At the advent of Trans-Pacific Partnership (TPP), Japanese investment trends in Vietnam tend to increase, said Mr Hirotaka Yasuzumi, Chief Representative of the Japan External Trade Organisation (JETRO) in Ho Chi Minh City, at the press conference and the signing ceremony of a cooperation agreement among JETRO, the Investment and Trade Promotion Centre of HCM City (ITPC) and Reed Tradex Company in HCM City on June 15, 2016.
The agreement aimed to form comprehensive supporting industries connectivity in Vietnam towards the future of global integration. This tripartite pact was expressed by their co-organisation of the Business Alliance for Supporting Industry 2016 together with the Vietnam International Exhibition on Machine Tools & Metalworking Solutions (Metalex Vietnam 2016), scheduled to take place from October 6 to 8, 2016 at the Saigon Exhibition and Convention Centre (SECC), District 7, HCM City.
Southern supporting industries see rapid growth
At the agreement signing ceremony, Mr Hirokata Yasuzumi said that a JETRO survey conducted in 2015 indicated that labour cost accounted for 19 per cent of production costs of Japanese companies in Vietnam, while materials made up 58 per cent. He said if local partners could supply more parts, they would help manufacturers reduce costs significantly.
According to the survey, the localisation ratio of Japanese companies in Vietnam was 32 per cent while the respective ratios in China, Thailand and Indonesia were 37 per cent, 24 per cent and 20 per cent. The survey showed local enterprises supplied 9 per cent in the north and 17 per cent in the south.
Commenting on Japanese investment trends in Vietnam, Mr Hirokata Yasuzumi said that although Japanese investment projects in Vietnam fell 12 per cent in 2015, this trend is rising again after the TPP Agreement. He added that despite negative impacts such as Japanese yen devaluation, Japanese investment trends in Vietnam will remain stable or even increase.
He said that JETRO put forth policy recommendations and specific actions for improving the business environment, particularly supporting industry development.
Focusing on business expansion
In the latest 10 years, JETRO has carried out various supporting industry exhibitions with the purpose of promoting business operations. Specifically in the south, the agency has launched many business connections although results did not meet expectations on the absence of new businesses.
Hence, to give priority to new Vietnamese companies in HCM City and other provinces and cities, apart from ITPC, JETRO has coordinated with HCM City Export Processing & Industrial Zones Authority (HEPZA), the Department of Industry and Trade, the Centre for Supporting Industries, and industrial zones authorities in Binh Duong, Dong Nai and other localities to organise the Business Alliance for Supporting Industry 2016.
Mr Nguyen Tuan, Deputy General Director of ITPC, said that HCM City has strategies for rapidly transforming its export structure, with the focus given to four key sectors: food processing, chemical - rubber, engineering - electronics, and information technology. He added that Vietnamese supporting industries are in the early stage of formation and development where development potential is huge. For that reason, developing supporting industries is a central task of Vietnam in general and HCM City in particular.
PV
Vietnamese
