PM Chinh’s Tokyo visit set to trigger new Japan investment wave into Vietnam

A large number of deals signed and high interest shown by Japanese businesses during Prime Minister Pham Minh Chinh’s recent trip to Japan is expected to trigger a new investment wave into Vietnam, said Deputy Minister of Foreign Affairs Do Hung Viet.

Besides strengthening further political trust between the two countries’ leaderships after bilateral ties were elevated to a comprehensive strategic partnership last month, the PM’s visit helped deepen economic ties, Viet said in an interview granted to the press about the outcomes of the PM’s December 15-18 visit.

Both sides agreed to expand cooperation to ensure economic security, with a focus on promoting and beefing up the participation of Vietnamese enterprises in Japanese enterprises’ global supply chains, especially in the fields of automobile, electronics, medical equipment, and textiles.

Viet asserted that the visit opened up cooperation opportunities in new fields like energy transition, digital transformation, and innovation.

At talks with leaders of top Japanese corporations, the Japanese business community highly regarded Vietnam's economic growth and stability as well as business and investment prospects.

“Japanese businesses showed their keenness on Vietnam’s policies and needs, and committed to foster investment ties in new areas,” the diplomat noted.

During his stay, PM Chinh called for increased Japanese investment in Vietnam and witnessed government agencies and companies of the two countries exchange more than 30 documents on cooperation projects worth nearly $3 billion, Viet added.

The documents embraced key areas such as finance, education, healthcare, and industrial parks. In addition, more than half of them embraced new areas, including smart cities, green transition, digital transformation, logistics, artificial intelligence, and robotics.

Among them, Tokyo Gas and partners were granted an investment license to build a $1.99 billion LNG-to-power plant in the northern province of Thai Binh. Major Japanese retailer Aeon Mall announced plans to invest another $500 million to open two new shopping malls. Sumitomo will invest $500 million in expanding its Thang Long II Industrial Park in the northern province of Hung Yen.

“This could be the start of an investment influx from Japanese firms into new areas in Vietnam in the near future,” he stressed.

Japan has been falling behind China in foreign direct investment (FDI) in the Southeast Asian country. According to Vietnamese government data, FDI commitments from Japan totaled $3.1 billion in Jan-Nov 2023, ranking it Vietnam’s fifth largest investor, one rank below China.

In 2021 and 2022, Japan was one rank ahead of China as the third largest foreign investor in Vietnam.