Ties ready to hit new gear

November 21, 2010 | 14:24
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Vietnam and Japan will open the first dialogue on the Vietnam-Japan Strategic Partnership in December, 2010 to comprehensively discuss economic, politic, diplomatic and security issues. Japanese ambassador to Vietnam Yasuaki Tanizaki, who took his office in Vietnam last month, tells VIR about strategic partnership relations between the two nations.
Yasuaki Tanizaki

How do you see the Vietnam-Japan bilateral cooperation development toward a strategic partnership and what will be your priorities to help boost this progress?

Japan and Vietnam have been already enjoying significant growth in bilateral relations during the past years. However, there remains a lot work to be done to improve the two countries’ bilateral relationship. That is the reason for the two governments’ agreement to bring Japan-Vietnam relations toward strategic partnership relations.

The Japan-Vietnam strategic partnership is composed by economic, politic and cultural cooperation. Of which, the economic partnership is becoming much more crucial.

Bringing bilateral economic relations to new heights and promoting freedom in trade, service and investment flows will bring about great benefits for both countries. The consolidation in economic cooperation will expand opportunities and benefits for both countries’ business communities, contributing to economic development and social welfare for the Japanese and Vietnamese people.

What I will manage to do during my term here in Vietnam is to translate the two countries’ strategic partnership agreement into real action.

Investment relations are a very important part of Vietnam-Japan economic cooperation. What do you think about new  progress in this field between the two countries?

Investment relations have become a more important part in the two countries’ economic ties. Japan is the third largest foreign investor in Vietnam.

What really impressed me is that there have been thousands of Japanese enterprises investing in Vietnam so far, particularly in industrial parks across the country. For example, there were up to 100 Japanese companies operating in the Thang Long Industrial Park in Hanoi, which contribute 5 per cent to Vietnam’s overall export value.

The point is that in the years to come, I am strongly believe that Japanese companies’ investment will keep increasing. A major reason is the appreciation of the Japanese yen, which has affected Japanese firms within Japan since their product costs become expensive and also their export items manufactured within Japan is going to loose international competitiveness.

Does it not mean that Vietnam will become a destination for Japanese firms since there remain bottle-necks in regard to infrastructure, human resource and legal framework?

The yen’s appreciation is a reason.

So, why Vietnam? Taking a look at some neighbouring countries like China, Thailand and Indonesia where many Japanese firms have already invested in. The fact is that labour costs have been rising a lot in Thailand and in China’s coastal area, where many Japanese manufacturing companies are located. Japanese businesses have had to choose to go to inner China or to other countries. And Vietnam has provided a very good investment environment to potential Japanese investors.

Otherwise, the Vietnamese business environment and competitiveness has improved significantly with the local government’s reform efforts and also the implementation of the Japan-Vietnam joint initiatives, which concluded its third phase recently. This improvement in Vietnam has attracted many Japanese enterprises. The Japanese and Vietnamese governments also realised the necessity to make further improvements in Vietnam’s business environment for the sake of Japanese and Vietnamese enterprises.

Do you think a lack of a strong supporting industry in Vietnam will make Japanese investors reluctant to expand their operations in Vietnam?

So far, Vietnam is still a very attractive investment destination for foreign investors. But, Japanese companies have to import the majority of their parts and components into Vietnam to assemble products here.

Those kinds of opportunities in doing assembling in Vietnam will end in between 2015-2018 when the country has to cut import tariff for finished products of Asean under its regional free trade agreement. A robust supporting industry is very crucial for Vietnam to keep foreign investors stay. There are some different views between the Japanese and Vietnamese governments about priorities in supporting industries.

We have been asking the Vietnamese side just to select strategically important supporting industries. So far, we are still waiting for those priorities to be introduced, while encouraging Japanese enterprises to participate in the supporting industry here in Vietnam.

By vir

vir.com.vn

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