Japanese firms in Vietnam turn eyes to non-manufacturing industries
There was a significant increase in Japanese investment in Vietnam’s non-manufacturing industries, such as retailing, education, healthcare, energy, finance and insurance, transport and real estate, according to a 2021 survey of the Japan External Trade Organisation (JETRO) on 700 Japanese FDI enterprises in Vietnam.
Japanese firms in Vietnam turn eyes to non-manufacturing industries. (Photo: VNA)
Hanoi (VNA) – There was a significant increase inJapanese investment in Vietnam’s non-manufacturing industries, such asretailing, education, healthcare, energy, finance and insurance, transport andreal estate, according to a 2021 survey of the Japan External TradeOrganisation (JETRO) on 700 Japanese FDI enterprises in Vietnam.
Some 51.7 percent of Japanese FDI firms in the manufacturingsector plan to expand business in Vietnam over the next one to two years, up4.6 percent year-on-year, the survey has found. About 58.7 percent ofnon-manufacturing companies want to do the same, up 12.1 percent.
Japanese enterprises are increasingly diversifying areas ofoperation in Vietnam, said Hirai Shinji, Chief Representative of JETRO in HoChi Minh City. Before most of Japanese firms in Vietnam were operating inmanufacturing, he said, but now FDI flows into food production, fast-movingconsumer goods, retailing and real estate are on a rise.
There is a shift from manufacturing to non-manufacturingsectors, Shinji told the Investment Review. This is a considerable transition ofJapanese investors to consumer goods and retailing from industrial production,he added.
Despite input and labour costs have trended upward inVietnam in the past several years, they are relatively lower than those inJapan. Vietnamese workers have also been regarded as dynamic and highly productive.
Many Japanese firms in the IT and retailing sectors, forexamples, which post relatively larger labour costs, are growing and expect toexpand business in Vietnam, he emphasized.
General Director of AEON Vietnam Furusawa Yasuyuki said thereare major changes in the way Vietnamese consumers shop as a result of COVID-19,significantly impacting e-commerce and demand for necessity goods.
Japanese firms view these changes as an opportunity soinvestment into retailing will definitely surge, he remarked on the sidelinesof the Conference on Investment Promotion held by the Investment PromotionCentre (IPC) South Vietnam in HCM City earlier this month.
“Vietnam has achieved encouraging economic growth so I thinkmany Japanese companies are considering pouring investment into Vietnam,” hesaid.
He added that the services, equipment and consumer goodsindustries have huge potential for growth in Vietnam, given the country’sfast-growing population, good economic outlook and people’s improving livingstandard./.
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Japanese firms in Vietnam turn eyes to non-manufacturing industries. (Photo: VNA)
