JETRO believes in enticing prospects for Quang Binh

June 25, 2023 | 18:16
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The Japan External Trade Organization highly appreciates the strengths and promising land of Quang Binh province for projects in areas like renewable energy, tourism, and manufacturing.
JETRO sees a lot of investment opportunities in Quang Binh province
Chief representative of JETRO Hanoi Takeo Nakajima

At the conference on Quang Binh's master plan and investment promotion on June 25, chief representative of the organisation (JETRO) in Hanoi, Takeo Nakajima, highly appreciated the strengths of Quang Binh.

Quang Binh has a population of nearly one million people and has developed 10 economic zones and industrial zones and good logistics infrastructure, such as Hon La Seaport and Dong Hoi Airport.

"Quang Binh is favourable to develop renewable energy projects, including in wind power and solar power," Nakajima said. "Production and trade in the renewable energy sector will be promising."

He also saw great potential for the province to become an attractive tourist destination by taking advantage of world heritage and recreational resources.

"Investment by foreign-invested companies is spreading from urban areas to provincial cities and we see a lot of opportunities," said the JETRO representative.

Specifically, priorities of Japanese companies and their expectations for Vietnamese localities focus on cost competitiveness, Nakajima revealed. According to a survey by JETRO, current risks in Vietnam include workers' salary increases and rising procurement costs.

"Japanese companies always look for low-cost production possibilities. They want to know the advantages of producing in Quang Binh compared to producing near Hanoi and exporting goods to foreign markets via Haiphong ports," he said.

Around three-quarters of Japanese businesses in Vietnam will promote human resource development and an average of two-thirds of ASEAN businesses said the same, meaning that human resources are a key factor in the country.

Currently, there are nearly 500,000 Vietnamese people working in Japan. They will gain experience there and return to Vietnam to exercise leadership roles. Then, they will return to Japan or other countries and be appointed to more important positions.

"Foreign-invested enterprises want such a staffing cycle, especially for young people in Quang Binh," he emphasised.

Moreover, with the increase in sustainable procurement around the world, companies must go green in their entire production processes. 67 per cent of Japanese enterprises in Vietnam have initiated, or will, carbon reduction campaigns in their business activities. Products with low green content will be difficult to sell.

"If Vietnam wants to become a manufacturing hub with high added value, a stable power supply is very important, as well as reducing fossil fuel consumption," Nakajima proposed.

Japanese companies are stepping up efforts to increase production in Vietnam. The amount of foreign direct investment has decreased on-year due to the instability of the global economy and the decline in business confidence. However, the number of investments is growing faster than last year.

"A number of export-oriented companies in the automotive, power, and electronic components sectors have shifted some of their production from China and Japan, underscoring the enhancement of Vietnam's importance," he confirmed.

Furthermore, Vietnam is becoming a research and development and high value-added manufacturing hub. Such companies as Fujikin, Panasonic, and Osaka University are turning Vietnam into a technology development hub in the region.

"Some 35 per cent of Japanese enterprises will become high value-added production, while 30 per cent of enterprises will focus on the general manufacturing industry," he added.

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