and laws and therefore he would like to urge officials to increase efforts to assist foreign investors in accessing the investment incentives on offer.
The new investment promotion law aims to facilitate foreign investment in Laos and government officials should put the policy into practice otherwise the country will not be able to attract more investment, he said.
Midori Anzen Company President Mr Fujio Matsumura said that his company decided to invest more than US$4 million to double its shoemaking capacity in Laos after experiencing success over the past three years.
He said that two of the main draws of Laos are its friendly people and the country's political stability.
Japanese investment in Laos has gradually increased in recent years. According to the Japanese Embassy to Laos, there are currently 65 Japanese-affiliated companies operating in Laos, up from 40 five years ago.
The companies are primarily involved in apparel and electric parts manufacturing, as well as mining and hydropower.
kpl lao news agency
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