Japan investors come knocking, annoyed at hindrances

VietNamNet Bridge – Japanese investors, aware of plenty of opportunities in Vietnam, are coming in droves here but are also vexed over numerous hindrances in the country, heard the Vietnam-Japan Economic Summit in Hanoi on Thursday.

Japan investors, Vietnamese market, Jetro, State-owned enterprises, business environment

Japanese entrepreneurs see Vietnam as the most lucrative destination in the region, but they proposed in a straightforward manner that the Vietnamese Government remove business obstacles for them.

Key economic partner

Doan Xuan Hung, Vietnam’s ambassador to Japan, related at the summit that his working days now are all occupied by meetings with Japanese investors.

“We have to meet with a new wave of Japanese investors – big and small alike – who show increasing interest in the Vietnamese market,” Hung said, adding the bustling atmosphere was seen in half of the 47 prefectures in Japan that he had chances to visit.

Such at atmosphere is a good chance for Vietnam, he said to representatives of Vietnam’s ministries and agencies at the summit.

“I earnestly insist that ministries and central agencies take hold of this opportunity, creating conditions for Japanese investors to implement their projects in Vietnam,” said the ambassador.

Statistics from Japan External Trade Organization (Jetro) backs Hung’s comments.

Daisuke Hiratsuka, vice executive president of Jetro, told the gathering that up to 6,800 Japanese investors visited Jetro’s Hanoi office and the number at its HCMC office was 5,700 in one year to March 2013. The number of visits at the Hanoi office is the second biggest among the Jetro offices worldwide.

Last year, the Vietnam section of Jetro’s website got as many as 36,000 pageviews, just third behind China and Thailand, he said.

“Those figures prove Japanese people’s increasing interest in Vietnam,” he noted via interpretation.

Last year, as per the Jetro report, up to 317 Japanese investment projects were registered in Vietnam, a substantial increase compared to 234 projects in 2011.

Investment from Japan is seeing a boom time in Vietnam, accounting for half of foreign direct investment (FDI) pledged in Vietnam and one quarter of disbursed FDI, he said.

Frankly speaking

But the voices at the summit also included frustration spoken out by high-profile people.

“As brethrens, I want to speak out in a very frank manner,” said Motonobu Sato, chairman of the Association of Japanese Investors in Vietnam.

The frequent rise of wages in Vietnam has bothered many Japanese investors, which could prompt them to move their projects elsewhere, he said.

He also complained about ad hoc policy changes and inadequate implementation of policies. “We find it very difficult to apply for investment certificates or preferential tax treatment,” he said.

Sato also complained about poor infrastructure, power supply, lack of skilled executives, and short supply of materials in the country.

Meanwhile, Japan’s Ambassador to Vietnam Yasuaki Tanizaki, said he often heard Japan investors complain about the low institutional capacity in the nation.

Without institutional reform, it would be difficult for the country to attract FDI from Japan in a sustainable manner, he said. The diplomat pointed out the case of reforming State-owned enterprises, saying delays in this reform would affect investors.

Vietnam’s Minister of Planning and Investment Bui Quang Vinh praised the comments, saying he was expecting Japanese investors to continue giving their straightforward views.

He also warned that if Vietnam fails to continue improving the business environment, Japanese investors will shift to other regional destinations.

Source: SGT

Japan investors, Vietnamese market, Jetro, State-owned enterprises, business environment