At the monthly February meeting of the Ministry of Planning and Investment (MPI), Mr Bui Ha, Director of MPI’s General Economic Department, said despite being seriously hit by the global economic crisis, Japan still spent US$17 billion to support regional countries to seek measures to fend off the recession. At present, MPI is working with relevant bodies to negotiate with Japan get a part of this sum.
More than US$6 billion ODA Capital in 2009
On February 23, at the visit of MPI Minister Vo Hong Phuc, Japan declared to resume ODA grant of 82.3 billion yen (around US$900 million) to Vietnam. This brought the Japan’s pledged ODA grant to Vietnam to over US$6 billion in 2009, the highest-ever amount.
To get this expanded package, Vietnam has to apply anticorruption measures vis-à-vis ODA compiled by a joint committee for ODA corruption prevention. This has been declared by the Japanese Foreign Ministry.
Mr. Yasuo Hayashi, Chairman of Japan External Trade Organisation (Jetro), said: “From the bottom of my heart, I am very glad when Japan’s ODA is reopened to Vietnam. We hope once the ODA is resumed, Vietnam will have more conditions to upgrade its infrastructure - a very important field to the development of any economies. The betterment of infrastructure is importantly meaning to attract foreign investment, especially after the world economy revives.”
Japanese companies rate high of Vietnamese market
A recent survey conducted by Jetro in nearly 3,000 Japanese companies showed that nearly 50 per cent wanted to invest overseas, especially prospective destinations. Many considered Vietnam an attractive destination.
Although most of surveyed companies want more positive actions to improve macroeconomic indicators, they saw highest prospects in Vietnam in 2009 and 2010 in comparison with Indonesia and BRIC country group (Brazil, India and China).
Vietnam was rated the first priority in terms of risk sharing and investment destination diversification in the China+1 strategy.
Surveyed companies are those with foreign presence. They mainly operate in electronic, chemical, mechanical, garment, textile, transport and food industries. Vietnam was ranked third in a list of countries showing promise for Japanese foreign direct investment (FDI) success in the medium term after China and India but above Russia, Thailand and Brazil, according to a survey conducted by the Japan Bank for International Cooperation (JBIC). However, the rate of supports for Vietnam was lower than in 2007 while Russia and Thailand is closing following up Vietnam.
The Japanese companies attributed Vietnam ’s bright business prospects to its inexpensive source of labour, the future growth potential of its domestic market, its suitability as destination for diversification of investments, its qualified human resources professionals and its use as a supply base for assemblers. However, these firms also pointed out a number of issues hindering foreign investment in Vietnam, such as the nation’s underdeveloped infrastructure, difficulties in hiring managerial and technical/engineering staff, rising labour costs and the often muddled execution of its complex legal system.
The survey demonstrates Japanese businesses’ continued interest in Vietnam’s electrical and electronic equipment manufacturing, automobile, general machinery and chemicals industries.
By the end of August 2008, Japan has 1,019 valid projects with a total registered capital of US$16.9 billion in Vietnam, ranking the second amongst 81 countries and territories with investment in Vietnam after Taiwan.
Kim Phuong
Vietnamese
