Vietnam tops ASEAN in attracting Japanese investment
According to a 2018 survey by the Japan External Trade Organization (JETRO), nearly 70 percent of Japanese businesses operating in Vietnam last year considered expanding their operations, which is the highest rate among 20 surveyed countries.
After coming in at 66.6 percent in 2016, the figure is higher than in regional countries such as the Philippines, Indonesia, and China, indicating Vietnam’s attractiveness as an investment destination. Vietnam appeals to Japanese businesses thanks to the market size growth potential, socio-political stability and low labor costs. More Japanese companies were optimistic about the country’s market outlook.
According to Mr. Hironobu Kitagawa, Chief Representative of JETRO in Hanoi, the most important factor encouraging expansion plans of Japanese companies in Vietnam is the expectation and belief in a rise of their turnovers. Japanese businesses expect their revenue to increase significantly by 88 percent in 2018. Along with that, 46 percent of businesses are confident in the potential growth of the Vietnamese market. In the research, 65.1 percent of Japanese firms in Vietnam were profitable last year, up 2.3 percentage compared to the survey results announced in 2017.
Among the investment areas, the manufacturing industry still took the lead in attracting Japanese investment, accounting for 40 percent of the total. This was followed by real estate with 23 percent. The other invested field including retail, hospitality, food and beverage service, logistics and transport and construction.