TPP to bolster Japan-Vietnam economic ties

16:35 | 29/10/2015 Cooperation

(VEN) - “The fact that Vietnam and Japan have finished negotiations on the Trans Pacific Partnership (TPP) is a good factor for the two countries to make the most of each country’s advantages to boost cooperation for mutual interest, particularly in terms of agriculture, support industries and high technology,” Deputy Prime Minister Hoang Trung Hai said at the joint Vietnam Chamber of Commerce and Industry (VCCI) in association with the Japan External Trade Organization (JETRO) Japan-Vietnam Economic Forum 2015 which was held recently in Hanoi.

TPP to bolster Japan-Vietnam economic ties

Japan-Vietnam Economic Forum 2015

Hoang Trung Hai said that the two countries have achieved great progress in all areas after more than 40 years of diplomatic relations. In terms of Vietnam’s foreign policy, Japan remains among the leading countries in terms of cooperation in economics, investment, trade, cultural exchanges, culture, education and more.

Japan is one of Vietnam’s largest investment partners with more than US$37.7 billion worth of registered investment capital for 2,661 projects focusing on all major economic sectors and contributing to boosting growth and economic restructuring such as manufacturing, real estate trading and construction. Two-way trade also increased annually reaching more than US$27.6 billion in 2014 and US$19 billion in the first eight months of this year.

To promote economic cooperation, the governments of Vietnam and Japan announced an industrialization strategy towards 2020, with a vision to 2030 within the framework of cooperation between two countries, plus an action plan for six industries including electronics, agricultural machinery, agricultural and seafood processing, environment and energy conservation, and automobile production and automobile accessories.

For this reason, the Vietnamese government wants the Japanese business community to expand investment in Vietnam in the short term, particularly in these six industries and other areas including agriculture, education, transport infrastructure, health and support industries, in the form of public-private partnerships (PPP) and other areas which are Japanese strengths and meet the demand in Vietnam.

Also at the forum, Dr Yuri Sato, Deputy Managing Director of the Japan External Trade Organization (JETRO), said that among 521 Japanese medium to small-sized enterprises wanting to invest in emerging countries, 130 want to invest in Vietnam compared with 78 in Thailand. He also said that they plan to launch more than 20 agricultural cooperation projects in the north and the central region of Vietnam, while connecting accessories buyers and sellers of the two countries.

However, according to Yuri Sato, Japanese investors have claimed localization issues are a barrier. The localization rate for Japanese investors in Vietnam remains very low, at only 33 percent compared with 55 percent in Thailand and 43 percent in Indonesia. In light of this, Vietnam firstly needs to develop support industries and small and medium enterprises (SMEs) to become an accessories supplier for foreign countries.

Yuri Sato also said that as agriculture is one of major areas under cooperation between the two countries in the near future and Vietnam is comprehensively restructuring the agricultural sector to increase added value and grow in a sustainable manner, JETRO has committed to implement the latest Japanese technologies and agricultural techniques to facilitate partnerships between businesses of the two countries.

Nguyen Huong