Stronger JPY to Boost Japan Investments in Vietnam

The recent appreciation of the Japanese yen (JPY) against the U.S. dollar (USD) and Vietnam dong (VND) is likely to boost Japanese investments into Vietnam.

 

One USD is now against just JPY88.7, compared to JPY180 or even JPY300 in previous years. Meanwhile, one JPY can be now converted into VND211, against between VND180 and VND200 before.

 

The JPY revaluation, along with Japanese interest rate, will create favourable conditions for Japan’s bigger FDI flow into Vietnam due to exchange rates factor, experts said, however, adding that however, the higher VND/JPY exchange rate means that Vietnam’s debts to Japan calculated in VND will increase.

 

Experts also noted that if the JPY appreciates it also means that VND depreciates and Vietnamese exports to Japan will enjoy more advantages. Thus, the Southeast Asian country should take full opportunities to raise its export revenues to this market.

 

By June, Japanese companies poured US$18.9 billion in a number of projects in Vietnam, ranking the fifth among countries and territories making direct investment in the country.

 

Japan has been the leading country in terms of official development assistance (ODA) provided to the Southeast Asian country. To date, Japan has pledged JPY1,394 billion (US$15.7 billion). (VIR)