As many as 30 Japanese companies operating in the agricultural and food processing sectors joined a Jetro
-held business matching event in Hanoi on August 30 to find Vietnamese partners to ship their products to Vietnam.
The companies, most of which are newcomers here, showcased a wide range of products, from confectionery, beverages to beef and seafood.
A representative from Igarashi Seimen was upbeat that their udon and ramen noodles would become more popular in the Southeast Asian country as consumers switch to low-fat noodles although they are five to six times more expensive than ordinary products.
Meanwhile, a beef company from Nagasaki prefecture tipped that their products were selling well in Vietnam, although their prices hovered around $107 a kilogram, tenfold those of the local products.
Vietnam Ranks among Top 10 Buyers of Japanese Farm Products
According to Japanese statistics, Vietnam was the seventh-largest importer of Japanese agricultural products in 2015. Vietnam’s imports of foods products from Japan have been on the rise in tandem with an the expansion of Japanese restaurants in Hanoi and Ho Chi Minh City.
Vietnam spent nearly $56 million on importing seafood, milk and dairy products, and other processed foods from Japan in the first seven months of this year, data of the General Department of Vietnam Customs showed.
Vietnam has become a promising market for Japanese farm produce, buoyed by Vietnamese consumers’ confidence in high-quality products from the Northeast Asian country and both nations’ participation in the landmark Trans-Pacific Partnership (TPP
Tomofumi Abe, a director of the Jetro Office in Hanoi, told BizLIVE
that this organization planned to hold another business matching event for food processors and agricultural firms next year.
Opportunities from Retailers’ Expansion
In addition to locals’ favor for Japanese-made products, Japan’s consumer goods have a great chance to get to Vietnamese consumers’ hands through the rapid expansion of Japanese retailers in the Southeast Asian country.
Nikkei Asian Review earlier this month reported that Japanese convenience store chain 7-Eleven will embark on Vietnam in early 2018.
In mid-2015, Japan’s Seven & I Holdings said it would open the first 7-Eleven store in Vietnam in 2017. The firm’s U.S.-based subsidiary 7-Eleven Inc. had clinched a licensing agreement with IFB Holdings, which currently runs the Pizza Hut store chain and other eateries in Vietnam, to open the first 7-Eleven in this market, according to Nikkei.
The first 7-Eleven would open in HCM City and Seven & I Holdings plans to expand its network to 100 stores in the first three years and 1,000 over a decade.
As such, 7-Eleven would become the third Japanese convenience store chain to enter Vietnam, following FamilyMart and Ministop.
Capitalizing on Vietnam’s growing middle class, Aeon has opened four megamalls in Vietnam with a combined investment of $500 million so far. The fourth facility was opened in Hanoi in October 2015.
This retailer has set an ambitious target of building 20 Aeon Malls in Vietnam by 2020. With a majority holdings in local supermarket chains Citimart and Fivimart, Aeon expects to launch 100 supermarkets of this type in the years to come.
Under TPP pressure, Japanese companies are bolstering investment in the agriculture-forestry-seafood sector in Vietnam, especially under the “Payroll Outsourcing” model, according to consultancy firm Seiko Ideas Corp.
With these projects, Japanese firms would export farm produce cultivated in Vietnam to Japan while meeting origin rules in line with TPP commitments.
In addition, service sector is another field that many Japanese enterprises are seeing new opportunities, Katsuro NAGAI, minister, chief of the Economic Section of the Embassy of Japan in Vietnam, told BizLIVE in an interview.
“The expansion of urban middle class thanks to the sustained economic growth over the past decades has created increasingly attractive market opportunities for many Japanese service enterprises such as retailers and restaurant chains. In the years to come, we have a good reason to expect many Japanese enterprises flock in the service sector in Vietnam,” Mr. Nagai commented.