Vietnam the second favorite destination for Japanese investors after US: JETRO

Many Japanese enterprises have plans to expand their investment in Vietnam, which has been voted as their second favorite destination for business expansion after the U.S., according to Takeo Nakajima - chief representative of the Japan Trade Promotion Organization (JETRO) in Hanoi.

During a conference presided by Vietnamese Prime Minister Pham Minh Chinh on Saturday morning, Nakajima said that while Japan’s foreign direct investment (FDI) inflows in the world grew only by three percent in 2021 and slumped by 49 percent year-on-year in the first half of 2022, those into Vietnam increased impressively by more than 59 percent and 45 percent, respectively.

A survey by JETRO last year found that up to 55 percent of Japanese firms operating in Vietnam are planning to carry out investment expansion - the highest among Southeast Asian countries.

Another JETRO survey reaching more than 1,700 companies in Japan showed that Vietnam was the second most chosen answer after the U.S. to the question “Which countries do you want to boost investment?”

In addition, Japanese enterprises plan to focus more on manufacturing value-added products in Vietnam, rather than Japan, China, and neighboring Southeast Asian countries, according to Nakajima.

However, they have faced challenges such as manpower shortage, unstable energy supply, and other problems related to bidding procedures, digital transformation, data resources, and logistics, the official said.

Expressing his appreciation for the companionship and contributions of foreign investors, Prime Minister Chinh affirmed that the Vietnamese government pledges to make efforts to solve the problems and create favorable conditions for foreign enterprises.

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