Japan investment to take off

Japan’s ANA Holdings will become Vietnam Arlines’ strategic partner under a deal expected to be signed this week Photo: Le Toan

The Ministry of Foreign Affairs (MoFA) last week announced that during PM Phuc’s May 26-28 working visit to Japan, where he will also attend the G7 Summit, a co-operation agreement will be officially inked between Japan’s ANA Holdings and Vietnam Airlines.

After the agreement is signed, ANA Holdings, one of the world’s top-class airline companies, will become a strategic partner of the Vietnamese firm with 8.8 per cent stake valued at $108 million.

The agreement will help satisfy ANA Holdings’ ambitions to expand its operations in fast-growing regional markets, including Vietnam.

In turn, Vietnam Airlines will have additional funds to boost operational and management know-how.

According to the MoFA, the agreement between ANA Holdings and Vietnam Airlines is among five co-operation agreements which are expected to be signed by Vietnam and Japan, during PM Phuc’s visit.

The other four agreements include an exchanged diplomatic note on the proposed Japanese loan to Vietnam for the development of its railway system in Ho Chi Minh City; an agreement on receiving the loan for this railway system; an agreement on improving the city’s water sources; and an agreement on providing a loan for Vietnam to develop its Thai Binh Thermal Power Plant.

During his visit, Phuc is to hold bilateral talks with his counterpart Shinzo Abe, focusing on further cementing the two countries’ extensive strategic partnership, with the focus placed on politics, trade, and investment among many other sectors.

Notably, PM Phuc and leaders of the ministries of Planning and Investment, Industry and Trade, Finance, Transport, and Construction are expected to hold large-scale talks with hundreds of Japanese firms.

By late last week, over 200 Japanese firms, including larger companies, have registered to attend the event.

Phuc will also meet with leaders of big groups and organisations, such as Japan International Cooperation Agency, Japan External Trade Organization, Mishubishi and Toyota.

According to the MoFA, Vietnam’s government wants to attract more Japanese investment, especially in the sectors of automobile, machinery, supporting industry, and hi-tech agriculture. These sectors are vitally important to Vietnam for its modernisation and industrialisation.

As of April 20, 2016, Japan had 3,051 valid investment projects in Vietnam, registered at $39.17 billion, making Japan Vietnam’s second largest foreign investor, after South Korea.

During the bilateral talks, Vietnam and Japan are expected to further clarify and boost their economic link concept, created during Party General Secretary Nguyen Phu Trong’s official visit to Japan during September 15-18, 2015. The concept includes connection of economic development strategies and connection of production capacity.

During the visit, Phuc will attend a summit of the Group of Seven (G7) [including France, Germany, Italy, Japan, the UK, the US and Canada]. This will be the first time Vietnam has been invited to attend this important event, which occurs every seven years in Japan.

“This shows that Vietnam’s prestige and position among the G7 nations is increasing,” stated an MoFA document on the visit.