Japan’s plastics giants partner with local firms

Two major Japanese firms have entered local plastics Photo: Le Toan

Japan’s Sojitz Pla-Net, the plastics division of Sojitz Corporation, entered into a strategic partnership with Rang Dong Plastic JSC last week to establish greater co-operation in the market, with Rang Dong Plastic selling a 20 per cent stake in its subsidiary Rang Dong Long An Plastic JSC to Sojitz Pla-Net.

The firms will join forces to develop the Rang Dong Long An factory complex in the southern province of Long An. It is slated to open in March 2018.

With $32 million in investment capital for the first stage, the plastics complex will house three factories on an area of 8.7 hectares. The factories will employ the latest technology from Germany, Italy, Japan, Taiwan, and South Korea.

Norio Satake, chairman of the board of directors for Sojitz Pla-Net, said they found rapid growth in the demand for greater sophistication in Southeast Asia’s packaging industry. This includes not only exported food production, but also the development of a cold chain system that caters to growing middle-class incomes.

According to Satake, the investment into Rang Dong Long An will help the firms to create new packaging businesses for the Sojitz supply chain. In Vietnam, the Vietnamese firm has been collaborating with more than 20 Sojitz group companies. Taking advantage of this network, it will supply Rang Dong products to Sojitz-operated Ministop Vietnam. In its overseas markets, Sojitz Pla-Net has already started supplying Rang Dong products in Cambodia, Myanmar, and the Philippines.

In addition, Sojitz Pla-Net will supply raw materials to Rang Dong to produce new products for customers. Through this partnership, Rang Dong will have access to a more stable, competitive, and high-quality supply of material.

On July 5, Japan-based Sekisui Chemical Group signed a strategic partnership agreement with Tien Phong Plastic South JSC, an affiliate company of Tien Phong Plastic. Sekisui has more than 66 years of experience in manufacturing plastic pipes in Japan and Tien Phong Plastic is one of Vietnam’s leading plastics manufacturers.

Hajime Kubo, director and senior managing executive officer of Sekisui, said that Asia has been the largest revenue contributor to Sekisui. With official development assistance funding from Japan, the group has plans to enter regional markets like the Philippines, Thailand, and Indonesia. The group is targeting Vietnam as a potential manufacturing base, capitalising on the country’s domestic demand and possibilities for export to other Southeast Asian countries.

Another Japanese firm, Oji Holdings Corporation, has bought major shares in Vietnamese packaging manufacturer United Packaging Joint Venture Co., Ltd. Meanwhile, Japanese investment institution RISA Partners has expressed its intention to invest in Dong An Plastic.

Nguyen Hoang Ngan, deputy chairman of the Vietnam Plastics Association, considers the plastics industry to be a dynamic sector of the Vietnamese economy, with annual increases from 12 to 15 per cent, and some plastic products growing by nearly 100 per cent.

At present, the Vietnamese plastics industry has 3,000 enterprises operating across the country. The 2016 revenue of the plastics industry was estimated to reach nearly $14 billion, a 10.3 per cent increase compared to 2015.