Mitsui gets access to distribution sector

Under the terms of the licence, the $30 million subsidiary Mitsui & Co Vietnam will be allowed to export Vietnamese products, import raw materials and parts, and distribute goods for Japanese-invested enterprises. The firm plans to start operations in April with a targeted revenue of $500 million per year.
Mitsui chief representative Ken Ozeki said that his company would introduce manufacturing support services mainly to Japanese-invested manufacturers.
“We plan to offer a supply chain management model, promote investment in Hoa Lac hi-tech park, and promote Vietnamese export products,” he said.
From the date of its accession to the WTO this month, Vietnam will grant all foreign firms and individuals, including foreign-invested firms, the right to import and export goods not otherwise reserved to State trading (such as petroleum products) and not including a few other types of goods for which a short transitional period has been agreed to before full trading rights are granted to outside foreign enterprises.
Foreign firms and individuals will also be allowed to sell imported products to domestic distributors in Vietnam, although this will not automatically grant importers the right to become distributors.
In other words Vietnam will maintain the right to apply all necessary measures to ensure that compliance with its trading rights obligations will not affect the country’s commitments in trade in services, including distribution services.
Present in Vietnam since 1991, Mitsui & Co has two representative offices and has invested either directly or indirectly in Vietnam’s steel, port management, industrial support and food processing sectors.
Mitsui & Co. is among the growing number of Japanese corporations that have expressed increasing interest in Vietnam’s market following its accession to the WTO and the US’ granting of PNTR recently.
the impact of Vietnam’s admission to the WTO was being felt towards the end of the year and permanent normal trade relations (PNTR) was granted by the US, promising a new wave of foreign direct investment in Vietnam.
The country attracted a record amount of foreign investment in 2006, at $10.2 billion, representing a 49.1 per cent increase over 2005 and surpassing the year’s targets by 57 per cent. Newly licensed foreign-invested projects worth a total of $7.83 billion focused mostly on the industrial and services sectors. Existing projects increased their registered capital by a combined $2.63 billion during the year.
Sound economic performance, institutional reforms, and the battle against corruption during the past year were also recognised by international donors, who disbursed $2.66 billion in official development assistance (ODA) and promised a whopping $4.45 billion in 2007.
To ensure sustainable growth during 2007, Prime Minister Nguyen Tan Dung told the cabinet meeting that government would prioritise the construction of infrastructure, education and training, the battle against corruption, and narrowing the economic gap among urban, rural and remote areas.
Vietnam needed to focus on coping with unsustainable growth, low competitiveness due to the shortage of a knowledgeable and skilled workforce and insufficient infrastructure, all of which hindered growth in 2006, Dung said.
Administrative reform would be advanced from central to local levels in order to create momentum for business development and the fight against corruption, he said. Many governmental administrative functions and responsibilities would be decentralised and transferred to local authorities, helping the government focus efforts on regulating socio-economic development.
Dung instructed the Ministry of Planning and Investment to identify and eliminate all unnecessary licences and sub-licences in order to help build more favourable conditions for enterprises.
Representatives from the Ministry of Home Affairs admitted that the existence of many cumbersome administrative procedures and licence requirements as well as the harassing attitude of many State cadres continued to cause problems and dissatisfaction among the people and businesses.



No. 794/January 1-7, 2007