Around 92.6 percent of Japan’s production companies operating in Vietnam plan to increase their investment capital and diversify products in Vietnam in the next two years, according to a recent survey conducted by the Japan External Trade Organisation (JETRO).
Mr Hiroyuk Moribe, JETRO chief representative in Vietnam said that Vietnam will become a new investment destination for Japanese companies. Foreign companies also consider Vietnam the best production site in Asia in the five and ten years to come with such major areas as machines, electronics, spare parts and mechanics in general.
However, the survey has also shown that Japanese companies face difficulties in doing business in Vietnam due to increasing costs including the cost of labour, the price of industrial land, and high office space and accommodation costs.
According to JETRO, Hanoi and HCM City ranks fifth in the Asian region in terms of high office space and house rents for foreigners.
The survey also showed that while assessing Vietnam – as a current investment destination, Japanese companies’ satisfaction rate decreased from 75.4 percent in 2006 to 41.7 percent in 2007 due to the inability to purchase materials and recruit staff in the country, poor infrastructure, and cumbersome customs formalities.
