Already big, Japan’s investment figures to grow bigger

>> Japan, Vietnam mark 40 years of friendship

Just 20 days after being re-elected as Japanese prime minister, Shinzo Abe paid a two-day official visit to Vietnam with the purpose of strengthening bilateral cooperation between the two countries. This was his first diplomatic visit overseas after being re-elected.

For Japanese investors, Abe’s visit underlines Vietnam is an important partner of Japan, which could open more opportunities for them to expand investment in this South East Asia nation.

“I believe this is the proof that Japan stands firm to regard Vietnam as a very important strategic partner. Japan and Vietnam have been cultivating good relation for decades in the past, and I believe this historical visit opens new era for two counties,” said Shimon Tokuyama, Mitsubishi Corporation’s senior vice president and general manager for Vietnam .

“I hope through the visit of Prime Minister Shinzo Abe, the investment environment, including Vietnamese domestic regulations, will keep improved for Japanese corporations, and the bilateral relationship will be much closer so that it will last into next generation to generation,” Tokuyama said.

Since Vietnam opened door to welcome foreign direct investment (FDI), Japan has always ranked among the largest investing countries in Vietnam. Total investment capital commitment of Japanese companies to Vietnam reached $29.14 billion till the end of last year, according to Vietnam’s Ministry of Planning and Investment. In 2012, Japanese FDI commitment to Vietnam was $5.13 billion, accounting for approximately 40 per cent of total FDI commitment to the country during the year.

Big Japanese companies include Nidec Corporation, Bridgestone Corporation, Fuji Xerox and Nippon Steel & Sumikin Metal. “Everyone can easily come up with the reasons why Japanese corporations are interested in Vietnam, like growing young population, high economic growth, competitive labor cost, diligent workers and high education level,” Tokuyama said.

Diplomatic stability, he added, was one of the most important factors when corporations consider investing abroad, especially for companies investing in infrastructure projects.

To improve investment climate in Vietnam, the Vietnamese and Japanese governments late last year agreed to push toward a fifth stage of an economic cooperation agreement. The agreement, known as the Vietnam-Japan Joint Initiative which started in April 2003, is an economic cooperation between the two governments to remove obstacles for Japanese investors operating in Vietnam.