Regular annual visits to Vietnam by Japanese businesses aim to strengthen trade ties and seek investment opportunities with local businesses.
However according to many experts, Vietnamese businesses should enhance their production capacity in order to do business with Japanese enterprises.
From between October 11 -13th, a total of 33 Japanese businesses held working sessions with 30 Vietnamese suppliers during the Supporting Industry Show co-organized by Japan External Trade Organization (JETRO), the Investment & Trade Promotion Centre of HCM City (ITPC) and HCM City Centre of Supporting Industries Development (CSID).
CSID Deputy Director Le Nguyen Duy Oanh said Vietnamese companies see huge potential opportunities to provide Japanese businesses with products for supporting industries.
However, to take full advantage of these opportunities, local businesses have been advised to improve their production capacity in order to meet the basic requirements of their Japanese counterparts.
ITPC Director Pham Thiet Hoa highlighted the great significance of the 2018 Supporting Industry Show for the production sector, saying it will present plenty of new opportunities for supporting industry firms to access cutting-edge technologies and machinery, seek effective solutions as well as adding value to their products.
Japanese enterprises, through the event, were able to seek suppliers of industrial components and create a healthy platform for Vietnamese businesses to promote their component products to potential clients.
According to JETRO, the demand for supply sources in Vietnam from Japanese businesses’ is huge and about 60% of Japanese enterprises are seeking immediate supply sources.
Although the support industry has more coverage over recent years, the rate of supply sources from domestic firms stand at more than 13%, lower than other regional nations such as China (40%), Thailand (roughly 30%), Indonesia (over 20%), Malaysia (nearly 20%) and the Philippines (14.5%).
At present, JETRO has launched a wide range of activities to boost the development of supporting industry businesses.
Japanese enterprises have increased their investments in Vietnam during recent times. In the nine-month period, Japanese businesses top the list of foreign investors in Vietnam with a total investment capital of US$7 billion, accounting for nearly 28% of total investment capital.
Japan now ranks second among nations, currently investing in the Southeast Asian nation with a total registered capital of US$55.7 billion, making up 16.6% of total investment capital.
Consequently, domestic companies have been advised to improve their capability towards stronger partnerships with their Japanese partners.