|Do Nhat Hoang, head of the Foreign Investment Department, Ministry of Planning and Investment and Takeo Nakajima, the representative of the Japan External Trade Organisation (JETRO) (L-R)
At the press conference that announced the survey on production and business activities of Japanese enterprises in Asia and Oceania in the fiscal year 2019 held on February 14, Takeo Nakajima, the representative of the Japan External Trade Organisation (JETRO), said 65.5% of Japanese firms had profits in 2019. Even though business in the Asia - Pacific region is declining, there are still many strong firms in Vietnam.
In ASEAN, Vietnam has the highest number of Japanese firms that want to expand businesses. 63.9% of Japanese firms that took part in the survey said that they would expand businesses for better revenues. According to Nakajima, this rate is lower than the previous year due to the general world economic decline.
Do Nhat Hoang, head of the Foreign Investment Department, Ministry of Planning and Investment, said the majority of Japanese firms still want to continue their investments in Vietnam. In 2019, the number of Japanese firms that came to Vietnam for field survey increased by 30%.
Japanese firms are most interested in power and smart city projects. In the near future, Japanese firms may invest more in the manufacturing industry to export back to Japan and those that aim at Vietnam domestic market.
Firms that want to join the Vietnam market include those in the consumer goods sector, the IT, construction and healthcare sector. Many firms have also expressed interests in the tourism sector as 1.4 million passengers travel between Vietnam and Japan each year. However, this sector is being affected by the coronavirus outbreak.
122 firms took the survey said they would move their manufacturing locations in the future, 42.3% of them said they would move to Vietnam.
According to Nakajima, many firms that already have factories in China want to open new business offices and factories in Vietnam in case there are export difficulties in China. Moreover, production costs in China are also much higher now so firms want to diffuse the risks in production and business and Vietnam is their top destination.