Japan enters local agriculture scene
The Vietnam-Japan business co-operation in the agricultural sector is flourishing.
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DTK Phu Tho Company is set on signing a memorandum of understanding (MoU) with three Japanese firms – ISE Food Corporation, Hytem Corporation, and Nabel Corporation – on projects to raise chicken and produce eggs for export to Japan and other regional markets.
A DTK Phu Tho source told VIR that the company is purchasing high technology from these firms for use in its $36.4 million production facility in the northern province of Phu Tho.
“We shall continue to seek more Japanese partners to expand our production in Vietnam,” the source said.
During the official visit, TH Group’s TH International Medical Development JSC will work with several Japanese firms to produce safe foodstuff and agricultural products. TH expects to ink a co-operation deal with Japan’s International Total Engineering Corporation to develop a high-tech health care complex in Vietnam.
“We want to co-operate with Japanese partners in the sectors of high-tech agriculture, processing technology, and health care,” said the group’s chairwoman Thai Huong.
Also during this visit, Viet Phuc Export-Import and Production will sign an MoU with the Japan Agriculture Association on developing a high-tech agricultural complex in Vietnam.
Nafood Corporation will secure an MoU with Maruzen Co., Ltd. detailing a high-tech project to cultivate and process organic ginger. Ho Guom Group JSC will sign an MoU with Meikoshoji Co., Ltd. to build a high-tech vegetable and spice production facility, with an output of 2.4 million spice packs per week.
Vietnam’s Veeteq JSC will sign two MoUs with Japan’s Inataba Bussan and Kobe Busan for a project to produce and process safe vegetables.
Since early this year, many Japanese agri-businesses have come to Vietnam in search of opportunities in the agricultural sector, according to the Ministry of Agriculture and Rural Development.
Early next month, a big Japanese infrastructure firm will resume working with the leadership of the Central Highlands province of Lam Dong on a project to build a 300-hectare high-tech farm for cultivating safe vegetables and flowers, with initial investment capital of nearly $100 million. The two sides met to discuss this project three months ago.
It is likely that the project will begin in mid-2017, and become operational later this year. After the farm is built, the investor will work to attract Japanese agricultural firms to run it.
Currently, Lam Dong has 12 Japanese agricultural investment projects, focusing on producing safe vegetables and fruit.
Japan’s Kawasaki Flora Auction Market Co., Ltd. is also reportedly planning to invest in Lam Dong, set to operate a floriculture facility in Da Lat to export flowers to Japan and European nations. In its first year, the firm will cultivate flowers on a 20ha area, which will later be expanded to 50ha after three years and 100-200ha after the fifth year.
According to the Embassy of Japan in Vietnam, Vietnam has a lot of agricultural development potential. The country is contagious to big consumption markets, such as ASEAN countries and China.
It would be economically strategic for Japanese enterprises to invest in Vietnam’s agricultural sector and export products to these markets through economic corridors and highways that have been under development in recent years.
The Japan International Co-operation Agency (JICA) said that it will raise its support for Vietnam’s agricultural sector via an array of projects invested in by Japanese firms.
For example, Kato Group is co-operating with the central province of Binh Dinh in a $771,000 tuna fishing project, which will last until June 2020. Another company active in the fishery industry, Shudensha Company, is implementing a $820,000 project to improve water quality in its fisheries.
Nikko Foods Company has also been active in Lam Dong , with their $820,000 project to develop high-quality tomatos.
According to Japanese investment consulting firm Seiko Ideas Corporation, Japan is co-operating with Vietnam though its “payroll outsourcing” model. Specifically, Japanese firms, through outsourcing, will pay the salaries of Vietnamese farmers, coming to Vietnam as transnational companies and hiring local labourers to implement their agricultural investment projects.
“This is considered to be increasingly popular when the hired companies have more knowledge about personnel, including recruitment, salary payment, relocation, and performance assessment,” said a Seiko Ideas document on Vietnam-Japan agriculture co-operation.
