[Round-up] Japan Biz Switching to Vietnam as Labor Costs Leap in China

Tuan Minh

18:13 02/06/2016

BizLIVE - More Japanese enterprises are looking to Vietnam as a favorite destination for increased investment amid an upsurge in Chinese labor costs and disputes with Beijing.

[Round-up] Japan Biz Switching to Vietnam as Labor Costs Leap in China

PM Nguyen Xuan Phuc has asked ministries not to increase prices of basic commodities and services to prevent high inflation.

PM Orders Stable Prices of Basic Goods to Avoid High Inflation
Prices of many basic commodities and services must not be increased this year to prevent a surge in the consumer price index, Prime Minister Nguyen Xuan Phuc said during the cabinet’s monthly meeting in Hanoi on June 1, according to the Vietnam News Agency.
The PM highlighted that the ultimate goal is to ensure the inflation rate does not surpass 5%, as targeted by the National Assembly. Relevant ministries must base decisions on facts on the market to adjust prices, while striving to make precise forecasts and stockpile an adequate amount of goods to prevent false price augmentation.
PM Requests Reports on Public Investment Disbursement Nationwide
PM Nguyen Xuan Phuc has asked ministries, agencies, municipal and provincial authorities to submit reports on the disbursement of public investment this year.
The reports should be sent to the Ministry of Planning and Investment, the Ministry of Finance and the Government Office no later than June 6, detailing any obstacles and their causes during the process, as well as suggestions to accelerate disbursement.
Vietnam Attends 25th World Economic Forum on ASEAN
Vietnam will continue integrating into the world, strengthening solidarity and making responsible contributions to building the ASEAN Community, Deputy Prime Minister Trinh Dinh Dung said at the 25th World Economic Forum (WEF) on ASEAN that opened in Kuala Lumpur, Malaysia on June 1.
Vietnam will continue with comprehensive reform, economic restructuring and shift to an economically, socially and environmentally sustainable growth models, he was quoted by VNA as saying.
Vietnam, EU Optimize Opportunities from Free Trade Deal
A negotiation delegation from the European Union (EU) is on a working visit to Vietnam to raise public awareness of how to optimize the benefits and opportunities from the freshly-concluded free trade agreement between two sides (EVFTA), Chief negotiator Mauro Petriccione said in an interview with VNA.
The two sides’ import-export structure is supplementary rather than competitive, thus opening opportunities for businesses to penetrate into the respective markets, he said.
German Toy Association Eyes Investment in Vietnam
Managing Director of the German Association of the Toy Industry (DVSI) Ulrich Brobeil has met with Vietnamese diplomats in Sweden to discuss the association investing in Vietnam, VNA reported.
Many of its member companies regard Vietnam as a priority for investment and they want to learn more about the country’s business climate and regulations for toy manufacturing, the DVSI managing director noted.
FDI in Dong Nai Likely to Double This Year
The southern province of Dong Nai is likely to attract double the targeted 1 billion USD foreign direct investment (FDI) this year, according to VNA.
As of May 31, total FDI in the province had reached $883 million, including $332 million in 50 new projects and the remaining added to 38 existing projects, said Director of the provincial Department of Planning and Investment Cao Tien Dung.
Honda Vietnam Sees Increase in Motorbike Sale
Honda Vietnam (HVN) Company sold 2.03 million motorbikes in its fiscal year 2016 ending in March, 120,000 units more than the previous year, said HVN General Director Minoru Kato.
The figure accounts for 70% of the total domestic market with nearly 2.9 million motorbikes sold. In addition, it export nearly 128,000 completely built units (CBU), up 40% from a year earlier.
Committee Set to Operate SOEs in Vietnam As a Business
The Vietnamese government has approved a plan to establish a special committee, which will operate like a business, to manage capital at State-owned enterprises (SOEs), according to VNA.
While the scheme is scheduled to be discussed before the National Assembly in the third quarter of this year, official data revealed that companies wholly or more-than-half owned by the state have a combined asset value amounting to around five quadrillion dong ($222.2 billion).
Vietnam Central Bank Okays Extension of Home Loan Package
The State Bank of Vietnam (SBV) has instructed local commercial banks to continue disbursing the 30 trillion dong ($1.34 billion) home loan package for contracts signed before March 31, 2016.
In addition, the banking authority also submitted a document to the PM to extend refinancing for credit contracts signed before March 31, 2016, allowing individuals and households to ask for loans to buy, rent or repair their houses till the end of this year.
Vietnam is by far Japanese firms’ favorite destination for increased investment among the 12 signatories to the U.S.-brokered Trans-Pacific Partnership (TPP) deal, Financial Times quoted a report by the Mizuho Research Institute as saying.
According to Financial Times, Japanese companies have been ramping up investment in Southeast Asia as labor costs surge in China and disputes with Beijing rumble menacingly in the background.
As many as 1,300 enterprises providing logistics services in Vietnam, 10% of which are foreign ones and occupy a market share of up to 80%.
Logistics costs in Vietnam are estimated at 20.9% of GDP per year, or $41 billion, according to the Vietnam Logistics Association.